UN Geneva - Multimedia Newsroom : UNCTAD Press Conference: Economic Development in Africa Report 2023

Council Secretary General Frederika Greenstein welcome Mr Paul Akewoman, Director of Antar Division of Africa, this developed countries and special programmes.

You are most welcome members of the for the state, friends from the university and other distinguished members in the room.

You are most welcome to be part of this talk this morning.

We are here for the launch of the economic development in Africa or for 2023 and the theme is the potential of Africa to capture technology intensive global supply chains.

The theme is the potential of Africa to capture technology intensive global supply chains.

See any further.

Let me just do some faith in housekeeping kind of let's all of our phones inside it most while we don't disrupt the programme as it continues.

And in case you want to visit the books and convenience fees exit by the school walk straight on time to your right and you'll be able to get a system.

So once again, welcome to the launch of intense economic development in Africa report for 23.

This event is being live streamed and attended by journalists in Geneva and all over the world.

Journalists going online can ask the questions through the Zoom chat.

Have a reiterate.

If you're plugging in perfectly, you can ask your questions through the Zoom chat.

You can assess to be able to voice your question right from the stage here.

Tech team, just check my right ahead, please.

We remind all journalists that the report is under embargo until today at noon Nairobi time.

Very important.

And then I want to know today and after that.

All material can be found on the Haunted website.

Secretary General will give an introductory give introductory remarks followed by technical insights from the Director of the Outfit division and then we shall open the floor to questions in the room online.

So as you listen to just be getting questions together.

We shall be getting through AQ and a session where I shall be correlating how that takes place without any further exception.

General for this audience.

Thank you so much.

And do you understand what I said?

Thank you all of you for for being here.

It's another to present on that Economic Development in Africa Report 2023, our flagship report for the company here in Nairobi.

And thank you all for for accompanying us.

And hello also to all the journalists and friends that are following us from Geneva.

So this, this one holds special significant.

It is my first official visit to Kenya as that Secretary General.

And really Kenya is an example of a vibrant economy, emphasising Africa's potential in global trade and World Economic culture.

That is exactly the point that we want to make in this report.

So that's why we say not only that it was important to come here to Africa to launch the report not to do it in our headquarters, but to to to do the global launch here in Kenya is at Nairobi is Africa's Nairobi is Africa's business hub, home to a robust Stock Exchange symbolises economic dynamism.

Kenya's resilience during Copy 19 was impressive.

The GDP growth in 2021 and also the GDP growth in 2022 where important signal so resilience and problems.

Let me say this without you know, obviously forgetting how hard all the developing countries have been hit, but what we call the cascading prices, yes, COVID-19, climate change here, the drought obviously that has hit the country a very severely.

It has the whole Horn of Africa and the war in frame with the food prices going up and inflation coming in, in the developing world because of that and and the strength of the dollar obviously has hit very severely the most vulnerable.

But this report tries to understand also the incredible potential of this continent.

So we will centre our attention on that part and on the main message of the report.

But obviously we can talk about all the other issues if that is needed.

So as I said, our report underlines in how Africa can become a major accent in the global supply chain by harnessing the vast resources of materials needed by **** technology sectors and their own growing consumer market.

Trade isn't just good as we know.

Yes, it's ideas and capacities that reflect the adaptability of countries to the global economy.

So diversification today is key for all the continent economies reliant on a better future.

So if we will be dependent only on one or few commodities, we know that that is risky and so we have to get away from that path.

Diversifying trade builds resilience and enhances innovation because our one based economy is key for private sector development and employment opportunities to really drive and that is what is the graphic bonus of Africa really requires.

Our framework highlights 3 export fields that we all know about.

We have developed commodities here, the intermediate and the complete finished.

Goods.

So as nations export higher tier goods, productivity, wages, price, reshaping economies, integration into complex global supply chain is the fact that we are advocating 3 reasons that we consider that prime what we call this huge opportunity for the country.

1 Geopolitics and trade dynamics, including the African Continental Free Trade Area.

Renewables and demographics So let me go to geopolitics and trade dynamics, renewables and demographics.

Geopolitically, countries and businesses are seeking diversification of surprise and this is because the reliance on one supplier is as risky as commodity dependence on one raw material.

Yes.

So diversification and diversification of risk is something that is happening in the trade dynamics at global level right now.

Renewables and that's a great opportunity for Africa and this together with the African continental area has incredible synergies for really participating in higher more complex flight chains at global.

The second reason is renewables and we all know that they this is a mineral rich continent basic to the supply chains in renewables, the batteries or energy renewables.

We know that Africa is centre piece for your material.

So the question here is how we can go up into value addition with this plate possibility.

And the third reason is demographics.

And it's Africa's beautiful population and growing consumer markets that propel tech innovation.

So Africa's tech tech ecosystem growth is impressive perhaps in artificial intelligence, 3D printing and blockchain are fostering innovation and render finding supply chains, fintech and e-commerce are thriving and Kenya is a very different topic showcasing Africa's entrepreneurship.

This transformation is important for African economies, but more importantly for African population.

For the report highlights that creating an environment on Tulsi to technology intensive industries would help raise wages and confidence.

Currently, the minimum wages in Africa are around an average $220 per month.

In the Americas, not only the US, but the continent is 670, around $670 per month.

So there is an important path to follow.

Our report is positive on the potential of the continent.

It analyses that the untapped potential in automobiles in several sectors and we choose automobiles, solar energy and pharmaceutical and Polaki, that is the director of the African Analysis Division in Ankat would get into much more detail on those areas in a elaborate partner a different world.

So African our priorities must guide this journey towards **** tech potential.

However, you know that investment is needed, financial investment as much as human capital, and we know that this is about.

So.

According to the report, the value of the African supply chain finance market rose by 40% between 2021 and 2022, reaching $41 billion.

But we know that this is not enough.

You know, a micro and small medium enterprises are still battling, you know, and having important obstacles for refinancing to be part of the supply chains.

And the company can mobilise more funds by removing barriers to supply chain finance, including regulatory challenges, **** risk perception and insufficient credit information.

However, from AMKA, we also underlie the current global context that is extremely challenging.

And we advocate for debt relief to offer African countries fiscal space to invest in strengthening their supply chain.

And we know that fiscal space is needed that can join or of the of the President of Kenya that has advocated for the international community to really respond to the developing countries and the African countries in terms of their meet our fiscal space and be able to have a better path of financing liquidity investment.

And obviously.

A issue on average, and this is a something that we highlight in report that we launched with the Secretary General of the UN on the challenge of debt worldwide.

We call the report a world of debt, global debt.

And this is an important number that we need to remember that that African countries pay 4 times more for borrowing than the US and eight times more than the European countries.

So for the same risk profile, African countries pay much more for their loans and for their death than the rest of the developed world.

And this must change if Africa is really to achieve its full economic potential.

And the a major actor in global.

Supply.

Chains the UN stand committed to supporting Africa in this bank and I hope that this report and the word that Antac has got in more detail in sectors and in the enablers for Africa to be able to take on this opportunity that is in front of us.

It will help is support countries in this battle.

So now I leave you with with Paul Akumi and I thank you again for being here with us and we will be happy to take any questions that you have.

So.

Thank you so much, Secretary General.

Answer to the Inbox.

Capturing issues around your politics with your Wall Street dynamics and also touching, it's called an environment in each continent by itself, especially with regards to public debt, unlikely possibly we have science in the back.

So we have serious interruption and now that we've had over the stage to call for the visitation.

Thanks.

Thank you very much indeed.

Good morning to all of you.

Thank you very much.

Second General, perhaps let me start off with what Second General mentioned.

It's a little bit about the global crisis, the disruption in the global supply chain that you've seen in the last 2-3 years.

Also the the need for multinational firm to diversify the supply chain which leads to the facility building and the lots further potentials.

So what was the potential of us, what was the motivation of this?

And and what I gave the motivation of importance to clearly look at the potential for to integrate technology intensive supply chains, not just any supplanting of our current technology intensive supply chains.

And what does the Secretary mention that the automotive industry in electronics, energy and pharmaceutical medical devices and this is extremely timely in in global context because it it outlines viable solutions to these problems.

Not only is the problems but also is in the problems so surrounding the problems of that need for decent jobs to have banned products from the constant position.

So the report we then signed that we were looking and assess 3 main things.

One is the first thing was the new technologies and the manufacturing trends going around that Africa will be to race to allow to be viable to actually adopt and to be the.

The second thing was we looked at very specifically as the secretary, which also the issue was also the emerging financing and technology solutions, technology solutions that can help to address the improved constraints while improving operational efficiency as well.

And then the third thing we focus on was recommendations, strategic policies, not not only for governments but also for the private sector and also for regional institutions and regional bodies so that they can integrate into the global supply chain.

So essentially, when we talk about the global supply chain, when we talk about supply chains, we're looking at three main areas.

First, we talk about procurements.

Second, we talk about production and 3rd, we talk about distribution.

Now, what are the potentials factored within those two sectors?

First of all, procurement sector.

General also mentioned it the sources of raw materials, abundance of raw materials on the continents.

Secondly, when we talk about production, we talk about the demographic dividends, the youth, but not also the youth, but the **** technology sadly used that is emerging in the African continent.

And today you may note that there are over 670 or 700 incubators or innovation labs within the African continent and within Kenya itself, the 12 already.

So there is a massive workforce that is available on the continents and, and this is very critical.

And also what is important in the production cycle is the energy.

Now we are talking about renewable energy.

And if you have a look at one of these atlases of renewable energy potential for the globe, you'll see Africa is one of the leaders in solar, in hydro, in wind.

And in geothermal.

But this is not just renewable energy, what this means is that the production can be done with energy, that is clean energy.

The processing of raw materials can be done with clean energy, rather than exporting the raw materials to a country which is using fossil fuels and polluting.

So there is a public good that Africa can also provide to the global community.

And the third thing, of course, is the distribution.

And distribution, essentially it's infrastructure, it's air travel, it's sea landfill.

And we know that Africa has a long way to go, but Africa over the last 15 years has made tremendous strides.

It's still below the global average, but it has also shown innovation as well.

We've seen during the COVID pandemic that there were no passenger flights flying anywhere else.

But there's only one airline, Ethiopian Airlines, which converted all its passenger planes into cargo planes.

So it was able to feed the supply chain in vets with medicines and PPPs and all the rest of it, not just to Africa, but to the code.

So the innovation in that sector now, This is why crucial when we are talking about exporting and also talking about adding value and exporting to other parts of the continent, other parts of the world, it's because there is now the carbon border adjustment mechanisms which are spreading up.

So it's Africa, Africa brand its products that it produces as carbon neutral because if it's horticultured, it uses it's, it's produced in Canada, for example, and it is green energy used to produce that and they're using smart irrigation as well.

And you can brand this product as a green product under a global arena.

So I think this is important, extremely important, not just Africa, but also the multinational films that want to invest as well now in order for all of this to happen.

So Jim also mentioned a point about enablers.

There's certainly enablers that are required throughout the continent.

On the technology side, there's the need for better data, storage of data, sharing of data.

There's need for technology tagging so you know where the products are coming from and you can track them.

There's need for more digital solutions and that of course requires a lot of energy as well.

In addition to that, we have looked in the reports you'll see we've done, we've run the technology regulars index of the African continent to see whether these certain countries have the the minimum standards for this.

And there are quite a number of them, but I'll mention just a few, South Africa, Tunisia, Morocco and Mauritius, which are above, even above the global average.

So this is very important.

And lastly, technology and financing using a blockchain, which is very crucial and incredible.

It is.

It's important to be able to attract investment and investors know that the financing of the world is the right place at the right time and secure.

One of the biggest thing is searching also is the African government of free trade.

Regional integration is good.

Free movement of goods is good for us.

Three, movement of skills is good.

And this is all important because when private investors contract, they need scale.

If they're going to build a car manufacturing plant, they need scale.

They need to know that it can be exported throughout that together without moving into customs, taxes, anything.

And so the whole objective of that contract get rid of so that they can move freely.

Now when you look at the the report about what Africa Action is producing, it may sound a little bit bleak now, but the point is if you turn to page 90 of the reports, what is interesting to see that is that you can actually see the different components of different countries too, from processing of raw materials to making components to assembling these components of finding products.

And you will see from the maps countries that have those capable uses.

So when I go back to that with the continental future and it's clear that as a whole has the potential to get involved in it's capturing the technology intensive global supply chains.

But we need to work together now that some of these helpful that are already working on today, which we may have heard and done.

Just open a Nissan factory ground independent where they have to produce 50,000.

You also know that South Africa produces local funds, but within these two complex, they're also producing components for assembly of cars.

So the components are not all coming from Japan, the components are also coming from African continent, which I think is a very important element.

But in all the for Africa to benefit from all of this and be able to view its usual operation, there is a need for mutual industrial development and we're already beginning to see what's coming to shape.

For example, Ecos region have already established A framework policy on developing a value chain for water and industry.

We've also seen in DRC and in Zambia where they are already having agreement to establish economic zone that will deal with the development and production of batteries.

So and this it's continued throughout the continent.

We know in Morocco as well that they also are producing just signed a new agreement to produce central central EV cards.

So what we are hoping is that the countries, the country, but also the external investors and international manufacturers can see same thing as some opportunities for them to actually develop and get Africa involved in the global supply chain.

Now you will ask, after all I've said, the question is, is Africa's supply chain great?

Well, that's a yes and a no.

It's not a clear cut, but we believe that as a sexy gentleman, the human capital, the youth is the natural resources, the critical minerals are necessary to produce batteries and these new generation cars and these new energy sources are nothing.

46.7% of manganese and 46.5% of coal is enough question we have to ask first.

Do we want to ship this to another continent and be processed by using fossil fuels or do we want to keep it On the contrary, develop our simple activities, use renewable sources, use the youth we have and create pieces and intellectual jobs for the up and coming.

We thought of society that.

So what is important then is clustering, cluster formation of these new industries throughout the continent, harmonisation regulations and also product registration.

So the report actually details this, which gives you clear examples.

And this is not just a report for African governments, but it is also very much a sales pitch to the multinational community, international, to investors.

There are great opportunities.

Now let me end that.

But I'd like to say that this is an excellent dream even for you young people on the side of the Internet.

So I I encourage you once that blog is over, that would be it.

And thank you.

Thank you so much.

Thanks for that presentation.

We have a deep dive into the report.

We takeaways class information for administration and organisation of pharmacies, especially from regards to three and you assure this is something we can test.

We want to transition into the QA session and the way we shall do this is that you will ***** up your hands, you get a mic, produce yourself, you make a question of every point is clear and to whom, and we shall patch them into 3.

So we have both pressmen in the room and those plugging in virtually.

We shall take care of all sides.

So please just bring forward your questions before we get into that as I get ready to see any hands coming up.

Secretary General, the question has been asked why this report, local report, is in particular, being launched in Iowa.

Yes.

Well, first is because it's an African report and you thought it should belong in Africa before it was, it has been launched in you know, but it's not for the Swiss people export African countries.

So it was very important to appear and to launch a king company.

Second, because Kenya, as I said before, is this engine.

Of.

Dynamic growth for East Africa and I think in some way it it connects the national dynamism with the voice for the integration of the country.

Kenya has been a very important supporter of the continental the African continental free trade Area and and the and the East African Community has been really ahead of many of the other integration kids in terms of trying to it takes away all the barriers that are obstacles or that integration.

So.

So Africa is a very Kenya is a very important voice in the African country.

But also let me say that the Kenya and the voice of the president has been very important that the international and we know that we need all of the three We need good national policies.

We need a, a, a regional integration, but we need the international because also the conditions at the international level will affect our possibilities at the national and the regional for development.

So the voice of the president has been very important in terms of the international financial architecture of the financing for the transition to renewable energy and the needs of the countries to have the space that the finance to be able to do what we need to do for a really sustainable development goals and the ambition to a shared prosperity to be real.

And I think that the three elements have this, this real in Kenya.

So that's why, that's why you chose first Africa.

Thank you so much for that context setting why we are Harding this reports being launched in Nairobi.

I can see we had let me start with the gentleman on the back there.

Please introduce yourself and which is just anyone with that ***** your question.

Thank you.

Could you please on the mind mind to is the question being asked here.

My name is Vincent from the East.

I have a couple of questions one for and the other for so to miss.

Is there evidence that the need to diversify supply of these critical resources like will basically benefit Africa?

Because what you've seen for instance, the European Union investigation plan, they are intending to recycle more and to expand domestic extraction and that government is going to impact African.

So what evidence is there that the investigation is going to help Africa or what can then to Miss Accumi?

Mr Accumi, sorry, I wanted to know if this potential for Africa to to capture technology, intensive supply chain, global supply chain is going to help all of Africa.

Because from what we know, not every country in Africa is middle rich, for instance, here in China, and the primary sector has been on a decline.

So is every country going to benefit because it's different?

Thank you, Vincent.

We have a hand on this side.

We have a microphone here please.

Thank you.

My name is Kaiser.

Coming from my question is why is it that African a disadvantage when it comes to OF?

And maybe by how much has this effective growth disproportionate?

Let's take one last question.

Yeah, my name is, I have two questions.

One of your points is that one of your points is that other country concentrate more on sustainable energy like solar power.

In Kenya we had actually producers of solar panels.

But right now everything is being imported from China because of we cannot compete with the production costs.

And this this means actually qualified opinions are missing their jobs.

What could be done in your opinion to make Kenya and other African countries to be on the same production level, are not dependent on imports?

And the last question is how much of the global investment in renewable energies comes to Africa?

Thank you.

I'd like us to take those questions 1st and check out for another bunch of questions.

The first ones go to the sector dental.

Is there evidence that diversification or supply chains with benefits Africa?

And also why is Africa disadvantage when it comes to tapping into global markets debt perspective?

So questions from Vincent and hello.

So thank you all of your excellent questions.

Let me say the first question from Vincent.

It is in the world we have seen a movement for more protectionism and more fragmentation in the global current.

So it is true what you say that we see in the US and we see in Europe a lot of policies going into strengthening their their market and their internal production and competitiveness.

That is true.

And this is something that has to be for us even a stronger reason for our integration at the region, at the regional level and for our ambition in terms of our going forward in a more dramatic way.

Yeah.

And I don't think that Europe will be able to compete with Africa in terms of critical minerals.

That is quite clear.

You know, as Paul was saying and as my my numbers show, you know Africa is home to 48% of the world's preserve reserves of cobalt in mandarins, 80% of the world's reserves of phosphate drug that is also important for fertilisers is also important for batteries and 92% of the world's reserves of platinum group metals.

Yes.

So in that sense, the endowment of the African continent, these are the other continents cannot be put on question.

So the question is if we will be able to add value in the supply chain, we will be able to go up in the ladder in the tiers that I referred to before.

And that depends on us.

You know, it's true that there are other parts of the world that are trying to strengthen their own policies, their own production, their own competitive advantage with respect to device.

If we do nothing, yes, we will lag behind.

But if we are able to have the ambition to live for in development and to understand that precisely that endowment.

Can give us the possibility for the intermediate goods and behind take goods that we are talking about that I think that is a huge opportunity for Africa because the world will move in that direction.

The raw materials will be needed.

So if we learn from the past where we didn't do that, yes, when we continue just as yes to just sell our raw material with no value added with not not put in negotiations with respect to our endowment.

So you you may be right, you know, the opportunity won't won't be there.

But what we are saying is that the diversification of sources that the renewable energy transition and that the demographic of Africa and the are, you know, good basis for this to happen.

It's not a dream in a sense that is not achievable.

It is very achievable if the right policies, continental integration is there for this to happen.

And let me say maybe Vincent here, and I'm sorry to make it to expand a little bit, is that I come also from a developing country, from a small country and we were able to diversify our economy against the laws.

Yes, it was because we had a long term view.

Many times we forget that the long term and the short term start at the same time.

There is no possibility or really a different long term if we don't plan from today, Yes.

And the long term is not only a succession of short terms that are not you know that are not driven by officials.

And so here I really think having been in development for so long that the results that we put in to perform for Africa to be able to do this now are very real, very concrete, very detailed in some parts of the report and very durable.

So we really think that this is the moment, yes, in which Africa can, can, can make it happen.

With respect to the a very important question of and it's a very, it's a very good question.

We have to admit that the international financial system is asymmetric and that if we don't change certain rules, the system only reproduces the asymmetric and part of the borders of the UN and ANCA in the UN Secretary General and the President of Kenya.

In this respect, yes, President Putin has been to change the rules that reproduce the So the perception of risk of the international investors with respect to our companies is distorted by perception.

Not necessarily by the basics of economics and let me be sincere, saying that the trading agencies don't help, they really hurt us because their perception of Greece reproduce that perception and not necessarily the reality of the economics.

And we have shown this in many ways.

We have shown the same basic indicators in the economy with respect to growth, with respect to fiscal deficit or external deficit, etcetera, in two countries, one in the developed world and one in the developing world.

And the developed world will be able to finance that with much lower rates than the country in the developing world.

And So what we have been advocating is for the reform of the international financial system, not to weaken, but to strengthen it to be able not to produce the asymmetry that is that the global finance financial system already or embeds already.

And as I said, you know, it doesn't make any sense that the, in developing countries, Africa in this case, is paying eight times the rates that the European countries are paying for the same debt.

So in a way, you know, you, you ask yourself, can I really do what I have to do, pay 8 times more for the resources and the financial resources that we need.

And that's why we have been advocating for the three works that are special liquidity, better instrument for investment and also better system, institutional system for debt restructuring for development.

And there will be the the report from the secretary General, because policy grief is there to be to be consulted is an important, an important one.

And the report I refer to with respect to that is very rough.

It's very easy to read because it doesn't have any words.

But we show how this is played in terms of the development of all the countries and what is the burden that really happens.

One indicator that we use in the debt report is that right now 3.3 billion people in the planet leaving countries that are paying more to service the debt than what they are investing in education or having.

So if we talk about the sustainable development goals, you tell me how we are going to achieve the goals if we cannot spend medication and help our basic needs of the people you know, in in a proper manner because of with respect.

And this has to do with the sustainable energy question.

I, I'm sorry, I don't, I don't remember the name and the issue of solar panels, the competition on the solar panels.

And it's true that China has become the main producers, producer of solar panels.

But what we saw in the time of COVID and with the trade disruption and when China had to close down, yes, because of COVID for so long is that relying 80% of the solar ban was trade on one supplier is a problem.

And the precisely the renewable energy value check was so disrupted that many of the projects have to hold.

They were ready to initiate in, in a moment where energy prices were going up and they were not able to do it because, you know, a trade was disrupted in the in the supply chain.

So diversification of the production of solar are now it's true that to be able to be competitive, as Paul said, we need to do more.

But the opportunity for the production of solar panels is really there, yes.

And I think that we need more private sector development for it, a, a capacity building for the jobs that solar panels can provide.

And part of it is the modelling of the finance yes, that Paul was talking about.

So I don't know Paul if you want to expand on this, but the there was another question there that how much of the investment in renewables are coming to Africa.

And if I don't mistake and James you are here with us in our global investment report that we launched just one month ago, I think that it's 2% if my memory is not mistaken, 2%, only 2% of the investment in renewable are coming to Africa.

So that's precisely what we are saying.

Yes, here is the opportunity, but the investment that has to come to this country is not coming.

And so we have to, you know, to call the international community of the asymmetry that I refer to before, but also the continental integration and the national courses have to play an important role for this to be overcome.

Thank you very much, Vincent.

Your question on the global supply chain, capturing it with all of Africa benefited some well the the short answer is that it will all benefit in different ways.

Some countries have natural resources, the critical minerals, but they don't have the energy to transform that in the 1st place or they don't have the knowledge to transform that with skills.

So they have to go to enable and help you, which will probably have the skills, skills to transform.

And then of course, then it's adding the second layer, which is making of components and they will have other types who are capable of making certain components.

And thirdly, the assembly of the final component.

So it's you, you have, you may want to think about it like the Airbus model in Europe, European countries, not one country makes Airbus, but they all make certain different components with their strength and and their comparative advantages, the skill sets they have.

And that is something that can also happen on the continent.

And as I mentioned, if you look at that this quick diagram on the page I mentioned every 91, you will see the, the, the action, the, the, the transformation, the capabilities and skills of countries of African countries in tier one processing to Tier 2, which is making the components to tier 3.

I'm sorry, the level is on tier 3 to Tier 2, making components to tier 17.

And you'll see across and you can, you can play around and you need to draw a map for yourself of how the supply chains could be.

So the the benefit of this regional integration that was extremely good for this because freely across no tariffs, no customers and that will enable it.

And then you have the scale of the continent as well for for sale as well.

Yeah, thank you.

Thank you both.

Thank you Mr for the responses.

Let's take the next large of where we have a hand here, so you can start.

Just introduce yourself one question.

Hi, my name is Hassan from the university student University student and I would like to ask to on the context of how trade policies can be designed to promote sustainable economic growth in Africa while still ensuring fair and equitable distribution of benefits.

Thank you very much.

Let's keep.

The mind in the next year.

Thank you.

My name is Gabor for Space international Agency.

I wanted, you've mentioned that national policy is very important and I, I was wondering if you could expand on what specific policies could Kenya's government and the African government just start developing right now?

Thank you.

That was kind of the bottom there.

Good morning.

My name is Victoria I'm.

From Voice of America.

In regards to to mention, Africa is paying eight times more to the loans compared to the other continents and you mentioned that perception is one of the reasons as to why, but did you look into what is creating that perception?

What is the role of Africa in regards to making the lenders and rather create that perception.

You can have much of default.

African continents are **** in terms of the monies or the funds that are borrowed.

In a nutshell, just asking what is the role of Africa in regards to that perception that is being created out there thinking thank.

You very much.

Let's take one question here.

Hi, maybe it's just to Adam was just saying my name is Victor Kupro.

I read about the conversation about rating agencies and the perception and the cost of borrowing and the need to reform the financial system.

Then I would just want to know what your thoughts about the calls we've been seeing around for our continental based ratings agency that would be able to important portrait the continent, correct?

Correct.

Thank you.

One last one.

Here good this morning all the Margaret Kimani.

I'm an investment banker and this topic is very close to my heart.

Talk about some of I I believe in my personal opinion.

I just recently came from Ghana and I've visited Ethiopia.

I do a lot of research.

It's part of my job as an investment banker.

And my question would be some of I think I've not had probably I'm next door.

We are doing something on traceability.

Traceability.

Yeah, I think you understand the lingo there.

You know, I'm finding that now that I'm investing in Kenya, a lot of our goods cannot travel alone.

Yes, there's a factor of the finance, you know, the complications of the bureaucracy and of course every country has their own policy and around finance.

But you can see even within Africa we have this man made, can I call the man made barriers that we've created for our I don't know if can I politely say that it's colonisation?

And she said, I think you also said it right, perception, right?

And even that from an investment banking now you can say that the rating isn't, there's more underlying issues behind the rating in line with what you've asked people.

So my question would be, I'll take a different angle because I'm proud we can and we are championing this, the Africa we want.

We are the ones to ship the Africa we want.

And yes, I feel both of you that I'm also an economist.

I feel both of you when you say that the time is now, but I feel like we are not moving at the right space.

And as a proud African or proud Kenyan, I feel like if we can innovate around the problems we ourselves see in the community.

So I was looking to see if you could talk a little bit about innovation, you know, innovation around even manufacturing coming up with solutions and the customer.

You know that.

Yeah, I need to, I said that you know that a lot of the problems you see in terms of goods and services becoming very expensive and all the ratings that we're talking about, it's obviously because we are not making enough, we're not producing enough ourselves and manufacturing the capital intensive intensity of you know the cost of manufacturing.

You find that for example, we have a lot of raw materials, right, but we are shipping them because we don't have the equipment.

So I want to hear more about innovation around the solutions we.

Have.

Thank.

You so much for your question.

So we have 4 questions here and I would like you for the line to the SG for very good responses.

We shall be going virtual next.

So you I've got a couple of questions from the virtual audience.

I'll take the next.

The first question was from Hassan and about trade policy and what are the right trade policies for equitable distribution.

And let me let me say this maybe as as a first, trade is not a national strategy.

It is part of a national strategy because we have to understand that trade is the result of what we produce.

So if we only focus on the trade part of it, we will forget about the productive policy strategies that need to be developed for a wide base, a cloud.

And probably here lies one of the weakness.

Many times when we talk about trade that we talk about trade in isolation of what should be a national strategy for the result of trade to be intrusive and really progressive in terms of the country.

So this is the first important point that I think that we have to.

And that's why for example, here in Kenya, we are working Paul, Paul and his group, we are working in the productive capacity index to understand what are the gaps that needs to be closed.

And this goes also to which policy, national policy we are looking at.

We are looking at the productive capacity index on how to close the gaps in productivity, in skills, in digitalization, in background linkages in the country, to be able to take advantage of the trade, the global trade and insert ourselves in the global economy in a better way.

Because we are doing this not to develop with our backs to the international economy.

What we want is to have a better standing in the international economy.

And I think that that is precisely.

Nutrients of our message, yes, we can do this together.

And so integrating Africa allows us for the trade to be better for the barriers that you were talking about, for the convergence in harmonisation on rules and regulations and not that non target barriers, not only target barriers, but non target barriers that are even in many cases more important than the target barriers themselves.

So we need a more integrated approach to trade for it to be equitable and really be able to to deliver the results that we now there is part of it that has to do with the international community.

What are the rules of the game and if the rules of the game are OK for us?

Yes, in terms of being able to read the but that is, you know, I will leave that part before another occasion.

With respect to what the Victoria said, I think that is an important and important point.

Let me say I come from a continent that defaulted in the 80s.

Yes, I was in the cover first when we renegotiated our debt.

If you look back, there were many factors for that to why that happened.

Yes, there were internal, but there were lack of external like we are seeing today in a certain way.

Yes, there was a strengthening of the dollar.

There was a change in interest rates in policy in in the in the US.

There was the energy crisis, you know, at the end of the 70s, and there was a term in the terms of ****** and obviously national policies and what we did was important, but also we couldn't cope alone with all what was happening at the global level.

And I think that now it's not the same as the 80s, but some of the reasons are the same in the sense that our after COVID, yes, and because of climate change keeping even stronger our countries and because of the word praying that, you know, was something that we didn't expect to happen.

And then food prices and energy prices grow so steep at the the world market, we didn't have the capacity to cope with these global issues that were not of our tool.

You know, it's true that we can have better policies, we can have more transparency, that we can really strengthen our police framework.

And that's why I always say national policies are not relevant.

If you don't do what you have to do, you cannot really take the benefits or change the perception.

Yes, but let me give you the example of Ghana.

Yeah, Ghana was perceived as a secure country for investment.

If they really received a lot of loans from the private sector, but in front of the global prices and the cascading prices, they couldn't cope.

So in a way, what we try to make also the international community to understand is that there is a shared responsibility here that COVID is not our fault, that climate change is not our fault and that the word Ukraine is not our fault.

And that then we need better instruments of liquidity of in, in debt and and investment to be able to change the perception too.

Let me give you an example.

There are certain countries, big countries in the emerging market that have swap arrangements with the US pressure.

No, that changed the perception of risk.

Yes, they are less risky because of that fact than other countries that are in the same situation.

If we would have a more universal swap review, that will also change that perception for our countries, that will help a lot.

So a less fragmented system and more universal system that will give some guarantees when global shocks hit, we will be able also to be better equipped to change the perception of investors and rating agencies.

And that goes to crippled a question in terms of if they read the complement correct.

No, I don't think so.

But also because they are in New York, yes, they're not here.

They don't want you.

That's the truth.

Probably many other organisations in the UN can reach the African countries and developing countries much better than the group that is in New York looking at the continent from a desk.

Yes, with numbers or also their perception of, of reality.

They should they, they need to be more embedded in the realities of these countries.

But they are very centralised, centralised organisations.

And so I don't think that they, they know these countries very well.

So, you know, a spreadsheet will really determine their perception of risk and they are very influential in the private sector.

Yes, in the private sector perception of the country.

And that is why that when you have and many times when I go to countries, the private sector is much more optimistic than the projections at international level.

Because when you know the reality by heart, yes, you are able to differentiate many factors.

When you are away in your distance, it's more difficult to do that than to be rather than so.

Perhaps I'll, I'll just add 222 things that second generation.

First of all, with regard to the rating, you may not be aware of the African Union and the Economic Commission for Africa do produce a ratings report as well.

But as the sex agenda says, they're not for once in control of system, but they do provide it.

So you can freely go and Google it and look yourself and see how the African Union and the Economic Commission for Africa rate Africa as well.

The the second thing is, is that as the second general mentioned, in order to produce goods, assets, in order to achieve structural transformation, you have to have the productive capacity support which you mentioned that you have to have the right institutions, you have the natural capital, you need the right human capital, you need ICT, you need energy, you need the private sector without the infrastructure and agriculture.

And this what we have worked with the government in Mission 2013 is to look at how we use the index to benchmark it.

And we've discovered where the gaps in mutations are and where the challenges are and where the opportunities are.

And it's very clear that if one wants to and Africa wants to get involved in, in capturing technology intensive or the supply chains, the policies have to change as well.

And you mentioned that policies are extremely important with regard to policies, educational policies, you must have, you're going to go into that industry, You must have produced enough engineers, you must produce enough ICT people.

You know, you have to have Mechanical Engineers if you're producing components manufacturing policy, There has to be a concerted strategic effort to do this, not left to chance and hope that you have people around.

So many countries we visit throughout the world, we see there are clear linkages between economic development plans in the country and the educational system that they're producing the people they need for and accept for the sectors.

And not just simply everybody going to university and lots of PhDs but not supporting the sector.

And this goes to also the technical level as well.

You know, you need electricians, you need plumbers, you know, you need engineers, you need to build constructors, you know, you need these type of people.

So to make it concerted to make these things to the economy.

So I just want to mention and on innovation side, there's a lot of innovation, there's a lot of startups who are innovative in many ways in the agriculture sector.

You know, when we talk about the youth in the agriculture sector, the youth don't want to go with the general ID at all.

They're using ICT to help provide the farmers.

The latest web report is with extension services.

If you know if your crops are not doing well, you take a picture and send it to them.

It'll tell you what you need to do with it.

The storage of your of your products with also distribution because the sale of our products, there's a lot happening, but it needs scaling up.

As I said to to imagine to scale up you need the investment massively.

Thank you so much for that.

Our time is first time.

So we take two questions from actually consolidate.

They need one because they're the same question.

SG in just a minute.

There's a question being asked around the status subject regarding the Grey Black secret initiative.

And this is a question from Genie or Associated Press and that we hear from Rogers News Agency Initiative exactly what apples are underway.

Yes.

Well, as the Secretary General of the United Nations have said, we continue to make all efforts to bring the exports of Ukraine and fertilisers from Ukraine and the Russian Federation to global markets because that is the only way and the, and the fastest way in which we can stabilise the market and stabilise the prices.

And we are in contact with all partners with Ukraine, with the, with the Turkey, with the the Russian Federation in trying to make this happen.

This is not an easy task.

We were able to strike a a deal and two agreements that were signed in July 2022 for one year.

We were able to maintain the two agreements running for the export side of grain fertilisers for both countries.

But in the in the midst of and so it's difficult and obviously the the compartment of or shedding of the infrastructure of grain infrastructure is not helping the markets.

And the ones that are suffering the most from this situation obviously is the most vulnerable because food prices are a very important component of income expenditure precisely of the vulnerable households.

And so when food prices go up, many of our countries are hit twice, one because of the price increase, but second because of the devaluation or the strength of the dollar that is happening in the markets in many of the countries devaluation is accounts for how of the domestic price increase.

So the main point to, to respond to the to the question is we need to continue to do, we won't spare any effort in trying to get to world markets to put on fertilisers from both countries.

But you know, efforts have to continue.

We are not there there yet.

I I suppose there is also one one question that is related to this, if you allow me that it's WFP, it has to cost 75%.

Of the.

Purchases of the World Food Programme to serve the people that is already in hunger and some of the family, it was purchased last year from the glassy brain in Italy, from Ukraine.

And so that is also a concern, yes, in terms of the World Health Programme to be able to continue to deliver human cabinet to the countries that are to the populations that are in it.

Very thanks to the Secretary of the United Nations of Antal, I should say, and let's appreciate that for.

The.

Yeah, it sounds like it's black hole.

Thank you.

I'd like to appreciate everyone must be part of this engagement.

I understand there are a number of signings and these lined up after this and therefore we need to create ample time for that.

Thank you so much for your questions both naturally and those in the group.

We truly appreciate your participation.

That's now that just a report.

We continue to interact on the subject of Africa trade as well as much as around fiscal debt.

Thank you so much.

UNCTAD Press Conference: Economic Development in Africa Report 2023 - Nairobi 16 August 2023