The World Bank’s Chief Economist for Africa, Mr Albert Zeufack, says there are enormous potential for Africa to develop by diversifying its markets and exports.
He said while it was important for African countries in general and Ghana in particular to diversify their economies from the exports of mainly raw materials to value added products, it was even more important for them to diversify their markets.
Mr Zeufack, who was interacting with the media on Friday, as part of activities for his three-day visit, said it was time for Africa to seize the opportunities available in emerging markets such as those in East Asia.
He noted that after adding value, Africa must look for a diversified market for its exports, aside the traditional markets of US and other places to places like East Asia.
“The largest consumption market and the fastest growing consumption market is actually in East Asia, it’s not in the US, it’s not in Europe, it’s in East Asia,” he said.
He said the market for chocolate in East Asia for instance, for 2018, was more than $ 16 billion.
He said if Ghana, being one of the largest cocoa producers was able to attract investment to manufacture chocolate and other cocoa products, it would be able to create jobs in Ghana and export chocolate to East Asia.
“This is what La Cote d’Ivoire is starting to do, and that is what Africa must emulate,” he said.
In line with this, Mr Zeufack said he would launch a report on how to position Africa to seize opportunities in emerging markets, especially those in Asia, called the ‘Africa-Asia Flagship Report’.
He observed that most African countries were lagging behind their counterparts in other parts of the world due to over-reliance on export of raw commodities, and have been hit hard by the recent commodity price slump.
Mr Zeufack said while Ghana, for instance, had gained independence at the same time as Malaysia, and had a higher Gross Domestic Product (GDP) per capita than Malaysia at the time, Malaysia’s GDP per capita was currently about nine times above that of the country.
He attributed this gap between the development of the two countries to the adoption of growth models that were focused solely on exporting raw materials instead of diversifying economies and adding more value, as was the case in most other African countries.
Giving an overview of the macro economy in Africa, Mr Zeufack remained optimistic about Africa’s growth, saying that although most African countries had been hit hard by the commodity price slumps, most of Africa remained resilient and continued to grow steadily.
He described 2016 as the worst year of growth for sub-Saharan Africa in two decades with the continent recording an average of only 1.6 per cent growth, lower than the rate of population growth, due to the collapse of commodity prices and reduced capital flows.
The Bank however projects a timid recovery of between 2.5 and three per cent in 2017 and three to 3.5 per cent in 2018.
He explained that if Nigeria, South Africa and Angola, who were heavily reliant on mineral and commodities exports, were excluded from the average, the rest of Africa was still growing above five percent.
“We are not giving in to this Afro-pessimism, telling us that Africa is collapsing or that Africa is no longer rising. We believe most of Africa is still resilient and in fact countries like Ethiopia, Rwanda and Tanzania are still growing above seven percent, while others like Senegal and Cote d’Ivoire are all growing above six per cent,” he stated.
Ghana will also recover from its 3.6 per cent growth last year to roughly 5.5 to six per cent depending on how the risks are managed.