Sunday , March 26 2023
Home / Business / Inside Africa’s development dilemma

Inside Africa’s development dilemma

AfCFTA is a continuation of WTO

He said the AfCFTA documents resemble those of the World Trade Organisation (WTO) both in wording and development models which failed to develop the continent in the previous years.

He said, for instance, that AfCFTA Article 5 provides that the agreement shall be governed by the number of principles including variable geometry, reciprocity, flexibility and special and preferential treatments and transparency, among others, similar to the WTO principles.

Yet, variable geometry is likely to slow down the implementation of the AfCFTA as countries try  to accommodate less advantageous countries or countries unwilling to move as fast as others. And, even if variable geometry is the only way to move forward in trade agreements as some commentators have argued, it complicates trade liberalisation and slows down integration initiatives.

Prof. Kiiza said AfCFTA Article 6 also provides a very wide scope covered in the agreement which among others includes goods, trade in services, investment, intellectual property rights and competition policy.

“This language has been copied and is being pasted from WTO orthodox into the AfCFTA agreements.  We are being persuaded that the African leaders are working for the Africans but they are actually working for the WTO and the big powers that control world economies,” he said.

“The AfCFTA has become a space through which western powers are becoming too intrusive into the development policy spaces.”

Prof. Kiiza said it is time for the African continent to move beyond the IMF and World Bank strategies.

Professor Erik S. Reinert, Professor of Technology Governance and Development Strategies-Tallinn University in Estonia, said in his key note speech titled “Building back better: In search for an Alternative Development Agenda in Africa” that there is no country in the world that has developed without industrialisation.

“No country has also ever developed from foreign direct investments (FDI); In fact, FDI hardly develops any country,” he said, adding that FDI instead promotes capital flight which have been made possible by local leaders through the enactment of  policies ostensibly to encourage foreign investments.

Integrate within Africa

But Isaac Shinyekwa, the head of Trade and Regional Integration Department at the Economic Policy Research Centre (EPRC) based at Makerere University, says AfCFTA presents a perfect opportunity for African countries to strengthen their agriculture sector, built infrastructure, industrialize and transform their economies.

He says African countries need to trade among themselves more rather than with the rest of the world to maximumise their returns.

“With our regional integration, we can produce light manufactured products for our African markets which is not possible with the countries abroad,” he said.

Latest statistics from the United Nations Conference on Trade and Development (UNCTAD) shows that intra-African exports have remained low compared with other trading blocs.  For instance in 2017, intra-African exports stood at 16.6% of total exports, compared with 68.1% in Europe, 59.4% in Asia and 55.0% in America.

Shinyekwa, however, says African countries face a new challenge as developed countries including the United Kingdom, China, India, USA, Turkey and Singapore seek for bilateral agreements to tap into the continent’s market opportunities.

“Kenya in the East African Community, for instance, has signed the Economic Partnership Agreement with the UK and is now negotiating with the US to open up market for the US products. Currently, Kenya is one of the biggest importers of Ugandan products alongside Tanzania in Africa,” he said, “So should Kenya and USA sign the agreement, our Sugar, our milk, our animal feeds and others will be under threat.”

Shinyekwa said some of these developed countries may open up market for the African countries with whom they have bilateral agreements with but their strict conditions such as adhering to their standards, human rights, labour laws, corruption, traceability and others may continue to hinder exports.

“Meanwhile, these countries will be continuing to flood your market with their products, “he said.

Now which way for Africa?

Going forward, Mwambutysa Ndebesa, a political science lecturer at Makerere University, said there’s need for the African population to dare think differently outside the existing ideologies and paradigms even if the idea seems weird in a bid to transform African economies.

“We should consider soft factors such as science and technology and norms if we are to catch up with the rest of the world,” he said, “Otherwise, we are not going very far with the hardware developments because we do not have capital.”

Mwabutsya said this is because technologies such as information and communication technologies do not need a lot of financial capital but brain power.

He said there’s need for Uganda to come up with a white paper on innovation and creativity to be debated with ideas on how to materialize the identified areas.

“We also need governance that will usher us in those technology innovations,” he said adding that human capital centered approach to development, equity and justice too are a pre-requisite for development to avoid future wars that could take the country back to under-development.

Shinyekwa said while there have been a lot of criticisms against the AfCFTA because it will be used by foreigners to access the local market, there is room for improvement.

“If you are into a dangerous journey, you do not stop going, you prepare yourself to face the challenge. And this is the thinking that the African leadership should have; not to fear going into AfCFTA,” he said, adding that there’s need for the African countries to strengthen their existing regional economic integration in all aspects –agriculture, energy, industrialisation, transport and communication, integration of financial institutions – to facilitate own growth and development.

Ndebesa said unless the regional blocs have relevant protocols on good governance amongst the partner states, it will be difficult to implement the AfCFTA.

He cited Rwanda’s border closures with Uganda and Burundi, and trade wars between Uganda and Kenya, Uganda and Tanzania, Kenya and Tanzania in which no solutions have been found yet they belong to the same regional economic bloc.

“Now with all these challenges at hand, we cannot compete with Egypt or South Africa who are already far ahead of us in terms of technology,” he said, “Something has to be done to move forward.”

However, Leo Kizito Ojara, the Commissioner- Economic Affairs, Ministry of East African Community Affairs in Uganda said the challenges facing regional economic blocs can be better sorted at the heads of state level.

Leave a Reply

Your email address will not be published. Required fields are marked *