Reducing cost of basic foodstuffs in Africa: Govts urged to provide investment incentives
NAIROBI-African countries have been asked to provide investment incentives to businesses operating in the agribusiness, green and blue economy in order to reduce the soaring costs of basic foodstuffs coupled with rising inflation in Africa.
African Governments have further been urged to facilitate access to capital and crowd-funding to support SMEs in Africa, through the use of Government Guarantee Funds [GGFs] and Privately Driven Guarantee Funds (PDGFs) including subsidizing agricultural production for key sectors such as cereals, vegetable, and palm oil to reduce the costs of production to enhance global competitiveness.
The proposals to aid Africa’s economic recovery, brought forth during the Coordination Committee meeting of the African Union Commission, Regional Economic Communities [RECs] /Regional Mechanisms [RMs]and Strategic Partners held recently in Nairobi, Kenya.
Opening the meeting, the Chairperson of the African Union Commission [AUC], Moussa Faki Mahamat said that with Africa having the world’s largest free trade area, with a market of 1.2 billion persons, the continent is creating an entirely new development path, which requires that it, to harness the potential of its own resources.
“The economic prospects for Africa in 2023 look promising, Africa is coming out as resilient and is bound to transform the three major sectors of economic activities into a much more sustainable economic model; the extraction of raw materials [primary], the manufacturing sector [secondary] and the service industries (tertiary sector),” he said.
On his part, EAC Secretary General, Dr. Peter Mutuku Mathuki said that RECs such as EAC play a critical role in coordinating and actively engaging stakeholders at the national and regional levels, which is highly necessary for the implementation of initiatives under Agenda 2063 including African Continental Free Trade Area [AfCFTA].
Dr. Mathuki highlighted the resilience of EAC economies during the Covid-19 pandemic that ravaged economies worldwide.
“The Covid-19 pandemic cost the EAC Partner States between US$ 37bln and US$ 79bln in terms of output losses. The region continues to rebound with intra-EAC trade, accounting for imports and exports in the EAC Partner States, growing from 13 percent in 2019 at a value of US$ 7.1bln to 15 percent in 2021 at a value of US$ 9.5bln,” said Dr. Mathuki.
Dr. Mathuki said that intra-EAC trade stood at US$10.17bln in September 2022, representing a 20 percent share of Intra-trade to global trade.
He further called on the continent to deepen collaboration and address some of the issues hampering the region’s growth.
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