Across Africa Special : "Africa must trade more with itself" says WTO chief Okonjo-Iweala

Summary

In this special edition of Across Africa, Dr. Ngozi Okonjo-Iweala, the first female head of the World Trade Organization (WTO) and former Nigerian Finance Minister, discusses the importance of trade to Africa's growth. She emphasizes the need for Africa to add value to its products and industrialize to capture a larger share of the global market. Dr. Okonjo-Iweala highlights the African Continental Free Trade Area as a significant step forward, urging for investment-friendly environments and infrastructure development to attract investment and create jobs. She also addresses the perception of Africa as a risky investment destination, advocating for a reduction in bureaucratic barriers and promoting the continent's entrepreneurial spirit.

Takeaways

• 🌐 The World Trade Organization (WTO) ensures stable, fair, and predictable trade rules among countries.
• 📈 Protectionism is currently on the rise, which contradicts the WTO's goal of predictable tariffs and duties.
• 💼 Africa's share of global trade has remained stagnant at around 3%, indicating a need for change.
• 🏭 To increase trade, Africa needs to add value to its products and industrialize more.
• 🔄 Intra-African trade is also low at 15-20% and has been stagnant, necessitating improvement.
• 🛑 The African Continental Free Trade Area (AfCFTA) is seen as a significant step towards increasing trade within the continent.
• 🌿 Africa must focus on processing raw materials like lithium and establishing factories to create a supply chain and jobs.
• 💡 Reducing bureaucracy and improving infrastructure are key to making Africa more investment-friendly.
• 🔋 Africa has the potential to produce green hydrogen for both domestic use and export.
• 🚀 Entrepreneurial drive among Africa's youth, especially in digital trade, is a significant asset that should be leveraged.
• 📉 The perception of Africa as a risky investment destination is exaggerated, and the continent offers high returns on investment.

Q & A

Why is trade important to Africa according to the World Trade Organization?

Trade is crucial for Africa because it allows countries to exchange goods and services based on stable, fair, and predictable rules, which facilitates economic growth and development.

What is the role of the World Trade Organization in global trade?

The World Trade Organization ensures that trade between countries is conducted under agreed-upon rules, maintaining predictability and fairness to prevent arbitrary customs duties or import duties that could disrupt trade.

How does protectionism affect the World Trade Organization's objectives?

Protectionism, where countries raise tariffs and duties to restrict market access, goes against the WTO's goal of ensuring predictable tariffs and can lead to reduced global trade.

What has been the historical trade situation for Africa in the global context?

Africa's trade as a percentage of global trade has remained stagnant at around 3% for many years, indicating a need for improvement in Africa's trade dynamics.

What does Dr. Ngozi Okonjo-Iweala suggest Africa needs to do to increase its trade?

Africa needs to add value to its products, industrialize more, and focus on manufacturing to capture a larger share of the market and reduce reliance on primary commodities.

How does the African Continental Free Trade Area (AfCFTA) potentially impact Africa's trade?

The AfCFTA is expected to substantially increase intra-African trade by creating a single market of 1.4 billion people, which can lead to more economic opportunities and growth.

What are the challenges Africa faces in taking advantage of the AfCFTA?

Africa needs to invest in infrastructure, reduce bureaucracy, and create an environment conducive to investment to fully benefit from the AfCFTA.

How does Dr. Ngozi Okonjo-Iweala view the entrepreneurial spirit in Africa?

Dr. Okonjo-Iweala sees Africa's entrepreneurial spirit, particularly among its youth, as a significant strength and a source of hope for the continent's economic future.

What is the Investment Facilitation Agreement for the WTO, and how does it relate to Africa?

The Investment Facilitation Agreement is a WTO negotiation aimed at reducing barriers to investment. Most African countries have signed on to it, signaling their commitment to making investment easier and more attractive.

How does Dr. Ngozi Okonjo-Iweala's role as the first female and African head of the WTO influence her perspective?

Dr. Okonjo-Iweala's background gives her a heightened perception of the challenges and needs of African countries within the WTO's framework, allowing her to advocate for policies that benefit the continent.

What initiatives is the WTO undertaking to support Africa's trade, particularly in agriculture?

The WTO is working on an agricultural agreement to address subsidies that disadvantage African countries. Additionally, partnerships like the one with FIFA aim to help African cotton producers add value to their products and capture a share of the sports apparel market.