East Africa shows the benefits of successful regional integration

CAPE TOWN, South Africa – Regional integration is the key to the development of Africa, but it requires strong political will to succeed, panellists in the closing session of the World Economic Forum on Africa heard today.

Donald Kaberuka, President, African Development Bank (AfDB), Abidjan, a World Economic Forum Foundation Board Member, said: “Infrastructure is a means to an end; it is not an end in itself.” So, for integration to work, the man-made barriers to trade need to be removed.

Claver Gatete, Minister of Finance and Economic Planning of Rwanda, said that it has taken a decision by the leaders of East African Community (EAC) states to have multiple trade barriers removed along the route from Kenya’s port at Mombasa to Rwanda. This has cut down the travel time from 22 days to five and halved the cost of transport between the countries.

The panel also flagged the cost and difficulty of moving around the continent, which is an added cost for business and has a significant effect on growth. Although the situation has improved, with 30 countries now having no visa requirements for Africans or visas issued on arrival, it is still an issue. Kaberuka said it is important to find out what fears lay behind visa policies to see if they could be addressed.

Again, East Africa was flagged as a region that has made significant progress in this regard, with requirements for visas, passports and even mobile phone roaming charges no longer applicable for nationals of the EAC countries wishing to move around the region.

Nhlanhla Musa Nene, Minister of Finance of South Africa, said Africa’s resources have to be used efficiently to lay the foundation for future generations. “Growth in our GDP is of critical importance. But what is important is the quality of that growth; whether that growth takes everyone on board. It is whether that growth continues to be sustainable and creates an environment that will cater for the next generation,” he said.

Makhtar Diop, Vice-President, Africa, World Bank, Washington DC, said that the conversations at the World Economic Forum on Africa are the same as those being held among policy-makers in the developed world about quality of growth, employment, inclusiveness, climate change, economic diversification and taking the economy to the next phase. “So the message I am taking from this meeting is that Africa is becoming a real part of the dialogue on economies. It is not an exception anymore,” he said.

Antony Jenkins, Group Chief Executive, Barclays, United Kingdom, and a Co-Chair of the World Economic Forum on Africa, said that the company is optimistic about Africa’s future, but urged the continent to seize the opportunities that have been presented by low growth in other regions in a world that is increasingly competitive and interconnected.

Jenkins cautioned that while it is temping to look for models for creating growth in other parts of the world, he would advise against it. “I think that’s looking in the rear-view mirror. It is very important to look to the future.” Diop concurred, saying Africa needs to create its own model for the future from the success stories on the continent and elsewhere.

South Africa’s Archbishop Desmond Tutu closed the 2015 meeting with a blessing. Next year’s World Economic Forum on Africa will take place in Kigali, Rwanda.

More than 1,250 participants took part in the 25th World Economic Forum on Africa in Cape Town, South Africa, from 3 to 5 June 2015. The theme of the meeting was “Then and Now: Reimagining Africa’s Future”.

The Co-Chairs of the World Economic on Africa are: Antony Jenkins, Group Chief Executive, Barclays, United Kingdom; Phumzile Mlambo-Ngcuka, Undersecretary-General and Executive Director, United Nations Entity for Gender Equality and the Empowerment of Women (UN WOMEN), New York; Patrice Motsepe, Founder and Executive Chairman, African Rainbow Minerals, South Africa; Paul Polman, Chief Executive Officer, Unilever, United Kingdom; and Sir Michael Rake, Chairman, BT Group, United Kingdom.