Private sector needs greater voice in African trade integration talks
Private sector forum on eve of African Union summit urges business partnerships ahead of politics
As African nations strive to achieve closer integration in trade in response to the global economic crisis, ITC Executive Director Patricia R. Francis has warned that the voice of the private sector in Africa is not being heard sufficiently. Ms Francis said that, with only five years to go to meet the Millennium Development Goal targets, ‘It will take coordinated multilateral action to address the triple bottom line of people, planet and prosperity if we are to achieve these goals, and the private sector is a partner in this drive.’
Ms Francis was speaking after addressing a two-day African Private Sector Forum in Kampala, Uganda, last week, held on the eve of the African Union (AU) summit in the Ugandan capital. The forum demonstrated the growing partnership between the AU and ITC in taking leadership to engage with the private sector on issues of importance to the African continent. The forum was devoted to the theme ‘Creating new business opportunities in the aftermath of the global economic and financial crisis’.
ITC, through the Aid for Trade initiative of the World Trade Organization (WTO), is at the forefront of efforts to create an environment that supports small and medium-sized enterprises (SMEs) in developing countries to become more competitive. It also works to help national finance institutions address the question of access to finance for SMEs, and in particular women-owned enterprises, which badly need better structured financial support for every stage of supply chain activities.
According to Ms Francis, the private sector has three roles in Aid for Trade: as beneficiaries; as advocates; and as partners for trade development. ‘At the end of the day, it is the private sector that trades,’ said Ms Francis, ‘but there is a large deficit in the private sector voice in advocacy for business partnership within and outside Africa.’
Forum participants observed that SMEs were becoming key drivers of economic growth and that there was a need for new ways of providing trade finance support mechanisms for the sector as well as value and supply chains connecting Africa to global markets. The forum agreed efforts were needed to:
Mobilize resources from the African Development Bank and other regional development banks to facilitate the access of SMEs to long-term credit, and guarantee credit lines from local commercial banks
Provide business development services to exporting SMEs so as to enhance their capacities to develop bankable agribusiness projects.
ITC’s Executive Director told the meeting that Africa should be looking for investments that added greater value to their products even as commodities.
‘The big issue is about getting the private sector in Africa up to a level where it can compete globally,’ Ms Francis said. ‘The private sector has the energy and imagination to take on the international marketplace, but it needs support from governments and international agencies through programmes such as Aid for Trade.’
She also urged the establishment of a mechanism to facilitate a sustainable dialogue between the public and private sectors in regional institutions to ensure that the voice of the private sector is heard as the continent tries to improve trading arrangements.
The Kampala meeting, attended by business leaders from across the continent, concluded with adoption of an ‘African Private Sector Forum Declaration’ outlining priority actions for implementation by the private sector, governments, regional economic communities and the AU, with the objective of enhancing the competitiveness of African industries and improving the continent’s share of global trade and investment flows
In Kampala, Ms Francis led a delegation of private sector leaders to the Africa Summit Roundtable, at which she presented key messages from the forum to heads of states and government leaders. Her main message was that they needed to reinforce the centrality of the trade agenda to Africa’s development, including Aid for Trade. She stressed that ITC’s mandate was to engage with the private sector in order to support that agenda. This required forgingmeaningful partnerships at national, regional and continental levels to take advantage of market opportunities, including:
- Engaging in public–private dialogue in a forward-looking spirit as governments and the business community work to improve their competitiveness in a rapidly changing global environment
- Setting the agenda on the importance of establishing an institutionalized mechanism for dialogue and joint action at national, regional and continental levels in order to be credible business partners in global markets.
The above was a joint initiative of the African Union, the Investment Agency of Uganda, the Ugandan Chamber of Commerce and the Global Compact.