OPINIONPartners in international development have an historic opportunity to spark a flourishing entrepreneurial industrial sector in Africa. They can transform the continent into a model of green, sustainable progress and good governance, writes Kandeh Yumkella
IT IS not hard to be gloomy about the future. Half of the global population is living in abject poverty. Africa remains particularly afflicted; many of its people existing without adequate food, shelter, health, education or influence on decisions that affect their lives.
It is already clear that the global Millennium Development Goal - of halving the proportion of people living in extreme poverty by 2015 - will not be met by many countries in sub-Saharan Africa. Some parts of the continent remain mired in civil unrest and war, leading to the continued existence of failed and fragile states in what Paul Collier has coined the "bottom billion".
Meanwhile, the developed world moves on, drawing ever more closely together in economic integration, rapid technological advance and - despite some bumps along the way - increased prosperity. Africa appears sidelined - or worse - a vast continent largely reliant on foreign aid for many of its basic needs. Its natural resources, markets and people are exploited by the rich.
So far, so stereotypical. But look again. World Bank estimates show a sharp acceleration in economic growth, particularly in sub-Saharan Africa. The average growth rate has increased from 5.7 per cent in 2006 to 6.1 per cent in 2007 - the region's fastest in more than three decades. We discover throughout the continent, against the odds perhaps, burgeoning economic activity: entrepreneurs developing and producing goods, trading with others and setting in motion whole chains of industry. These are the green shoots, which - if encouraged by partners in international development - will transform Africa.
Industry plays a pivotal role by reducing poverty, modernising societies and bringing economic prosperity. All the developed countries and the newly industrialised nations of Asia, without exception, have used industry and the private sector as the main vehicles for achieving economic growth and wealth creation for their populations. Clearly, Africa can do the same.
The challenge is to bring about the full participation of African entrepreneurs in the global economy by promoting small and medium enterprises and thus creating the "missing middle" between a few state-owned enterprises on the one hand and the myriad of micro-businesses in the informal sector on the other hand. In particular, this calls for diversifying production, developing products up the value chain, ensuring that these goods can be traded internationally and fairly, engaging transnational corporations and encouraging them to link up with local business.
A further challenge is the "greening" of economic growth. Africa can become a true world leader in unlinking industrial growth from environmental degradation by building upon clean production and developing its own environmental services industry. Yes, African countries, first and foremost, need access to energy for economic development. Yes, the climate change agenda must be reconciled with the development agenda so as to be credible and realistic. But there is no doubt that opportunities abound for the continent to fulfil its potential in using wind, solar, bio- and small hydro-energy. Such sustainable industrial growth generates employment and encourages the development of new skills and attitudes.
This is all very well, you may say, but how can we concentrate on private sector growth in Africa when the humanitarian and social needs are so overwhelming?
Let us be ambitious. Right now, Africa does not have a vibrant private sector to provide employment opportunities for its teeming populations to create the individual and societal wealth that meets basic needs and beyond. Pockets of success exist, but this success must be brought together into a cohesive whole through a well-designed and well-implemented policy.
The very phrase "industrial policy" has been much maligned in recent times. This is perhaps not without some justification where Africa is concerned. Until the 1970s, these words meant the centralisation of industrial assets in state hands. Then the thinking shifted to an over-reliance on market forces, liberalisation and deregulation. The story of east Asia, however, shows how properly developed policy can change societies and lives for the better. Today, we have a real opportunity to reinforce dynamic sources of growth through appropriate policy advice to governments and assistance in building up well-functioning markets and effective support institutions.
The United Nations Industrial Development Organisation (Unido), which I have the privilege to lead as director-general, has its own part to play as the specialised agency of the UN system mandated to advance sustainable industrial development and international industrial co-operation. However, we cannot achieve progress in isolation and, for this reason, Unido strongly supports efforts toward system-wide coherence across the wider UN. In fact, no single government or agency, public or private, can effectively address the interconnected and complex development challenges of our time.
This is as true for development agencies, multilateral and bilateral alike, as for African governments. Corruption remains an issue but there is noticeable progress in Africa - look at the improved scores in Transparency International's 2007 Corruption Perceptions Index - and only through engagement can we hope to effect further change. History shows us time and again that democratisation and good governance have strong roots in economic prosperity.
Ireland itself can be a model for Africa. A country once described as "the poorest of the rich" has transformed itself in a few short years into a dynamic, open and successful country; a country that, in keeping with its long history of concern for the developing world, is now, on a per capita basis, the sixth-largest donor of aid worldwide.
I dare to posit that, one day, there will be a whole host of African "Irelands" - lands without conflict, with peace and prosperity - and that the generous assistance of this country will reap a fine dividend.
Dr Kandeh Yumkella is the director-general of the United Nations Industrial Development Organisation (Unido). He will be speaking on the theme of poverty and globalisation at the Institute of International and European Affairs, North Great George's Street, Dublin 1, tomorrow at noon