Keynote address by Mr. Cheick Sidi Diarra, Under-Secretary-General, Special Adviser on Africa and High Representative for the Least Developed Countries, Landlocked Developing Countries and Small Island Developing States on "Trade and Development for Africa's Prosperity: Action and Direction" during the high-level segment UNCTAD XII Conference, Accra, Ghana, 21 April 2008
It is a great honor and pleasure for me to address you on the occasion of UNCTAD XII here in Accra and I would like to express my appreciation to the Government of Ghana for hosting this conference. It is particularly appropriate that we are holding this conference today in an African country. Although Africa, a continent endowed with abundant natural resources and growing economic activities, holds the promise of becoming a major player and a key trade partner in the world economy, Africa’s share in global exports in value terms increased only marginally, from 2.3 to 2.8 per cent between 2000 and 2006.
While globalization has brought prosperity and better income distribution to many parts of the world, the benefits of globalization have failed to reach the overwhelming majority of the population in Sub-Saharan Africa. Thus, the theme of the UNCTAD XII Conference – Addressing the opportunities and challenges of globalization for development – is timely and particularly relevant to the African countries.
It is a source of encouragement that, despite the challenges faced by the African countries, many of them have achieved commendable economic and trade growth in recent years. African countries are taking steps to transform their productive capacities, undertake structural reforms and take their future into their own hands through initiatives such as the New Partnership for Africa’s Development (NEPAD). Favorable commodity prices, combined with improved economic policies, have contributed to an average annual economic growth rate of almost 6 per cent in many African countries in the last three years. This trend is expected to continue in 2008, despite the slowing down of the world economy.
However, economic growth is necessary, but not sufficient unless it is accompanied by sustained poverty reduction. What truly matters is how the growth affects the living standards of the neediest and most vulnerable segments of the population. Unfortunately, the recent growth performance in Africa has not translated into significant progress in social development. On current trends, most countries in Sub-Saharan Africa will not be able to meet the Millennium Development Goals by 2015. This situation could be exacerbated by global factors such as the emerging food crisis, higher oil prices and the slowdown of the world economy, which are undermining poverty reduction efforts in many parts of the world.
Trade has enormous potential to assist African countries in their development efforts. Therefore, the creation of an equitable and transparent multilateral trading system is an important precondition if we are to deliver on the MDGs in Africa. This conference provides a timely opportunity to commit to attaining meaningful progress towards concluding the Doha Round of trade negotiations. Special attention needs to be given to issues of particular concern to Africa, such as, inter alia, market access for agricultural goods, reduction in tariff peaks and escalation, reduction in market-distorting export subsidies and domestic support measures, and preference erosion.
However, trade liberalization is not an end in itself. As globalization advances, the majority of countries in Sub-Saharan Africa are lacking the starting point that would allow them to participate more effectively in world trade, such as access to basic transport and communications infrastructure, skilled human resources, developed private sector and strong institutional frameworks. Moreover, constantly changing global markets, where many sectors are dominated by resource rich and technologically advanced corporations, have made it extremely difficult for small enterprises and new players from African countries to be competitive.
Therefore, trade-related capacity building is key for increasing the competitiveness of African countries and ensuring their beneficial integration into the world economy. To that end, building productive capacities, development of physical infrastructure, human capital, and strong institutions is crucial for sustained growth and sustainable development of African countries.
Trade-related capacity building through mechanisms such as the Integrated Framework (IF) for Trade-Related Technical Assistance to Least Developed Countries, the Joint Integrated Technical Assistance Programme (JITAP), the World Trade Organization (WTO) Development Agenda Global Trust Fund and activities of the International Trade Centre (ITC), plays a crucial role in addressing the supply-side constraints in African countries and helping them to integrate into the world economy.
The Integrated Framework has been identified as a key vehicle for delivering trade-related assistance to LDCs, including those in Africa. Launched in 1997 and revamped in 2000, it aims at mainstreaming trade into national poverty reduction and development strategies, as well as coordinated delivery of trade-related assistance. As of March 2008, 30 African LDCs were accorded the benefits of the integrated framework and 23 African countries had completed Diagnostic Trade Integration Studies (21 of them through the Integrated Framework). During 2006-2007, sixteen African countries also benefited from JITAP, a major trade-related capacity-building programme.
In this context, I welcome the progress made in the implementation of the Aid-for-Trade Initiative by Africa’s development partners. The 2008 Aid-for-Trade Roadmap can further improve the quality of trade related assistance by increasing developing country ownership, strengthening the monitoring of its implementation, and by developing performance indicators.
These efforts need to be accompanied by the implementation of the various commitments made by the donors in Monterrey, Gleneagles and other UN and G8 summits. Moreover, since the share of ODA to trade-related capacity building in LDCs fell by 42 per cent since 2001, donors must make genuine efforts to increase this share.
At the same time, I would like to emphasize the importance of national ownership and leadership in designing a successful export-led growth strategy for Africa. Trade needs to become a bigger part of national development strategies. From their side, African countries need to further improve the business climate, remove critical supply-side constraints, build productive capacity and enhance product quality. Moreover, considering that many African countries are dependent on exports of a single commodity, upgrading from primary commodity exports through diversification of products and exports remains an important challenge. In the right environment, the private sector could thrive. The importance of a vibrant private sector as an engine for growth, job creation and poverty reduction, is now widely recognised.
It is my sincere hope that the occasion of UNCTAD XII will allow us to further address Africa’s concerns in a meaningful and pragmatic manner and that the discussions will identify specific and critical action that can be taken, in collaboration between the Africa countries and their development partners. The pieces to the solution are all there – they just need to be brought together in a coherent and coordinated manner. Let us all work together to turn trade into a true engine of growth for the African countries and to ensure that the benefits of globalization reach all the people of Africa. After all, there can be no prosperity for Africa without achieving prosperity for the vast majority of African people.
Thank you for your kind attention.