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What will it take to raise Africa’s competitiveness game?

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‘What does it take to raise your competitiveness game?’ is the question many African countries will be asking at this year’s World Economic Forum on Africa, to be held in Cape Town on 8-10 May, 2013. Competitive economies create more jobs for their citizens and their economic fundamentals, institutions and policies act in coherence to boost the productivity of industries and new entries to the market. Competitive economies can also attract higher levels of investment, creating opportunity and access for a country’s entrepreneurs to make a difference in global value chains. With average growth rates of more than 5% over the past decade across the continent, a demographic advantage, and a keen sense of ‘can-do’ spirit, African economies are pitching to be recognized as innovative locations.

Still, this year’s Africa Competitiveness Report finds wide regional differences in competitiveness across the continent. This is captured in the findings, such as the placement of South Africa in the top half of the Global Competitiveness Index rankings at 52nd, while Burundi is the lowest ranked at 144th. Ghana and Tanzania, with budding middle classes and growing levels of urbanization, also continue to rank at 103 and 120, respectively. A lag in infrastructure improvements and reforms to strengthen regional markets continues to challenge African economies, and requires focus and attention. At once, competitiveness improvements could be fuelled by the entrepreneurial drive that is sweeping the continent.

In order to raise one’s competitiveness game, ‘outside-the-box’ thinking is required. This kind of aspirational thinking will involve brainstorming about how local manufacturers can supply buoyant services sectors in growing cities from Lagos to Dar es Salaam. It will require fresh thinking about how to make ‘Made in Africa’ especially attractive to keen local and international investors who will create jobs. It will concern customizing international business models to the local and regional markets in Africa – a trend with entrepreneurs in growing cities such as Accra and Kigali. And it will take a powerful effort at coordination, accountability and risk-sharing on behalf of public and private stakeholders to roll out the next M-Pesa-style innovation, and to scale that up to regional markets in Africa.

What types of opportunity may the budding entrepreneurs in the capitals and countrysides of Africa need to bring their innovations to the market? The newly revitalized public-private efforts at simultaneous, coordinated investments in many economic sectors to support the development self-sustaining production capacities in a country can be a significant push forward. Such investments - known as ‘growth poles’- are an aspirational means to enhance competitiveness and  deepen regional integration to develop African countries’ productive capacities. Central to a growth pole is a group of dynamic industries connected around a particular resource. These industries are, by virtue of their dimension or negotiation strength, anticipated to have the capacity to innovate and adapt to market conditions. This year’s Africa Competitiveness Report investigates how growth pole investments, when connected to infrastructure improvements within countries or across borders, can pave the way for greater competitiveness.


Marjo Koivisto

Private Sector Development Specialist

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