THE reality check on all the good news about Africa’s new development trajectory is surely the report released last week by the United Nations showing that trade among African countries is declining as a share of the continent’s total trade.
From 2007 to 2011, the average share of intra-African exports in total merchandise exports was 11%, less than half of the 1997 peak of 22.4% and not even close to the 50% in Asia and 70% in Europe.
Just a few weeks ago, Kenyan President Uhuru Kenyatta said at a conference on Africa’s need to industrialise that Africa was still largely a trading continent. And yet it accounts for just 3% of global trade and a mere 11% of trade among its own countries.
The reasons intra-African trade is so low are barely changed from a decade ago. They include cumbersome import and export procedures, tariff and nontariff barriers, a lack of harmonisation of operating requirements across borders and unsupportive policy frameworks for exports.
It still takes a truck up to five days to clear one border post in Southern Africa — pricey, given the average cost of $400 a day for a stationary truck. Beitbridge, one of Africa’s busiest crossings, remains a blockage to trade, with truckers plagued by long queues, touts, inefficient systems, corruption and unpredictable service.
Corruption also undermines trade. For example, in Côte d’Ivoire, illegal roadblocks set up by police and soldiers netted more than $19m in bribes last year and the year before.
Lack of infrastructure is a key constraint to improving trade. Goods are forced onto the roads because of neglected rail infrastructure. It can cost up to $6,000 to transport a container from Durban to Lusaka, which is borne by consumers and import-reliant businesses inland.
A further problem is the lack of industrialisation. African firms are mostly small and uncompetitive, partly as a result of the challenging, expensive and unsupportive business environment. This makes it difficult to build export businesses.
There has been a lot of talk lately among African ministers, officials and bureaucrats about how to industrialise. They have finally woken up to the idea that industrial development is important for development.
Earlier this year, for example, African Union officials joined finance, planning and economic development ministers and central bank governors at a six-day jamboree in Abidjan for the “Industrialisation for an Emerging Africa” conference. But critics said the discussions lacked detail about how to drive industrialisation. It did not help that many officials banged the old drum about colonialisation and imperialism being to blame for Africa’s lack of economic diversification.
These are the people who have the power to remove many of the constraints to industrial development and to draw up policies for its advancement. But if they are not prepared to assume some blame, they are unlikely to have creative ideas about how to improve the situation.
An innate suspicion of the private sector, and particularly of foreign multinationals, continues to dog attempts to build industry in Africa. The private sector, which is expected to drive industrialisation, is mostly precluded from making inputs into these lofty discussions.
Simply making it easier and cheaper for business to operate in African countries would have a knock-on effect on the ability of Africans to invest in their own economies, produce goods and trade them with their neighbours. As businesspeople always say, give them the tools and they will get on with the job.
It is easier to fly to conferences inside and outside Africa to make speeches that focus on identifying, rather than fixing, trade in Africa than to take a ride to the nearest border post to experience first-hand what the problems are.
It is also easier to pontificate among fellow bureaucrats and politicians about the need for action than to face companies and ask them directly what would help them to be more competitive.
• Games is CE of Africa @ Work, a consulting company.