According to UNCTAD, Africa has the potential to become a major exporter of higher value-added goods, leading to economic growth, job creation, and increased wages. At the report’s launch in Nairobi, UNCTAD Secretary-General Rebeca Grynspan identified three factors that would help the continent take advantage of this “huge” opportunity: geopolitical trends, the African Continental Free Trade Area, and the emergence of the renewable energy market. Ms. Grynspan pointed out that Africa has a unique edge in the renewable energy market due to its plentiful supply of raw materials for technology-intensive industries, such as lithium for electric car batteries. She also highlighted the continent’s dynamic, youthful workforce and its “burgeoning” middle class, which provides local markets for hi-tech goods. The report examines the possibility for African countries to strengthen their position in the automobile, solar energy, and pharmaceutical industries.
Ms. Grynspan noted that creating a favorable environment for technology-intensive industries will raise wages, which are currently much lower in Africa than in the Americas. She also called for more investment, as only about two per cent of global investments in renewable energy go to Africa. To draw in more large-scale private investment, regulatory barriers must be removed and regional industrial development plans put in place. Finally, Ms. Grynspan highlighted the importance of debt relief for African countries in order to create fiscal space and invest in strengthening supply chains and in education for their workforce. She highlighted UN Secretary-General António Guterres’ mission to “change the rules that reproduce these asymmetries” and fix the “distorted” perception of risk which international investors hold in relation to developing economies.