Chief Of Staff Bureau of the Chairperson African Union Commission.
Peace and Security
Up to the early 1990s, the continent was plagued by numerous conflicts and the cost of these conflicts on Africa was incalculable. However, since the late 1990s, conflicts and violence have decreased substantially on the continent. Africa has experienced a dramatic decline in the number of violent conflicts as compared to other developing regions. A large measure of stability is being restored in many conflict afflicted parts of the continent such as the Horn of Africa, the Great Lakes region, although some challenges remain in places like Eastern Democratic Republic of Congo and some parts in West and Central Africa. We have worked closely with our Peace and Security Council to expeditiously address conflicts, prevent crisis as well as the management and resolution of volatile situations on the continent.
The African Peace and Security Architecture (APSA), the Panel of the Wise and the Continental Early Warning System, are some of the instruments being utilized, in this regard. Others include, post-conflict reconstruction and development support programmes, the African Standby Force and the Peace support missions. What is required now is to mobilize more resources for the functioning of the APSA so that Africa can take full "ownership" of it, and optimize the use of the various instruments that have been created. This will help to better manage the different stages of conflict situations, from prevention to reconstruction, making full use of mediation and, if necessary, preventive deployments. We are confident that promoting peace and security in Africa will enable the continent to take full advantage of its immense potentials.
The African continent is making good strides on the road towards democratization and good governance. In spite of some challenges, free, fair and transparent democratic elections are increasingly the norm with several examples of peaceful handover of power. In the 1960s and 1970s, Africa averaged only 28 elections for the decade. By the 1990s, this had increased to 65 per decade. Between 2000 and 2005 alone, African countries held 41 elections. In 2011, 18 countries in Africa were considered electoral democracies as compared to only four in 1991. Impunity is also being progressively reduced.
Another positive development is that increasingly, more elections are achieving the minimum standard of democratic fairness, signaling improved quality of the electoral process. Other aspects of the governance picture in Africa relate to the rule of law and corruption, and improved citizen participation and accountability, all of which clearly show signs of improvements and a rejection by Africans of the old ways of doing things.
As one way of enhancing democracy on the continent, the African Union established the African Peer Review Mechanism (APRM) where African countries peer review each other on four components: democracy and political governance; economic governance & management; corporate governance; and socio-economic development. Some 32 of the 54 African countries have joined and 16 so far have been voluntarily assessed. The African Charter on Democracy, Elections and Governance adopted by the AU in 2007 whose purpose is to deepen commitment to democratic principles, elections, the rule of law and respect for Human Rights, has also been developed. In addition, the African Governance Platform has also been put in place on the continent aiming at establishing in a near future an African Governance Architecture.
Between 2002 and 2008 the continent grew at an annual average rate of 5.6 per cent. This growth was interrupted in 2008 by the global financial crisis and fell to 3.1 per cent. However, despite the crisis, on average, Africa grew at around 6 per cent during the past decade, making it one of the fastest growing regions of the world after East Asia. This was mainly due to the commodity price boom, increase in domestic demand and consumption, improved macroeconomic management and governance, a rising middle class and urbanization, increased global trade links, favorable weather conditions and reduced political conflicts and civil unrests. Between 2000 and 2009, eleven African countries grew at an annual rate of 7 per cent or more, which is considered sufficient to double their economies in ten years.
Between 2000 and 2011 six of the fastest growing economies were African. Africa’s collective Gross Domestic Product (GDP) at US$ 2 trillion today is roughly equal to Brazil’s or Russia’s. Despite the sovereign debt crisis in Europe and the subdued growth in North America and China, Africa’s medium-term growth prospects, projected at 4.8 per cent in 2013 and 5.1 per cent in 2014, remain strong.
The business climate on the continent has also improved and there is a nascent and growing middle class which stands at 355 million people or 34 per cent of the total population in 2010, thereby increasing the continent’s consumer base and providing an impetus for investment by foreign investors such as those from Mexico.
Africa’s external debt has fallen significantly in recent years, from 53.6 per cent of Gross National Income (GNI) in 2000 to 20.6 per cent of GNI in 2011 largely through the adoption of prudent macroeconomic strategies, including tighter fiscal policies and an increased emphasis on domestic resource mobilization, amongst other strategies. Another fact has been the extensive international agreements on external debt forgiveness, including the Multilateral Debt Relief Initiative (MDRI) to cancel outstanding debts of Highly Indebted Poor Countries (HIPCs), as agreed at the 2005 Gleneagles Summit, and the Paris Club’s Evian Approach for non-HIPC countries. However, increased borrowing to finance development and infrastructure projects still presents a challenge to Africa’s debt performance in the medium- and long-term.
Foreign direct investments (FDI) inflows to Africa have experienced a boom over the past ten years, increasing from US $9.6 billion in 2000 to a pre-crisis high of US $58.9 billion in 2008, and have since rebounded to US $50 billion in 2012. Investment flows have been driven by high returns across all sectors in Africa, particularly with respect to commodities and the construction sector, as well as the marked improvements in the ease of doing business and the global perception of Africa as an investment destination. Flows from traditional European and North American sources have been complemented by new investments from Southern partners such as Turkey, China, India, Brazil, Mexico, etc. These are important for diversifying sources of investment to mitigate future FDI decreases due to economic crisis. Between 2006 and 2010, gross capital formation as a per cent of GDP fluctuated between as low as 21.4 per cent to as high as 24.5 per cent, and gross domestic savings between 19.3 per cent and 24.4 per cent.
For Africa to sustain its current positive economic growth performance, a key priority is to accelerate the depth and pace of regional integration in order to facilitate greater levels of trade, boost diversification and sustainable growth, create larger markets, pool human capital and natural resources, and leverage the different comparative advantages of African countries for the achievement of the continent’s industrialization goal.
The OAU Charter and the Constitutive Act establishing the AU identifies regional integration as one of the foundations for Africa’s Unity. The Lagos Plan of Action and the Abuja Treaty elaborate the specific economic, political and institutional mechanisms for attaining this goal.
The AU has over the last few decades, supported the creation of Regional Economic Communities (RECs) aimed at consolidating markets, taking advantage of economies of scale and promoting sustainable development. These regional economic communities are: the Southern African Development Community (SADC); the Common Market for Eastern and Southern Africa (COMESA); the Economic Community of Central African States (ECCAS); the Community of Sahel-Saharan States (CENSAD); the Economic Community of West African States (ECOWAS); the East African Community (EAC); the Arab Maghreb Union (AMU); and the Intergovernmental Authority on Development (IGAD).
These RECs have focused on eliminating tariffs, promoting free movement of people, goods, services and capital and creation of a monetary union under the aegis of the Minimum Integration Programme (MIP). Intra-African trade in agriculture and manufacturing has reached twice the level of overall trade, creating a solid basis upon which intra-African trade can be deepened through the development of regional value-chains. All these have assisted the continent to make headway in its integration agenda. Efforts are also underway to establish an African Continental Free Trade Area (CFTA) by 2017.
Africa’s growth has been aided by the quality and quantity of available infrastructure. The continent’s infrastructure has been responsible for more than half of Africa’s growth performance and has the potential to further contribute to Africa’s future growth. African governments and the private sector are investing about $72 billion annually in new infrastructure on the continent. Governments contribute 65% while the private sector contributes 25% and Official Development Assistance (ODA) contributes 4%.
In order to enhance infrastructure provision, the AU has established a flagship programme called the Programme for Infrastructure Development in Africa (PIDA). Africa needs to invest US$ 118 billion yearly over the next few years to address the continent’s infrastructure needs and keep pace with economic growth.
Power is by far Africa's largest infrastructure challenge with 30 countries facing regular power outages and many paying high premiums for emergency power. It should be noted that the continent has 1/3 of the Global Energy potential and this suggests that this challenge can be tackled.
It has become clear that for Africa to increase the rate of infrastructure delivery, a greater focus has to be placed on project preparation and development as well as specialized financial tools to address specific socio-economic development needs and market challenges. In this context, and in collaboration with the African Development Bank, a new infrastructure delivery vehicle called Africa 50 Fund has been established and will be launched in January 2014, in Addis Ababa, Ethiopia.
Africa 50 Fund aims at mobilizing private equity fund to accelerate infrastructure delivery in Africa. It focuses on high impact national and regional projects in energy, transport, ICT and water sector. It will be structured as a development-oriented, yet commercially operated entity. Its initial objective is to shorten the time between project conception and financial close. As a commercially operated financial institution, Africa 50 Fund will preserve and grow its capital base, as well as provide high returns to its shareholders. It will have three broad groups of investors, namely, African countries, the African Development Bank and other major development financial and institutional investors such as sovereign wealth and pension funds.
With respect to ICT, the continent has made progress although challenges remain. Africa is faced with inadequate broadband network development, weak inter-state broadband connectivity and Internet Networks and the absence of Internet Exchange Point (IXP). Access to several types of digital content is, therefore, a prerequisite for building an African information society. Africa’s telecommunications penetration rate stands at 3 percent compared to an average of 40 percent for other geographical zones.
Africa’s needs in the ICT sector exceed US$9 billion. This, therefore, provides an investment opportunity which could be exploited by the Mexican private sector. Specific areas of investment include, among others, the establishment of specialized broadband networks, development of inter-continental connectivity, upgrading of national ICT infrastructure, establishment of Internet Exchange Point Network, and establishment of data centres and building Integrated Fibre Optics in all road and energy transmission projects, as well as, fibre optic access to at least two different submarine cables.
Access to energy is critical for the continent’s growth and development. In this regard, the continent’s energy needs, amongst others, include: interconnection of regional power pools into a continental network, integrated development of major hydropower potential, development of Trans-Saharan Gas Pipeline as well as the operationalization of Regional Gas Pipelines and petroleum products pipelines; and the establishment of an African Electrification Fund. Enormous potential also exists for the development of renewable and clean energy such as geothermal, wind and solar energy. With special reference to geothermal energy, efforts are underway to develop geothermal facilities in eleven countries on the continent.
Africa is endowed with huge natural resources such as minerals, oil and other resources which are being exported in raw form and thus generating little benefit to the continent and hence resulting in jobless growth. The continent is home to 12% of the world’s oil reserves, 50% of its gold and 90% of chromium and platinum group metals, 20% of the world’s cooper, 60% of the world’s uncultivated arable lands and has significant deposits of bauxite and other raw materials. In total, Africa is blessed with more than 30% of global natural resources share.
The African Union has recently increased efforts to exploit these resources for the benefit of the continent. Many mining industries have been established or revived. Exploitation of these natural resources has been responsible for the transformation that the continent is experiencing today. An African Mining Vision has been developed to guide mining operations on the continent. Efforts have also been made to ensure sustainable utilization of natural resources. Many countries have made progress in reducing biodiversity losses and 27 countries have registered improvements in protecting terrestrial and marine ecosystems. This presents tremendous opportunities for investment on the continent. Our desire is to have the continent process the oil into petroleum and chemical products, so as to ensure value addition and best revenue.
It is acknowledged that the quality, quantity and availability of freshwater impacts on the continent’s social and ecological well-being. Despite huge water resources in the form of large rivers and lakes, e.g. Congo, Nile, Zambezi and Niger rivers, and Lake Victoria and Tanganyika, Africa is the second driest continent after Australia. The continent has about 9 percent of global freshwater resources despite holding 15 percent of global population. Africa’s fast growing economy, urbanization and expanding population, as well as the uneven distribution of water resource makes water scarcity a major constraint for development.
Second, an increasing number of rivers and fresh water lakes are drying up primarily due to climate change (particularly recurrent drought and temperature rise) and siltation caused by severe soil erosion. Third, the high population growth and shifting human settlements induced by war and political instability, extreme weather events, etc. have placed strain on existing water resources. In a nutshell, scarcity of water severely constrains food production, ecosystem maintenance, access to water for drinking and domestic use, and for development.
Ground water is equally important to the African population. It is estimated that more than 75 percent of the African population uses ground water as its main source of drinking water. Presently, Africa’s water sector faces number of problems, including: Multiplicity of trans-boundary water basins; high spatial and temporal variability of rainfall; growing water scarcity; inadequate data and human capacity; and depletion of water resources through human action. To this end, the African Union, in collaboration with UNECA and AfDB, has launched “Africa Water Vision 2025” which aims to create “An Africa where there is an equitable and sustainable use and management of water resources for poverty eradication, socio-economic development, regional cooperation and the environment.”
Oceans, Seas and Coasts
Africa has a total length of over 26,000 nautical miles coastline across the Atlantic and Indian Oceans, the Mediterranean and Red Seas, including its islands. Over thirty-eight (38) African countries are either coastal or island states. African-owned ships account for about 1.2% of world shipping by number and about 0.9% by gross tonnage, African ports handle only 6% of worldwide water borne cargo traffic and approximately 3% of the worldwide container traffic.
Africa’s coastal zone is known for its rich biodiversity including fisheries, grass beds and wetlands, which are vital sources of livelihoods to many Africans. If properly managed it will generate valuable sources of export earnings e.g. tourism and provide ecosystem functions and services. Considerable oil reserves and gas have also been discovered offshore, while the coastal sand dunes and seabed sediments along the Atlantic shores contain commercially valuable alluvial diamonds.
However, Africa’s inland waters, oceans and seas are under serious threat arising from: dumping of toxic waste; illegal trafficking; oil spill; degradation of the marine environment; loss of biodiversity; illegal, unreported, unregulated and indiscriminate fishing; aggravated effects of climate change. And to tackle these problems, the AU Commission has developed the 2050 Maritime Strategy that is aimed at fostering more wealth creation from Africa’s oceans, seas and inland water ways.
The demographic size of Africa in the world has grown from 9 per cent in 1960 to 15 per cent in 2010. By 2050, Africa’s share of global population will leap to 23 per cent and this will be considerably larger than either China or India. The continent’s population will grow by 1 per cent annually, well above the rate of other regions in the World. Africa has the fastest growing and most youthful population in the world. There are 200 million Africans aged between 15 and 24 years constituting 20 % of the continent’s population.
Furthermore, 60% of the continent’s 1.03 billion population is under the age of 35. This is a huge resource which if adequately skilled and capacitated could catapult Africa to become a global centre for manufacturing, ICT and service industries. The youth provide Africa with a demographic dividend which must be exploited. The youth bulge will result in an increase in size of the labour force, a decrease in dependency ratios, increased national savings and acceleration of urbanization. To this extent the continent requires support from countries like Mexico to engage in capacity building programmes to train these youths.
A growing middle class due to rapid urbanization can create a further impetus for growth and transformation; 34 percent of the continent is middle class providing a large consumer market of at least 355 million people. This dramatic growth will considerably increase Africa’s importance in the world as a place of opportunities, a growth pole, and an investment destination.
Youth unemployment across the continent is twice to thrice higher than unemployment among adult workers and the majority of poor people (72%) are young people between the age of 15-24. The continent, therefore, needs to create 10 million jobs per year to be able to cope with youth unemployment. This cannot be achieved with commodity exports alone but with emphasis on transformation through manufacturing and industrialization.
Urbanization in Africa is also on the increase and is creating a growing middle class. Currently, 40 percent of Africans live in cities but this is projected to increase to 60 percent in the next decade. We estimate that in the next ten years, the number of people with discretionary income (i.e. income in excess of food requirements) will rise by 50 percent reaching 128 million, hence an increased spending power.
The increase in urbanization coupled with the increasing demographics will translate to increased consumer demand, thereby catalyzing industrial development for the continent’s growth and thus offering investment opportunities for the private sector, including the Mexican private sector. A growing labour force estimated at 1.1billion by 2040 is poised to overtake both China and India, and possess one of the world’s largest and youngest working populations. The above demographic dividend could, if not coupled with job creation, lead to social unrest on the continent and hence the need for skills and vocational training.
Africa has made substantial progress in many aspects of human development. Today, its people are healthier, live longer and are more educated and have better access to various goods and services. Some African countries have also been among the top ten HDI movers between 2000-2010 (Rwanda, Sierra Leone, Mali, Mozambique, Burundi and Niger). Africa continues to make good progress in improving access to education and in promoting girls education, with performance closely matching that of India.
Now the task is to improve on tertiary education as a prerequisite for technological advancement and innovation. In this regard, the AU has established the Pan African University (PAU). The University will comprise five campuses spread geographically on the continent. Four of these campuses have opened. The continent will, therefore, require technical and financial support to ensure successful implementation of the PAU programmes. This should could alongside with E-education aiming at achieving an unprecedented skills revolution in Africa.
Despite these developments the continent continues to face severe challenges on the health front.
The effect of climate change on Africa’s development cannot be overemphasized. Adverse climatic trends in Africa compound resource degradation, resulting in loss of decades of hard-won development gains with increases in floods, loss of biodiversity, desertification, water scarcity, droughts and other effects. Africa is increasingly paying attention to the environment and Climate Change and its attendant effects. The continent has, in this regard, started to take measures aimed at protecting the environment and mitigating the efforts of climate change. The overall assessment of Africa's response to its environmental challenge shows some progress. We, therefore, wish to take advantage of new opportunities in the post Rio+20 context and the creation of new financing mechanisms (e.g. Green Climate Fund) to address sustainable development.
Gender and Women Empowerment
Women represent more than half of the population in Africa and they give birth to the rest of the rest. That is why they need to be paid attention to. Over the past decades, the AU has made tremendous strides with regard to gender and women empowerment. The representation of women in decision making positions has increased. In 2011, the proportion of seats held by women in national parliaments grew and was surpassed only by the developed countries and Latin America.
The legal frameworks supporting women endeavours have been developed; seven countries (Rwanda, South Africa, Mozambique, Angola, Tanzania, Burundi and Uganda) have achieved the 30 % target of women parliamentarians and three other countries are close to reaching the target (Ethiopia, Tunisia and Sudan). Africa, as well as regional bodies, have placed emphasis on gender equality and women’s economic empowerment through various legal instruments such as:(i) The AU Constitutive Act; (ii) The AU Gender Policy; (iii) The African Women’s Decade; (iv) The Fund for African women; and (v) The Solemn Declaration. These are all encouraging developments for the continent.
However, challenges remain; women’s employment outside of agriculture is low when compared to other regions. In 2009, Africa’s score stood at 32.6% compared to 43% for Latin America & the Caribbean and 41.7 % for East Asia. Majority of women employed outside agriculture are found in the informal sector which is characterized by low earnings, lack of social protection and vulnerability to economic downturn and other factors.
Africa’s agriculture sector has been critical in generating the growth that has thus far been experienced on the continent. Agriculture has been responsible for job creation, foreign exchange generation and food security and poverty eradication. In Africa, the agricultural sector employs 70% of the labour force, provides 50% of exports and 30% of GDP. Africa has 60% of the world’s cultivable land, as early indicated. These potentials should be exploited to meet Africa’s need for sufficient and quality food. Over the last decade, the continent has begun to expand areas under cultivation. The continent is also implementing the Comprehensive African Agricultural Development Programme (CAADP) whose aim is to improve agricultural production on the continent.
Investment and Partnership Opportunities
Africa offers numerous investment opportunities in many sectors such as manufacturing, Information and Communication Technology, agriculture, renewable and clean energy, cultural industry, tourism and many more. Furthermore it offers opportunities for partnering in addressing global issues such as climate change, peace and security, transnational crimes, but also in promoting human development and capacity building through education, vocational training, healthcare, etc. I, therefore, wish to take this opportunity to invite the Mexican private sector to visit the continent so as to assess the investment opportunities and to also call the government for developing a partnership framework in areas of its interests and in line with the African priorities.
THE AFRICAN UNION AGENDA 2063
The continent has embarked on the preparation of a fifty year plan for accelerated socio-economic development and integration, taking into account recent progress in technological transformation and other developments. The overall objective is to make Africa a prosperous, peaceful, and united continent that assumes its rightful place in the global community of nations. The plan is titled, African Union Agenda 2063: A Shared Strategic Framework for Inclusive Growth and Sustainable Development.
The objective of the African Union Agenda 2063 is to chart a development trajectory for Africa for the next 50 years. We want to determine the type of Africa that we want. The formulation process of the Agenda is being led by the African Union Commission under the leadership of the Chairperson of the AUC H.E Dr. Nkosazana Dlamini Zuma, working closely with the New Partnership for Africa’s Development (NEPAD) Agency and supported by the United Nations Economic Commission for Africa (UNECA) and the African Development Bank (AfDB). The African Union Agenda 2063 will build on previous continental wide long-term development and regional integration frameworks, such as the Lagos Plan of Action, the Abuja Treaty and the NEPAD.
Agenda 2063 is also being developed at a time when the continent is celebrating 50 years of the establishment of the OAU/AU. This will enable us to learn lessons of the past and look into the next 50 years and rekindle the spirit of Pan Africanism that existed during the struggle for decolonization and harness it for social, economic and technological transformation.
African Heads of State have committed themselves to the development of the agenda through the adoption of their Solemn Declaration during the 50th Anniversary celebrations on 25th May, 2013. In the Declaration, they rededicated themselves to the continent’s development and transformation in many areas, including science and technology and pushing for Africa’s place in the world. They pledged to advance this through, inter alia,
• Enhancing the African Renaissance;
• Integrating African economies through expanding infrastructure, trade and finance;
• Transforming the continent’s social and economic landscape to ensure that Africa plays a dynamic and sustained role in the global arena;
• Advancement of international cooperation.
The vision for the African Union Agenda 2063 is that of an Africa that is at peace with itself, secure, corruption free, encompassing democratic and properly governed states run by efficient and effective public service institutions. It envisions an integrated and technologically advanced continent supported by the biggest workforce in the world and highly skilled human resources.
Africa will be a continent with the necessary infrastructure to support the exploitation and beneficiation of its vast natural resources as well as management of its marine resources and adoption of climate conscious activities. It will be a continent with high life expectancy, high literacy rates and low infant mortality rates.
The process of developing the agenda will be through analytical examination of various trends, both continental and global, that could impact Africa’s development and determine appropriate response mechanisms. There will be a number of studies and development scenarios to determine the best fit for the continent, including potential policies and strategies to be pursued. Risks, threats and opportunities will also be outlined. Drivers of change will also be identified as areas of focus for the continent’s transformation. The Agenda will have milestones to be attained along the way to 2063 to enable us review progress. We expect to have a draft framework of the Agenda ready by the time of the January 2014 Summit of AU Heads of State and a complete plan during the course of 2014.
We have already embarked on the consultative process but more work needs to be done. This process is dictated by the necessity to mobilize all Africans by ensuring their participation in the process and by way of granting the required ownership of it for its successful implementation. We are consulting stakeholders in all Africa’s society sectors including the diaspora and to reach more people we have developed a website dedicated to Agenda 2063.
Agenda 2063 is critical to the achievement of our political objective of African renaissance. We want to regenerate our pride and dignity as a continent to significantly contribute to the progress of Universe with the efforts of our vibrant and dynamic people especially the women and the youths who will be the key drivers of our continental development. The time has come for Africa and the rest of the World for a change of paradigm. Strategically, it has become evident that the future of the World heavily depends on the future of Africa. We say it and we believe it without arrogance because it talks to reality. This is the reason why we should move from a traditional perception of the African continent to a new one looking at the vital importance of its social and economic resources for World economy. Today, when we Africans partner with the rest of the world, it is with full confidence in our own ability to determine our priorities and choices but not to be dictated, as it was the case in the past, by donor institutions or countries, under the scheme of aid mechanisms. This is also the reason why we are opened to permanent and constructive dialogue with our partners that will enable them to better know us, better understand us, in order to build effective and efficient cooperation.