To fully harness the continent’s business and growth potential, African political and business leaders need to work together to improve the continent’s integration. The call for better integration was voiced by financial service executives attending the World Economic Forum on Africa held in Cape Town, South Africa.
Africa is bigger than the U.S., China, India, Japan and Europe combined. More than 1 billion people live on the continent and more than 2,000 languages are spoken. Several African countries have been amongst the fastest growing in the world in the past five years. Foreign direct investment onto the continent has grown and multinational companies and local businesses alike are expanding to become regional players. But doing business across borders still faces many barriers.
“We have a lot more to gain by integrating our markets,” Maria Ramos, chief executive officer of Barclays Africa Group Limited, told an audience at WEF this June.
Politicians and business leaders talk about improving cooperation between countries, but the continent still lags other regions. According to African Union statistics, intra-Africa trade amounts to just 12% of the continent’s total trade. That compares to 60% in Europe and 40% in North America.
While the East African Community has made the most advances on the continent to integrate markets and movement of people, more needs to be done to break down barriers to allow freer movement of goods, services and people across borders.
“Africa is in the top 10 growth geographies in the world,” Citi’s global head of corporate and investment banking Raymond McGuire told the event. “Capital markets could be developed if you develop a regional strategy.”
Ramos said improved integration requires leadership from both the public and private sector to sit down around the table to bring about change.
“Unless we make it easier to do, growth will be suboptimal on this continent,” Ramos said.
photo credit: http://www.weforum.org/