President Paul Kagame says Africa is missing an opportunity to utilize intra-African trade and raise enough investment to replace foreign aid.
“We are missing an opportunity in our own countries; intra-African investments are key and it is not happening the way it should,” he said.
The Rwandan leader was at a panel discussing Africa’s future during the Milken Institute Global conference in Los Angeles, California on April 28.
The panel included; Tony Blair, Former UK Prime Minister, Scott Minerd, Chairman of Investments and Global Chief Investment Officer for Guggenheim Partners and Patrice Motsepe, Founder and Executive Chairman, African Rainbow Minerals.
Minerd said: “Africa doesn’t carry the burden of the old infrastructure of the developed world, so it can leapfrog with innovative solutions.”
Kagame noted that Africa has paid a big price for failure to engage in intra-African trade and that investments will be secure if African countries work together on security. “This is happening in East Africa,” he said.
Africa, with 1.2 billion people, is a mineral rich continent, but is engulfed in conflicts and unfriendly policies that have impeded boosting economies.
It has the Economic Community of West African States, the Common Market for East and Southern Africa and the East African Community, but have not opened doors for trade between each other.
Apart from EAC where its citizens freely travel without a passport and need no work permits, labour movement in Africa remains a daunting task.
The African Development Bank says intra-African trade was less than 5% and the continent spent over $35 billion on food imports in 2014 despite having massive arable land.
Kagame cited several factors that have created the gap including the key factor-insecurity followed by gender inequality, bad governance etc. He emphasized that if Africa increases trade within, “it has the capacity of attracting more foreign direct investment.”
He said economies of East African Community, comprised of Kenya, Uganda, Tanzania, Burundi and Rwanda have increased greatly due to regional integration and efforts to ensure political stability and security.
Cooperation among EAC member states is yielding results.
Rwanda’s exports to East Africa increased to $131.56 million out of total $573 million in 2014 from $122.94 million in 2013, according to the central bank.