Dr. Mahamudu Bawumia, Vice President of Ghana, on January 29 disclosed at a high-level conference attended by African ministers, diplomats, policymakers, and business executives in Accra that Africa requires an annual investment of between $130 billion and $170 billion to achieve sustainable growth of 5% to help plug the infrastructural gap in Africa.
“This presents immense opportunities for the private sector investment,” Bawumia noted.
He emphasized that while the AfCFTA has laid the foundation for Africa’s transformation, its full potential can only be realized through decisive action by African stakeholders, focusing on the key areas he proposed.
Bawumia also emphasized that Africa should take deliberate steps to overcome the infrastructure deficit to effectively implement the AfCFTA, which will come at an estimated cost of at least $130 billion annually.
In his presentation, the Vice President highlighted three key areas for Africa to prioritize to achieve its desired transformation.
The first area is a smart investment in critical infrastructure, which he views as crucial for the continent to trade and grow its way out of poverty and underdevelopment. This involves investing in physical infrastructure like roads, rail, and energy; digital infrastructure like data centers to support digital transformation; and financial infrastructure to integrate financial markets.
The second area is unleashing productive capacities across the African continent. To do this, Mr. Bawumia suggests creating platforms for knowledge brokerage and access to information, developing Africa into a manufacturing zone, and allowing the 445 million small businesses on the continent to participate in value chains.
The third area is the mobilization of finance and investments. Bawumia says that attracting private sector involvement through public-private partnerships is crucial for delivering infrastructure projects and calls for innovative policies to allocate resources effectively and for better coordination among African stakeholders and international partners.
He is optimistic that if these proposals are adopted and implemented, the AfCFTA will provide greater opportunities for Africa to reverse its economic challenges.
“As growing economies, we often struggle to attract much-needed investments. However, with the collaborated strength from all fifty-five (55) member states, with a population of 1.2 billion, the majority of whom are young, and a GDP of US$ 2.5 trillion, making Africa the eighth (8th) largest economy in the world, this positions Africa as an attractive investment destination. “With the right investment, we will be able to sustain economic growth and create the job opportunities that the continent desperately needs,” he said, adding that the AfCFTA is a significant turning point, and once fully implemented, it can increase intra-African trade by $35 billion and decrease external imports by $10 billion annually.