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Africa Is World’s Next Economic Power

President Kikwete says Africa is next world’s economic power – Africa is poised to become the world’s new economic power house for the 21st century, provided it continues to embrace the sound economic policies that engendered the progress being witnessed today, Tanzanian President Jakaya Kikwete said here Thursday, at the official opening of the 2012 Annual Meetings of the African Development Bank (AfDB). “We must strive to maintain macro-economic stability and sustain it through tackling high budget and overall external deficits,” the President suggested, calling for more efforts to lower the high inflation rates in many economies and keep it at single digit level.

In his view, regional integration is a unique vehicle that would enable Africa to build capacities for self-reliance and resilience against the uncertainties presented by the current crisis in the global economy.

There were times, he said, when African countries worry about international markets for their commodities while overlooking neighbouring outlets, adding: “This happens because our markets are not integrated.”

Commending the Bank’s support to infrastructure development across the continent, Kikwete appealed for increased resources to support regional integration endeavors.

“We need to increase connectivity in Africa to facilitate growth in intra-African trade. We need more roads, railways, ports, airports and ICT to open up and increase market access. These are heavy capital investment undertaking that many countries cannot afford on their own,” the President pointed out.

Besides regional integration, Kikwete cited opportunities for alternative markets and sources of investment from the emerging economies of Brazil, Russia, India, China and South Africa.

“In recent years, African countries have witnessed a significant increase in trade, foreign direct investment and development assistance from these countries,” he said.

For instance, he said that through such engagement, trade with China alone rose more than ten times from US$10.59 billion in 2000 to US$126.9 billion in 2010.

Within Africa, total trade among member countries of the East African Community (EAC) increased by 86 percent, from US$2.2 billion in 2005 to US$4.1 billion in 2010.

“With the current awakening and the drive to stop being perpetual exporters of primary products and become exporters of processed or semi-processed goods, things should work well for us,” Kikwete said.

On Africa’s industrialization prospects, the President noted that many countries are endowed with plenty natural resources that can be used as raw materials in local industries.

In addition, Africa could take advantage of its low labour costs to attract industries that relocate from high production cost countries.

Commending the AfDB’s dynamic role in promoting Africa’s development agenda, President Kikwete made three proposals for boosting the Bank’s new 10-year Long Term Strategy of 2013-2022: address the financing gap to advance Africa’s infrastructure; provide additional funds to implement country-led agriculture investment plans; and support for growth of manufacturing by small and medium enterprises and the private sector.

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