The most urgent things for African Leaders to do now are economic diversification away from commodities as well as build vibrant, competitive human resources. Some countries are making effort to do something. Despite these efforts, data from international organizations such as the World Bank indicate that the regional economy is still significantly driven by commodities revenue.
However, this is not necessarily a deterrent to economic growth. For years to come, the economic outlook indicates that commodities and oil will continue to serve as the backbone of the African region’s economy and remain the mainstay of all development across countries in Africa if urgent steps are not taken. This means they must do things on the path of research and development (R & D) innovation and capacity building. They must do thing that focuses on new economic sectors to exploit the unique advantages of each country. Considered a safe haven for economic stability, these new sectors prioritize investing in human capital as the winning formula for the future economy.
Given the close connection that the countries of Africa share with commodities – one that goes beyond the economic diversification plans of these countries – the volatility of commodity prices defines growth, slow-down or decline levels in these countries. This is acknowledged in the World Bank’s Reports for some years now.
In this context, the pertinent question is – how does Africa build strong foundations for economic sustainability away from commodities fluctuations in the medium and long term? Also, how can it enhance the connection between human capital and growth in all the 54 countries?
While governments across the region have introduced reforms to improve the business environment, there has not been enough concern, with infusing the youth with confidence, skill-sets, and facilitating entrepreneurship, to help young entrepreneurs in achieving their objectives and create new investment opportunities in promising sectors.
Policy adviser must encourage Government to embark on these things. Doing so will help push Africa up in order to achieve sustainable economic growth. Of course, his belief is that African governments must continue their fiscal consolidation efforts, diversify economic activities, create jobs in the private sector specifically tailored for women and the youth, and perhaps most importantly, accelerate investment in human capital through stimulating current government strategies to improve health and education outcomes. Authorities must also develop new strategies to empower young generations with skill-sets and knowledge to fast-track the transition to a digital economy and prepare them for the future economy that will be largely based on AI, big data and innovation.
After all, nations that have significantly invested in their people by way of education, human development and youth empowerment have leapfrogged their way to advancement.
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