Nigeria’s Vice President, Senator Kassim Shettima, has called on African leaders to work to expand the continent’s $3.1 trillion gross domestic product (GDP), which accounts for just 3 percent of the world’s total GDP.
Sen. Shettima, who made the statement at the Africa-wide economic plenary held on the sidelines of the World Economic Forum (WEF) in Davos, Switzerland, said African trade still accounts for about 3 percent of global trade.
The Vice President also stated that the current need to increase intra-African trade by 15% and the potential to increase the continent’s GDP are some of the compelling reasons why the African Continental Free Trade Area (AfCFTA) agreement is not recognized.
He emphasized that:”African trade still accounts for only 3% of world trade. These indices need to reverse and increase. I believe this is one of the key concerns in Africa’s economies of scale.”
“It is important to remember that African economies remain essentially primary and simple economies and are highly dependent on the world economy. Most countries on our continent have access to raw materials, minerals,” The vice president said in a statement issued by Spokesperson Stanley Nkwocha
“African economies are increasing the value of primary products, such as cash crops, and moving towards the production of secondary and tertiary products. I understand that we have to start doing that.”
He encouraged the leaders to act faster and more decisively to catch up with the rest of the world in eradicating the continent’s dire poverty, and a “world” break in an era where artificial intelligence and machine learning are redefining human interaction and existence.
He continued: “Scale and scalability are important in negotiations, and African countries need more productivity to improve the living standards of their people. More food, more affordable housing, an emerging textile sector to clothe the population, more energy/power, more social services for the poor and disempowered.
“By sharing our resources as African countries, we can provide many of the essential goods for our people. It can reduce the cost of production.”
“We must achieve higher levels of efficiency in both the public and private sectors.”
The Vice President says the African Trade Agreement will increase continental GDP by $450 billion over next 10 years However, he said it was urgent to achieve an African trade agreement. As the AfCFTA demonstrates, Africa’s economies of scale are the reason for trade cooperation on the continent.
He praised the idea of economies of scale for Africa, saying it was timely given that the continent is seen as the last frontier of development and offers many opportunities.
Vice President Shettima noted that while the continent’s infrastructure deficit runs into trillions of dollars, the challenges facing Africa are not disadvantages but opportunities for engagement, productivity and profitability.
Pointing out some of the deficit, he said: “At least 51 million new homes need to be built. We need schools, stadiums, community centers, roads, rail networks, airports, water transport, technical assistance and major facilities, interventions in the energy sector, among others.”
“When viewed from space, Africa still looks like the darkest continent. This narrative can be changed through a combination of hard work and intensive cooperation between us and the international community. I would argue that the bigger challenge lies within ourselves.”
“The concept of African economies of scale is therefore a wake-up call to all of us sitting here to take a giant leap of faith and move away from the usual dirty nicknames with which we have been identified as a people and as Africans. We need to prepare a better Africa for our children and unborn children. In the information age, we can no longer hoard information or have small dreams that have no impact on the world.”
He said, “African trade is expected to increase by 52.3% by 2025. We need to raise these goals and address trillions of dollars in funding. African countries must act quickly and remove all remaining agreements and barriers to ensure free and smooth trade.”
Vice President Shettima said that to achieve the set goals, trade is incomplete, but “information sharing with private sector actors needs to be optimized and prioritized.”
“The future requires speed and unity among African countries. The philosophy of the AfCFTA must not fail and there is no room for mediocrity in today’s world,” the Vice President added.
Citing the example of European, American, and Asian trade unions, the Vice President argued that “we must continue to externalize African trade, even if we increase intra-African trade from just 7 percent ten years ago to about 15 percent.”
In his opinion, intra-European trade is about 70 percent, but African leaders need to organically strengthen the countries of the continent and solve their own problems. He urged African private companies to act proactively and take their place in the continent’s trade.
Meanwhile, Vice President Shettima on Wednesday warned foreign investors that Nigeria has the potential to leverage its enviable status as Africa’s largest economy and its deep footprint in oil, technology and creative sectors, among others. He said the country is on a trajectory that will please them.
The vice president said this on Wednesday at a forum welcoming investors to negotiations with Nigerian officials on the sidelines of the ongoing World Economic Forum in Davos, Switzerland.
Sen. Shettima said President Bola Ahmed Tinubu’s administration is “engaging the entire ecosystem of investors, from private equity investors to venture capitalists, impact investors and skilled contractors around the world.
“We are committed to partnering with them to include this exploration.”
Commenting on the country’s potential as a major attraction for investors, the Vice President said: “Nigeria occupies an enviable position as having the continent’s largest economy and largest population. Nigeria is currently repositioning its economy away from oil dominance and increasing its presence in the areas of technology, arts, culture, creativity and industrialization.
“The emergence of new sectors such as the steel sector, gas sub-sector and alternative energy.”
Similarly, Vice President Shettima noted that much has been done under President Bola Ahmed Tinubu to rebuild Nigeria’s image, combat remaining regional instability and promote Nigeria to the world.
He said this at an event to celebrate Nigeria’s cultural richness and diversity during the ongoing WEF in Davos.
The Vice President said: “The strength of Nigeria lies in its diversity. We have over 300 different languages. Every culture can learn something from other cultures and also have something to teach.”