The African Union (AU) has projected economic growth to slow to about four per cent this year, and part of 2016 because of the fall in commodity prices.
Mrs Fatima Haram Acyl, AU Commissioner for Trade and Industry, said economic growth would slow down to about four per cent, from over five per cent that Africa had sustainably achieved in the past two or so decades.
Mrs Acyl, speaking in Accra, at the first ECOWAS Mining and Petroleum Forum and Exhibition (ECOMOF) said about 48 African countries were vulnerable and would be affected by the slump in commodity prices.
A World Bank report, ‘Africa’s Pulse,’ estimates the initial terms-of-trade deterioration of 18.3 per cent for Sub-Saharan Africa and declines of about 40 per cent for the oil-exporting countries and 0.6 per cent for agriculture exporting commodities, while metals and minerals exporting countries will experience a modest gain of just 1.2 per cent.
She said the report projected that 14 countries would be faced with terms-of-trade decline greater than 10 per cent while 22 countries would suffer terms-of-trade fall of less than 10 per cent.
She noted that in the past, the falling commodity prices and the international poor terms-of-trade would have meant no options for Africa.
“However, this time around, the picture is different because the down turn offers great opportunities to Africa. The same opportunities also help the rest of the world that is working with Africa to overcome the consequences of the down turn,” Mrs Acyl pointed out.
Mrs Acyl said Africans were determined to strengthen their regional integration and cooperation, trade among themselves and with the rest of the world, but this time round in value added and manufactured commodities, as opposed to raw commodities.
“This indeed means Africa is committed to accelerate its industrialization to boost its intra-African trade from the current 12 per cent to at least 22 per cent by 2025,” she said.
She said through Agenda 2063, African leaders have set various targets, including the creation of a Continental Free Trade Area by 2017, Sustainable Industrial Zones and Information Technology and Communication Hubs for Value Addition.
There are also plans to set up Commodity Exchanges, introduce High Speed Trains and other infrastructural projects in transport and energy, to link these industrial and manufacturing hubs.
“We are in the process of mapping all the resources on the continent both on land and in the deep waters of oceans, to establish a geological knowledge and information that can help our Member States in negotiating fair contracts.
“Africa is the only continent that still offers huge opportunities for all. It is through responsible investment that we can create decent jobs and wealth for the huge youth population of Africa,” she said.
Mr Johan Ferreira, President of the Ghana Chamber of Mines, said governance was essential for leveraging the natural resources for Africa’s sustainable development.
He urged African governments to provide the enabling environment for the extractive industry to operate.
Mr Alexander Kofi-Mensah Mould, Acting Chief Executive of the Ghana National Petroleum Corporation, urged West African countries to focus on economic diversification, which would ensure real growth in other non-oil sectors.
Mr Kadré Désiré Ouedraogo, President of the ECOWAS Commission, said it would continue to be guided by its core operative principles that border on co-operation, harmonization and integration.
The two-day ECOMOF 2015 is on the theme: “Valourizing West Africa’s Mineral and Petroleum Resource through Regional Cooperation.”