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Africa Industrialization Day: Unlocking Africa’s “value-added” industrial potential

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Africa Industrialisation Day, which falls on Friday, mobilizes the commitment of the international community to the continent’s industrialisation and gives us the opportunity to reflect on the Bank’s impact in this sector, one of its High 5 priorities. 

From oil to cocoa, cotton to vanilla, Africa is rich in naturual resources but its heavy dependence on commodity exports means it has yet to take full advantage of the added value that processing raw materials and manufacturing can bring.

The African Development Bank is working to change this by promoting successful industrial policies, attracting funding to infrastructure and industry and supporting the growth of capital markets to create quality employment that alleviates poverty.

The last decade has seen progress, with manufacturing growth in Africa outpacing the global growth rate. In 2019, Africa’s industrial GDP expanded by 17% to $731 billion (in 2010 dollars), with the value-added of manufacturing surging by 39%, according to the Bank’s 2020 Annual Development Effectiveness Review (ADER).

But Africa’s industrialisation is geographically limited, with around two-thirds of value-added manufacturing taking place in just five nations: Algeria, Egypt, Morocco, Nigeria, and South Africa.

This year, progress has been reversed by the COVID-19 pandemic, which has upended economic growth, disrupted trade and financial flows and triggered losses of millions of jobs.

The economic and social impact of the pandemic has injected more urgency into the drive to industrialise Africa, just as the African Continental Free Trade Area is set to reshape the continent into a singular market of 2.5 billion people by 2050.

As the African Development Bank joins the international community to mark Industrialization Day, some stories of women and men turning the tables on Africa’s industrialisation front merit all our attention.

PROCESSING, MANUFACTURING AND TECH

Just outside Cairo, the Egyptian Refining Company (ERC), a greenfield petroleum refinery, is one of the largest industrial units of its kind in Africa.

With nearly $222 million in funding from the Bank, the refinery converts the lowest-value fuel into 4.7 million tons of refined products and high-quality oil derivatives per year, meeting domestic consumption needs, cutting emissions from dirty fuels and reducing Egypt’s balance of payment deficit.

The huge project created more than 15,000 jobs at peak construction and 1,000 permanent local job opportunities.

“From day one they were able to see that this project, which has been 12 years in the making, was going to have a transformative effect on Egypt’s economy,” said Ahmed Heikal, chairman and founder of ERC’s parent company, Qalaa Holdings.

In 2019, 1 million people across Africa benefited from the Bank’s industrial investee projects. Turnover from Bank investments in micro, small and medium-sized enterprises (MSMEs) almost trebled, reaching $1 billion and far exceeding targets.

Some of the best opportunities for Africa’s industrialization lie in agriculture. Crucial to this sector is the Bank’s support of Special Agro-Industrial Processing Zones (SAPZs), which strengthen African countries’ ability to attract private sector investment by bringing policy, investment and infrastructure together, usually in a rural area with high agricultural output.

Take South Africa, where the Bank is supporting the development of 22 SAPZs. One of them, Bokomoso Ba Rona SAPZ, aims to rehabilitate an area and develop a post-mining economy on a 30,000-hectare site owned by mining company Sibanye-Stillwater.

“We are aiming to attract private sector investment, which will drive agro-processing and build a strong value chain,” said Noxolo Mtembu, Project Manager at the Gauteng Infrastructure Financing Agency, which is responsible for developing the SAPZ.

Africa’s emerging connectivity and a workforce increasingly familiar with the digital world and new technologies will make it possible for the continent to take advantage of the fourth industrial revolution to improve productivity, create jobs, and extend social welfare.

New industries have transformed the fabric of local economies, for example in Nabeul, in north-eastern Tunisia, once most famous as a craft and tourist centre.

Now Nabeul is becoming as well known for its high-tech industries. With financing from the Bank, the MEDIS pharmaceutical laboratory was established to produce generic medicines, creating thousands of skilled jobs and becoming one of the region’s biggest employers.

The laboratory has provided formal, secure jobs for many who otherwise would have been confined to informal work or unemployment.

“My job with MEDIS has given me freedom and dignity. I’m not asking for a handout and I’m not asking anything of anyone,” said employee Sabra Gmati.

“If MEDIS or a business like it wasn’t in Nabeul, I’d be unemployed and I would stay at home.”

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Africa Today

Joining hands to strengthen food safety knowledge in West Africa

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In the context of the Guinea-Bissau component of the European Union-funded West Africa Competitiveness Programme (WACOMP), implemented by the United Nations Industrial Development Organization (UNIDO), 30 Bissau-Guineans  received training on the Hazard Analysis and Critical Control Point System, HACCP, and on the ISO standard for Food Safety Management System, ISO 22000.

This virtual training was made available to all those participating in the WACOMP, which allowed additional 30 people to benefit from the training. The 60 participants who attended the training came from nine countries in the region: Benin, Burkina Faso, Côte d’Ivoire, The Gambia, Ghana, Guinea-Bissau, Guinea, Liberia and Togo.

In his opening remarks, Christophe Yvetot, UNIDO’s representative to Senegal, Guinea-Bissau, The Gambia, Cabo Verde and Mauritania, emphasized that the “training sessions on HACCP and ISO 22000 are crucial to provide capacity-building in the fields of food safety assurance and management for people responsible for performing conformity assessment activities, and technicians involved in food safety and quality.”

The WACOMP Programme is funded through a €116m contribution under the 11th European Development Fund and includes one regional and 16 country components. The objective of the programme is to strengthen the competitiveness of West African countries and enhance their integration into the regional and international trading system. UNIDO has been entrusted with the implementation of the WACOMP regional component, as well as six country components, namely The Gambia, Ghana, Guinea, Guinea-Bissau and Sierra Leone, and a component of the one for Cabo Verde. With a portfolio of €29m, UNIDO is the main implementing agency of the WACOMP.

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Africa Today

Somalia recognizes decent work for women and men

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Somalia has become the second country in Africa to ratify international labour standards seeking to end violence and harassment in the world of work. 

The Somali Minister of Labour and Social Affairs, Duran Farah, presented the instrument of ratification of the Violence and Harassment Convention, 2019 (No. 190)  to ILO Director-General, Guy Ryder.

He also presented the ratification instruments of the Tripartite Consultation (International Labour Standards) Convention, 1976 (No. 144) ; the Occupational Safety and Health Convention, 1981 (No. 155) ; the Promotional Framework for Occupational Safety and Health Convention, 2006 (No. 187 ); the Migration for Employment (Revised) Convention, 1949 (No. 97) ; the Migrant Workers (Supplementary Provisions) Convention, 1975 (No. 143) ; and the Private Employment Agencies Convention, 1997 (No. 181) .

The seven Conventions are the first ratifications by Somalia since 2014 and bring to 26 the total number of Conventions Somalia has ratified.

“I welcome the deposit of these seven key ILO instruments. They mark the desire of the Somali people for peace, stability and good governance and their resilience in insisting democracy delivers on its promise” said Guy Ryder.

He highlighted the importance of continuous dialogue, patience, compromise and strong legal, political and civic institutions to nurture peace and guide democracy, as illustrated by Somalia’s ratification of Convention No. 144.
“Promoting peace, preventing conflict, enabling recovery and building resilience often start at the workplace” Guy Ryder added. “With the early ratification of Convention No. 190, Somalia recognizes the critical importance of gender equality and the empowerment of women and girls in promoting peace.”

Convention No. 190 calls on ratifying States to respect, promote and realize the right of everyone to a world of work free from violence and harassment and to this end adopt an inclusive, integrated and gender-responsive approach for the prevention and elimination of violence and harassment in the world of work.

The Somali Minister stressed the importance of the moment. “As a member state of the ILO, the Somali government is committed to enforcing the international labour organization’s Constitution and standards to promote social and economic justice and uphold internationally recognized human and labour rights. Somalia, over the years, has ratified numerous conventions essential to improving labour standards in its domestic economy, and the recently approved conventions were a Government priority crucial for the reforms, regulatory laws, policies, and frameworks in implementing the National Development Plan.”

With the support from ILO, social dialogue and tripartism have been embraced by tripartite constituents in recent years. A conducive working relationship based on consensus, confidence and trust building between the government and trade unions has enhanced social peace in Somalia and opened the door for the establishment of the first formal tripartite structure, the Somali National Tripartite Consultative Committee to deal with labour issues including policies of relevance to the post-war rehabilitation and reconstruction, including a new Labour Code, National Employment Policy, Social Protection Policy and National Development Plan, all anchored in the ILO Decent Work Agenda.

At the conclusion of the ceremony, the ILO Director-General thanked H.E. President Mohamed Abdullahi Mohamed, the Federal Government of Somalia, led by Prime Minister Mohamed Hussein Roble and Somalia’s workers and employers organizations for their “commitment to the rights of working men and women, as set out in ILO instruments.”

The seven Conventions will enter into force in Somalia on 8 March 2022.

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Africa Today

Climate change link to displacement of most vulnerable is clear

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Weather-related crises have triggered more than twice as much displacement as conflict and violence in the last decade, the UN refugee agency (UNHCR) said on Thursday.

Coinciding with Earth Day on Thursday 22 April, the UN High Commissioner for Refugees, UNHCR, published data showing how disasters linked to climate change likely worsen poverty, hunger and access to natural resources, stoking instability and violence.

“From Afghanistan to Central America, droughts, flooding, and other extreme weather events are hitting those least equipped to recover and adapt”, said the UN agency, which is calling for countries to work together to combat climate change and mitigate its impact on hundreds of millions of people.

Since 2010, weather emergencies have forced around 21.5 million people a year to move, on average.

Home countries worst hit

UNHCR said that roughly 90 per cent of refugees come from countries that are the most vulnerable and least ready to adapt to the impacts of climate change.

These countries also host around 70 per cent of people internally displaced by conflict or violence.

Citing the case of Afghanistan, UNHCR noted that it is one of the most disaster-prone countries in the world, as nearly all of its 34 provinces have been hit by at least one disaster in the past 30 years.

The country is also ranked the least peaceful globally, owing to longstanding conflict that has killed and injured thousands of people and displaced millions.

Chronic floods, droughts

Recurring floods and droughts – along with population growth – have compounded food insecurity and water scarcity and reduced the prospects of refugees and IDPs being able to return to their home areas, UNHCR said.

It pointed to indications that 16.9 million Afghans – nearly half of the country’s population – lacked enough food in the first quarter of 2021, including at least 5.5 million facing emergency levels of food deprivation.

As of mid-2020, more than 2.6 million Afghans were internally displaced and another 2.7 million were living as registered refugees in other countries, mainly Pakistan and Iran, according to UNHCR.

Mozambique is experiencing a similar confluence of conflict and multiple disasters, says the agency, with one cyclone after another battering the country’s central region while increasing violence and turmoil to the north displaces hundreds of thousands of people.

Hosts hit too

Many of the countries most exposed to the impacts of climate change are already host to large numbers of refugees and internally displaced.

In Bangladesh, more than 870,000 Rohingya refugees who fled violence in Myanmar are now exposed to increasingly frequent and intense cyclones and flooding. 

“We need to invest now in preparedness to mitigate future protection needs and prevent further climate caused displacement,” said UN High Commissioner for Refugees Filippo Grandi, earlier this year.

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