Why ‘Industrialisation is required for Intra-African free trade to flourish’
WHAT IS INDUSTRIALISATION?
Industrialization is the process by which the economy of a nation is transformed from a primarily agricultural one to one based on the manufacturing of goods. When an economy is being industrialized, individual manual labor is often replaced by mechanized mass production, and artisans are substituted by assembly lines.
FEATURES OF INDUSTRIALISATION
What characterizes Industrialisation is that there is economic growth, there is an efficient division of labor, and the use of technology in solving problems rather than depending on conditions beyond human control.
AFCFTA
The African Continental Free Tree Area has come into full force and covers the trade of goods and services investment, intellectual property rights, and competition policy.
The main purpose of the free trade area was created was to boost trade in Africa.
One way by which intra-trade can flourish in Africa is by seizing the opportunities in manufacturing and Industrialization.
The development of manufacturing is essential if African countries will benefit from industrialization if they are to increase the production of value-added products, expand exports of these products, and reduce their trade imbalances. This will improve the diversification of the economy as it will speed structural transformation.
In developing productive capacity, there is a need for both massive and new investments, and industrial ecosystem that is supportive, and the acquisition of skills in a competitive environment.
Currently, in Asia, there has been a decrease in the trend of labor productivity, and this must be reversed, as the productivity gains will be shaped by the competitiveness of African economies.
BENEFITS TO BE DERIVED FROM INDUSTRIALISATION IN AFRICA’S INTRA-FREE TRADE.
- To begin with, Through industrialization, there will be the alleviation of poverty.
- Also, the sturdy manufacturing industry will provide well-paid jobs for low-skilled workers reducing the unemployment rate on the continent.
- Additionally, the household income of many will increase.
- Moreover, the economies of African countries will be stabilized against any external shocks.
- Last but not least, industrialization will contribute to innovation and diversification.
EFFORTS BY AFRICAN ECONOMIES TOWARDS A GLOBALLY COMPETITIVE INDUSTRIALISATION
In countries like Cameroon, Egypt, Kenya, Morocco, Nigeria, Senegal, and South Africa, the major contributor to growth in business-to-business spending. Thus, these countries can take advantage of this opportunity.
In Morocco, there has been a shift within the manufacturing industry towards the assembling of automobiles. Zambia has also eliminated the payment of VAT and has deferred corporate tax.
CONCLUSION
The African continent is blessed with the required resources to turn the economy from a primarily agricultural one to a successful manufacturing powerhouse.
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