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Carlos Lopes: How Africa can find its place

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Carlos Lopes: How Africa can find its place

To find its place in global trade, Africa must scale up the success stories of its industry and build its value chains. Academic and former secretary general of the UN Economic Commission for Africa Carlos Lopes tells Hichem Ben Yaïche about what he considers are Africa’s priorities.

Your book “Africa in Transformation” has just been published in French. You’ve titled it “Africa Is the Future of the World”. That’s a pretty bold statement?

I am convinced, considering major demographic, technological and climatic trends, that the future of the world depends on that of Africa.

However, thinking that Africa is fundamental to the future of the world does not mean that things will be easy from an African standpoint. We are living a crisis of hyper-globalisation that is calling into question the fundamentals of the system itself. The pandemic has shown its shortcomings, in spectacular fashion.

Yet Africa remains fundamental to a comprehensive [global] solution. Given its limited options [in terms of access to capital for example], we must do our utmost to help Africa structure itself economically, socially, and politically. Africa has a major role to play [to become a global powerhouse] but with no guarantees of success: some countries operate a rent-seeking model [and don’t want change], whilst others are reform-minded. The two systems will inevitably clash.

Your book sounds like a political manifesto. All of Africa’s major issues are addressed: reforming the political system, respecting diversity, understanding the context of public policies, structural transformation through industrialisation, increasing agricultural productivity, etc.

I like to say that I am not a politician but that I love politics because it can function on so many levels. [Transformation only works] if you go into the details of this great agenda of change. These choices of direction and change are ultimately political choices.

Too often, we have looked at Africa as a ‘development’ issue, a ‘social’ sector, only associating it with the fight against poverty, drought and hunger when we should be looking at it as an economic issue, a business. One must look at and learn from what has happened, throughout history, in other parts of the world.

There is no example where agricultural productivity has increased in a systematic fashion without it being linked to an industrial policy. This debate has not yet taken place [in Africa], and in many ways it’s rejected as a viable option, even though it is known, in economic theory, that structural transformation begins a rapid increase in agricultural productivity.

The word that stands out for me from this book is “transformation”. How do we implement an action plan for the continent?

With great difficulty! This is why very few countries are achieving what I can consider to be transformation. There are three important elements to transformation: ambition, sophistication, and consistency.

Ambition is to look at and understand both the current and historical context and to be able to look ahead and define a future where Africa is changing at incredible speeds, which is already happening demographically.

When it comes to sophistication, the window of opportunities to industrialise and transform our economies is limited, so we must be selective with our priorities. This targeted approach will help identify these windows of opportunity, which thankfully do exist.

If we make the whole economy dependent on the export of cocoa, we must study the cocoa value chain, from A to Z. Then, we must understand where we have negotiating leverage, and apply it, in a field that is particularly competitive and where the bigger players have been the ones setting the rules.

It’s a common conception that Africa will industrialise with two or three industrial parks, some infrastructure and declarations of intent. That will get us nowhere. The world has 43,000 industrial parks. How can you make yourself stand out? You must be extremely precise and have a complete value chain policy, which will then drive the third factor, coherence and consistency.

Will the African Continental Free Trade Area be an accelerator for the vision you are talking about?

It will widen these windows of opportunity a little. We are expanding one of them, in the field of trade, where we face three major hurdles: value chains are globalised, intellectual property is both highly concentrated and responsible for value, and finally we have no access to the most sophisticated logistics.

The most valuable part of the finished product is its intellectual property through design, software, and associated patents. Logistics is important as it determines your competitivity from a price standpoint. And then we need to look at a productive capabilities.

Is Africa prepared to be part of this future? Without innovation, artificial intelligence and new technologies, is Africa ready to enter this innovative cycle?

We have displayed many examples of talent and quality but have yet to strike the balance that would allow us to say that Africa is prepared for innovation. In Cape Town, South Africa, where I’m currently based, the largest tech investor was created with funds from Naspers, Africa’s largest company by market capitalisation.

The company, based in Cape Town, owns 31% of Tencent, China’s largest tech company. As a result its value accounted for a quarter of the Johannesburg Stock Exchange. It has since moved [this tech part of its business] to create Prosus, which it listed in Amsterdam [in 2019], which has become the largest technology investment company in Europe.

Let me give you another example: when Jeff Bezos steps down from the executive management of Amazon he will be replaced by the person responsible for cloud computing, which was created in Cape Town and from where it continues to be managed. It is the most profitable part of Amazon. Many are surprised to learn that Amazon employs 3,000 back-up and cloud computing engineers here.

Talent and innovation exists, but we are yet to extract the full value of our innovations and our talent.

Since 2018, you have been the African Union’s special envoy to negotiate with the European Union. Is progress on the post-Cotonou agreement looking favourable to the interests of Africa?

This agreement concerns African, Caribbean and Pacific (ACP) countries and is not an agreement between the EU and the AU. I deal with relations between the EU and the whole of Africa. This agreement is not linked to a European disbursement and financing system to ACP countries and is therefore separate from the financial instrument.

What will succeed the old agreement financially speaking is rather a completely European-driven instrument which concerns all countries with which the EU has partnerships, not just Africa. The four strategic areas for Africa – peace and security, immigration, climate change and of course trade – require something else. Trade is the big one, and this is why we need to be strategic in our negotiations and protect our continental free-trade area.

This interview was originally published in French on our sister website www.magazinedelafrique.com

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