Leaders of multinational enterprises and economists Wednesday urged African countries to "look east" and learn experience from emerging economic giants of China and India.
"The hunger of China and India for commodities is an opportunity for Africa to create significant wealth and global champions in that sector," Jim Goodnight, one of the co-chair persons of the World Economic Forum African Summit that began in Cape Town on Wednesday, told Xinhua.
"However, the risk is that African countries that are currently benefiting from the demand will not invest current profits in long- term priorities--education, health care, infrastructure. Commodity prices will eventually go down and Africa needs to prepare effectively for the downturn," said Goodnight, who is also the CEO of SAS, a world's leading business-consultation-software supplier based in the United States.
Africa is enjoying a record economic growth in 30 years with its 2005 growth rate registered at 5.8 percent. The latest data released by the International Monetary Found (IMF) in its World Economic Outlook predicted that last year's strong growth is to be repeated this year at a prospected 5.5 percent.
Experts said China and India, having gone through a long journey from poverty to boom in the past 30 years, are in many respects role models for Africa whose 700 million people are trying to review its growth path and find out a sustainable developing pattern.
To echo the trends, a series of special sessions titled as " Doing Business in China," "China and Africa in 2025: Making Strategic Choices" and the like have been set to take place during the summit.
"The responsibility and opportunity that a conference like this provides is to showcase those economies and parts of the continent that are doing well and doing great things and also acknowledge that there are parts with challenges." Said Maria Ramos, Group Chief Executive with Transnet, who is also co-chairing the summit.
Steve Booysen, Group Chief Executive of Absa, one of Africa's biggest banks, also expressed the same opinion in a previous interview.
"China and India are growth and development role models, because they have achieved excellent, consistent economic growth, they are putting an enormous effort into developing their human resources and technology so that these become productive assets and they are both investing enormously in infrastructure. We face many of the same challenges and can therefore learn from them, " said Booysen.
"China and India also present an enormous market opportunity. Both of these countries need our resources, they are big investors in gold and other precious minerals and they have over 2 billion consumers between them," Booysen added.
African exports to China totaled US$1.7 billion in 2005, an eight-fold increase in the last decade. Experts said African businesses should make an effort to become preferred suppliers to these markets, so that Africa can supply raw material, and value added products as well.
"Imagine, for instance, the impact on the South African viniculture industry if Cape wine and brandy products can become the leading wine and brandy brands in India and China," said Booysen.
(Xinhua News Agency June 1, 2006)