Prioritising commercial and investment relations between Africa and higher-income countries is the best avenue for bringing about sustainable development, page President Paul Kagame has revealed.
The Rwandan leader made the remarks on June 13 while addressing several other African Heads of State at the G20 Africa Partnership conference in Berlin, Germany convened under the theme “Investing in a Common Future”.
Observing that traditional aid, while useful, was never going to be enough to bring about sustainable development, President Kagame said the partners were at the limit of what government-to-government action alone could achieve.
“The time is right to put commercial and investment relations at the centre of our joint agenda. A broader relationship is therefore necessary between Africa and higher-income countries, together with the international financial institutions that serve us all.”
Donor funds account for about 20 percent of Rwanda’s budget while foreign loans also constitute 13 percent, meaning approximately 33 percent of the country’s annual expenditure is funded externally.
Additionally, recurrent uncertainties in the global economy lead to consistent fluctuations in donor funds and tax receipts, stalling development programmes.
President Kagame presented that among the ways that African governments can improve the operating conditions for the private sector and their role in development is by making it easy to do business and shunning bureaucratic red tape that only serves the interests of a few and contributes to poverty.
“Wherever it is found, even outside of government, bureaucratic red tape serves special interests, not the public interest. It contributes to poverty and slows progress generally. Therefore eliminating such barriers is a very important first step,” said Kagame.
The President said that Rwanda had attracted the attention of investors by easing the business operating environment, in addition to rising in the World Bank’s Doing Business rankings.
“Administrative reform on its own is not enough, and so the second job for the governments is to reduce the cost of enterprise by building critical infrastructure through public-private partnership,” he observed, adding, “Indeed, some of the most attractive and impactful investment opportunities are in the roads, bridges, ports, railways, power plants, water and sanitation infrastructure, and communications networks that Africa needs so urgently to drive its growth.”
President Kagame observed that through the integration of the global economy, business conditions had gotten better, contracts were respected and the continent was increasingly stable and that governance, transport, and internet connectivity had all significantly improved in recent years.
“Companies are doing well in Africa, and not only in extractive industries. Opportunities in retail, construction, agribusiness, and financial services are very strong. Africa’s population will continue to expand, including the middle class, and our cities are some of the fastest-growing urban areas in the world.”
President Kagame challenged the G20 leaders to go beyond discussions and build partnerships that would guarantee a win-win scenario for Europe and Africa.
“We have been here before. Let’s challenge ourselves to do things differently and more quickly this time. Endless rounds of discussion won’t solve our problems, or yours. The sooner we arrive at clarity about the way forward, the better. Count on us to continue doing our part, in partnership with others.”
The conference brought together selected African Heads of State from Rwanda, Ghana, Tunisia, Guinea, Senegal, Niger, Mali, and Ivory Coast and delegates from across Africa, and the group of 20 (G20) leading economies.