1. Sustainable and Inclusive Growth in Africa: Industrialization a MustBy
Humphrey P.B. Moshi
University of Dar es Salaam
Presented at a the International Conference on “Manufacturing-Led Growth for Employment Creation and Equality” May 2014, Johannesburg

2. Presentation Outline Introduction Why industrialization matters
Africa’s industrialization status
Factors undermining Africa’s
industrialization
Industrialization a must
Concluding remarks

3. Introduction
One of the most puzzling paradoxes of Africa’s growth is its failure to address poverty, unemployment, inequality, and structural transformation
But history has repeatedly shown that the single most important factor for addressing these paradoxes is through enhanced capabilities in manufacturing.

4. Why Industrialization Matters?
Industrialization is not only linked to economic growth but also plays a catalytic role in transforming the economic structure
Manufacturing accounts for the bulk of world exports(78 percent in 2010), and is less susceptible to shocks

5. Cont’d…
Manufacturing generates externalities in technology development, skill creation and learning: crucial for competitiveness
Manufacturing has a “pull effect” on other sectors of the economy
Internationalization of production has spread the benefits of manufacturing

6. Africa’s Industrialization Status
The general picture is that the contribution from industrialization has been minimal.
Trends of structural change show movement of resources from higher to lower productivity sectors (agriculture and services) rather than the opposite. Thus harming productivity in agriculture and industry.

7. Cont’d…
The state of technological development is such that SSA has the lowest share for high technology, and the highest for resource based manufacturing.
Africa’s share in global trade is also well below potential, at 3.3 percent, and its exports are dominated by resource based commodities. Likewise, intra-Africa trade remains low versus other regions (11.5 percent in 2010).

8. Factors Inhibiting Africa’s Industrialization
Neo-liberalism development paradigm under conditions of dependence
The minimalist role assigned to the state
The addiction to growth, while underplaying the paradoxes associated with it
The resistance to industrial policy which is neither tenable in economic development history nor informed by a coherent

9. Cont’d… theoretical framework
The neglect of agriculture despite its critical role in the economy (livelihoods, reduction of poverty, linkages and demand for industrial products
Other factors: political and ethnic conflicts, natural disasters, external market, shocks, poor macro-economic management,

10. Cont’d…
infrastructural gaps, etc.

11. Industrialization a Must
The MUST is informed by two arguments: One, no country or region has achieved prosperity and enhanced welfare without the development of a robust industrial sector. Two, Africa has requisite resources that can support a meaningful industrialization process

12. Cont’d…
However, putting in place an appropriate development paradigm is key to realizing the above. The starting point is to reduce financial and policy dependence.
Creation of a friendly investment climate for effective mobilization of both domestic and foreign investment
Establishment of strong linkages (consultative and collaborative) between

13. Cont’d…
the public and private sector

14. Concluding Remarks
To the extent that African leadership is currently more aware of the critical role industrialization plays in a country’s socio-economic process, it is high time it were to get down to business to address the paradoxes of Africa’s so called impressive growth.

15. Thank you for Listening