The African Development Bank (AfDB) has announced its plans to up Africa's industrial Gross Domestic Product (GDP) by 130 percent by 2025 driving the continent's overall GDP from $2.3 trillion to $5.6 trillion.
The African Development Bank's headquarters in Abidjan, Côte d’Ivoire. Photo: VOA News
In AfDB's latest report entitled Industrialise Africa, the continent’s lender said of the eight African nations profiled, South Africa had the highest industrial GDP with Nigeria the lowest.
South Africa has 44.8 percent, Egypt 30.1 percent, Cote d’Ivoire 29 percent, Kenya 23.3 percent, Ghana 21 percent, Ethiopia 21 percent, Cameroon 17.9 percent and Nigeria 13.1 percent.
With this, AfDB unveiled its plans of industrialising Africa by placing a stronger focus on areas where it can best leverage its experience, capacities and its finances to support countries through six ‘Flagship Programs’, which are at the core of the Bank’s Industrialise Africa priority.
To deliver its contribution to these programs, AfDB intends to increase its level of funding over the next decade by fostering successful industrial policies, attracting and channelling funding into infrastructure and industry projects, and growing liquid and effective capital markets.
The Bank also aims to promote and drive enterprise development, promote strategic partnerships in Africa, and develop efficient industry clusters cross the continent.
In addition, AfDB hopes to help Africa move from agriculture to agro-industries, from raw natural resource exports to high-value semi-processed or processed exports and to curb high unemployment rates and lay the groundwork for greater diversification of economies.
To achieve these, there is a need for technological progress, reallocation of new investments into high-return emerging markets and offering Africa opportunities to leapfrog over its development gap.
Stakeholders working on this industrialisation agenda estimate that structural transformation would require the industrial GDP to grow by an average of 11.5% per year (corresponding to a cumulative growth of 130% by 2025), while GDP per capita growth would have to almost double to 4% per annum.
Africa can realistically achieve these objectives by increasing industrial GDP in the next 10 years from $751 billion to $1.72 trillion within the next decade as observed in the experience of other industrialising economies. This would raise continental GDP to $5.62 trillion and African GDP per capita to $3 368 by 2025.