Accra, July 8, GNA - Professor Joseph Stiglitz, a Noble Prize Laureate in Economics, on Tuesday emphasized the need for African countries to focus on productivity, invest in higher education and infrastructural development to enable them to transform their economies and speed up the process of development. Delivering a lecture on the topic: "Transforming African Economies: Lessons from Asia," Prof Stiglitz said countries must focus more on the objective of
development by ensuring that education help people to fulfil their potentials while
the gains of growth were equitably shared among the population. The Institute of Democratic Governance and the African Centre for Economic
Transformation (ACET), civil society organisations, organized the lecture to
provoke discussion on how to enhance the continent's economic development. In a discussion spanning issues and challenges associated with globalization in
today's rapidly changing world, Prof Stiglitz asked governments to play the lead
role by building effective systems and regulations that would promote the rapid
growth of the economies. He said all developing countries were in the process of transformation of their
economies and this would require special attention and a concrete policy shift on
how agriculture had been done in the past as well as a change in economic structure
and management. He said although Africa countries had shown remarkable growth in the last few
years, the challenge of rising food and oil prices was threatening to undermine these
growth prospects. This, he said, would make the sustenance of current growth prospects difficult.
The economies of most African countries rely heavily on few primary commodities whose prices fluctuate widely in the world market.
Besides, these economies also suffer from inadequate investment in the manufacturing sector while Foreign Direct Investment inflows are directed to the extractive industries.
Prof Stiglitz said all these must be reversed to ensure a structural transformation of the economies to accelerate the pace of growth.
He said the state must play a catalytic role since 'development does not only happen by itself.'
In addition, countries must use their local experts who would nurture home-grown policies and strategies in dealing with the future economic direction of the continent to give meaning to African ownership instead of allowing 'outsiders' with little knowledge of the situation to dictate the pace and shape their destiny.
Touching on the Doha Round of talks in the World Trade Organization, Prof Stiglitz said developing countries were likely to lose out on any agreement reached because what it sought to be corrected when the Round was launched is still being forced on the developing countries.
One of these issues is the elimination of subsidies that developed countries continue to pay to their farmers, thereby putting the developing countries at a disadvantage.
"To me the so-called Doha development Round is like pouring an old wine into a new bottle. In this circumstance no agreement is better than a bad agreement," he
said at a Luncheon with executives of the Association of Ghana Industries. Prof Stiglitz said the developed countries, having realized the difficulty in
concluding the round, had embarked on a crusade of signing Free Trade Deals with
various regional blocs to enable them have the same access they have always had. He urged Africa trade ministers to remain wary of free trade agreements, adding
that "it is actually a managed agreement." In this direction it is important to negotiate the agreements and reshape where
necessary to meet the socio-economic development aspirations of the region. There is also the need to act collectively as a bloc while the political elites must be
prepared to take the tough decisions on such agreements when necessary. On the industrial sector, Prof Stiglitz said government must play active role in
accelerating the pace of industrial expansion through the pursuit of macro-economic
policies that would insulate industries to enable them to grow. On the oil discovery in Ghana, Prof Stiglitz called for transparency, openness and
a strong system to track the revenues as well as the building of a national consensus
as to how the funds generated would be equitably distributed to ensure growth.
Prof Stiglitz arrived in Accra for an official engagement at the invitation of the African Centre for Economic Transformation (ACET). Dr K.Y. Amoako, President of ACET, said credible, committed and inspired leadership, who has a long-term view of economic growth and development, develop credible policies and strategies and effectively implement them, was required if the continent was to be transformed.
