Africa must stop exporting raw materials and importing finished goods - Sir Jonah

Businessman and Executive Chairman of Jonah Capital, Sam E. Jonah, has called on African countries to reduce their dependence on other countries to process their raw materials and instead create more wealth from the continent’s natural resources.

Speaking at the Global Business Forum, he said African countries must trade more with one another, invest in local businesses and develop the capacity to process their natural resources within the continent.

He identified Africa’s low level of intra-African trade as a major challenge to the continent’s economic development.

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Intra-African trade accounts for only about 15% to 16% of the continent’s total trade, significantly lower than levels recorded in Asia and Europe.

“Consider one uncomfortable number: trade among the African countries accounts for roughly 15 to 16 percent of total trade,” he stated.

According to Sam Jonah, many African countries continue to export raw materials and import finished products made from those same resources, resulting in much of the economic value being created outside the continent.

He cited cocoa as an example, noting that Ghana and Côte d’Ivoire produce a significant share of the world’s cocoa, while much of the value from processing the commodity into chocolate is generated outside Africa.

He said the situation must change if African countries are to create more jobs, strengthen local industries and generate greater wealth from their natural resources.

Sam Jonah also called for the African Continental Free Trade Area (AfCFTA) to move beyond agreements and become a practical reality for businesses and consumers.

He said African countries need better roads, ports, electricity, border systems and common standards to make it easier and cheaper to move goods across borders.

“Agreements don't move goods. Trucks move goods. Ports move goods,” he stated.

He also warned that African businesses cannot expect consumers to buy their products simply because they are made in Africa.

According to him, local companies must produce goods that are competitive in terms of price, quality and reliability if they are to succeed in both African and international markets.

The businessman further called for African pension funds, insurance companies and other institutional investors to channel more capital into businesses and infrastructure on the continent.

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He said Africa has significant savings but often sends its capital abroad and later borrows at higher costs to finance its own development.

While acknowledging that foreign investment remains important, Sam Jonah stressed the need for African countries to develop stronger domestic sources of capital to finance businesses and infrastructure.

He said Africa’s economic future would depend on the continent’s ability to build strong businesses, increase trade among its countries and retain more of the value created from its natural resources within Africa.

DR/MA

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