SHARM EL-SHEIKH: “The image of Africa does not reflect the positive economic developments that have taken place . and it’s time to portray a new image and put Africa on the investment map, Egyptian Investment Minister Mahmoud Mohieldin said Monday at a COMESA conference.
During his opening remarks at the third annual COMESA Investment Forum in Sharm El-Sheikh, titled “Connecting Africa to the World, Mohieldin said the conference is meant to “boost investment ties between member countries and investment institutions worldwide, and [present] investment opportunities in development projects.
Cooperation between member states of the common market help facilitate trade and investment as well as streamline business procedures for a region with 400 million people.
Trade has exponentially increased over the past five years, and even after enduring three crises (food, fuel and financial), “Africa has proven resilient.
The focus moving forward will be on pumping money into major infrastructure projects across the region, as well as in information technology, telecom, energy, agriculture, manufacturing and finance.
Member states are already working on creating common investment area, to reap the benefits of their partnership, much like their intra-COMESA free trade agreement.
The common investment area to facilitate capital flows, Mohieldin said, “all common market areas have provisions to move capital. What’s needed to move forward with this area is the approval of six of the 19 member countries.
Sindiso Ngwenya, secretary general of COMESA, said at the opening that the FTA enacted in October 2000 has already helped trade grow from $3.2 billion in 2000 to $15.2 billion in 2008, and the aim remains for a Grand FTA, one that would span from Cairo to Cape Town.
The legal framework adopted to govern relations between member states has helped ensure non-discriminatory treatment as well as protection of investments. Cross-border investments are mostly directed to manufacturing and services sectors, as opposed to sectors like real estate and construction, where FDI usually flows.
Officials announced that a detailed report on cross-border investment will be released this coming June.
Despite the development accomplished so far, however, Mohieldin pointed out several challenges facing any kind of sustainability, namely unemployment rates in the region and a slowdown in growth figures.
“Attracting FDI remains a major challenge for the region as a whole, Ngwenya said, before pointing out that investment flows into the common market reached $450 billion, making it an attractive investment destination.
Highlighting some success stories, Mohieldin pointed to Rwanda, which came in first place as the top reformer in 2010, while Egypt maintained its place in the top 10 reformers for the fourth year while maintaining its reform program.
Talking more about Egypt at a press conference later that day, Mohieldin said growth rates are expected at more than 5 percent this fiscal year and at about 6 percent next year.
Asked about the current minimum wage debate in Egypt, Mohieldin announced that Safwat El-Sherif, head of the Shoura Council, said Monday that “the NDP will discuss how to deal with policies related to wages and ways to share some of the fruits of growth and investment.
Welshman Ncube, minister of industry and commerce of Zimbabwe and chairman of COMESA Council of Ministers, said that COMESA “creates an environment for promotion of trade and investment, designed to serve the interests of our people. The key being to establish peace, stability and security.microeconomic stability is a condition for investment and trade in the region.
He reiterated investment in infrastructure as currently the top priority for member states, saying that “without infrastructure, trade within and without COMESA region cannot be carried out efficiently.
Along with transportation, energy, technology and communication, Ncube added that investment in agriculture is equally important due to “current food security threat in the region.
“High energy costs affect business and competitiveness, so it is important to invest in energy, namely in renewable energy sources such as solar and wind, he added.