Amidst Raging U.S-China War, Brexit, AfDB Chief Seeks Increased Inter-African Trade

Amidst the lingering trade dispute between the U.S. and China, the world’s two largest economies, now stretching into its second year with no end in sight, continuing instead to unsettle global markets and unnerved investors daily, President of the African Development Bank, Dr. Akinwunmi Adesina, on Saturday night challenged African leaders to intensify trade with each other.
As if this was not enough cause for concern, there is the uncertainty over Brexit (Britain’s planned exit from the European Union, now set for October 31), which poses risks to the continent’s economic prospects, Reuters quoted the head of the African Development Bank (AfDB) as saying. Brexit is continuing, even without a transition deal, which economists fear could severely disrupt trade flows.
In a chat with Reuters on the sidelines of the Southern African Development Community meeting in Dar es Salaam, Tanzania, Adesina also noted “the recent challenges between Pakistan and India that have flared off there… All these things can combine to slow global growth, with implications for African countries.”
As a way out, he urged leaders of African countries to add value to their agricultural produce, thereby cushioning the impact of external shocks occasioned by these risks.
“I think the trade war has significantly impacted economic growth prospects in China and therefore import demand from China has fallen significantly and so the demand for products and raw materials from Africa will only fall even further,” he said.
Even more significant for him is the fact that “China’s own outward-bound investments on the continent” could also affect official development assistance.
Adesina, however, believes the African Continental Free Trade Area, launched last month, could help speed up economic growth and development, African nations, he stressed, however, needs to remove non-tariff barriers to boost trade.
For him also, “the countries that have always been facing lower volatilities have always been the ones that do a lot more in terms of regional trade and do not rely on exports of raw materials.
“The challenges cannot be solved unless all the barriers come down. Free mobility of labour, free mobility of capital and free mobility of people.”
Meanwhile, in view of the looming risks to the continent’s economy, Adesina said the AfDB could review its 4% economic growth projection for Africa in 2019, and 4.1% in 2020 if global external shocks accelerate.
“We normally revise this depending on global external shocks that could slow down global growth and these issues are increasing by the day.
Meanwhile, Adesina, while charging Africa “not be under-ambitious,” expressed happiness that AfDB’s “$13bn investment in Southern Africa is delivering strong results.