Thank you very much. In the name of God, the Most Gracious, the Most Merciful. His Excellency the President, Abdel Fattah el-Sisi, the visionary leader. Your Excellencies, the presidents of African states and governments. I would also like to thank His Excellency Obasanjo, who traveled from Kenya to here — I don't know how he got here at the age of 90. My colleagues from the private sector, ladies and gentlemen, it is an honor to be among you today here in the City of the Two Holy Mosques, and especially to participate in this dialogue that calls on us all to think about the future of our beloved continent.
We are living in an era in which many changes have affected the global economy. Trade is now dominated by geopolitical supply chains that depend on national security and geography for production. Energy has once again become the axis of diplomatic policies and investment decisions, and governments around the world are rediscovering industrial policies. The world is facing a great deal of disruption, and the role of the economy is now subject to change. Africa is no stranger to this environment. The question before us is: how can Africa achieve higher growth? We must ask ourselves this question: what kind of growth can drive Africa forward in a world that has become more divided and less predictable?
For me, this must be the core of the new covenant for Africa. We want to transform African economies for growth. We used to celebrate increases in gross national income as an indicator of growth, but growth alone is not enough. In which areas does this growth occur? What local opportunities does it create? What jobs does this economy provide? And what economic resilience exists? Africa represents 18.5% of the world's population, but only 2% of the value added in global trade, and 0.8% of high-tech exports. This gap does not only shed light on gross national income; it represents a challenge.
A country can achieve significant growth in gross national income while still depending on imports of food, machinery, medicines, and vital technologies. Such an economy may grow steadily, but it becomes more structurally fragile. The next phase of development in Africa must concern itself not only with the process of growth, but with shaping that growth and its strength. This requires a fundamental transformation, as Africa moves toward greater capabilities. Indeed, Africa possesses many capabilities. We hold a large share of the minerals essential for manufacturing the technologies of the future, and we have vast agricultural lands representing about 60% of the world's cultivated land. We also have large areas for generating renewable energy and young populations, with a large proportion under the age of... And through the free trade agreement in Africa, African markets are indeed available, and skills become a key advantage for African economies.
Indeed, Africa is a strong and vast continent, but there is a need to support the different economies. Manufacturing in a single African country does contribute significantly, but there are different regulations in each African country, different systems, different payment systems, and different border procedures from one country to another, in addition to differences in logistics and logistical obstacles. Even with this African exchange, we still have many opportunities. For example, what we consume in Nigeria differs from the consumption of Togo or Ghana or other countries. There must be alignment. These figures only show the problem: only 16 out of 46 African countries manufacture intermediate goods, and more than half of the continent's exports and imports involve five economies outside Africa. Therefore, neighboring economies must all be interconnected. This fragmentation or division is what weakens Africa, and businesses in Africa are smaller than required, and investment decisions become more difficult. This common market does not translate into a strong or shared economic power.
The African Free Trade Agreement offers an opportunity for all of us, but we must think of this agreement not only as a trade agreement — there must be an expansion of infrastructure so that investment becomes possible within the African continent, and so that this investment crosses African borders. We must also design a market that aims at 30 million people — this is one of the proposals, and there is a need for more proposals so that there is genuine integration.
Your Excellencies, distinguished guests, there is another issue that requires more attention. African entrepreneurs do not lack ambition; what limits them is the cost and the environment in which they operate, which increases competition. Of course, the cost here relates to the cost of capital, the cost of transport, the cost of logistics, and the cost of crossing borders. Sometimes there are costs related to policies that are not certain, and the gaps in infrastructure in areas such as transport and energy increase costs by 50% above the global average. The African factory competes globally with lower costs in other markets. This increases the cost of African goods. If we want investment to move from trade to manufacturing, we need long-term assets and we must work to reduce these costs. This is possible, and we have proven that we can do it, as we supply more than 20% of the energy used by the European Union.
There must be a policy adjustment: we must understand the cost of manufacturing a single good and compare this cost with similar economies, as well as the number of hours lost in business due to the unavailability of electricity, which is the case in many African countries. How much time is needed to reach the airport? How much time is needed to reach the markets? How can we cross borders? This question may seem operational, but collectively we need to make these decisions to strengthen industry in Africa. Everything that affects industry in Africa is energy, and there is a need for energy infrastructure. The formation of energy in Africa will always be important, but obtaining energy is only the starting point.
It certainly helps business operations. For several decades, the average per capita electricity consumption in Africa was much higher than that of India or Central Asia. But today, we find that per capita electricity consumption in India has risen significantly, and has increased at an even higher rate in Southeast Asia. The expansion in the use of electricity and electricity supplies helps trade and helps stabilize manufacturing operations. Manufacturing operations greatly benefit African economies, but this has also led to an increase in household electricity consumption. Therefore, there is a need for an integrated energy strategy that helps achieve industrial ambitions. We must start by thinking of energy from an economic perspective, especially energy-intensive industries, and think of investment corridors, agriculture, financial centers, technology, clusters, and major cities. Energy systems must be platforms for developing other industries, and we must stop importing raw materials and instead export fully manufactured goods.
The new growth covenant includes private sector companies, and in this dialogue we must choose between the state and the market. Africa does not have markets that allow assistance — we cannot support the private sector if there are no strong governments. We must support entrepreneurs and encourage them to have competitive businesses. The challenge is not to decide which side to lead, but these institutions must help both the state and the private sector succeed, and do what is best in terms of the policies put in place, encouraging entrepreneurs and making prosperity available. Of course, providing infrastructure and protecting market integration are two important matters. Markets need capital to build companies and provide the right environment. When these roles are integrated, we see an increase in investments. Of course, capital always defends itself and always seeks favorable environments that help it work. Therefore, today's legislation is what helps make tomorrow's decisions.
Similarly, there is a need for an African approach so that there are global partnerships. Africa must be a participant in every economic center. We need investments, technology, markets, and partnerships from all over the world, but the quality of these partnerships must rise to help Africa. A good partnership supports African capabilities and provides the necessary skills, helping local companies work with modern technologies and enter global markets. As much as possible, we seek to participate in global value chains. Africa will not seek a place in the global scene — rather, we must define our economic destination and seek the partnerships that will help us reach this goal.
Ladies and gentlemen, the global disruption we are witnessing today may continue for some time, and Africa will not remain at the mercy of any event happening far from its shores. But our economies must be resilient in the face of these disruptions, and Africa must become a base for precision industries and complex industries. The industries in Africa have so far been small, but with time and with the necessary financing, Africa can define its economy and its growth, and provide the materials needed for global markets, especially in the field of technology. This option will be the reason for Africa's new growth. We are about 20 years away from 2050, and therefore Africa must be the supplier of food, minerals, fully manufactured goods, and more.
The world we live in today is changing, and this gives Africa a rare opportunity. We need to have a fixed place in the global economy — we can design this economy, and this must be the ambition of African governments and African partners, to secure Africa's share of growth and to increase Africa's capacity to create this growth. I would like to thank all our leaders for providing this support, especially Afreximbank, because many countries would have faced great difficulties were it not for Afreximbank. I can say in my testimony that without Afreximbank and the other banks, we would not be where we are today. I thank you for giving us this opportunity. The visions of our leaders are extremely important. Foreign banks will not help us develop our continent — only Africans will develop Africa, not anyone else. Africa must unite to develop Africa.
For this reason, our group supports Vision 2030, and we are currently investing over four years about 50 billion dollars, and we have invested in Kenya alone about 16 billion dollars. We have done this work and obtained the approvals, so we welcome all cooperation with us today. What I want to commit to before our leaders is: if you allow this free trade agreement to exist — free movement of people, services, and goods — if we do not interact with one another, there is no other way to build the Africa we dream of. I know that prosperity, job creation, and other matters require stability, and this stability provides jobs, as we have the youngest populations in the world. If we do not cooperate with one another, we will face difficult times. Thank you.
[Applause] Thank you, Mr. Aliko.
