Relying solely on the extraction and export of resources and commodities is not a sustainable economic model for AfricaWhile international trade and GDP growth have historically been highly connected, over the past decade these once inextricably linked economic building blocks have been steadily decoupling.
It could be argued that most of Africa’s exports are commodities, the essential nature of which offers the continent some protection from the negative impact of a shrinking global trade environment. But, while this is true to a degree, it has become clear in recent times that relying solely on the extraction and export of resources and commodities is not a sustainable economic model for Africa.
The challenge is that developing such a processing-led economy requires knowledge, skills and, of course, investment. Historically, foreign investment has been a catalyst to encourage skills transfer on the continent. Of course, such foreign investment requires an attractive economic and business environment as well as compelling investment opportunities.