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Integrating African Markets: The Way Forward

Most African markets are moving towards integration. Deepening regional integration in Africa is critical to maintaining economic competitiveness. Most assessment of the progress in regional integration in the continent has focused on market integration associated with trade in goods. Yet, regional integration, in its broadest terms, including goods, labour, and finance, is an important pathway for economic transformation and diversity. Regional integration is a priority for Africa because it is seen as a rational response to the difficulties faced by a continent with many small national markets and landlocked countries. As a result, African governments have concluded a very large number of regional integration arrangements, several of which have significant membership overlap. While characterized by ambitious targets, their performance record is unimpressive.

 “Trade and regional integration are imperatives for African economic development in a rapidly globalizing world. In particular, integration of African markets is important for removing barriers to intra-African trade and to broadening the market beyond domestic markets. Africa needs to integrate its markets in order to create larger, more viable internal economic spaces to permit efficient functioning of markets – products and goods markets, labor makers, and financial markets. We have already began witnessing encouraging developments in terms of financial integration. Enhanced integration of the community’s financial markets, with a focus on electronic banking, has been an area of success, even though the more traditional banking and capital markets are largely segmented,” says Prof. Lemma W. Senbet, AERC Executive Director.

  Recognizing that a deeper integration agenda that includes services, investment, competition policy and other behind-the-border issues are important for integration in Africa, the African Economic Research Consortium (AERC) addressed this issue during its 44th plenary session of the week-long, regional biannual workshop for economic researchers and policy makers, which opened on Sunday, May 29, 2016 at the Safari Park Hotel in Nairobi, Kenya. The opening remarks were delivered by Prof. Lemma W. Senbet, AERC Executive Director, and H.E. Erastus Mwencha, Deputy Chairperson of African Union Commission was Chief Guest at the opening of the Plenary.  

The session featured three presentations by thought leaders on the subject.

Prof. Bernard Hoekman of the European University Institute (EUI), Florence, Italy started off the proceedings with a look at Policy Dimensions of Reducing African Trade Costs: Recent Research and Open Questions, followed by Prof. Akpan Ekpo of West African Institute for Financial and Economic Management (WAIFEM) whose paper was on Financial Sector Reform and Financial Regionalization in Africa and final paper, Towards a Transformative African Integration Process: Rethinking the Conventional Approaches was presented by Dr. Stephen Karingi, United Nations Economic Commission for Africa (UNECA).

Discussions on these papers was led by Prof. Leonce Ndikumana, University of Massachusetts Amherst, USA, Prof. Robert Lensink, The Netherlands University of Groningen and Dr. Tilahun Temesgen, African Development Bank Group, East Africa Resource Centre (EARC) Nairobi, Kenya. Thereafter, active discussions by the participants made up of senior African policy makers, distinguished economists from all over the world, development partners and researchers from Africa and beyond took place. A public/private sector policy panel discussion followed later, to wind up the activities for the day. The round table was chaired by Prof. Njuguna Ndung’u, former Governor of the Central Bank of Kenya, and panelists included: Mr. Kebour Ghenna, Executive Director, Pan African Chamber of Commerce and Industry, Ethiopia; Ms. Phanice Kwamboka, Founder/CEO, Eye On Africa; Prof. Akpan Ekpo, West African Institute for Financial and Economic Management (WAIFEM) and Dr. Stephen Karingi, United Nations Economic Commission for Africa (UNECA), Addis Ababa, Ethiopia. The objective of the public/private sector panel discussion was to contribute to finding solutions to the challenges of integrating African markets, by focusing on the practical opportunities and challenges. This way, the panel discussion complemented the preceding plenary presentations.

Concurrent sessions of the workshop started on Monday, May 30, 2016 featuring 80 presentations of research proposals, work in progress, final reports and PhD theses proposals. These cover a wide range of topics that fit into the focal areas of AERC’s thematic research programme: poverty, labour markets and income distribution; macroeconomic policy and growth; finance and resource mobilization; production, trade and economic integration; agriculture, climate change and natural resource management.

Moreover, following the tradition, special sesssions were conducted on various topics by AERC partners:

 Launch of the DFID/ESRC-funded Research Project on Inclusive Finance “Finance for low Income Countries” (DFID-ESRC Funded Research Project on Inclusive Finance) by Victor Murinde, Lemma W. Senbet and Robert Lensink on Monday, May 30, 2016.

 Using High Impact Resources to Improve Research Output by Joy Owango, Customer Education Specialists, Thomson Reuters on Tuesday, May 31, 2016.

 AERC Alumni Presentation on Strategic Repositioning for Effective Collaboration by Joy Kiiru on Tuesday, May 31, 2016.

 Learning to Compete: What did we learn? By Finn Tarp and Abebe Shimeles on Wednesday, June 1, 2016.

AERC also played host to one back-to-back workshop at the same venue:

 An Inception Meeting for the DFID-ESRC Growth Research Programme was held on Saturday, May 28, 2016 on Delivering Inclusive Financial Development and Growth. About 15 researchers met to scope the project, especially to: identify the key research papers that each member will be working on; explored further collaboration within and outside the team; planed data needs and fieldwork in Africa; and discussed the involvement of in-country researchers.

Each of the AERC’s biannual research workshops attracts about 200 researchers, academics, policy makers and other economists who participate in the Research Programme. The workshops provide a forum in which the participants can meet each other within a worldwide network of professionals, and deal with issues relevant to Africa’s economic development. They also provide an opportunity for monitoring the progress and quality of the various research projects sponsored by AERC, thereby fulfilling one of its major mandates – to strengthen local capacity for conducting independent, rigorous inquiry into problems facing the management of economies in sub-Saharan Africa.  

 

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