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COVID-19: How Africa can rebuild trade institutions for a robust recovery
The COVID-19 pandemic has presented unprecedented challenges to global supply chains with the World Trade Organization (WTO) reporting a drop in trade of between 13 per cent and 32 per cent in Africa but could revival present an opportunity for Africa to build stronger trade institutions? Zachary Kaplan, Head of Sustainable Business Group at Dai Global.
Wed, 10 Feb 2021 14:40:23 GMT
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AI Generated Summary
- The importance of diversification and localization of supply chains in enhancing resilience and reducing risks
- The role of digitization and tools in promoting local businesses and expanding their market reach
- The significance of efficient resource utilization and sustainability in driving economic growth
In the wake of the COVID-19 pandemic, Africa faces challenges in global supply chains with the World Trade Organization reporting a significant drop in trade ranging between 13 and 32 percent. However, amidst these challenges, there lies an opportunity for Africa to build stronger trade institutions for a robust recovery. Zachary Upland, the Head of Sustainable Business Group at Dai Global, discussed the potential for Africa to capitalize on diversification and localization of its supply chains in a recent interview with CNBC Africa.
One of the key takeaways from the interview was the importance of diversification of supply chains, as highlighted by Upland. The pandemic has raised questions about overreliance on single sources of goods and services, pushing companies to consider diversifying their supply chains. This shift provides an opportunity for markets in Africa to capitalize on the localization of supply chains, reducing risks and enhancing resilience.
Upland emphasized the need for digitization and tools to promote local businesses and their goods and services. The integration of technology can help these businesses reach a wider audience and adapt to the evolving market dynamics post-pandemic. By leveraging digital platforms, local businesses in Africa can enhance their visibility and competitiveness in the global market.
Moreover, the interview touched upon the impact of the pandemic on raw material prices, with fluctuations observed in various sectors such as oil and gold. While there has been a rebound in some commodity prices, the sustainability of this trend remains uncertain. Upland emphasized the importance of utilizing finite resources efficiently to drive sustainable economic growth.
Furthermore, the conversation delved into the role of raw materials in the context of evolving industries such as electric vehicles and the circular economy. Upland highlighted the need for more efficient and diversified energy sources, emphasizing the value of innovation and sustainability in resource utilization. While the shift towards alternative energy sources is underway, Upland noted that traditional sectors like mining continue to play a crucial role in the global economy.
Lastly, the interview touched upon the operationalization of the African Continental Free Trade Agreement (AfCFTA) at the beginning of this year. Upland expressed optimism about the potential for increased trade within the continent, highlighting Africa as one of the highest growth markets. With the AfCFTA opening up opportunities for international and African companies alike, there is a promising outlook for trade expansion and economic development in the region.
In conclusion, the challenges posed by the COVID-19 pandemic have underscored the importance of strengthening trade institutions in Africa. By leveraging opportunities in diversification, localization, digitization, and sustainable resource utilization, Africa can pave the way for a resilient post-pandemic recovery and sustainable economic growth.
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