Manufacturing, power can create local jobs to stem brain drain
By Jeph Ajobaju, Chief Copy Editor
A $2 trillion investment in manufacturing and power in Nigeria and other African countries can create 3.8 million jobs and reduce unemployment, particularly in Nigeria where educated but jobless youths are trooping overseas.
The forecast is in a report on ‘Africa’s Green Manufacturing Crossroads’ partly funded by the United Kingdom and released by McKinsey & Co, a global consulting firm.
A total of between 10,000 and 15,000 passports are issued monthly by the three passport offices in Lagos alone – in Alausa, FESTAC, and Ikoyi – as Nigerians leave in droves and post “Goodbye Nigeria” on social media on getting abroad.
United Nations Economic Commission for Africa (ECA) expects economic growth on the continent to drop 4.1 per cent in 2020 but rebound 5 per cent in 2021.
ECA Executive Secretary Vera Songwe said the African Continental Free Trade Area (AfCFTA) has the potential to increase Africa’s Gross Domestic Product (GDP) by $1 trillion.
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Decarbonise existing industries
McKinsey adds that “the continent could create a net 3.8 million jobs if it could attract a $2 trillion investment in manufacturing and power.
“Nigeria and other African nations will need $2 trillion for low-carbon emitting manufacturing without the added costs of transitioning from fossil fuel-based factories.”
McKinsey Nairobi Senior Partner Kartik Jayaram said Africa has the opportunity to leapfrog high carbon-emitting manufacturing processes instead of building a low-carbon industry from scratch.
“Africa could avoid future costs by sidestepping the expensive transition from fossil fuels to renewables,” he stressed in the report, published by Nairametrics.
According to the report, the continent emitted a total 440 megatonnes of carbon dioxide equivalent in 2018, almost a third from cement and 13 per cent released by coal-to-fuel plants operated by Sasol Limited in South Africa.
South Africa was the largest emitter.
Nigeria was the fourth-largest emitter of carbon dioxide equivalent, emitting about 30 megatonnes with the largest amount from cement manufacturing. Egypt was the second-largest emitter, followed by Algeria.
The report warned that if Africa fails to commit to decarbonisation, it could double the current rate to 830 megatonnes by 2050.
African countries would need to tap green finance instruments such as carbon credits, green bonds, green insurance and payment for performance linked to green outcomes, the report said.
“To decarbonise existing industries, $600 billion would be needed while $1.4 trillion is needed for new green businesses.
“Carbon capture and storage and the production of green hydrogen are two technologies that could help the continent attain the target.”
The report added that new industries that could be developed ranged from bioethanol and cross-laminated timber to electric vehicles and green hydrogen.
AfCFTA can grow Africa’s GDP by $1 trillion
Songwe made her GDP remarks at the ECA Regional Business Forum, titled, “Empowering women youths to drive Africa’s transformation agenda,” per reporting by The PUNCH.
Her words: “In a crisis, the first thing we want to do is ensure we prevent good businesses from falling below and focus a lot on retention. Africa, in particular, the West African region, has the population dynamics working for it.
“The African population is estimated at 1.3 billion in 2020 of which over 250 million are the youth and it is estimated that 10 million to 12 million are entering the workforce every year but only 3.1 million of them find jobs.
“AfCFTA stands to grow Africa’s GDP by an additional one trillion dollars to deliver on what is needed: first unlocking our borders, building value chains and making sure the African women all work together to create the supply chain for textile, fashion, for agro-industry.”
Finance Zainab Ahmed stressed at the event that it has become critical for society to empower young men and women
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