Africa needs trade even more than aid

Comment Liam FitzGeraldAs chairman of the Government's Private Sector Forum, focused on engaging Ireland's private sector in developing countries, I had the great pleasure earlier this week of attending the Business Action for Africa Summit in London, on behalf of Taoiseach Bertie Ahern, attended by more than 300 delegates from many countries.

The meeting was arranged to allow business to debate issues and to make recommendations for more trade and investment with Africa which are being forwarded to the G8 Summit in Gleneagles.

The message was very clear. Africa needs trade even more than aid and debt relief for long-term economic progress and stability, and the business community needs to act now to help create the best possible conditions for investment, establishing trading links with African partner enterprises, lobbying for the removal of tariff and non-tariff trade barriers and looking for direct investment opportunities on the continent.

Average African GDP growth last year was 5 per cent. There was an overwhelming sense from the delegates, and business representatives from African nations who attended, that the image of Africa as an international "brand" open for business, really needs to focus more on the positives, the successes and the spirit of entrepreneurship, rather than the more prolific images of poverty and hardship.

Of course, these issues and challenges facing Africa should mean more to us in Ireland than most, given our economic history. In my own experience as chairman of the Private Sector Forum, everyone wants to learn more about Ireland's economic transformation, our foreign direct investment success, and how this was achieved.

Africa will not change overnight, but through our Irish experience, education, and know-how, we can certainly play a part.

At a macro level, the widely documented challenges of good governance, appropriate legal frameworks and better infrastructure are ongoing challenges but are also being addressed by a strong new initiative conceived by the African Union's New Partnership for Africa's Development (Nepad), called the Investment Climate Facility (ICF).

This facility is pledging $550 million over the next seven years, co-funded by the private sector, and driven with a clear results focus. It has strong private sector representation and guidance through its trustees. The British government has thrown its weight fully behind this initiative by agreeing to fund 10 per cent of the target. Niall FitzGerald, former chairman and chief executive of Unilever, is co-chairing this initiative.

It is a worthy focused effort to drive meaningful change and is deserving of strong support from government and the private sector. According to Mr FitzGerald, the ICF does not have time to deliver perfection, but will target rapid change in key enabling areas with a sense of urgency and a clear results focus agenda.

At a more micro level, it is about trade, investment and skills sharing. Many Irish companies have successful trade and investments in Africa already, including the likes of Glanbia, J. Sisk, Bimeda, Kenmare Resources and Fyffes.

The risks can be overcome and returns can be very strong. What is important is that Africa gets on the agenda of Irish business now, and that the business community takes its responsibility, at whatever level, as part of the international business community and acts now in developing much needed trade with this continent of 800 million people.

It is not all about investment. It can also be about trade, skills exchange and training. Former minister of state Tom Kitt set up the Private Sector Forum in April 2004 and today his initiative is being further developed and supported by Minister of State Conor Lenihan.

Having concluded a very successful exploratory trade mission to Uganda last January, predominantly with food sector companies, the forum is currently working on a project to create the Real Ugandan Food Company umbrella brand, through which local Ugandan producers of fruit, fruit juices, tea, coffee, honey and yogurt can access brand and "route to market" expertise that otherwise might not be available.

Our aim is to have a small range of products on Irish supermarket shelves by early 2006. The core objective is to prove it can be done, that barriers can be overcome and that African brands can produce and compete strongly with produce from other countries.

The macro issues are important and need to be addressed. However, they are not an excuse to sit on the sidelines and wait for perfection. Irish business can very easily make a difference by engaging and engaging now.

Over the medium term, the Irish Private Sector Forum will need more permanent, funded structures through which it can promote trade and investment, lobby for trade reform on the international stage, educate Irish business on opportunities in Africa and develop a mechanism for training business executives and technical operatives through formal skills exchange programmes.

The Government has a strong willingness to support this initiative. It is now up to Irish business to play its part and take up the challenge! As Niall FitzGerald recently said "There are many ways to help Africa. Not all of them are bleeding heart."

Liam FitzGerald is chief executive of United Drug plc and chairman of the Government's Private Sector Forum.