Region must exploit its natural and human resources

Lazarus Sauti

The Southern African Development Community (SADC) is endowed with an abundance of natural resources, including minerals, arable land, huge watercourses as well as diverse wildlife and flora, but most countries in the region continue to get very little in return for the exploitation of their natural resources by foreign multinational companies.

This is so because minerals and other resources are exported in raw form and human resources continue to flow outside the region.

The Herald, in a recent editorial, concurred: “Southern Africa, dubbed the ‘Persian Gulf of minerals’, is getting precious little in returns from its generous natural resource endowments which are exported mostly in raw form as many member states lack vibrant industries to beneficiate or value-add the resources before export.”

Johannes Chikowero, a Harare based policy and planning coordinator says Southern African is losing well-trained professionals such as doctors, nurses, scientists, development practitioners, economists, technologists, environmentalists, lawyers, teachers and engineers due to brain drain.

“Due to brain games as well as abuse of natural and material resources by foreign multinationals, SADC’s development is undermined politically, economically, socially, technologically, environmentally and legally,” he said.

However, Zambia’s minister of Commerce, Trade and Industry Margaret Mwanakatwe says it is time member states of the SADC region started putting resources together to create jobs for its people.

She said economic transformation can be achieved through the effective utilisation of the natural resources the region is endowed with and maintaining a stable macroeconomic environment.

“It is not business as usual. We need transformation within the region in order to better the lives of our people and this can only happen when we industrialise our economy through transformation of natural endowment and human capital,” Mwanakatwe said.

Chikowero adds that SADC member-states must exploit their natural, material and human resources it they are to transform their economies and lift citizens out of poverty.

“In line with the theme of the 35^th Summit of Heads of State and Government of the SADC that calls for accelerating industrialisation of SADC’s economies through transformation of natural endowment as well as improved human capital, member-states must fully exploit their natural and human resources to promote sustainable social and economic growth,” he said.

Speaking at the opening ceremony of the SADC Council which met prior to the SADC Heads of State and Government Summit in Gaborone, Botswana recently, incoming SADC Council chairperson, Kenneth Matambo, reiterated that there is need for southern Africa to broaden its industrial and economic bases to promote sustainable socio-economic growth in the region.

“There is an urgent need for SADC countries to broaden their industrial and economic bases in order to create employment and intensify the fight against poverty,” said Matambo, who is also the Finance and Development Planning Minister of Botswana.

South Africa’s Deputy President Cyril Ramaphosa also believes the time is now for SADC to step up the tempo of economic transformation, so that SADC economies become more competitive and create more gainful jobs.

“Countries in Southern Africa must tap into their natural and human resource wealth as well as widen the sources of socio-economic activity to accelerate the pace of growth,” he said.

Ramaphosa added that human development can help drive SADC’s structural transformation by speeding both the rate of innovation and uptake of new technologies.

“Human capital development can foster economic development in SADC countries, but more attention should be paid to improving access to and quality of education and healthcare systems,” he said.

Ramaphosa noted that SADC governments must prioritise the expansion and development of technical as well as vocational education and training colleges as “cornerstones of the regional effort to meet the bloc’s human resources needs.

Mario Pezzini, Director at the OECD Development Centre, an institution where governments, enterprises and civil society organisations informally discuss questions of common interest, says African countries must provide the right conditions for turning natural and material resources into jobs and optimise their resource revenues through smart taxation and help investors and locals to make the most of linkages.

As an expert in industrial economics, Pezzini noted: “Optimising primary resources require sound land management, balanced and effective tax systems and the right mechanisms and incentives to cause an acceleration and diversification of the sources of growth.”

He also said countries should develop infrastructure, improve education, create larger and more competitive markets, promote domestic, regional and global value chains and invest in power generation infrastructure to support industrialisation, a notion supported by Mwanakatwe.

“It is important to note that electricity demand in the region increased by a weighted average of three per cent per annum during 2014/2015 compared to 2.5 per cent in 2013/2015.

“This means that there is therefore, need to invest in power generation to support industrialisation,” Mwanakatwe said.

Educator, economist, professor of economics and author Emmanuel Nnadozie also believes creating more competitive markets is a step in the right direction as access to markets is essential to structural revolution based on natural and material resources.

“Access to markets is fundamental to structural transformation based on natural resources: regional integration and better access to the markets of large partners could open new opportunities for all,” he said.

Supporting Pezzini and Nnadozie, Zimbabwean Foreign Affairs Minister, Simbarashe Mumbengegwi, notes that deeper cooperation among countries in Southern Africa provides a tonic to development.

“Deeper cooperation among all SADC member states will enable the region to address its challenges and foster socio-economic development for its citizens,” he said.

Matambo added: “The spirit of the Frontline States should invigorate the region into action that would make SADC emerge as the most purposeful, most powerful and most successful African regional economic community.”

Permanent secretary in Zimbabwe’s ministry of Mines and Mining Development, Professor Francis Gudyanga, urges SADC governments to ensure that a fare share from mineral resources accrue to SADC citizens.

“Government sectors as well as local and international investors must make sure that a fair share of the proceeds from natural resources, especially extractive industries accrue to SADC societies to ensure citizens escape poverty,” he said.

Prof. Gudyanga also said Southern Africa must foster change and economic diversification through corridors of development around power, transport and communication lines.

Mthuli Ncube, Chief Economist and Vice-President of the African Development Bank (AfDB) agrees, but believes there is need for adequate budgetary provisions for financing such activities.

Ncube also argues that improved stability, sound macroeconomic policies and blossoming trade links are needed if the region is to shape its sustainable social and economic agenda.

Echoing Ncube sentiments, Matambo said SADC member states must fully implement all regional agreed programmes to ensure that the general socio-economic conditions are improved.

“Let us move with speed to effectively implement all the policies that are critical for the region’s growth and development,” he said, adding that countries must also fully implement all protocols that have been ratified,” he said.

The time is now ripe for SADC countries to exploit their natural and human resources.

Policy decision makers and other development partners must therefore analyse the obstacles to structural change, and draw lessons from countries or regions that have built on their human as well as natural-resource wealth to transform socio-economically.