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Culture and Creative Industries can accelerate structural transformation in Africa, according to AfreximBank

The African Export-Import Bank, a Pan-African multilateral financial institution mandated to finance and promote intra-and extra-African trade, also known as Afreximbank, published the 2022 edition of the African Trade Report. The document examines trade and economic developments in Africa and other parts of the world during 2020 and 2021, a period during which the global economy witnessed a global downturn triggered by the COVID-19 pandemic. African GDP expanded by 6.9 percent in 2021, recovering from the 1.6 percent contraction in 2020 that marked the first recession of the continent after 25 years of continuous growth. Despite this strong rebound, Africa however still remains a peripheral contributor to both global trade and growth, accounting for just about 2.6 percent of global trade and less than 3 percent of world GDP.

The report concludes that the continent must develop promising sectors which have not been fully exploited, such as the dynamic creative and cultural industries (CCIs), which include the arts, media, and design sectors, along with convergent and emerging digital technologies.

These industries, despite neglected by current policy and development programs, have not only the potential to boost economic growth and job creation in Africa but also to deepen the process of economic integration by fueling cultural convergence among its citizens. Yet, to highlight the importance of the sector, considering the rich cultural and creative heritage of Africa, the African Union declared the year 2021 as the Year of the Arts, Culture and Heritage as levers for Building the “Africa We Want”. A case in point is the Nigerian film industry, Nollywood, recognized as the world’s second largest film producer in the world, with thousands of films produced every year promoting the African cultural heritage around the world.

But CCIs also include radio, literature, music, video and computer games, creative arts, fashion, sport, museums and libraries and many other knowledge-based economic activities, including those aimed at the manufacture of creative goods (e.g.; traditional fashion, craft, make-up and contemporary fashion design). This sector, which is estimated to generate about US$2.25 trillion annually (three percent of global GDP) and to currently employ 30 million people, can be further boosted by growing penetration of internet and mobile applications in Africa, notes the report. At the same time, two warnings are raised: one on the shortage of skills in the cultural and creative sectors (as Africa’s youth are not equipped with skills needed to competitively position Africa’s creative industries in global markets  - hence, the need to invest in on-the-job training programs), and the second about the lack of institutional capacity, in most African countries, to protect intellectual property rights, which is critical to supporting the development of creative industries.

Particularly interesting is the relation with the AfCFTA. According to AfreximBank, the ongoing tariff liberalisation under the AfCFTA will significantly reduce the costs of intra-African trade in creative goods. As known, the AfCFTA targets the removal of tariffs on 97 percent of imported goods from State Parties over a period of between 5 and 15 years. It also aims to reduce non-tariff barriers and foster standards harmonization, customs cooperation, and trade facilitation. The implementation of the Agreement will therefore significantly reduce import costs associated with creative goods and open up new market opportunities for the continent’s creative industries. Looking ahead, the African Trade Report 2022 urges a speedy conclusion of negotiations on the rules of origin as well as those on trade in services, intellectual property, investment, and digital trade, as this framework, apart from enabling goods to circulate freely, will unleash creativity and stimulate innovation to further leverage CCIs and facilitate development through knowledge sharing. Additionally, it can catalyze technology transfers to accelerate the diversification of sources of growth and boost African trade in the AfCFTA era.

 

 

 

 

 

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