African Ministers of Finance, Planning and Economic Development have underscored the need for appropriate fiscal policies for the continent to maximize sustainable job creation from the growing foreign direct investments.
This was revealed during the session of experts that was meeting ahead of the third joint annual meeting of the African Union (AU) from March 29 to 30, 2010 in Lilongwe, Malawi.
The conference gathered African Ministers of Economy and Finance as well as Ministers of Finance, Planning and Economic Development of the Economic Commission for Africa (ECA).
The two day conference was working under the theme “Promoting high-level sustainable growth to reduce unemployment in Africa.”
˝The economic and social challenges involved in jobless growth are not new for African countries,” Professor Emmanuel Nnadozie, the Director of ECA’s Economic Development and NEPAD Division said in a press release by ECA.
The release says that during the discussion, States’ representatives highlighted the specific features of each country, which required targeted policies.
Nnadozie said that their persistence reflects the failure of policies pursued hitherto and demands innovative solutions.
He also noted that prior to the economic and financial crisis, economic growth had followed a rising trend, from an average rate of 2.7 percent between 1990 and 1999 to 5.3 percent between 2000 and 2007.
“Despite this performance, unemployment had fallen by only a marginal 0.8 percent in most African countries,” Nnadozie said.
Experts said there is an urgent need to rethink the link between growth, employment and poverty reduction.
Nnadozie urged that engines of growth should not only be reactivated but must be redirected towards high-productivity, high-employment sectors such as agriculture— which must be modernized, as well as textiles, construction and tourism.
The ECA study on the link between growth and employment identified the need for institutional reforms designed to attract more FDI.