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LSE Firoz Lalji Institute for Africa’s releases White Paper on sustainable industrialisation in Africa

A new paper on African industrialisation “The Art of Upgrading Industrial Policymaking Itself”, released by the African Trade Programme at the LSE Firoz Lalji Institute for Africa and supported by ARISE Industrial Platforms Ltd (ARISE IIP), argues that successful African industrialisation in the twenty-first century will be different to the East Asian experiences of the twentieth century.

Under the guidance of David Luke, Professor in Practice, LSE Firoz Lalji Institute of Africa by Jamie Macleod, Policy Fellow at the LSE Firoz Lalji Institute for Africa and Olawale Ogunkola, Professor of Economics, University of Ibadan, the paper claims that there is no single “the model” or “golden policy template” towards industrialisation, instead what matters is the approach and process by a committed developmental state including “experimenting and learning” to craft appropriate interventions.

This first requires an understanding of the “big five” industrialisation issues of today: policy consensus, green industrialisation, supply chain security and resiliency, shifting industrialisation paradigms, and widening policy space. But most importantly industrial policymaking in Africa itself must upgraded to become more adaptive, collaborative, and consultative, while bringing together government, anchor investors, and donors, into a grand bargain for social and environmentally sustainable industrialisation.

The “big five” of a contemporary route to sustainable industrialisation in Africa:

  1. Policy consensus involved building a collective strategic vision for industrialisation, striking careful bargains with elites, and aligning economic incentives to ensure that the industrial policy is committed to at the highest levels of government, and through the business community to other constituencies and individuals within societies.
  2. Green industrialisation should involve developing Africa’s underutilized renewable energy sources, reducing process emissions in production, and increasing resource efficiency. Africa’s historic contribution to CO2 emissions is negligible but is likely to rise as the continent develops. The challenge is to ensure the emergence of a competitive industrial sector while transitioning to cleaner energy and production methods.
  3. Supply chain security will be dominated by geopolitical tensions and corresponding security-influenced industrial policies in major economies are leading to a recalculation of supply chain risks and investment decisions. African economies must consider how their industrial policies can traverse and circumvent such risks.
  4. Shifting industrialisation paradigms such as the rise of digital production methods, the growth of platform production models, and continuing changes to the geographic distribution of production must be accounted for if policies are not to be out of date before their ink is even dry.
  5. The widening policy space means there are more options for African countries to take advantage of without spooking international organisations or markets. This gives governments the opportunity to tailor policies to their countries individual needs and not accept off the shelf solutions.

About LSE Firoz Lalji Institute

The Firoz Lalji Institute for Africa acknowledges a grant from ARISE Industrial Platforms Ltd. that supported the research and related activities.

David Luke is Professor in Practice and Strategic Director at the LSE Firoz Lalji Institute for Africa. He has worked at the African Union, the UN Development Programme, and the UN Economic Commission for Africa where he and his team were instrumental in the preparation of the protocols that make up the African Continental Free Trade Area Agreement. He holds a PhD in African Political Economy is from the School of Oriental and African Studies. He tweets @DavidLukeTrade.

Jamie MacLeod is a Policy Fellow at the LSE Firoz Lalji Institute for Africa. He has six years’ experience as a Trade Policy Expert at the Africa Trade Policy Centre at the UN Economic Commission for Africa and he is co-editor of the first book-length publication on the AfCFTA, Inclusive Trade in Africa.

E. Olawale Ogunkola is Professor of Economics in the Department of Economics at the University of Ibadan, Ibadan, Nigeria. He was Head of Department of Economics, from 2017-2021 and the Dean of the Faculty of the Social Sciences between 2012 and 2014 at the University of Ibadan. He is a Senior Research Fellow at the Centre for Econometrics and Allied Research and Director, Trade Policy Research and Training Programme. He holds a Ph.D. degree from the University of Ibadan, Ibadan, Nigeria.
The Firoz Lalji Institute for Africa (FLIA) focuses on engagement with Africa through cutting-edge research, teaching, and public events, strengthening LSE’s long-term commitment to place Africa at the heart of understandings and debates on global issues.

For more information, please contact Mark Briggs at the Firoz Lalji Institute for Africa via email m.a.briggs@lse.ac.uk

About Arise IIP

ARISE Integrated Industrial Platforms (ARISE IIP) is a pan-African developer and operator of world-class industrial parks committed to making Africa thrive. We identify opportunities in commercial and industrial value chains across Africa, and conceive, finance, build and operate the necessary infrastructure, playing a catalytic role in supporting countries to transition to an industrial economy. We are driven by the pursuit of green growth; our ambition is to unlock the continent’s industrial potential while neutralising our carbon emissions and climate impact. ARISE IIP is currently present in Benin (GDIZ), Togo (PIA), Gabon (GSEZ), Côte d’Ivoire (ZIC), and more. GSEZ was ranked the world’s best special economic zone in the timber sector (2020 FDI ranking).