The tripod that Africa needs to build combines the correct economic rules and reform, improvement of its institutions and the development of effective implementation capability. One of the main difficulties faced by African governments is to have a good knowledge of their natural resources: a good public geological survey. This will enable the governments to have credibility and knowledge in the negotiating processes with extraction corporations. Today it still happens that the estimate on the resources is given by the corporations, often to the disadvantage of the country.
African opportunity is the industrialisation of its economy- so far it hasn’t done it. Here Collier draws attention to the global manufacturing phenomena by giving a “lecture” on the economics of buttons> two thirds of world’s buttons are made in China in one single town, No comparative advantage can explain this. The synergy effects, deriving from a cluster set-up, where the production chain is developed as well as the economies of scale, make it very difficult for a newcomer to break in the business. Only with gradual increase of wages in Asia, Africa may have a chance with labour intensive sectors. Where EU can help is by keeping open markets and relocate some of its labour intensive business to African countries. EU can help by giving a privileged access in our own markets over the goods coming in from Asia. We do it, but in a patchy way- we should also open the markets to the better of African countries.
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