Private sector role stressed at Japanese-African leaders’ meeting

Japanese Prime Minister Shinzo Abe, right, shakes hands with Ethiopian Prime Minister and African Union Chairperson Hailemariam Desalegn, center, after their joint press conference concluding the three-day Tokyo International Conference on African Development (TICAD) in Yokohama, near Tokyo, Monday, June 3, 2013. African Union Commission Chairperson Nkosazana Dlamini-Zuma of South Africa is seen at left. Abe announced Sunday a plan to provide 100 billion yen ($1 billion) in aid over the next five years to northern Africa for economic development and humanitarian efforts, including help with security and counter-terrorism measures at the three-day conference where officials from 50 African nations have gathered to talk about trade, growth and other issues. (Photo : AP Photo/Koji Sasahara)

Japanese and African leaders stressed the importance of private sector investment in promoting Africa’s economic growth as they wrapped up a development conference Monday held once every five years.

Japan promised 3.2 trillion yen ($32 billion) in government and private-sector aid to the region at the outset of the three-day Tokyo International Conference on African Development. The gathering brought together delegations from 51 African nations as well as representatives from the United Nations and World Bank.

Japan is eager to catch up to rival China, which has invested heavily in the resource-rich continent.

“We hope to further support and continue to expand together with Africa. We hope to develop a win-win situation in our relationship,” Prime Minister Shinzo Abe said at a closing news conference in Yokohama.

Calling the private sector “a vital engine of growth,” the participants pledged in a final declaration to boost private investment by improving the business climate and legal and regulatory frameworks.

Africa is the least integrated continent in the world with low levels of intra-regional trade, and accounts for only 3 percent of global trade, said an accompanying action plan laying out various targets.

Japanese Prime Minister Shinzo Abe announces the Yokohama Declaration 2013 during the closing session of the Fifth Tokyo International Conference on African Development (TICAD V) in Yokohama, south of Tokyo, Japan, 03 June 2013. The closing session of the TICAD adopted the Yokohama Declaration 2013 and Yokohama Action Plan 2013-2017. (Photo : AP Photo)

Private capital flows into the continent now exceed official development assistance, but they are still concentrated in extractive industries such as oil and mining and in resource-rich countries, it said.

Diversifying foreign investment into areas such as infrastructure, farming, manufacturing and tourism – an area of “tremendous potential” – are challenges for the future, it said.

“We will encourage expanded trade, tourism and technology transfer” and help small and medium-size companies develop by improving their access to long-term financing, the declaration said.

The private sector’s growth has facilitated the emergence of a middle class across the continent, an expanding consumer market and the widespread use of cellphones, the action plan said.

Among other measures, Japan will invite a thousand people from Africa to study and work as interns at Japanese companies.

The five-year aid package includes 1.4 trillion yen ($14 billion) in official development assistance and 100 billion yen ($1 billion) in aid for economic development and humanitarian efforts, including help with security and counter-terrorism measures.

Ethiopian leader Hailemariam Desalegn, the chairman of this year’s conference, said it was important for the participants to make sure that the conference’s recommendations are implemented “to the satisfaction of both sides.”

Japan’s conference for Africa has been held every five years since 1993. <AP/NEWSis>