Leaders urge Africa's industrial shift

Kenya's President William Ruto and Uganda's President Yoweri Museveni have urged African countries to deepen regional cooperation and invest in refining and manufacturing industries to accelerate industrialization, turning away from a model that relies on exporting low-value raw materials.

Speaking at the two-day Africa We Build Summit in Kenya's capital Nairobi that opened on Thursday, the two leaders said Africa's continued reliance on exporting raw commodities has left the continent vulnerable to global economic shocks, including disruptions stemming from tensions in the Gulf and the Russia-Ukraine conflict.

Ruto said Africa produces roughly 10 percent of global output, yet paradoxically remains a net importer of petroleum products, importing 120 million metric tons annually at a cost of about $90 billion.

He noted that at an average export price of $75 per barrel, Africa's crude oil production is valued at roughly $270 billion annually. However, "if this same production were refined domestically and exported as finished products at an average price of $800 per ton, it would generate over $500 billion", Ruto said.

He added that the difference represents about $230 billion in lost income each year — nearly 7.5 percent of Africa's GDP.

Museveni echoed the call, noting that Uganda has banned the export of unprocessed minerals, attracting investors who are already setting up processing plants.

He said exporting raw gold previously earned about $64 per kilogram, but refined gold now fetches $168 per kilogram, which means "jobs and industrial growth that would otherwise be lost when minerals are exported in raw form".

With refined gold now available locally, Museveni said Uganda is considering establishing jewelry manufacturing plants.

Both leaders also hinted at plans to establish a joint East Africa Refinery in Tanga, Tanzania, to facilitate mineral beneficiation and reduce raw material exports.

Museveni said Uganda currently utilizes only about 40 percent of its oil fields, adding that the country could supply crude to the proposed regional refinery.

Ruto also signaled a policy shift toward discouraging raw mineral exports.

"Our policy is clear: process minerals locally first," he said. "We have the minerals, we have the market, and we have the capital and industrial partners needed to build refineries and develop downstream industries."

Beyond minerals, the leaders said Africa could increase export earnings by adding value to agricultural products.

"The same kilogram of unprocessed cotton that sells for $1.2 can fetch $15 after spinning, weaving and garment production," Museveni said.

Ruto noted that manufacturing has stagnated at about 10 percent of Africa's GDP for the past two decades.

"As long as this pattern persists, our growth will remain constrained, our economies will remain vulnerable, and our full potential will be unrealized," he said.

Ruto added that Africa can no longer rely on historical limitations to justify slow industrial progress.

To address the challenge, he proposed strengthening regional integration, establishing regional platforms for strategic industries, and mobilizing African capital to finance industrial development.

Ruto said regional blocs such as the East African Community could play a key role by pooling resources and developing competitive manufacturing value chains linked to the global green energy transition.

edithmutethya@chinadaily.com.cn