Regional industrial clusters game changers in economic integration

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Prosper Ndlovu

Adoption of cluster-driven production techniques could steer Southern Africa and the continent at large to unlock wider global opportunities through enhanced critical mass and market size.

Academic and former Zimbabwe Deputy Prime Minister, Professor Arthur Mutambara, believes the desired regional economic integration could be viably catalysed by production cluster models that connect individual countries that possess common natural resources, to work together towards increased scale economies. To him, isolated regional economies would not make it in a globalised socio-economic and political environment, as they lack the required muscle to engage and compete with dominant economic powerhouses.

In a recent public lecture at the University of Johannesburg, South Africa, under the topic: “Engineering and the Future of Africa: Decolonisation and the Future of Africa”, Prof Mutambara called on African countries to speed up economic integration so as to gain global respect and be in vantage position when negotiating with their peers in other regions. 

At a time when most developing economies in Africa are dependent on primary industries and raw commodity exports, the robotics scholar, who is now an independent technology and industrial strategy consultant based in South Africa, said a cluster-driven model would be a game changer towards increased value addition and beneficiation for the sub-region and the continent. An ideal situation would be for Southern Africa, for instance, to establish a diamond cluster involving Zimbabwe, Botswana and Angola as well as a platinum cluster between Zimbabwe and South Africa as top producers of the mineral, he added. Similarly, oil-rich countries could form another cluster while Zimbabwe, Zambia and South Africa could form another iron and steel cluster.

“The major argument against beneficiation is that we don’t have the critical mass, we don’t have the market, technology and money. When we pool our resources together money will be there. By coming up with these regional clusters we will be able to beneficiate swiftly,” said Mutambara.

“This will address the critical mass and market size concerns, allow global leverage and new technology development, which enables value addition in these clusters. If we have economies of scale we will be able to beneficiate and produce high-value products.”

He challenged African engineers, the private sector and political leaders to steer collaboration and influence speedy economic integration. 

Mutambara called on Africans to discard the colonial mentality of looking for innovation from the developed world, urging them to develop confidence in its experts and locally produced goods. Instead of pursuing nationalistic goals and competing against each other, the former deputy prime minister, said African countries need to harmonise their operations and help each other towards creating an attractive regional hub for potential investors.

“South Africa alone is too small a market, we need to think about SADC, Comesa, Ecowas, the African Union and the African Continental Free Trade Area. We need to develop within this broader African agenda.

“This will give us the scale we need for our products. South Africa cannot be attractive if Zimbabwe is not attractive. We need regional competitiveness as opposed to national competitiveness, regional attractiveness as opposed to national attractiveness,” said Mutambara.

He said global powerhouses like China, Russia, the European Union and the United States would give African states an ear in terms of investment if the continent spoke with one voice and argued its case as collective. He also challenged South Africa to rope in the whole of SADC in its engagements within the ‘BRICS’ grouping, which also includes Brazil, Russia, India and China. Under globalisation, Mutambara said SADC’s 280 million population and its estimated US$600 billion economy as well as Africa’s 1.3 billion population and about US$2.3 billion economy, were critical imperatives that serious global investors cannot ignore when compared to an isolated individual state. Within this framework, global economic powerhouses will engage with Africa as an equal partner “not out of love, but part of economics”, said Mutambara.

In order to achieve the above, he said the continent had to urgently embrace the tenets of the Fourth Industrial Revolution (FIR) and be relevant to global expectation. According to Mutambara, the first industrial revolution was about water and steam power to mechanise production. This was followed by the development of electrical power to create mass production. The third industrial revolution was centred on electronics and information and communication technologies that automated production. The FIR, he said, is building on the third revolution and is a fusion of technologies, blurring the lines between physical, digital and biological spheres.

Mutambara said the FIR is distinct because of the nature of its impact on economies in terms of speed and scope. Its key drivers are artificial intelligence, augmented reality, big data, internet of things, media and commerce revolution among others. Africa can leverage on these drivers to achieve her prosperity, he said.

Mutambara is a renowned academic internationally with vast exposure in the field of engineering. He is also an author and served as Deputy Prime Minister during the inclusive Government of Zimbabwe.

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