Africa: Building a Case for Value Addition in Africa

Value addition is the key to elevating African economies, creating jobs and accelerating development, according to industrial policy expert Phyllis Wakiaga. Adding value at every step of the production process boosts a product's worth, whether it's tea, coffee or cotton. Africa needs industrialisation to retain production value and leapfrog development stages, similar to how developed countries industrialised a century ago.

Governments must create a favourable business environment through effective industrial policies, and the manufacturing sector requires support from various actors, including farmers and industrialists. Developing countries need affordable patient capital to invest in equipment, working capital and utilities. Special economic zones can provide lower utility costs and tax benefits for industries like cotton value addition.

To remain competitive, Africa needs to address technology obsolescence, with countries like Kenya having lost world-class textile manufacturers like Kisumu Cotton Mills and Rift Valley Textiles. With free trade agreements, Africa has access to global markets, so it must focus on vertically integrated textile mills and local production to maximise value chain opportunities, especially in regions like coastal Kenya and western Kenya where Bt cotton is gaining traction.