PROMOTING REGIONAL COMPETITIVENESS: Investment in Value Addition Operations

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PROMOTING REGIONAL COMPETITIVENESS Investment
in Value Addition Operations
EAST AFRICAN INVESTMENT CONFERENCE KIGALI 26TH
28TH JUNE 2008

• Prof. Charles Kwesiga
• Executive Director
• Uganda Industrial Research Institute (UIRI)
• June 2008

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Outline of Presentation

• Factors for success
• Current regional status
• Value Addition
• Conclusion

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FACTS ABOUT EAC

• Wealth of resources and favourable climatic
  conditions
• Strong political commitment to EA Federation
• Similarity of development profiles key to
  harmonization of policies, strategies and
  development agendas

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Critical success factors

• Skilled manpower
• Optimal resource allocation
• Capacity for TT and technology development
• Sound infrastructure
• Effective value addition
• Quality of products and well designed processes
• Investment in RD, Science and Innovation
• Promotion of regional trade and joint strategies
  for global market
• Good governance and political stability

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Key Players
POLITICAL CLASS

• Stability
• Policy development
• Resources allocation

PRIVATE SECTOR
TECHNOCRATS
Collaboration

• Implement policy
• Offer technical services

• Develop enterprises
• Promote products
• Effect industrialization

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REGIONAL OVERVIEW
Regional Growth Investment (2007)
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Regional Export Profiles

• All heavily dependent on export of unprocessed
  agricultural commodities
• Common exports are Coffee, Tea, Cotton,
  Horticulture, Fruits and Vegetables

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Regional Export Destinations

• Common export destinations are Netherlands and
  Germany

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Regional Import Profiles
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Regional Industries- 2007
Source CIA World Fact book (2004 2008)
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Regional Balance of Trade

• Negative balance of trade due to excessive
  imports

Sources British Chamber of Commerce Country
Profiles (2002 2003) CIA World Fact book
(2004 2008)
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Comparison of Regional Select Country Balance
of Trade

• In contrast, Southeast Asian countries register
  positive increasing balance of trade due to
  increased export of high value finished products

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Challenges faced in EAC Region

• Post-harvest losses are very high
• Exports are mostly raw materials
• Lack of financing
• Lack of highly skilled workers
• Importation of basic goods services
• Limited indigenous technology base
• Low levels of entrepreneurship

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World Technology Clusters
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VALUE ADDITION

• The state of our economies require, as a matter
  of priority, that we focus on value-addition.
• This requires addressing several necessary
  conditions (e.g. TT).
• The guiding principle is the concept of the
  Product Value Chain which must be understood
  and adhered to.

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The Product Value Chain
Post harvest loss
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Timelines for Technology development

• Photography

Modern Photography
Modern Photography
Modern Photography
Modern Photography
Modern Photography
Pin Hole Camera
35 mm Camera
Digital Cameras (Kodak DCS-100)
1727 107 yrs 1834 157 yrs
1991
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Timelines for Technology development

• Transistor was invented in 1947 and
  commercialized in 1953 (6 years later)

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Consideration for effective TT

• Operability of the technology in the intended
  environment
• Infrastructure to sustain the technology
• Availability of skills
• Maintenance and suitability of raw materials
• Intellectual property rights
• Policies and other political, Social and cultural
  issues

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Collaboration between Institutions
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WAY FORWARD

• Invest in RD and support RD institutions
• Establish science and technology academies
• Reverse the brain drain
• Invest in infrastructure that supports
  competitiveness
• Establish TT regimes
• Exploit the opportunities identified by
  Investment bodies
• Joint trade missions
• INVEST IN VALUE ADDITON!

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Thank you !