Let’s reduce dependency on external aid - President Akufo-Addo urges African govts
President Nana Akufo-Addo has urged African governments to pursue strategies to stimulate economic self-sufficiency to reduce dependency on external aid which has undermined domestic ownership and self-reliance.
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“Aid weakens the capacity of African governments to generate and mobilise domestic resources, ultimately hindering sustainable development.
“While aid has helped meet some immediate needs and supported various development projects, it has also created a dependency syndrome,” he added.
The President, therefore, encouraged the governments to amplify domestic resource mobilisation, nurture entrepreneurship and create an enabling environment for indigenous private sector investment in their respective countries.
He said they must also build resilient economies and solidify domestic capacities, especially tax collection agencies to reduce dependency on aid and pave the way for sustainable growth.
Event
The President was speaking at the fifth anniversary lecture series of the Council on Foreign Relations (CFR) Ghana, in Accra last Friday on the theme: “The limits of the current development co-operation framework for Africa’s transformation.”
Participants in the lecture
The CFR is a non-profit institution, specialising in Ghana’s foreign policy and international affairs. Its membership consist of diplomats, bankers, lawyers, media practitioners, academics, military officers, distinguished professionals, public servants and traditional leaders.
Role of AfCFTA
On the transformative potential of the African Continental Free Trade Area (AfCFTA) agreement, President Akufo-Addo said it represented a bold initiative aimed at accelerating intra-African trade, industrialisation and fostering economic integration across the continent.
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He added that AfCFTA in full force would create a single market for goods and services, encompassing 54 countries and more than 1.3 billion people, with the capacity to significantly beef up trade.
The President cited a report of the United Nations Economic Commission for Africa (UNECA), which projected intra-African trade to exceed 34 per cent by 2045, with the implementation of AfCFTA.
He also emphasised that Africa needed to move away from over-reliance on the export of raw materials with little value addition in order to fully exploit its potential.
“The establishment of a continental free trade area should magnify Africa’s attractiveness as an investment destination,” President Akufo-Addo further said, adding that it created a more predictable and stable business environment to attract both domestic and foreign investments.
SME contribution
The President also highlighted the role of small and medium enterprises (SMEs) in Africa’s economies, saying they contribute significantly to employment and income generation.
He, however, said they often faced challenges relating to market access, financing and regulatory constraints, which President Akufo-Addo said could be addressed by providing new opportunities for SMEs by expanding their market reach and reducing trade barriers.
He also touched on the recently launched SME Growth and Opportunity Programme which aims to provide targeted financing solutions and technical assistance to SMEs in the country.
The President said that the programme was an important step towards creating a viable SME ecosystem that would empower businesses with high-growth potential to scale up and create impact across communities.