The Southern African Development Community (SADC) participated in the launch of the Africa Industry Observatory (AIO) and Africa Industrialisation Index (AII) during the Africa Industrialisation Week held on 22-26 November 2022 in Niamey, Niger. The SADC region has prioritised industrialisation as the key sector by adopting the SADC Industrialization Strategy and Roadmap (SISR 2015-2063). Industrial statistics is one fundamental prerequisite for accurately monitoring the progress of industrialisation in the SADC region. In Africa, the availability of such data is limited due to poor national statistical, finance and surveying capacity.
The AIO is an initiative by the United Nations Industrial Development Organization (UNIDO) and Africa Union, while the AII is by the African Development Bank (AfDB) to help strengthen data on Africa’s industrial development. It aims to fill data gaps by providing a data portal and the first-ever comprehensive picture of Africa’s industrialisation progress. It covers 52 out of 54 African countries for the period 2010 to 2019. The index asses the countries across the 19 indicators. The goal is that this portal and index become a valuable source of data for African countries to enable them to assess their progress, benchmark themselves against others and formulate more effective industrial policies. African countries, particularly the SADC region, can benefit significantly from the AIO and AII launch.
The AIO is a portal to be embedded in the RECs website, while the AII report first provides the reader with a summary of the progress of industrialisation in Africa. Information about the index and its structure follows, and the methodological framework of the AII follows it. The overall scores under the AII for each year are then presented with country-by-country comparisons and sub-regional analysis also being made. The UNIDO and AfDB’s role in supporting industrial development is discussed, and the challenges and recommendations are presented.
AIO and AII focus on data collection,compilation, and analysis, helping consolidate and extend the available quantitative evidence to sharpen qualitative analysis on industry trends, forecasts and comparisons at the national, regional and continental levels.
The index is organised around three dimensions: performance, which discusses how well African countries are generating manufacturing output and exports; direct determinants, which discusses how well capital and labour are directed towards industrial development and indirect determinants, which discusses how well an enabling environment for industrialisation is created including macroeconomic stability, sound institutions and infrastructure.
The results of the AII show that most African countries are making slow and steady progress on industrial development, with a handful having already developed sophisticated manufacturing capabilities. In the SADC region, DRC, Eswatini, Mauritius and South Africa are shown to be top performers. The index is recommended to be further improved and effectively used to track industrial development in Africa, including the SADC region. This must be done by improving the collection process of relevant data and prioritising training and capacity building of country officials in regional country members. Another recommendation is to institutionalise industrialisation data collection in Africa by mainstreaming industrialisation statistics in the work programs of National Statistics Offices.
