UNIDO Industrial Development Report 2004: industrialisation, environment, and the Millenium Development Goals in Sub-Saharan Africa: the new frontier in the fight against poverty

UNIDO Industrial Development Report 2004: industrialisation, environment, and the Millenium Development Goals in Sub-Saharan Africa: the new frontier in the fight against poverty

Published Jan 2004

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Unido's annual industrial development report for 2004

This year's report focuses on the prospects for achieving the MDGs in sub-Saharan Africa and on the usefulness of these as targets. It argues that meeting the MDG targets are necessary to set sustained economic growth in motion, but that sustained productivity growth (the main source of long-term economic development) will not result automatically from progress towards achieving the MDGs. Other pre-requisites for take-off are the demographic transition, a quantum leap in agricultural productivity and a compositional change within manufacturing and services. While increased public spending will help create a platform for take-off, prolonged success depends on ‘crowding in’ private enterprise.

The report's Competitive Industrial Performance Scoreboard (which ranks the industrial performance of 93 countries since 1980) shows that manufacturing industry in SSA has stagnated and lost global market share since 1980. Then, SSA accounted for one percent of global manufacturing output, but by 2000 this had shrunk to 0.8 percent, just over half of which was contributed by one country, South Africa. Since 1980, manufacturing production has either declined or stagnated in 28 countries. There have been some success stories in SSA, but for the most part these are atypical cases like Mauritius and, more recently, Lesotho, that have achieved breakthroughs by exporting clothing to markets where they have preferential entry thanks to the USA’ s AGOA and EU’s EBA initiatives.

The report argues that:

  • the region must shed its pessimism on its ability to industrialize and improve its investment climate, but it must also strive to overcome its structural problems and create capabilities for sustained growth
  • there is no single growth formula that guarantees success and no single model to emulate. SSA governments must implement a broad swathe of policies designed to overcome initial handicaps, build capacity, strengthen institutions and increase productivity by fostering the development of skills, technological progress and environmental sustainability
  • SSA policymakers face taxing development challenges while building up social and technological capabilities. It is crucial for the international community to help them meet their capacity-building needs, including those related to trade

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