The RMCE strategy is also built on realization that capacity building and policy reforms to strengthen the services sector are necessary to support the growing African middle-class and rapid urbanization while contributing to development of a healthy and productive human capital base. Africa’s household consumption is projected to reach $2 trillion in the next decade, but companies will need to gather detailed market intelligence to access the most promising consumer markets and target quality services to them.
The RMCE strategic operations are driven by the reality that “regional integration is a must for Africa” because of its proven capacity as a key driver of economic growth, especially for a region where the majority of the economies are too small to sustain growth on their own or even landlocked, with their associated higher costs to economic activities. However, Africa has a poor outcome of trade integration, despite many commitments to bolster REI. Many African economies are dependent on single revenue sources that are largely commodity and oil-export oriented and prone to market volatility and disruption in growth trajectories. Strengthening REI could also address Africa’s perennial scarcity of skilled human resources, increase competitiveness, create a stronger environment for innovation, make growth more inclusive, and bolster resilience to natural disasters and climate change adaptation.
RMCE aims to assist countries to implement and monitor progress on already agreed REI treaties, frameworks and provisions of the RECs, including the African Union’s treaties. This would help enhance trade intra-regional trade and make the services sector vibrant, paving the way for large investments – from both external and domestic sources, including through efforts to link the continent’s major stock exchanges – that can be used in diversifying the economies through extension of value chains in priority sectors such as agriculture and extractive sectors. Value-chain development would help develop Africa’s small- and medium-size enterprise (SME) sector, boosting local manufacturing, and creating jobs for the large youth population while transforming rural livelihoods.