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November 26th, 2015

ITC to support joint China and UK effort to create jobs and growth in Africa

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Written by: Jacqueline Shaw
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The International Trade Centre (ITC) is joining efforts by China and the United Kingdom to reduce poverty through job creation and boosting growth in Africa. Launched on the sidelines of Chinese President Xi Jinping’s state visit to the UK in October, the Partnership for Investment and Growth in Africa (PIGA) aims at developing export-oriented manufacturing on the continent by helping companies overcome constraints on export success.

Selected to implement the project, ITC will work with the UK Department for International Development (DFID) and the China-Africa Development Fund (CADFund), an independently operated fund that seeks to stimulate investment in Africa by Chinese companies, to spur export-oriented manufacturing.

Among ITC’s key tasks will be to identify and tackle constraints facing exporters such as inadequate market information, weak supply-side capacity, trouble overcoming regulatory barriers within the region and overseas, and obtaining access to finance, both for investment capital and to underwrite trade.

Speaking at the Geneva launch of the PIGA project, ITC Executive Director Arancha González said: ‘Africa is the new growth frontier. We have all said it. We all know it. We have to continue to ensure that growth delivers for the global good and for Africa itself.’

‘Our approach will be market and business driven, focusing on creating more and better jobs in Africa. ITC will work with African, Chinese and British entrepreneurs to increase sustainable investments in productive sectors with high potential for export promotion and job creation in Africa,’ She said.’

The PIGA project seeks to increase exports and sustainable incomes for people living in poverty in Africa through greater integration into international value chains in agro-processing and manufacturing. For China and the UK, the underlying idea is that enabling sub-Saharan African countries to capture more than their current sliver of global manufacturing would reduce poverty by creating productive jobs and stable growth. As a by-product of the project, the China and the UK hope to strengthen bilateral cooperation and generate useful learning on trade-related investment and development assistance, with a particular focus on SMEs.

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Zhou Xiaoming, Deputy Permanent Representative and Minister Counsellor of the Permanent Mission of the People’s Republic of China to the United Nations Office at Geneva and other international organizations, said: ‘This is an important initiative in addressing some of the critical issues that African countries face. With ITC on board, it adds a new dimension to the joint efforts of China and the UK in helping African countries achieve substantial development.

Julian Braithwaite, Ambassador and Permanent Representative of the United Kingdom to the United Nations Office at Geneva and other international organizations, said: ‘This new partnership demonstrates how two donors, the UK and China, can work together with efficient multilateral agencies such as ITC, as catalysts for economic growth and poverty reduction in Africa’.

A preliminary ‘scoping’ phase of the project will focus on Ethiopia, Kenya, Mozambique and Zambia, for a year from November 2015. This work will serve to identify high-impact project activities that will subsequently be implemented and expanded across the rest of the region. Interventions will focus on SMEs in the four countries, with the aim of increasing employment and incomes through enhanced trade and investment.

‘The UK and China are both are major providers of foreign direct investment to Africa. And both agree that the private sector must ultimately drive growth. I know this is also the case for Ethiopia, Kenya, Mozambique and Zambia who have all placed SME growth at the heart of their development strategies,’ González said.

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