MONROVIA – The Speaker of the House of Representatives of the 55th Liberian Legislature, Cllr. J. Fonati Koffa, asserts that African nations can achieve the objective of building resilient economies by leveraging technology, opening borders, and adopting a single continental currency in the near to medium term.
Speaker Koffa emphasized that climate change, global security uncertainties, and the regression of democracy in Africa necessitate the development of resilient African economies—economies capable of anticipating and learning from crises while maintaining momentum.
He made these remarks during his address at the 12th African Leadership Magazine (ALM) Persons of the Year Awards 2023 in Addis Ababa, Ethiopia, where he was invited as a guest of honor to speak on building resilient African economies, focusing on a single currency, digital trading, electronic payment systems, and open borders.
At this year’s award, former President George M. Weah emerged winner of the African Political Leader Award. The President of Kenya, William Ruto alongside former President Jakaya Kikwete of Tanzania also secured African Person and the African Peace and Security Leader of the Year 2023 respectively.
Koffa, reflecting on Liberia’s experiences surviving civil war, Ebola, and COVID-19 within a single generation, stated, “Resilience for us is not a means of thriving but a requirement for survival!” He stressed the necessity of open borders, technological investment, and a swift transition to a single African currency to achieve this resilience.
The African Development Bank estimates the annual gap in Africa’s infrastructure investment spending is between US$68 billion to US$108 billion. The Speaker said while the African continent may never be able to close this gap, if it leverages technology, the continent can make easy wins to generate the growth it needs to be able to finance the hard infrastructure that it needs in place.
Technology
Speaker Koffa underscored the pivotal role of technology in building resilient African economies, highlighting its ability to facilitate connectivity and trade without traditional infrastructure. He cited examples of leapfrogging in telecommunications and proposed similar strategies for intra-African trade and services via the internet.
To leverage technology effectively, Koffa called for expanded access to electronic payment systems and a balance between security concerns and innovation facilitation. He criticized excessive regulations hindering innovation and advocated for a more diversified and accessible payment system platform to unlock economic potential.
He further said that most African countries are being held back by excessive regulations that slow innovation. And the continent is under utilizing the systems it currently has. The Speaker noted that in most African countries, people use mobile money systems chiefly to make internal remittances and to a limited extent, to buy goods and services. He said that was not enough. “We could capture way more value than that by moving to a wider electronic system platform and diversifying our payment systems so that one industry does not dominate the advancement. Governments can borrow or sell securities to unbanked people through the payment system platforms using their mobile phones as gateways; low income earners could buy bonds and make other investments in these same ways.”
‘Single currency is indispensable’
Speaker Koffa urged accelerated efforts towards a single African currency, citing its potential to remove trade barriers and boost internal commerce and tourism. While acknowledging challenges such as inflation requirements and regional disparities, he emphasized the necessity of moving beyond commitments to concrete steps for currency convergence.
He noted that ECOWAS has postponed the conversion to single currency five times. The bigger economies like Nigeria and Ivory Coast and Ghana could not meet the inflation requirement. He said Nigeria, which accounts for 65 percent of this conversion, has yet to own it and take leadership of it, and Francophone West Africa is still unwilling to relinquish its dependence on a colonial era monetary system.
“We must say a single African currency is indispensable in building resilient African economies. Without the need to buy foreign currency in order to trade with each other, Africans will travel around the continent more, buy more goods and services from each other and boost internal tourism. To this end, we as leaders on the African continent need to not wait for a perfect system but move beyond talk and commitment to concrete first steps.”
He noted that although the continent has made progress by signing the African Continental Free Trade Agreement, it won’t reap the full benefits unless its land borders are open and facilitate intra African trade. “The many horror stories we hear from entrepreneurs who face endless demands for informal payments as they try to trade between our countries must become a thing of the past,” he said.
Open Borders
In addition to a single currency, Speaker Koffa emphasized the importance of open borders for facilitating the free movement of goods and services across Africa. He highlighted the benefits experienced by ECOWAS from open borders and urged African nations to develop stronger trade bonds and closer integration through border openness.
“We must turn to each other, trade with each other, and develop an African bond that makes us closer in fact and not just in theory. Open borders will do that. We will build resilient African economies if we leverage technology, open our borders to each other and reach a single continental currency in the near to medium term.”
In conclusion, Koffa thanked the African Leadership family for the platform and reiterated his commitment to advocating for open borders and a single currency, emphasizing that a continent of 1.2 billion people should rely on trade, not aid, for economic growth.