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Thursday 11 July 2019

Investing in research and innovation, the path to achieving Africa's sustainable growth

Vocal synthesis
Investing in research and innovation, the path to achieving Africa's sustainable growth

Investing in research and innovation is no longer a luxury, but a necessity as it is the path towards achieving the rapid and sustainable growth Africa needs, Governor of Bank Al Maghrib (central bank), Abdellatif Jouahri, said Thursday in Rabat.

"Amid an increasingly competitive world, constantly reshaped by deep-seated changes which alter the classical paradigms, investing in research and innovation is no longer a luxury, but a necessity. It is the path towards achieving the rapid and sustainable growth Africa needs to meet the aspirations of its population, especially the youth," Jouahri pointed out at the opening of the Africa Meeting of the Econometric Society.

"It is also the only alternative to prevent the divide with the advanced countries from widening further," he added, noting that Africa performs poorly in the field of research.

The Continent, now home to nearly 17% of the world's population and more than one quarter by 2050, produces only 5% of the wealth, measured by the purchasing power parity, and contributes to the world’s scientific publications by no more than 2.6%, according to the latest UNESCO Science Report published in 2015, he went on.

In Morocco, we are well aware that developing human capital and research is not an easy task, Jouahri said.

"Despite the strong will and a budgetary effort of around 6 percent of GDP, we still struggle to put our education system on track to provide the skills adequate for the labor market and to develop research and innovation," he explained.

"In areas such as economy and finance, there is a huge need for cutting-edge research that takes into account the specificities of Africa. No one can deny the laudable initiatives and projects focusing on Africa, such as the one carried out between 2007 and 2014 by the U.S National Bureau of Economic Research (NBER), nor the establishment, within prestigious universities, of centers dedicated to Africa. However, the continent should enhance its own skills and develop its national capacities," he said.

Central banks are particularly aware of this challenge, Jouhari said, noting that monetary policy decision-making requires a thorough understanding of the economy and its performance drivers.

"To this end, we need to build up models which draw on the most recent advances in economics, while taking into account our realities, oftentimes different from those of advanced countries. As such, we are facing two major challenges," he said.

"We view this meeting as an opportunity for us as a central bank, as well as for all the national institutions here represented today, to inquire about the progress made in economics research, namely with regard to quantitative economics. It is also an opportunity to strengthen the bonds with the academia and initiate new cooperation relationships," Jouahri pointed out.

For several years now, Morocco has been committed to a policy of openness to Africa to further reinforce their ties, already strong by history, geography and culture, and to promote a win-win co-development in all fields, he said.

"As a central bank, our contribution lies in accompanying the banking system in its expansion and in maintaining a broad cooperation with several similar institutions of the continent. Today, we are pleased to pursue this contribution for the benefit of research," Jouahri added.

For his part, President of The Econometric Society, Stephen Morrris, said that this meeting is an important initiative that will help develop a scientific community in the region.

The meeting brings together distinguished researchers and experts who will discuss the all the aspects related to economic development and integration in Africa, he added.

In his turn, Professor Christopher Sims, winner of the 2011 Nobel Prize in economics, said the meeting "is a chance for African economists to get together and exchange research ideas".

"The economics profession in Africa is growing and meetings like this are important to exchange about research ideas," he pointed out.

The meeting is organized by Bank Al-Maghrib and the «Econometric Society» as part of the bank’s 60th anniversary.

Founded in 1930 by Ragnar Frisch, winner of the first Nobel Prize in Economics, the «Econometric Society» is considered as one of the most prestigious economic institutions.

The meeting is aimed at creating a space for exchange and constructive debate for the advancement of economic theory in its relation to statistics and mathematics. This edition is attended by high officials representing national and international institutions, as well as the academia and the private sector.

The program of the meeting includes plenary sessions led by high-level speakers, including the 2011 Nobel Prize winner, Professor Christopher Sims. During this event, prominent experts of the Moroccan economy will also be brought together in a session to discuss the "New Moroccan development model and Economic integration in Africa ".

MAP 11 July 2019