What is the purpose of AFES and what do you hope to achieve this year?
The Econometric Society has been holding an annual conference in Africa for the last four years. Leading scholars from all over the world, including Nobel Prize winners, come to Africa for this meeting in order to discuss issues in theoretical econometrics as well application of econometrics to various areas of economics, including banking, finance, environment, macroeconomics and political economy. There’s a great interest in understanding developments in Africa at the moment so although our discussions will cover other areas of the world there will be an emphasis on issues in Africa. In Cotonou we especially look forward to supporting young economists such as PhD students and recently completed PhD students. These are the people who will be researching economics in Africa for the next 30 or 40 years. We hope AFES can play a part in mentoring young talent to be part of the development of new techniques in applied economics.
Why are mathematics and statistical tools important in order to understand economic trends?
They are particularly important because the core of the economics discipline rests on using scientific tools of analysis and quantitative evidence to underpin both policy and private sector practice. In order to generate hard evidence it is very important to apply mathematical and statistical tools to economic and finance issues, hence generating numerical values to guide policy and practice.
What role can the African School of Economics play in shaping global economics?
The fact that this meeting is taking place at ASE is a great achievement. It is very timely that the ASE is taking off very well and it will be a game changer in influencing the development of economics not only in Africa but globally. From there, Africans will contribute learning and innovation on a global playing field, especially in some of the intricate issues that have remained a challenge in Africa for quite a long time. For example, we’ll see important breakthroughs by doing randomised controlled trials to understand human behaviour. MPesa originated in Kenya and has influenced developments in financial technology all over the world. I can see ASE playing a similar role.
What is the outlook for the African economy?
The ground has shifted. There have been a lot of positive developments in Africa recently. Only a couple of years ago it was announced that 10 of the fastest growing countries were in Africa. There is a lot of optimism about economic transformation in Africa as countries are transitioning from low to middle incomes. This is not to say there are no structural problems. Growth has occurred but it is not equally shared. That lack of inclusive growth and inclusive finance present a great impediment to the rapid transformation of African economies. The research we are going to discuss in Cotonou will shed more light on how we can achieve inclusive growth that is sustainable for African economies, among other things. I would hope therefore that all stakeholders — policymakers, private sector practitioners and NGOs will be paying attention.
What impact will Africa’s population growth have on its economy?
I would argue that the growth in the African population is a dividend that has to be taken into account by policy makers and private businesses. I would like to discount some of the negative voices who think that it’s an impediment. If there is a growth in effective demand, infrastructure and production, you get a vibrant African economy. I hope to see some further breaking down of national barriers that militate against a bigger market. It is already happening in my own area of banking and finance, where we have witnessed the growth of Pan-African banks. For the first time we’re seeing indigenous banks from four banking hubs — Nigeria, Morocco, Kenyan and South Africa — crossing borders in Africa and competing with multinationals. They are growing their sector and have high prospects for going global. This is an African revolution in banking.