Asian and African business leaders form business council to boost trade, prosperity

JAKARTA - INSTANT noodle producer Indofood plans to build a factory in Morocco, its sixth in Africa, this year.

It is one of a growing number of Asian companies investing in the continent of late.

More natural resources from Africa, such as crude oil from Angola, are also flowing to Asia.

But trade between both regions remains well below its potential, and business leaders on both sides today agreed to form an Asian-African Business Council (AABC) to step up links, share know-how and boost investments.

The council will bring together businessmen from both sides, and its secretariat will be based in Indonesia and South Africa.

It will also meet at least once a year, with the first meeting in Indonesia within the next six months. Egypt has offered to host the second meeting in 2016.

"As the global economy becomes increasingly competitive, there is a greater need for our countries to work together," Mr Suryo Bambang Sulisto, chairman of the Indonesian Chamber of Commerce and Industry (Kadin), told 500 participants of the Asian-African Business Summit.

The summit is one of several events taking place this week to mark the 60th anniversary of the 1955 Asia-Africa conference in Bandung, attended by 29 newly-independent Asian and African countries in a display of political solidarity.

On Wednesday, leaders from the two regions, including Singapore Prime Minister Lee Hsien Loong, will meet at the Second Asian-African Summit here.

Earlier today, Mr Suryo reminded participants that the world today is far different from that of the mid 1950s.

"And we too have to move away from pure ideology to practical business, while still keeping alive the spirit that originated from our past leaders," he said.

Foreign direct investment and trade between the two continents rose from US$2.8 billion in 1990 to US$270 billion in 2012, with flows expected to surpass US$1.5 trillion by 2020.

But Indonesian President Joko Widodo told the summit these flows have yet to reflect their full potential, with exports from Asia to Africa forming just 26 per cent of Asia's total exports, and Africa's exports to Asia just 3 per cent of Africa's total exports.

Asian and African countries now play a greater role in the global economy, but both regions face major challenges, including poverty, conflict, and high inflation, which closer economic cooperation can help tackle, he added.

Countries also have to take steps to minimise barriers to trade, help bring about a more open and fair global trading system, and woo investors, he said, calling on them to make business licences easier to get and to protect investments.

Mr Joko singled out manufacturing, agriculture, infrastructure and energy as areas with investment opportunities, sectors South Africa's deputy president Cyril Ramaphosa also highlighted.

Mr Ramaphosa represented South African president Jacob Zuma, who cancelled his trip at the last minute due to an outbreak of anti-immigrant violence at home.

Mr Ramaphosa said there were many valuable lessons Africa can learn from Asia's success.

Over 30 per cent of the world's oil resources are in sub-saharan Africa, and Africa also has 60 per cent of the world's arable land, but millions remain in poverty.

This was why his continent cannot afford to let up on economic reforms, and has to keep an eye on moving up the ladder, he said.

"Africa has the capacity to become the manufacturing success that Asia has become," he added.

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