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one thing that is extremely clear is the need for support from the commodity-dependent economies, our
international community. intervention strategies there focuses on
reducing overdependence by tapping the
One way that we at UNCTAD provide concrete support to LDCs countries’ comparative advantages outside
is by producing a General Assembly mandated study called a of the extractive sector. This includes a shift
Vulnerability Profile. When LDCs reach certain milestones on towards the development of green sectors, as
their path towards graduation, UNCTAD starts work on these well as efforts to integrate into, and effectively
documents, which drill down in a systematic way to assess the participate in, regional and global value chains.
economic, environmental and social constraints to development. For developing countries, especially the LDCs,
We also look at the inherent and emerging threats that could arise the development of productive capacities is
as a consequence of graduation from LDC status and what that not a choice. Rather, it is a necessity and a
might mean for a country’s future. The assessment of each country’s condition for sustainable development. Our
vulnerability to certain shocks is viewed through the lens of the 5 work aims to support countries in the areas
Ps of the 2030 Agenda for Sustainable Development: People, Planet, where they need it most to help them meet
Prosperity, Peace, and Partnerships. Within each dimension we their own and international development
identify key indicators and areas that are crucial for sustainable goals.
development and making the country resilient against external
vulnerabilities. These are critical documents that guide the rest of Three years ago, your office published a report,
the United Nations system in their decision making and strategy. Economic Activity in Africa 2021, where
we read: “African economic transformation
We are developing innovative tools such as the Productive Capacities must be inclusive, and not just about growth.
Index (PCI), which is a data-driven and multi-dimensional index Stronger African regional cooperation through
designed to measure and benchmark productive capacities in all an effective implementation of the African
economies. Th PCI is a multidimensional and quantitative tool that Continental Free Trade Area is expected to
helps countries track development across the eight core dimensions unlock new opportunities for diversification
of productive capacities, namely, human capital, natural capital, and trade.”
energy, ICT, transport, institutions, private sector and structural What, exactly, does the African Continental
change. The PCI looks at the input factors – the economic ingredients Free Trade Area involve, and what sort of
– needed to produce goods and deliver services. These capacities are “transformation” can one hope for from the
what enable countries to take part in trade and global supply chains regional cooperation it is promoting?
and to create the jobs, income, and production linkages necessary to The African Continental Free Trade Area
help economies thrive. The PCI has recently been updated to reflect (AfCFTA) is a landmark agreement. It has
the impact of external shocks such as COVID-19 pandemic and created the world’s largest free trade area.
account for the evolving importance of various factors on productive The overall mandate of the AfCFTA is to
capacities such as climate change and environmental degradation. create a single African market home to about
We use the PCI as a practical input to deliver National Productive 1.3 billion people, and with a combined
Capacities Gap Assessments (NPCGAs). The application of the PCI GDP of approximately US$ 3.4 trillion. It
helps countries to identify binding development constraints and, is a commitment to deeper socioeconomic
importantly, forge informed policies to plug these gaps. In using integration and improved cooperation that
the PCI as a guide, policy approaches and recommendations can be enables trade, investment and the mobility
clinically targeted to the most pressing and relevant needs that will of people, in support of industrialization
have the most impact on fostering sustainable development and and the development of a dynamic services
structural economic transformation. sector. The implementation of the AfCFTA
provides a unique opportunity to accelerate
NPCGAs provide an in-depth assessment of national socioeconomic the post-pandemic recovery, and make
performance, together with the identification of opportunities, progress toward meeting the 2030 Agenda
prospects, and challenges for further growth. NPCGAs are staring for Sustainable Development and the targets
points for holistic, economy-wide, multi-dimensional and multi- of Agenda 2063 of the African Union. Such
annual programmes to support structural transformation and achievements could ultimately generate
economic diversification through tailored policy interventions and decent jobs and increase revenue and
institution building. The central aim of these holistic programmes thereby contribute to inclusive growth on the
is to accelerate economic transformation. In extractive and continent.

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