Poor countries advised to invest in partnerships

A UN security officer inspects the delegates outside the Kenyatta International Convention Centre during the 14th Unctad meeting yesterday. [PHOTO: PIUS CHERUIYOT/STANDARD]

NAIROBI: Poor countries have been asked to invest in private partnerships and reduce the cost of production to grow their economies.

United Nations Conference on Trade and Development Secretary General Mukhisa Kituyi said the countries, referred to as Least Developed Countries (LDCs), are faced with challenges such as low-level production of goods and lack of access markets for their produce.

Dr Kituyi said although the UN had set criteria for the LDCs' graduation to developing countries, no conditions had been set on how to receive them.

"LDCs still face challenges of low-level production of their goods and services. We have never set conditions for receiving those moving from LDCs to  developing countries," said Kituyi.

However, LDCs have also been challenged to take up funds from the African Pension Funds, which currently has Sh100 trillion lying idle.

And even as LDCs are being encouraged to take up the funds, they have been warned not to invest them in real estate in capital cities but rather in small and medium enterprises and the agricultural sector.

An LDC is one that, according to the UN, exhibits the lowest indicators of socio-economic development, with the lowest human development index ratings of all countries in the world.

Kenya graduated from an LDC in 2014 to become a low-middle income country following the re-basing of its national accounts, including gross domestic product and gross national income

Kenya is now the fifth largest economy in sub-Saharan Africa behind Nigeria, South Africa, Angola and Sudan after the size of the economy grew by 25 per cent.

Economic growth during 2013 was revised upwards from 4.7 per cent to 5.7 per cent, but challenges of poverty and income inequalities remain high.

Yesterday, conference participants agreed that there was need to strengthen structural transformation by investing in increased production of goods and finding ready markets for LDCs.