Africa’s productive transformation in a changing world

This chapter analyses how public policies can support African firms’ productive transformation. It first explains why productive transformation matters for the continent’s development agenda. Second, the chapter proposes three main sets of policies to accelerate productive transformation in a fastchanging world. The first set consists of developing clusters of firms. Successful clusters enable local firms to specialise and scale up their production. The second set of policies aims to develop regional production networks. Governments can strengthen regional public goods, like cross-regional infrastructure and institutions, as well as regional complementarities in value chains. The third set focuses on increasing African firms’ capacity to thrive in export markets. Exports will become ever more important as African governments implement the Continental Free Trade Area. The chapter highlights innovative practices on the continent relevant to African policy makers at local, national, regional and continental levels.