Paul Romer from Stanford about Africa needs

Renowned American economist Professor Paul Romer from Stanford University, Unites States, attended the Mauritius International Investment Forum. Romer stressed the importance of creating coastal mega cities in Africa for economic development. Speaking to The Independent, he underlined the crucial role that Mauritius can play in this endeavour.

How do you see the evolution of the new world economic landscape?

Countries with low per person income are catching up with developing economies. Economic activity is now going to more closely reflect the population density because so many people live in Asia and Africa. Economic activity is going to shift in that direction and it is a very positive trend for the world.

How is the situation after the global financial crisis?

The financial crisis showed weaknesses in the stabilisation policy. What we have learned is that our regulatory mechanism was not effective in tackling weak regulations which exist in rich countries. Therefore, we must fix the regulations of the financial systems.

What other shocks do you think might emerge in the future?

There are still very serious problems in Europe which have not been resolved and there is a chance that it will precipitate in a shock which will seriously impact on the euro. Some countries are growing but they have high levels of unemployment. If a country does not have inclusive growth, social tensions can grow leading to political and economic disruption.

It is now being said that the time for Africa has come. Do you agree?

The development of India and China only raises expectations for Africa. I think that there is a serious issue in Africa associated with the resource curse. I think it is possible that growth in Africa will be more resource-oriented, which may in turn lead to growth that is not inclusive. It is an important challenge and Africa will have to work very hard to have industrial growth and create jobs.

Mauritius is considered a springboard for African countries and the rest of the world. What are your views?

What Africa needs are coastal mega cities. If Africa develops these cities, it can have successful development in agriculture, exploitation of minerals and create employment in areas like manufacturing. The role for Mauritius is to help mobilise resources that can lead to the development of coastal mega cities.

What is your message to us?

Mauritius is now compared to countries like Singapore, Hong Kong and Dubai. It is now playing in this league and should benchmark everything about its economy and government to keep pace with competitors. It has to be competitive in terms of flexibility of air transport, cost of bandwidth, creativity and social life.