World Economic Forum on Africa kicks off in Cape Town

The 18th World Economic Forum on Africa kicked off in Cape Town, South Africa on Wednesday under the theme of "Capitalizing on Opportunity."

Klaus Schwab, founder and executive chairman of World Economic Forum, said in the opening ceremony that Africa needs partnership.

Some key issues and key risks and challenges that Africa is facing would be addressed at the meeting.

John Kufuor, president of Ghana, Thabo Mbeki, president of South Africa, Bingu Wa Mutharika, president of Malawi, Pierre Nkurunziza, president of Burundi and Raila Odinga, prime Minister of Kenya were present at the opening ceremony.

The leaders expressed optimism about Africa's future. Kufuor said that the opportunity for Africa was immense, and, with time and good coordination, the Africans could make it a powerful entity.

This opinion was agreed by President Nkurunziza, who said Africa was a rich continent and it had no right to be poor.

Africa has seen annul economic growth of more than 5 percent for four consecutive years. In the year of 2008, the growth rate in sub-Saharan Africa is expected at 6.2 percent.

However, the continent also faces many challenges. President Mbeki pointed out that the instability was the major risk that impacts Africa negatively.

In a report dubbed "Africa@ risk" released before the forum, the experts of Global Risk Network said Africa was facing 26 interconnected global risks, of them, four have been identified as being critical for Africa's future.

They are food insecurity, political instability, external economic shocks and climate change. More than 800 decision-makers, experts and entrepreneurs from 50 countries participate in this forum which will last to June 6.

The first one to be stressed is food insecurity which has emerged as a major risk for Africa. High and rising food prices impact disproportionately on poorer communities, high dependence on food imports and food aids lead potentially to social unrest.

Another negative factor is political instability. Eight out of the 10 most vulnerable and weak states are in Sub-Saharan Africa. Political instability, institutional incapacity and social unrest inhibit foreign capital inflows and lower investment appetites, negatively affecting economic opportunities.

Meanwhile, Africa is vulnerable to economic shocks. Any pronounced slowdown in world growth would affect African exports of agricultural products, minerals and hydrocarbons. Africa's dependence on natural resource exports has made many countries vulnerable to commodity price shocks that are outside their control. Sudden increases in export revenues or import costs can cause currency instability and budget uncertainty.

In the medium term, growing income inequalities might generate social unrest and violent conflicts.

The wealthiest decile of the population across the continent still controls between 30 to 60 percent of total income.

Many African countries appear in the lowest positions of the United Nations' Human Poverty Index.

Africa contributes least to global climate change, with only 5 percent of greenhouse gas emissions, but it is the most vulnerable region to the expected negative effects.

In other regions there is still a sense that the consequences of climate change lie in the future, in Africa it's being felt now.

The impacts on the continent include greater frequency and severity of extreme weather events, raising the threat of further food and water insecurity and more poverty, disease and population displacement.

These impacts are idiosyncratic: there will be local winners and losers. At the same time, opportunities will be created by the need for new investments.

These four threats to Africa's future are not isolated risks. Their drivers, triggers and potential consequences are highly interconnected. They will all be addressed in the meeting.

Since the forum started many years ago, the participants had made some progress to help Africa, said E. Neville Isdell, chairman and chief executive officer of Coca-Cola here on the same day.

"People come together to bring about the solutions to engage the triangle of government, society and business, make them work effectively," he said.