Panetta stresses infrastructure and regulation for African job growth
Bank of Italy Governor Fabio Panetta emphasized the urgent need for job creation in Africa and developing economies. Speaking at a conference in Rome, he highlighted core infrastructure and robust business environments as critical pillars for employment growth.
Africa's demographic imperative
Over the next decade, approximately 1.2 billion young people are projected to enter the labour force in developing countries, significantly outpacing current job creation.
Africa alone is expected to host a quarter of the world's youth population by 2050.
Panetta underscored that whether this demographic transformation yields a dividend or becomes a source of instability hinges on the ability to generate sufficient employment opportunities.
He noted that while globalization previously expanded economic opportunities, progress has become fragile due to the pandemic, rising trade disputes, renewed protectionism, and growing geopolitical tensions.
Rapid technological change, particularly artificial intelligence, is also reshaping production and labour demand, creating new challenges for job creation.
Two pillars for inclusive growth
Translating innovation into more and better jobs, rather than deeper inequality, requires foundational elements such as infrastructure, digital skills, access to finance, and credible institutions.
Many low-income countries face severe fiscal constraints, limiting public investment in infrastructure and increasing the urgency to attract private capital.
Panetta stressed that unlocking private sector resources at scale depends on creating an environment where firms can invest, expand, and absorb labour.
This rests on two mutually reinforcing pillars: strengthening productive capacity, notably infrastructure and human capital, and improving regulatory quality to stimulate firm entry, investment, and employment growth.
The Mattei Plan, launched by the Italian Government, underpins this integrated agenda.
A pragmatic roadmap for Africa
Panetta's remarks provide a clear, actionable framework for addressing Africa's job crisis, moving beyond broad statements to concrete policy areas.
The emphasis on both physical infrastructure and regulatory quality correctly identifies the systemic challenges.
This integrated approach is crucial for translating demographic potential into sustainable economic opportunity.