African Development Bank President Dr Akinwumi A. Adesina has said that a concerted effort to change the narrative on Africa in the United States is necessary to attract increased investments into the continent.
He said the need for advocacy in the United States made having an African Development Bank office in Washington a matter of importance, and that he would be pursuing approval with the Board of the African Development Bank Group.
Meeting with African ambassadors at the chancery of the Embassy of the Republic of Congo in Washington on 1 October, Dr Adesina said: “We are a responsive and solutions bank at the heart of Africa’s development, and at the core of our work as a multilateral development bank, there is a very clear strategy to fast-track Africa’s development.”
In a comprehensive tour d’horizon of the Bank’s priority agenda, Dr Adesina began by thanking the ambassadors for their strong support for his re-election to a second consecutive five-year term last year under the leadership of their Dean, Ambassador Serge Mombouli of the Republic of Congo.
Speaking to the Bank’s core objectives, he drew the ambassadors’ attention to the UNDP’s assessment, which showed that if Africa achieved the Bank’s High 5 priorities, it would have achieved 90% of both the African Union’s Agenda 2063 and the UN Sustainable Development Goals.
Promising results at scale
The African Development Bank chief told the ambassadors that the results already spoke for themselves. In the past five years, he explained, the Bank, through its High 5s, had positively impacted the lives of 335 million people. He said that 21 million people had gained access to electricity, 76 million people to agricultural technologies to ensure their food security, and 12 million people had gained access to finance through the investee companies the Bank itself had invested in. He also revealed that 69 million people had benefitted from improved transport infrastructure, while 50 million people had benefitted from improved water and sanitation.
“This is the kind of scale on which we work,” Dr Adesina said, explaining that the desired level of development will not come about by small projects but by those of scale.
The Bank chief said the Covid-19 pandemic had made the challenge of development tougher, with 5 million Africans infected by the virus and more than 200,000 lives lost. The Bank, he explained, had moved quickly, launching a $10 billion crisis response facility to provide fiscal support to countries, and going to the international capital markets to launch a $3 billion fight Covid-19 social bond – the largest social bond denominated in US dollars ever done in the world.
Dr Adesina decried the vaccine nationalism by developed countries. He said Africa had only fully vaccinated 24 million people, a mere 2% of its population. “In Africa we have 4.4% of the population receiving one dose, and 1.8 % of the population receiving the second dose. Compare this to 70% in Europe and 56% right here in the United States, respectively,” he said. “So, while developed countries are moving to booster shots, Africa is still struggling to just get basic shots.”
An African healthcare defense system
The African Development Bank president said Africa must learn some critical lessons from this experience. “Africa cannot, and Africa must not, outsource the health security of its 1.3 billion people to the generosity and the benevolence of others,” he stressed. “Africa must ensure health security for its people with a good healthcare defense system. Another virus will come, and we cannot be in this situation where we are not able to respond or where we are the last to be able to get access to vaccines.”
Dr Adesina said Africa must develop its indigenous pharmaceutical manufacturing capacity. He said this was important not only for Covid-19, but also for other viruses to come after Covid-19. As part of efforts to revamp Africa’s quality healthcare infrastructure, the African Development Bank is investing $3 billion dollars to support pharmaceutical and vaccine production on the continent.
The issue of debt sustainability also had resonance. The Bank president and the envoys agreed that the75% rise in Africa’s debt to GDP and the continent’s quantum $845 billion of debt was a matter of grave concern. The share of Africa’s debt from private and commercial debt has risen from 17% in 2002 to 40% today. Most of this is high yield short-term debt.
Dr Adesina said the recent issuance of $650 billion special drawing rights (SDRs) by the IMF offered a unique opportunity to support countries going forward. He commended IMF Managing Director Kristalina Georgieva for her role in making this possible, as well as support from US President Joe Biden and US Treasury Janet Yellen.
While Africa is the least resourced region to tackle the continual effects of the Covid-19 pandemic, the continent only stands to receive $31 billion out of $650 billion in SDRs. Dr Adesina advocated a reallocation of SDRs by developed countries to developing countries, and to Africa in particular. He commended French President Emmanuel Macron for his leadership by example in recently announcing France’s donation of 2% of its own allocation of SDRs to Africa.
The group learned that the Bank was spearheading efforts to help Africa tackle climate change; and that it had doubled its allocation for climate finance to $25 billion by 2025 with 40% of its total financing going to climate finance. While Africa contributes less than 4% of greenhouse gases, it does suffer from it and has been found – by the International Intergovernmental Panel on Climate Change – to be heating up faster than the rest of the world – 10 years faster than originally projected.
“This is why the Bank is responding. We are increasingly applying more of our resources to climate adaptation,” Dr Adesina said. “Today, 67% of all our climate finance is in adaptation, which is the highest of any international financial institution in the world.” He quoted UN Secretary-General António Guterres’ recent commendation of the Bank’s leadership when he said at the UN General Assembly: “The African Development Bank has set the bar in 2019 by allocating half of all its climate finance to climate adaptation. Some donors have followed their lead. All must do so.”
Dr Adesina also spoke about the Bank’s collaboration with the Global Center on Adaptation to mobilize $25 billion for African climate adaptation.
Outlining the Bank’s efforts to light up and power Africa, Dr Adesina spoke about how the institution was harnessing the extensive sources of solar, hydro, wind and geothermal power. He highlighted the Desert to Power project, a $20 billion investment by the Bank and its partners to create the world’s largest solar zone in the Sahel. It will help to develop 10,000 megawatts of electricity and provide electric power to 250 million people.
On the environment, the Bank president spoke of efforts to protect very fragile and vulnerable regions of the continent from the impact of climate change. He talked about the Great Green Wall initiative launched by the Bank and the African Union, designed to provide an environmental defence shield in the Sahel and the Sahara against desertification.
Trade and investment
On trade, Dr Adesina said the African Continental Free Trade Area (AfCFTA) represented a huge opportunity to transform Africa with a combined GDP of $3.3 trillion, the largest free trade zone in the world. He said the size of consumer and business expenditures in Africa would rise to $6.7 trillion by 2030. “Africa is no longer a continent that can be ignored,” he said. “And if you are not investing in Africa, the question I would ask is: where in the world are you investing?”
The ambassadors were presented with several examples of Bank-financed infrastructure projects that were impacting development across the continent. The Bank has invested over $40 billion in infrastructure, working closely with the African Union’s New Partnership for Africa’s Development.
“The African Development Bank is the largest financier of infrastructure in Africa – far above the World Bank and far above any institution that you can find,” Dr Adesina told his audience.
Dr Adesina said Africa’s massive infrastructure needs presented viable economic investment opportunities for institutional investors in Africa and those from the United States.
“This is the time to change the investment narrative on Africa in the United States,” he stressed. “The African Development Bank is developing strategic alliances and partnerships, taking advantage of the new outlook of new US administration.
“We are working closely now that the US Development Finance Corporation, The Millennium Challenge Corporation, the Corporate Council on Africa, the United States Trade Development Agency, USAID, and of course, the Department of Energy, PROSPER Africa, and the US Exim Bank to launch a new approach of working together to massively direct US capital investments to infrastructure in Africa.”
The African Development Bank president applauded the US government’s Build Back Better World launched by President Biden. He enjoined the ambassadors as African diplomatic envoys in Washington to help to make this initiative a huge success, describing it as a unique opportunity for Africa. “It is time to expand US investments in Africa at scale,” he stressed.
Africa Investment Forum
While on the subject shoring up US investments in Africa, Dr Adesina spoke about the forthcoming Africa Investment Forum, an annual forum organized by the African Development Bank, which has become Africa’s premier investment marketplace. He said it presented the perfect opportunity to attract greater US investment in Africa.
The ambassadors learned that the maiden edition of the forum in 2018 mobilized $30.7 billion of investment commitment interests to Africa – and this in less than 72 hours.
The Bank president said: “Some people used to think that Africa was not bankable, I know Africa is bankable. I just don’t know where your bank is. You should bring your bank to Africa.”
He said that in 2019 the African Development Bank mobilized $40 billion in investment interest – again, in less than 72 hours. This included a $24 billion transaction for liquefied natural gas in Mozambique and will make Mozambique the third-largest producer of liquified natural gas in the world.
The African Development Fund 16th Replenishment
The African Development Bank president called on the ambassadors to support the 16th replenishment of the African Development Fund, the Bank’s concessional lending window, which it uses to support low-income and fragile states. He said it was desirable that the African Development Fund be allowed by donors to go to the capital market, just like the World Bank Group’s International Development Association (IDA) had gone to the capital market.
“We have equity in the African Development Fund of $26 billion. But we can go to the capital market and raise an additional $33 billion that we can use to scale up support for African economies, especially low-income countries,” Dr Adesina told the ambassadors. “Your advocacy with donor countries, especially the United States Treasury, and the mobilization of strong support for this is crucial.”
A physical presence in Washington
Finally, the African Development Bank chief said the need for advocacy and for changing the narrative on Africa in the United States made having an African Development Bank office in Washington a matter of importance, and he would be pursuing approval of this with the African Development Bank Board. “It is very important that Africa’s voice be heard. It is very important to have the mindset on Africa change,” he said.
Dr Adesina concluded by emphasizing that “Africa was not begging for help. Africa is an investment destination for the United States, and it must be respected by all, as the frontier of investment in the world.”
The African ambassadors showed enthusiastic support for the Bank’s agenda and commended Dr Adesina for his leadership. They decried the imposition of vaccine passports by developed countries, which was found to be discriminatory against travellers from Africa. They agreed on the need to change the mindset of Africa as a welfare continent that only received but rather one that had a lot to offer.
The ambassadors thanked Dr Adesina for his guidance and welcomed the continued technical support of the Bank, which they felt would make up for the technical expertise that they did not necessarily have in the areas of the Bank’s comparative advantage. There was broad agreement that a Bank office in Washington was timely.
The group said they were engaging with the new administration in Washington and found that there was a new mood in Washington – an interest in doing business with Africa.
New Project to Support the Emergence of a Digital Economy in Djibouti
The World Bank today approved a US$10 million credit from the International Development Association (IDA), the World Bank’s program for the poorest countries, in support of Djibouti’s efforts to accelerate the digital transformation and build a more inclusive digital economy.
While Djibouti has made significant inroads in becoming a digital hub in regional connectivity and data markets, many Djiboutians do not fully benefit from the country’s connectivity infrastructure. The new Digital Foundations Project aims to ensure that more citizens and businesses have access to quality and affordable internet by developing an enabling environment for the gradual introduction of competition and private-sector investment in information and communication technology (ICT), and by fostering the uptake of digital skills and services. The project is aligned with the new Country Partnership Framework and Djibouti’s Vision 2035, which recognize the role of ICT in economic growth.
“Accelerating digital transformation in Djibouti is an urgent necessity for post-COVID-19 recovery,” said Ilyas Moussa Dawaleh, Djibouti’s Minister of Economy and Finance in charge of Industry. “Stimulating economic growth, innovation and job creation through technology is an opportunity that will benefit present and future generations.”
The new financing will strengthen the capacity of the public sector, specifically the Ministry of Communication, with responsibility for Posts and Telecommunications, the Delegate Ministry in charge of Digital Economy and Innovation and the Multi-sectoral Regulatory Authority of Djibouti, to promote digital economy and market competition. It will provide support to micro, small and medium enterprises (MSMEs), while boosting Djibouti’s resilience to external shocks, including disaster response and climate monitoring.
“COVID-19 has highlighted the importance of digital technologies,” said Boubacar-Sid Barry, World Bank Resident Representative in Djibouti. “With this new project, the Bank supports Djibouti in its efforts to address vulnerabilities and create a favorable environment for the development of an inclusive and safe digital economy.”
The project will also support the development of digital skills programs for entrepreneurs and the integration of basic digital skills into school and university curricula. It is anticipated that the project will benefit all segments of Djibouti’s economy and society, including the public and private sectors, women, youth and underserved rural populations. Citizen engagement will be an essential component of the program.
According to Eric Dunand and Tim Kelly, co-Task Team Leaders, “The project will help Djibouti to harness its digital potential. A high-performing digital economy in Djibouti, based on a well-developed ICT sector, will have many benefits. Wider use of digital technologies will help the government improve service delivery, offer youth more job opportunities, and entrepreneurs, more business prospects in diversified economic sectors.”
The World Bank’s portfolio in Djibouti consists of 14 projects totaling US$258 million in financing from IDA. The portfolio is focused on education, health, social safety nets, energy, rural community development, urban poverty reduction, the modernization of public administration, governance, and private sector development with an emphasis on women and youth.
Violence in Cameroon, impacting over 700,000 children shut out of school
Over 700,000 children have been impacted by school closures due to often brutal violence in Cameroon, according to an analysis released by the UN humanitarian arm, OCHA, on Thursday.
Two out of three schools are closed in the North-West and South-West regions of the country. On 24 November, four children and one teacher were killed in an attack in Ekondo Titi, in the South-West.
A recent lockdown imposed by a non-State armed group, from 15 September to 2 October, limited access to basic services including health and education.
During the period, OCHA reported a series of attacks in the North-West.
Eight students were kidnapped, and a girl’s fingers were chopped off after she tried to attend school. Five public school principals were also kidnapped, including one who was then killed.
All schools and community learning spaces were closed, except for some schools in a few urban areas which operated at less than 60 per cent capacity.
The lockdown and insecurity also forced UN agencies and aid organisations to temporarily suspend the delivery of aid. During that time, about 200,000 people did not receive food.
Nine out of ten regions of the country continue to be impacted by one of three humanitarian crises: the crisis in the North-West and South-West, conflict in the Far North, and a refugee crisis, with people fleeing the Central African Republic.
Because of these combined crises, over one million children need urgent education support.
To answer some of these needs, Education Cannot Wait (ECW), the UN global fund for education in emergencies and crises, is working closely with UN agencies, the Norwegian Refugee Council and other civil society partners.
ECW is contributing $25 million over three years and calling for other donors to fill the gap, which is estimated at $50 million.
When fully funded, the programme will provide approximately 250,000 children and adolescents with access to safe and protective learning environments in the most-affected areas.
Just this week, the Secretary-General of the Norwegian Refugee Council, Jan Egeland, and the Director of Education Cannot Wait, Yasmine Sherif, had a joint visit to the country.
In a statement, Ms. Sherif said the situation “is among the most complex humanitarian crises in the world today.”
“Children and youth are having to flee their homes and schools, are threatened with violence and kidnapping, and being forced into early childhood marriage and recruited into armed groups,” Ms. Sherif recalled.
Jan Egeland argued that “putting a schoolbag on your back shouldn’t make you a target”, but unfortunately children in Cameroon “risk their lives every day just showing up for school.”
“Cameroon’s education mega-emergency needs international attention, not deadly silence by the outside world,” Mr. Egeland declared.
Uganda Economy to Rebound but Could Take Longer to Become a Lower-Middle-Income Country
Uganda’s growth is expected to be between 3.5% and 4.0% in Fiscal Year (FY) 22 and about 5.5% in FY23; both projections are about one percentage lower than the June 2021 forecast, according to the latest edition of the Uganda Economic Update (UEU). The economic recovery in FY21 tapered off in early FY22 mainly due to the more severe second COVID-19 wave in mid-2021 and the related lockdown measures.
The 18th UEU: Putting Women at the Center of Uganda’s Economic Revival says that although growth rebounded since the start of the COVID-19 crisis – driven by a pick-up in private consumption and investment, and a recovery in exports – the country is still likely to face a stop-start recovery until there is wider coverage of the COVID-19 vaccine.
“To ensure an inclusive economic recovery, faster deployment and widespread coverage of the vaccine is critical,” saidMukami Kariuki, World Bank Country Manager for Uganda. “It is encouraging to note that in January 2022, schools will be opened; and support to micro, small and medium enterprises has been prioritized to stimulate job creation. Staying the course will require sustained prudent and transparent fiscal and debt management.”
The update notes that there has been a rise in poverty and household vulnerabilities, widening of inequalities, and a significant threat looms to human capital development, especially in the education sector where schools have been fully or partially closed for a large part of the last two years.
“Even with higher growth prospects, per capita GDP will remain well below the target of the Third National Development Plan, meaning Uganda will now take longer to become a lower-middle-income country,” saidRichard Walker, Senior Economist, and co-author of the UEU. “Significant uncertainty remains on the evolution of COVID-19; weather shocks are a perennial threat; while lower revenues, spending pressures and adjustments to the government’s debt profile could jeopardize Uganda’s hard-earned macroeconomic stability.”
On the upside, commodity prices have recovered, digital technologies and the digital economy continue to support new ways of operating and doing business, and the potential for Ugandan women to drive the recovery is enormous, but only if they have fair and equal opportunities to reach their full potential.
The UEU’s special focus this year is on women’s economic empowerment, which is essential to an integrated response to shorter-term recovery needs and longer-term actions that will address deeper gender inequalities and foster more inclusive and sustainable growth.
“Uganda’s economic recovery will be faster, stronger, and more sustainable if it brings more women into the center of profitable economic activity,” said Jennifer Solotaroff, Senior Social Development Specialist, and co-author of the UEU. “Not investing in women deprives households and the economy of the contributions they would make and slows its transition out of agriculture.”
The update urges Uganda to keep girls in school; invest in interventions to ease women’s unpaid care work responsibilities; create more time for women’s wage employment or entrepreneurship; pass and enforce laws protecting gender-equal rights for heirs and descendants to inherit land and other family assets; improve financial literacy among women, increase women’s access to formal financial services; meet women’s demand for more credit by passing laws prohibiting gender discrimination in access to credit; and promote alternative methods to establish women’s creditworthiness.
The benefits of investing in women’s marketable job skills and growth-oriented entrepreneurship will accrue not only to women, but to their households and, by extension, the whole of Ugandan society.
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