African economies show resilience as 12 countries grew at over 5 percent while 20 countries grew by 3.5 percent signaling that it is a destination for trade and investment inflows

AKINWUMI Adesina, president of the African Development Bank, AFDB, on Tuesday, May 23, at the formal opening of the banks 52nd annual meetings in Ahmedabad, India, told the world that Africa is the place to be in terms of trade and investment.

He said that despite challenging times occasioned by the global economic recession, Africa continues to post resilient growth. “Growth will pick up from 2.2% last year to 3.4% this year. These averages hide exceptional growth performance of many countries,” Adesina told thousands of delegates from all over the world attending the ongoing meetings holding from May 22 to May 26.

According to him, in 2016, 12 countries grew at over 5 percent and 20 countries grew by 3.5 percent. “Africa’s head is above waters in rising waters of global recession. Africa is resilient. But we must move quickly to unlock greater growth rates that will substantially drive down poverty and support faster diversification of the economies,” he said.

Adesina said that confidence in Africa and its potential is what drives our work at the African Development Bank. “The new kick in our steps for Africa comes from our High 5s: Light up and power Africa; Feed Africa; Industrialize Africa; Integrate Africa; and improve the quality of life for the people of Africa. The High 5s will accelerate Africa’s development. Don’t just take it from me. The United Nations Development Programme’s (UNDP) independent analysis and report shows that Africa will achieve 90% of the SDGs and 90% of Agenda 2063 by focusing on these High 5s. The distance between vision and reality is action. We need to accelerate actions on these High 5s. Africa’s future must not continue to get postponed into the future,” he said, adding: “That’s why the Bank is accelerating its investments in Africa.”

“In 2016, we approved $10.5 billion – the highest ever in Bank’s history. We disbursed US $6.5 billion – the highest ever by the Bank. The Bank is delivering for Africa and we are ready to do more. Let me summarize what we achieved in 2016 alone in ‘action units’: 3.3 million Africans benefitted from new electricity connections; 3.7 million Africans benefited from improved access to water and sanitation; 5.7 million Africans benefitted from improvements to agriculture; 9.3 million Africans benefitted from access to better health care services; 7 million Africans benefitted from improved access to transport.

“We did all these, while implementing major institutional reforms to improve institutional efficiency and effectiveness. We have rolled out our new Development and Business Delivery Model and five regional business development and delivery offices have been approved. Director generals and deputy director generals for all these offices have been appointed. I am pleased that 80% of the deputy director generals are women. We have approved the opening of new country offices in Benin, Niger and Guinea. So, President Talon, who is here with us today, will be our one of our new hosts and we are grateful to him for all his support.

“The focus of this year’s annual meeting is on our second High 5: Feed Africa. There’s no better place to have that discussion than here in India. The Green Revolution turned India from depending on the largesse of others to a food self-sufficient nation and now a global powerhouse in food. And it took just three years to turn it all around. It was not a miracle, it was political will mixed with a resolve to develop with dignity,” Adesina said while delivering his keynote address.

To develop with pride, he said Africa must feed itself. “Africa’s food import bill stands at $35 billion per year and is estimated to grow to US $110 billion per year by 2025. This has negative consequences on macroeconomic and fiscal stability. Africa must rise up quickly and unlock the full potential of its agriculture.

“Africa has 65 percent of the uncultivated arable land left in the world to feed 9 billion by 2050, so what Africa does with agriculture today will determine the future of food in the world. The key is to turn Africa’s natural comparative advantage in agriculture into a competitive advantage. We must accelerate access to high-quality seeds, fertilizers, irrigation, mechanized services and finance. And agriculture must be taken as a business all across Africa.

“Africa needs to industrialize its agricultural sector to unlock wealth. To achieve this, Africa needs to establish Staple Crop Processing Zones and Agro-industrial Zones –fully enabled with physical infrastructure – to attract private agribusinesses to locate in rural areas, create market pull for produce of farmers, and reduce high post-harvest losses in the supply chains. By doing so, we will turn rural areas from zones of economic misery to new zones of economic prosperity.

“We will be able to empower African countries to add greater value for what they produce. Our massive cotton production will translate into textile and garments. After all the price of apparels never go down, even when price of cotton declines. That’s why we are pleased to showcase the “Fashionomics” session at this Annual Meeting.”

He said Africa, which produces 75 percent of the world’s cocoa, receives only 2 percent of the $100-billion annual chocolate market. African farmers sweat, while others eat sweets. While the price of cocoa has hit an all-time low, profits of global manufacturers of chocolates have hit an all-time high. It’s time to process Africa’s cocoa in Africa, for we must end Africa being at the bottom of global value chains.

“We are taking action. That is why the African Development Bank has rolled out its Feed Africa High 5 and have committed to investing US $24 billion in agriculture over the next ten years. That’s 400% increase of annual lending to the sector. We are investing in companies like East Africa Trading Group, providing market access to millions of farmers. We have developed the Technologies for African Agriculture Transformation (TAAT), a new technology dissemination platform to take agricultural technologies to millions of farmers across Africa. As you’ve just heard from Bill Gates, we’ve jointly launched the African Leaders for Nutrition to help address the high malnutrition and stunting levels in Africa.

“But these efforts will only succeed if Africa improves access to electricity. As we solve Africa’s access to electricity, agro-industrialization will take off in Africa, boosting rural economies, creating jobs for the youth, and lifting millions out of poverty.

“We are taking action. That’s why the Bank is investing US $12 billion in power in the next five years, and leveraging US $50 billion from the private sector. We have moved quickly to set up the Vice-Presidency for Power, Energy, Climate and Green Growth, and recruited world-class staff. In 2016, we invested US $1.7 billion in energy and leveraged US $2.5 billion. Our last mile power connection in Kenya is linking one million people to electricity. We led the syndication of US $965 million A/B corporate loan for South Africa’s power utility, Eskom, the largest in Africa’s history. We provided energy sector reform budget support of US $1 billion to Algeria. Our support last year provided 22,000 kilometres of distribution lines,” he said.

—  May 24, 2017 @ 10:42 GMT