AfDB Annual Meetings open in Ahmedabad: Deliberations underscore win-win Africa-India cooperation
The 52nd Annual Meetings of the Board of Governors of the African Development Bank (AfDB) and the 43rd Meetings of the Board of Governors of the African Development Fund (ADF) opened in Ahmedabad, India, on Tuesday, May 23, 2017 with calls for greater cooperation between the Bank and India to help drive Africa’s transformation.
Addressing over 3,000 participants at the Mahatma Mandir Conference and Exhibition Center, the President of the African Development Bank Group, Akinwumi Adesina, highlighted the Bank’s efforts in the implementation of its Ten Year Strategy encapsulated in the High 5 priorities. These are, Light up and power Africa, Feed Africa, Industrialise Africa, Integrate Africa, and Improve the quality of life for the people of Africa.
With the ever-increasing need to meet the demands of the High 5s, Bank Group operations went up by over 17% to 305 in 2016. In the same vein, cumulative investments, rose by 19% to US$ 10.45 billion over the figure for 2015.
In real terms, over 22 million people benefitted from Bank finance services ranging from access to water and sanitation to healthcare, electricity, agriculture, and transport, among others; while 630,000 people mainly youth and women benefitted from its “agripreneurs” project aimed at attracting young graduates to agriculture as business.
The central theme of the Annual Meetings, “Transforming Agriculture for Wealth creation in Africa,” underscores the importance of agriculture for Africa’s transformation and the Bank is banking on the continent’s bulging youth population engaging in agriculture as a business for real transformation to take place.
“To develop with pride, Africa must feed itself,” Adesina said noting that the continent’s food imports bill would nearly triple to reach US $110 billion per year by 2025 and disrupt the continent’s macroeconomic and fiscal stability.
Adesina also raised the issue of youth unemployment in Africa and how the Bank has embarked on creating 25 million jobs that would impact 50 million youths within 10 years in which it invested US $800 million in 2016 to support 50,000 young commercial farmers and agribusiness entrepreneurs in eight countries.
Investing in agriculture will enable African economies to grow by 10-20%, he said. It would reduce the one million migrants who travelled from Africa to Europe in 2016 alone, and avoid the loss of over 5,000 young lives, whose future now lies buried at the bottom of the Mediterranean Sea.
Adesina also emphasized the need to bring in the private sector in the Bank’s High 5s projects; with the imminent launch of the Africa Investment Forum, a completely transactional Forum to enable mega deals and fast-track investments in Africa by pension, sovereign wealth, insurance and other institutional investors.
“Our job as Africa’s Bank is to bank on Africa’s future. We will trust the youths, we will support their dreams, we will spark their creativity and we will enable their entrepreneurship,” he said.
Adesina emphasized the fact that to do more for Africa, its economies, its youth and women – the Bank would need more resources. Therefore, there is a need to begin discussions on the recapitalization of the Bank. He cited the plea made by the German Minister for Development and International Cooperation Gerd Mueller who, during his recent tour of some African countries and visit to the Bank said, “The African Development Bank is the voice for Africa. It should be given more resources to do more for Africa.” In this regard, a recapitalized bank will be able to deploy resources to meet the rapidly rising needs of a continent for development.
“Africa’s huge investment opportunities beckons to you, from agriculture and agribusiness to energy, infrastructure and financial services – and the African Development Bank and its partners will be there to help you advance your investments,” Adesina added.
Prime Minister Modi calls for Asia-Africa Growth Corridor
For his part, Prime Minister Modi reiterated the centuries-old strong ties between India and Africa, noting that India’s partnership with Africa is based on a model of cooperation that is responsive to the needs of Africa. “India is the fifth-largest investor in Africa and has invested US $54 billion in the continent in the past two decades,” he said.
He called for an Asia-Africa Growth Corridor for development of Africa, supported by Japan and India.
There is a great deal of development know-how to be gleaned in India – from the development of modern IT systems, to the management of sprawling rail infrastructure – that Africa can benefit from. “By 2018, no village in India will be without electricity,” said Modi, who for 15 years was the Chief Minister for Gujarat, home state of Mahatma Gandhi.
The Prime Minister concluded by saying that while India may never compete with long-distance runners, India would always stand shoulder-to-shoulder with Africa in the great development marathon.
Bill Gates sends message of solidarity
For his part, Bill Gates conveyed his support to the meetings in a video statement emphasizing the importance of partnering with Africa. He said partnership is a powerful way to help Africa move forward.
Presidents Macky Sall of Senegal and Patrice Talon of Benin, as well as Vice-President Daniel Kablan Duncan of Côte d’Ivoire participated in the ceremony alongside India’s Minister of Finance, Arun Jaitley, and the Chief Minister for Gujarat State, Vijay Rupani.
Keynote speech by AfDB Group President Akinwumi A. Adesina
I hear that for the people of Ahmedabad, trade and business is in your blood. Prime Minister Modi, who is from Ahmedabad, is so passionate about trade and investments. It is in the blood: your successful India-Africa Forum Summit reinforces the need to boost trade, investment, education and economic partnerships.
Well, Africa is the place to be. 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. In 2016, 12 countries grew at over 5% and 20 countries grew by 3-5%. 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.
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.
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....
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.
To develop with pride, Africa must feed itself. Africa’s food import bill stands at US $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% 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.
Africa, which produces 75% of the world’s cocoa, receives only 2% of the US $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…. In 2016, we invested US $1.7 billion in energy and leveraged US $2.5 billion…. Our support last year provided 22,000 kilometres of distribution lines.
The Bank hosts the Africa Renewable Energy Initiative, co-developed with the African Union, with commitments of US $10 billion by G7 countries and the European Union. We are delighted with Prime Minister Modi’s launch of the International Solar Alliance and look forward to the establishment of the India-Africa Energy Co-Financing Fund between Government of India and the African Development Bank.
Climate change is affecting Africa badly. East and Southern Africa have been hit by droughts, costing many lives and putting over 20 million people at risk of famine. It’s the worst humanitarian disaster since 1945. We are taking action. Our Board of Directors recently approved the framework for our “Say No to Famine” campaign for a comprehensive response, which will provide short-, medium- and long-term support of US $1.1 billion to South Sudan, Somalia, Ethiopia, Kenya and Nigeria. We’ve got to build climate resilience for Africa. The promises made to Africa on climate adaptation must be kept, not dismissed or unpaid. Adaptation to climate change is what is needed, not adaptation to promises made....
Africa’s youth population will rise from 434 million to 840 million by 2050 and Africa will become the youngest region of the world. 38 out of the 40 countries that will be the youngest nations are African. The median age for Africa will be 25 years. If this huge demographic asset is well tapped and well trained, it will make Africa the talent centre of the future.
But today their situation is not prosperous. One third of them are unemployed or discouraged, one third is in vulnerable employment and only one sixth are in wage employment. If we can cut back the unemployment rate of the youth to the same as adults, African economies will grow by between 10-20%....
Africa’s youth unemployment stares us in the face, stirs up our conscience and calls us to action. Africa’s youth don't need handouts; they need support to spark their creativity and unleash their entrepreneurship. We are taking action. That’s why the Bank launched the Jobs for Youth in Africa, designed to support Africa to create 25 million jobs for youths and impact 50 million youth within 10 years. Making agriculture cool for the youth is a key part of our action plan. That’s why we invested US $800 million in 2016 to support 50,000 young commercial farmers and agribusiness entrepreneurs in eight countries. Some of them are in this room today. They are the future for Africa’s agriculture.
Our job as Africa’s Bank is to bank on Africa’s future. We will trust the youths, we will support their dreams, we will spark their creativity and we will enable their entrepreneurship.
We will do more, as our resources expand, for we cannot wait to give hope for millions of Africa’s youth. To do more for Africa – its economies, its youth and women – the Bank needs a lot more resources. That’s why it will be critical to begin discussions on the recapitalization of the Bank. The German Minister for Development and International Cooperation Gerd Mueller got it right when he said: “The African Development Bank is the voice for Africa. It should be given more resources to do more for Africa.” A recapitalized Bank will be able to deploy resources to meet the rapidly rising needs of a continent so thirsty for development. It will allow the Bank to deliver on its High 5s and allow Africa to meet 90% of its SDGs. The High 5s is the best deal for Africa’s development.
But fast-tracking Africa’s development also means fast-tracking private investments. For those of you with “business in your blood”, let me make the case for your investments. Think of a continent that will have the same population as India and China taken together by 2050. Think of a continent with rising middle class, rapid urbanization and that will have the youngest population on earth by 2050. Think of a continent where consumer spending is projected to reach US $1.4 trillion in the next three years and business-to-business spending to reach US $3.5 trillion in the next eight years. Think of the continent that accounted for 30% of global business and regulatory reforms in 2016.
Don’t look far: Think Africa!
To help unlock massive investments in Africa, we are taking action. I am pleased to announce that the African Development Bank will be launching later this year the Africa Investment Forum. This will be a totally transactional Forum that will be all about making deals happen and fast-tracking investments in Africa by pension, sovereign wealth, insurance and other institutional investors.
So, Africa’s huge investment opportunities beckons to you, from agriculture and agribusiness to energy, infrastructure and financial services – and the African Development Bank and its partners will be there to help you advance your investments.
Let’s move forward to a greater Africa. Let’s together accelerate Africa’s development. Africa’s greater future is for the bold. Yes, we have challenges, but we will overcome them. As John Legend said in his song, “If you’re out there”: “The future started yesterday and we’re already late. So, let’s give Africa the High 5s and let’s strongly support the African Development Bank to get the job done!
I wish you a fruitful and enjoyable Annual Meeting.
Thank you very much! Dhanyavaad!