‘ Africa’s transformation depends on how well we mobilize inputs and promote infrastructure through Africa50’
#AceFinanceNews – NEW YORK – On 16 October 2014 / PRN Africa / -The Ninth African Development Forum (ADF) opened on October 13 in Marrakech with the call by the African Development Bank Group (AfDB) for stronger emphasis on infrastructure and for ownership of the Africa50 Fund, “a profit-driven entity seeking to provide risk-adjusted returns to its investors, while building Africa of the future.”
Speaking on behalf of the Bank Group, Operations Vice-President, in charge of Agriculture, Human Development and Governance, Aly Abou-Sabaa, said he believes in Africa’s transformation.
He said many countries in the region are hungry for infrastructure investments, and now is the best time for African governments and their development partners to focus on fast-tracking resources.
Abou-Sabaa said infrastructure is vital for transformation, but added that “other sectors are central, including agriculture, good governance, health, education systems.
“Africa’s transformation cannot occur with weak governance, health or education systems or within a context of prevailing food insecurity,” he said. He also addressed various unforeseeable crises prevailing in the region, including HIV-AIDS, malaria and Ebola.
The Vice-President explained that in spite of agriculture contributing up to 25% of Africa’s GDP and employing about 60% of the population, the continent still imports US $25 billion worth of food every year. “The Bank is promoting participation of anchor investors in private sector investment in agriculture,” the Vice-President stated.
Infrastructure, a gap of US $50 billion annually:
The big challenge is that Africa invests only 4% of its collective GDP in infrastructure, compared with China’s 14%. For the continent’s future to be rosy, its premier development finance institution – the AfDB Group – has made every effort to help bridge the infrastructure gap.
Abou-Sabaa expounded on the Bank’s estimates, observing that “the annual financing need for African infrastructure is about US $95 billion, of which only US $45 billion is currently invested each year, from African governments, development finance institutions and the private sector.”
Building on these facts and figures, Abou-Sabaa argued that Africa’s transformation largely depends on how well countries mobilize inputs from a range of stakeholders, promote infrastructure through new vehicles such as the Africa50 Fund, invest in their human capital, and foster good governance to enable a business-conducive environment.
Africa50 Fund to directly inject US $10 billion in projects:
He also said the Bank has created Africa50 Fund, headquartered in Casablanca, as the new game-changing solution to stimulate and drive the African infrastructure market.
The Africa50 Fund, “seeks to reconcile governments’ strategic objectives of meeting the substantial investment needs in infrastructure and the attractiveness of African assets to the growing sources of domestic and international capital,” Abou-Sabaa said.
More importantly, the long-term strategic aim of Africa50 is to invest directly US $10 billion in projects, and facilitate total project investments of US $100 billion by crowding in private-sector players and enticing investors.
The Bank Group in recent years has put much emphasis on the key role played by the private sector in implementing infrastructure projects, especially in the power and transport sectors, for the development and transformation in Africa.
AfDB strongly believes in Africa’s transformation:
The Operations Vice-President vividly called for a significant involvement of the private sector, as well as more bankable projects with viable local financial markets capable of leveraging project investments.
Stressing the need for sustainable tax systems and systematic analysis of new and innovative ways of mobilizing domestic resources, the Vice-President offered the Bank’s assistance to African countries in reforming their tax systems and in modernizing revenue administration systems including, where appropriate, systems automation.
The opening session also heard keynote addresses from the Kingdom of Morocco, Ivoirian President Alassane Ouattara, Senegalese President Macky Sall, as well as Cape Verde’s Prime Minister, José Maria Pereira Neves.
The ADF in Marrakech brings together more than 800 participants, comprising political leaders, government officials, academics, key players of the private sector and civil society organization as well as national and international media.
The ADF is a flagship biennial event of the UN Economic Commission for Africa, convened in collaboration with the African Union Commission, the African Development Bank and other key partners. The event, which runs from October 12-16 in Marrakech, offers a multi-stakeholder platform for debating, discussing and initiating concrete strategies for Africa’s development.