MARRAKECH, Morocco, April 23, 2013/ — The African Development Bank
(AfDB) Group’s 2013 Annual Meetings (http://www.afdb.org) take place
from 27-31 May in Marrakech, Morocco. The 48th meetings of the AfDB
and the 39th meetings of the African Development Fund (ADF) will be
held under the central theme of “Structural Transformation in Africa.”
For the AfDB, transforming Africa’s economies entails diversifying and
expanding the sources of economic growth and opportunity in a manner
that promotes greater productivity for sustained and inclusive
economic development.
“A major policy challenge for Africa today is how to broaden access to
economic opportunities for its expanding population, including the
most vulnerable groups,” the Bank says in its 2012 Annual Report,
which will be presented to the institution’s Governors at the
Marrakech meetings.
“Africa requires structural transformation to propel it towards
inclusive growth,” the report says, citing high unemployment and
underemployment especially among young people and women, as one of the
main problems facing the continent today.
Structural transformation will not materialize unless there is a
concomitant investment in skills development in areas that have kept
the continent behind other developing regions. In this regard, Africa
needs to harness its natural resources to build skills for its
youthful population in order to leapfrog development and secure a
place in the global value chain. Developing skills will unleash the
dynamism of Africa’s untapped entrepreneurship potential, creating
opportunities for increased job and wealth creation. An enlightened
population is also important in Africa’s global engagement in trade
and commerce.
“The key message is that Africa should accelerate its structural
transformation by boosting the potential of its youthful population,
investing in science and technology and innovation, speeding up its
rate of economic integration, greening the economy and supporting
private sector enterprise,” the report emphasized.
The report identifies leadership, degree of economic integration at
the national, regional and global levels, as well as inclusive growth
as the key factors that can influence transformation. Regional
political events, weather, and price shocks must also be taken into
consideration.
According to the report, Africa’s transformation can be realized by
leveraging the huge potentials in some of the following areas:
– Infrastructure – Africa’s infrastructure financing needs —
about USD 390 billion in the medium term, mostly for power and energy
— are in the USD trillions in the longer term.
– Natural resources – It is estimated that Africa’s natural
resource extractive industries will contribute over USD 30 billion per
annum in government revenues in the next 20 years.
– Revenues from natural resources could finance a substantial
part of Africa’s infrastructure development. Some countries have
already issued Eurobonds for infrastructure, on the basis of
natural-resource revenues.
– Demographics – Young people comprise the bulk of Africa’s
one billion population. To convert this “youth bulge” into a
“demographic dividend” will require investing in skills and the
creation of job opportunities on a large and unprecedented scale.
– Promoting agriculture – the agriculture sector employs the
vast majority of Africa’s population, and provides direct inputs to
the agro-processing value chain, supplies food to urban areas, and is
a source of household savings for investment.
– The Private Sector – As Africa’s economies expand, the
private sector, which accounts for 90 per cent of informal employment,
will become even more important, especially in industry.
– Urbanization –- Africa’s cities, with 40 per cent of the
population in 2010 — projected to be 50 per cent in a generation, and
65 per cent by 2060 — are increasingly becoming the drivers of
consumer demand and hence economic growth.
– Governance/Investment climate – improved governance and
better macroeconomic policies – lower debt, low inflation and stable
exchange rates are essential in fostering economic competitiveness.
– Technological innovation – Investment in technology, and
particularly ICT, have greatly improved public access to information,
spurring a knowledge economy and innovative approaches to
micro-finance and the mobilization of rural producers, e.g. Kenya’s
M-PESA, Kenya’s innovative mobile banking.
The strategies to unlock Africa’s potential reside in elimination of
the causes of national and regional conflict to bring peace; visionary
leadership and strong and effective government institutions, while
empowering women and youth; strengthening human capital development
through education and training, especially in science and technology,
and improvements in basic services; fostering diversification,
especially in agriculture and rural areas, including sustainable
greening of the economy and promotion of manufacturing; and promoting
intra-Africa trade through increased domestic and regional investment,
and forging strong trade links with emerging partners.
The Bank will continue to support and monitor the transformation
efforts of the Regional Member Countries. Accordingly, the Bank has
adopted a 10-year strategy whose overarching goal is to promote
socially inclusive and environmentally sustainable economic growth.
The core operational priorities of this strategy include
infrastructure development; regional integration; private sector
development; governance and accountability; as well as skills and
technology development.