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African Development Bank gives $148 million to support Namibia’s education, agriculture

Comments (0) Actualites, Africa, Agriculture, Education

CAPE TOWN/WINDHOEK (Reuters) – The African Development Bank (AfDB) has approved a total of 2 billion rand 148 million) in loans to boost Namibia’s education and agriculture sectors, it said on Tuesday.

The funds are aimed at helping reduce youth unemployment by boosting technical and vocational training, and reducing food imports by the South-western African country.

Both the education and agriculture projects will receive additional Namibian government contribution, the AfDB said.

The south-western nation’s unemployment rate jumped to 34 percent of the working population in 2016 from 28.1 percent in 2014, the last time a labour force survey was conducted by the Namibia Statistics Agency.

($1 = 13.4738 rand)

 

(Reporting by Wendell Roelf in Cape Town and Nyasha Nyaungwa in Windhoek; Editing by James Macharia)

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Respected Cameroonian economist joins African Development Bank

Comments (0) Africa, Business, Featured

Célestin Monga

Célestin Monga has been named Vice President of the ADB and will take charge of governance and knowledge management at the pan-African financial institution.

Célestin Monga, a distinguished Cameroonian economist with a long career in global finance, has been named Vice President of the African Development Bank.

Monga will be in charge of governance and knowledge management at the pan-African financial institution.

Since 2014, Monga was deputy managing director of the United Nations Industrial Development Organization.

Prior to that, he spent 17 years at the World Bank, including working as senior economist for Europe and Central Asia. He also led a World Bank team that reviewed policies in the office of the vice president in charge of development economics and was a director for the structural transformation program in the African region.

Among top 5 economists in Africa

Monga also launched several initiatives, including debt relief for poor, indebted countries, and development of financial practices now used in many countries to protect against external financial disruption.

In 2012, he was named by Jeune Afrique magazine as one of the five best African economists. He has published economic analysis with some of the most prominent economists in the world, including Nobel laureates in economics.

Monga favors an economic integration model for Africa, in which markets coordinate more closely with an eye to exporting to the West.  “If you are a group of neighboring countries but all poor and producing the same raw materials, it is useless to invest in infrastructure to connect because there is no market or purchasing power among the others. It is necessary to seek markets where they are, especially in the West,” Monga said.

Monga holds a post-graduate degree from the University of Paris-Sorbonne. He was Mason Fellow at the Kennedy School of Government at Harvard and continued graduate studies at Sloan School of Management at the Massachusetts Institute of Technology (MIT). He received his PhD in France, at the University of Pau.

He has lectured at Boston University in the United States and the University of Bordeaux in France.

Writer and editor in economics

He is the author of several books and served as editor of the economy section of the New Encyclopedia of Africa.

His latest book on economics is the “Oxford Handbook of Africa and Economics” (2015), co-published with Justin Yifu Lin, former vice president and chief economist of the World Bank. Mongo is co-author of the forthcoming book from titled “Handbook of Structural Transformation.” His works, which explore aspects of economic and political development, have been translated into several languages and serve as teaching tools in many universities worldwide. His next book about the challenges of modernity in Africa, will be published in September.

Monga said he was “very excited” to be joining the African Development Bank at a time when its new president, Akinwumi Adesina, is plotting a new strategic course for the financial institution that promises to improve standards of living in Africa.

Bank shifts course

Adesina, who joined the bank in September, adopted a strategy of “power for all” or universal access to electricity for the continent. Lack of electricity, he said, is the greatest obstacle to development of Africa.

“The development of the energy infrastructure for Africa will drive more rapid economic and social development of the continent by reducing the cost of doing business, powering industrial growth, unlocking entrepreneurship, improving education and health systems and deepening financial services,” Adesina said.

Other priorities of the new leadership at the African Development Bank include increased investments in the private sector and a more “activist” approach to infrastructure development by helping resolve legal and regulatory bottlenecks that slow progress.

“Africa is living a crucial moment in its history and I am delighted to join the team to carry out this program,” Mongo said.

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African Development Bank: Ease visa rules to promote trade, tourism

Comments (0) Africa, Business, Featured

passport-kenya

Saying cumbersome visa requirements undermine business growth, the organization ranks visa openness of 55 nations.

Making access to visas easy or scrapping the requirement entirely is an important way governments can help promote tourism and trade among the nations of the continent, according to the African Development Bank (ADB).

The ADB has developed the Africa Visa Openness Index to assess which countries have the most open and efficient visa access. The bank says cumbersome visa procedures undermine doing business across borders on the continent.

On average, travel within the continent is often difficult because African nations are “more closed off to each other than open” the ADB said in its 2016 report (pdf) on visa access. “Free movement of people is not a reality across Africa.”

Most require visas in advance

The report said only 20 percent of the 55 countries in the index do not require visas and only 15 percent offer visas on arrival, meaning more than half require visitors to obtain visas in advance.

To make matters worse, the report said, many of Africa’s strategic hubs have restrictive visa policies while the continent’s small, landlocked and island states tend to be more open to promote trade links with neighboring countries.

The report said countries in West and East Africa tend to be more open than in other regions.

The top 10 nations for openness stand out, with an average score of 0.86 (out of 1) on the ADB index, more than double the overall average of 4.25.

Seychelles is first for openness

The top 10 countries are Seychelles, Mali, Uganda, Cape Verde, Togo, Guinea-Bissau Mauritania, Mozambique, Mauritius, and Rwanda.

At the bottom of the list are Eritrea, Ethiopia, Sudan, Angola, Gabon, Libya, Egypt, Equatorial Guinea, São Tomé and Príncipe, and Western Sahara.

South Africa was 35th on the list, Nigeria 25th and Kenya 16th.

The report said eight of the top 10 countries for openness have seen gains in travel and tourism as a portion of gross domestic product.

In Seychelles, which is visa free, tourism accounted for nearly 57 percent of the country’s gross domestic product in 2014 and was expected to increase by more than 5 percent in 2015.

Rwanda, Mauritius ease requirements

The report highlights benefits to Rwanda and Mauritius after they adopted open visa policies for visitors from other African countries in recent years.

Both countries have seen an increase in African business and leisure travelers, which has produced “an economic impact that is still growing,” the report said.

After Mauritius relaxed visa requirements for visitors from 48 African countries, more than one quarter of visitors to the nation in 2014 came from other African states, with revenue from tourism totaling $1.2 billion.

“Greater visa openness forms part of Mauritius’ Africa strategy, which aims to promote the country as a gateway for investment into the continent,” the report said.

New open visa policies are also helping Rwanda with gross domestic product growth of 7 percent in 2014 and tourism income up 4 percent to more than $300 million.

Rwanda adopted a visa-on-arrival policy and cut its fee by half, to $30, then saw visits by Africans increase by 22 percent annually.

“We are seeing more African travelers not just in tourism, but in business,’’ said Francis Gatare, chief executive officer of the Rwanda Development Bank.

ADB wants visa requirements eased

The report notes that the African Union’s Agenda 2063 calls for removal of visa requirements across the continent by 2018 and creating an African passport.

Other potential solutions include offering visas on arrival, as Mauritius and Rwanda have begun doing, creating visa-free regional blocs or visas for regional blocs, offering multi-year visas, or offering visa-free access to Africans as Seychelles does.

Other way to make travel more is to offer eVisas so the traveler can apply online rather than having to be present to obtain a visa, the report said. Currently, nine African countries offer e-Visas: Côte d’Ivoire, Gabon, Kenya, Nigeria, Rwanda, São Tomé and Príncipe, Sierra Leone, Zambia and Zimbabwe.

Questions about security

The report argues that more open visa policies will not undermine security.

“Having strong systems in place including biometric databases at border controls and joining IT systems with other countries and regions seems to be the answer. That allows information sharing and greater cooperation, which in turn minimizes risk and provides higher levels of security overall.”

The report emphasizes the importance of travel to the development of the continent in the coming years.

By 2034, air arrivals to destinations in Africa are projected to increase to 280 million from nearly 120 million in 2014.

That increase “needs to be matched by more visa-open policies on arrival on the ground,” the report said.

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Development bank: ‘High 5’s’ will drive African economic growth

Comments (0) Africa, Business, Featured

Powering and industrializing the economy of Africa are among key priorities outlined in March by the new head of the African Development Bank.

Akinwumi Adesina, president of the bank since September, told about 500 business leaders from 43 countries at the fourth Africa CEO Forum in Abidjan that the continent will rely on private investment as it seeks to advance on “the value chain” from being a source of raw materials to becoming a manufacturing economy.

Adesina said the African Development Bank will focus on five key priorities as it seeks to improve the business climate and quality of life on the continent.

The priorities, which Adesina dubbed the “High 5’s,” are:

  1. Light up and power Africa

This priority is critical to the development of a manufacturing economy, the bank president said.

He noted that more than 645 million Africans do not electricity while energy bottlenecks power shortages cost Africa about two to four percent of gross national product each year, undermining economic growth and job creation.

He said the African Development Bank has launched a program New Deal on Energy for Africa that has investment commitments of $12 billion over the next five years, in addition to public and private partnerships worth about $50 billion.

  1. Feed Africa

With two-thirds of the world’s uncultivated arable land and more than 60 percent of its population involved in agriculture, Africa could become a powerhouse in providing food to the world, Adesina said.

Nevertheless, many on the continent suffer from malnutrition and African nations are forced to import food at a high cost, some $35 billion annually.

Adesina said African leaders must change their strategy from thinking about agriculture as a way of managing poverty to treating it like a business to generate wealth and diversify economies.

  1. Industrialize Africa

In sub-Saharan Africa, manufacturing accounts for only 11 percent of economic output on the continent and less than two percent of global output.

However, without infrastructure, power, and a supportive business environment, Africa will continue to import manufactured goods that might otherwise be made in Africa, Adesina said.

  1. Integrate Africa

Adesina said the fragmentation of African economies is holding back progress and integration will be critical to driving industrialization.

He called on African governments to implement regional and inter-regional agreements that would remove barriers to integration.

He said the African Development Bank would continue to invest in regional infrastructure and work with regional partners to facilitate integration of trade and transport.

  1. Improve the quality of life for Africans

Adesina said the bank will accelerate its investments in vocational training and education to help drive economic development.

The centerpiece of this effort is the “Jobs for Africa’s Youth Initiative,” a partnership of the development bank, the United Nations Economic Commission for Africa and the African Union.

Adesina said the goal of the initiative goal is to reach 50 million young people and create 25 million jobs in the coming decade, to enable young Africans to “realize their economic potential through business incubation and financing.”

Private sector critical to growth

He said the private sector, which accounts for 90 percent of African jobs, must play a major role in the youth education initiative and in the overall development of the economy.

The private sector, he said, accounts for 90 percent of employment on the continent, 80 percent of production and two-third of investments.

He said the bank’s effort to support private enterprise includes investment in private projects. In 2015, the development bank approved private sector projects at a cost of $2.4 million out of a total of $9 billion.

Adesina said the continent is poised for growth in spite of challenges to the global economy and, in Africa, declines in commodity prices and in demand from China.

He said economic growth on the continent will outpace global growth. The global economy is projected to grow by three percent in 2016 while the predicted growth rate for Africa is 4.4 percent this year and five percent in 2017, he said.

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African Development Bank approves $1.1 billion in loans to Tanzania

Comments (0) Africa, Latest Updates from Reuters, Politics

DAR ES SALAAM (Reuters) – The African Development Bank (AfDB) has approved a loan package worth $1.1 billion to Tanzania to be paid out over five years to fund infrastructure projects and improve public sector governance, it said.

The line of credit will be used primarily to support the transport and energy sectors and improve the business environment in east Africa’s second-biggest economy.

The loans would support “transport and energy to promote domestic and regional transport connectivity and improve access to reliable, affordable and sustainable electricity,” AfDB said in a statement late on Thursday.

“The second pillar prioritises strengthening of financial management and improving the enabling environment for private sector investment and finance for sustainable job creation.”

The government plans to spend $14.2 billion to construct a new standard gauge rail network in the next five years financed with external loans. It also plans to build a new $10 billion port at Bagamoyo, expand existing airports and invest in new roads.

Tanzania, like its neighbour Kenya, wants to profit from its long coastline and upgrade existing rickety railways and roads to serve growing economies in the land-locked heart of Africa.

Tanzania boasts economic growth of 7 percent a year, yet it is largely driven by state investment and poverty remains stubbornly high.

It also has natural gas reserves that are estimated at more than 57 trillion cubic feet (tcf) and the central bank believes 2 percentage points would be added to its annual economic growth simply by starting work on a plant to process that would draw in billions of dollars of investment.

“Board members underscored the need for Tanzanian authorities to ensure that the country’s high GDP growth delivers robust economic transformation, poverty reduction and improved livelihoods,” AfDB said.

 

(Reporting by Fumbuka Ng’wanakilala; Editing by Toby Chopra)

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New African Development Bank leader puts energy at the forefront

Comments (1) Africa, Featured, Leaders

Akinwumi Adesina

The new head of the African Development Bank says his top priority is to develop the continent’s energy infrastructure to spur economic growth.

Akinwumi Adesina, known for his reforms and anti-corruption efforts as Minister of Agriculture and Rural Development of Nigeria, became president of the bank on September 1, 2015. The bank is one of Africa’s largest lending institutions and finances projects to improve electricity, water and transportation.

“My top priority will be to focus the Bank to deliver on “power-for-all” – a universal access to electricity for Africa. Nothing is more important to Africa than access to power,” Adesina said in his vision statement for his candidacy for president.

Lack of energy slows development

Adesina said lack of energy is the greatest obstacle to the development of the continent.

“The development of the energy infrastructure for Africa will drive more rapid economic and social development of the continent, by reducing the cost of doing business, powering industrial growth, unlocking entrepreneurship of millions of small and medium size enterprises, improving educational and health systems and deepening financial services, driving agro processing to create jobs,” he said.

He noted that Africa’s total energy capacity is only 147 GW – similar to that of Belgium. He wants to expand that to 700 GW by 2040 with development of renewable resources.

“Africa has 50% of the world’s renewable energy (wind, hydropower and solar) but they remain largely untapped,” he said.

Plans to fund large and small projects

He proposes a mix of large, regional projects and smaller local ones that can be developed quickly.

“The Bank cannot afford to put all its focus on large regional power projects alone, as they are very complex, have high capital exposure and risk profiles, will take time to achieve, even though they are critical,” he said.

“Under my leadership, the Bank will pursue a twin track approach: build success in the short term, deliver successful investments in power and then scale up based on success. To show quick successes, build momentum on execution and delivery for countries, the Bank will also focus on providing support for the piloting of decentralized integrated power systems within countries.”

Corruption is an obstacle

Another obstacle, he said, is corruption.

“The cost of corruption is massive; it turns the whole continent into darkness,” he said, estimating that corruption costs Africa $148 billion a year.

Africa looks to reduce carbon emissions

Adesina was a prominent voice for a unified African agenda at the recent Climate Conference in Paris and that agenda also stressed development of renewable energy sources in order to reduce greenhouse emissions.

At the time, he said Africa needs an international investment of $55 billion a year through 2030 to create an efficient energy sector that uses more renewable resources. He said the bank would contribute $5 billion in financing, 40 percent of its total investments.

Increased investment in private sector

In addition to pledging to make investments in the energy infrastructure, Adesina said the bank would increase its investments in the private sector.

He said private sector lending by the bank was $2.1 billion in 2013.

“Given that the private sector accounts for 70% of all investments in Africa, 70% of all output and 90% of all employment, there is need for the Bank to be more expansive in its private sector operations,” he said.

Adesina also said the bank will embrace an “activist” posture in support of infrastructure developments.

“The Bank will increasingly take on a transactional approach by helping countries and the private sector to resolve legal and regulatory environments that will unlock bottlenecks to project development and execution. The role of the Bank will be more of an “activist financier” that will be more engaged in driving the execution of infrastructure projects, not just ideas and master plans,” he said.

Known for agricultural reform in Nigeria

Adesina is a respected economist and agricultural expert.

Before joining the bank, he had been Minister of Agriculture and Rural Development in Nigeria since 2011. He was known for implementing bold reforms in the country’s agricultural sector, including anti-corruption efforts and infrastructure improvements. Agriculture had been long neglected as the West African country’s reliance on oil revenues grew.

During his tenure, domestic food production increased by 22 million tons while food imports decreased significantly.

In 2013, Adesina won the Forbes Africa Person of the Year award for his reforms in Nigeria’s agriculture sector. In 2014, he was selected as Anti-corruption Man of the Year and Most Transparent and Accountable Minister of the Federal Republic of Nigeria by the Foundation for Transparency and Accountability.

He holds a master’s degree and a PhD in agricultural economics from Purdue University.

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African Development Bank approves $1.5 billion loan to Egypt

Comments (0) Business, Latest Updates from Reuters, Middle East

CAIRO (Reuters) – The African Development Bank (AfDB) has approved a $1.5 billion loan to Egypt to be paid out over three years, International Cooperation Minister Sahar Nasr told Reuters on Tuesday.

The first $500 million of the loan will arrive within days, said Nasr, and will go toward the government’s economic development programme and national projects.

“We have a competitive economic reform programme that started more than a year back and based on that we are taking the first tranche,” Nasr, a former World Bank official, told Reuters by telephone.

Egypt expects to receive an additional $1 billion from the World Bank by the end of the year to support the budget and could discuss potential IMF financing once parliament convenes, Nasr told Reuters previously.

“The bank’s approval today is a strong message affirming that the Egyptian economy is moving at a steady pace towards achieving comprehensive development and confirms that the bank is confident in the government’s reform process,” said AfDB representative Leila Mokaddem.

A foreign currency shortage has crippled import activity this year and the country has scrambled to find new sources of dollars as shipments have piled up at ports and manufacturing has slowed.

Foreign currency reserves, which stood at about $36 billion before the 2011 uprising that toppled veteran ruler Hosni Mubarak, were $16.42 billion at the end of November despite billions of dollars in Gulf Arab aid that Egypt has received since mid-2013.

 

(Reporting by Lin Noueihed; Writing by Eric Knecht; Editing by Mark Trevelyan)

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