…As AfDB calls for investment in infrastructure to drive inclusive growth in Africa***
In a bid to achieve a strong and enduring cooperation needed to entrench Sustainable Development, the AU and UN have signed a Framework Agreement for the Implementation of Agenda 2063 and the 2030 Agenda at the 30th AU Summit in Addis Ababa.
The UN Secretary-General António Guterres said after signing the agreement that such strong cooperation with the AU was essential for the UN to be able to fulfill its mandate.
The UN chief said the new agreements would help bolster the collaboration between the two organisations on a range of global issues.
“For the United Nations, the most important partnership is the partnership with the African Union,” Guterres said, alongside Moussa Mahamat, Chairperson of the AU Commission.
The summit gathered leaders from across the region this year under the theme “Winning the Fight against Corruption: A Sustainable Path to Africa’s Transformation”.
Guterres said across the three main pillars of the United Nations – development, peace and security, and human rights – the African continent was key to solving global problems.
“The international community would not be able to have successes in development if Africa does not succeed in its development taking advantage of its youth ‘dividend’,” he said.
He added that neither would the global community secure lasting peace and security if Africa is not able to manage not only its conflicts, but above all, to make strong effort at conflict prevention and resolution.
“We will be side by side with the African Union in respecting African leadership in solving African problems to help in this regard,” he said, noting that Africa has also made admirable strides in human rights.
“Today, we talk a lot about immigration. I have always seen African countries open their doors to refugees and migration,” the UN chief said, adding that this is a lesson other parts of the world could learn from.
The agreement followed the signing at UN Headquarters in April 2017 of a landmark framework to strengthen partnership between the UN and the AU on peace and security, to help the two organisations better respond to the evolving challenges of peace operations.
Guterres also addressed a high-level event to take stock of progress on the renewed partnership to end hunger in Africa by 2025.
He noted that agriculture and livestock productivity on the continent were under threat and hunger rates continue to increase, and cited the close links among hunger, food insecurity and poverty.
He flagged that the majority of undernourished people in Africa lived in conflict-affected countries, where hunger was almost twice as high when the crisis was protracted.
He advocated for stronger commitment by governments, the AU and the UN to promote peace, human rights and sustainable development.
“To build and sustain peace and address hunger and poverty, we need community-based approaches that build social cohesion and the capacity of local institutions and actors.
“Improved governance that can deliver equitable services is essential,” he asserted.
Meanwhile, the African Development Bank (AfDB) in a determined bid to tackle joblessness in the continent, has called for massive investment in infrastructure to drive inclusive growth in Africa.
AfDB made the call in the presentation of Economic Outlook (AEO) 2018 to African Union Summit delegates in Addis Ababa, on Saturday in Abuja.
The Bank said the continent was still experiencing jobless growth in spite of increased Gross Domestic Product (GDP).
“As a leading African institution, the bank is the first to provide headline numbers on Africa’s macroeconomic performance and outlook.”
It said African economies had been resilient to negative shocks, adding that poor infrastructure was a serious impediment to inclusive growth.
The bank said the African Union Commission (AUC) report urged African countries to adopt recommendations from the summit.
Chief Economist and Vice-President for Economic Governance and Knowledge Management of the banks, Célestin Monga said the report was presented in January to give policymakers enough time to reflect on the recommendations for economic planning and transformation.
The outlook quoted Monga saying the bank would be translating the report into key African languages and engaging with policymakers and civil society organisation’s to ensure its operationalisations.
Beyond the observed increase in GDP, Monga called for structural change in Africa.
The outlook stated that Commissioner for Infrastructure and Energy at the African Union Commission, Amani Abou-Zeid, described the report as highly relevant and useful for governments and other stakeholders.
Abou-Zeid said AEO puts average real GDP growth in Africa at 3.6 per cent in 2017, a good recovery from the 2.2 per cent recorded in 2016.
He said the 2017 figure was projected to grow by 4.1 per cent a year in 2018 and 2019.
Monga said that growth was driven by improved global economic conditions, better macroeconomic management, recovery in commodity prices mainly oil and metals, sustained domestic demand and improvements in agriculture production.
He however said “Africa is still experiencing jobless growth due largely to limited structural change.’’
He added that consequently, sustained high growth had not had substantial impact on job creation.
Monga quoted the report, saying “about two thirds of countries in Africa have experienced growth acceleration.
“Basically, a growth acceleration period is one in which the average growth rate of GDP per capita over a period of eight years is at least 3.5 per cent per annum,” the report notes.
The outlook stated the Commissioner for Economic Affairs at the AUC, Mr Victor Harrison endorsed the report, urging African countries to adopt the recommendations for inclusive growth.
“These studies present the behaviour of African economies in the face of difficult external conditions and announce the revival of growth with an estimated rate of 4.1 percent in 2018.
“We all know that growth is not yet inclusive in Africa and unemployment affects more women and young people,” he said.
Harrison urged member states to improve the business climate and stimulate the private sector to participate in the development.
According to the outlook’s findings, Africa’s infrastructure is still behind those of other regions in quantity, affordability, and quality due to lack of investment.
“At the same level of GDP per capita, South Asia, East Asia and Latin America have higher access to electricity and water than most African countries.
“It observed that Africa needs higher growth and investment rates, but debt levels must be monitored closely.
” Public debt ratios are rated to be on the rise, stocked by appetite for infrastructure spending,’’ he said.
The Outlook indicated that 40 countries in the region recorded increases in external debt from 2013 to 2016, adding that nine countries experienced a decline.
The report stated that though there were growing concerns about the debt levels in Africa, indicating that if used productively, debt may be necessary to unlock long-term growth potential.
“Tackling poverty will need efforts to increase employment elasticity of growth.
“The employment elasticity of growth of 0.41 in Africa is below the desirable 0.7 for all developing countries.
“Pressing policy concern is therefore to ensure that growth is reflected in creation of high and quality jobs,” the Outlook stated.
The report notes that Africa could be the next investment frontier and recommends three options for the international financial community to resolve the savings glut.
It said the adaptation of a policy of more negative real interest rates in high-income countries; the use of excess savings to finance public investment in rich countries; and the facilitation of the flow of capital to developing countries.
The report estimates show that investment needs for infrastructure would be in the range of US 130 to 170 billion dollars a year.
It also called for infrastructure in special economic zones and industrial parks and the mobilisation of domestic resources through well-targeted subsidies and rigorous collection of fees using technology.
It urges Africa to attract more private funding to infrastructure projects, focusing on risk mitigation; to creating an infrastructure asset class to attract institutional investors; choosing appropriate financing instruments to develop infrastructure.
