Africa: an emerging destination for investments

One of the major audit firms recently published its index on the attractiveness of Africa for 2017[1]. The report puts into perspective the economic trend of the continent in a rigorous and detailed way, enabling us to avoid the two pitfalls of Afro-optimism or Afro-pessimism.

It should first be noted that 2016 has been the worst year in terms of economic growth for sub-Saharan Africa over the past 20 years. The continent has been hardly hit by the end of the super-cycle of commodities, particularly impacting Nigeria, Angola and South Africa. The geopolitical upheavals of the West such as the Brexit and the election of Donald Trump also contributed to diminishing or at least stagnating investments from these countries which are important investors in Africa. However, while the number of FDI projects fell by 12% in 2016, they increased by 32% in value terms (reaching $ 94.1 billion), making it the second region of FDI growth at world.

Obviously, Africa is not a homogeneous bloc and in fact there are great disparities between countries. The three major countries impacted by the drop in the commodity prices mentioned above should not distract us from the bigger picture that reveals the growing young shoots in French-speaking Africa as in East Africa. While Morocco, South Africa, Kenya, Egypt and Nigeria attract the bulk of FDI projects (57%), other investment hubs appear. Ghana (4th), Côte d’Ivoire (7th) and Senegal (9th) attract investors, as evidenced by their ranking in the Africa Attractiveness Index. On the other side of the continent, growth is also very strong with an average of 6% for Kenya, Ethiopia, Tanzania and Uganda. These last two being boosted by the recent discoveries of oil and gas fields.

As nature abhors the vacuum, Asia-Pacific, especially China, has filled the decline in investment from the United States and Great Britain. China is now the third largest investor in terms of FDI projects in Africa, with the strongest growth in terms of jobs created. Note also the breakthrough Japan has seen its level of investment and jobs created increase by 757% and 106% respectively.

These figures, which show a real enthusiasm of investors for the African continent, remain to be relativized and taken in retrospect. Africa still receives an inadequate share of global FDI (11.4%) in terms of its population and its potential. Long coveted for its natural resources, the diversification of the African economy is underway, driven by the dynamism of sectors such as transport and logistics or the automobile. It is also worrying that the share of investment projects carried by African investors has continued to decline since 2013, falling to 15.5% in 2016. This contributes to the degradation of Africa’s resilience to external shocks ‘economy.

That Africa is attractive to foreign investors is a good thing, but it must also become an opportunity for African investors themselves! That is why we must redouble our efforts to achieve greater regional integration and a policy of reducing barriers to trade between the countries of the continent. History has shown that these choices lead not only to economic development but also to political stability, two essential objectives for ensuring the well-being of the population.

[1] EY’s Attractiveness Program Africa, « Connectivity redefined », May 2017

Let’s encourage African think tanks !

A decade ago, African think tanks were not legion but the situation has now changed: today we notice a far greater interest in joining forces to find African solutions to African problems. This phenomenon is reinforced by the fact that some of Africa’s most brilliant analytical minds, having gained some experience in the international arena, are returning home to share their knowledge with their fellow citizens. That societal trend of Africans taking more control of their own economic, political and social destinies is extremely positive for Africa’s future.

As we all know, further improvements in governance, infrastructure and education are required if we want our continent to achieve a wholesome development. I am certain that think tanks can play a key role by serving as catalysts for ideas and proposing practical solutions for policy problems. They have a specific part to play: according to K.Y. Amoako (who is also former executive secretary of UNECA), “whereas academic centres focus on contributing to the body of knowledge, think tanks not only contribute to the body of knowledge, but also take from the body of knowledge to propose real solutions to busy policymakers ». Indeed, the outcomes from the leading African think tanks are often very original and practical as they look at societies in the round rather than from single aspects such as economics and politics. Besides, think tanks that are based in Africa and mainly run by Africans have shown a greater sense of the economic reality on the ground and also stand as a bigger chance of securing the ear of governments. This is why they cannot be overlooked.

When the African Capacity Building Foundation (ACBF) organized the 3rd Africa Think Tank Summit in partnership with the AUC, NEPAD and UNECA on 8-9 April under the theme “Creating a Sustainable Future for African Think Tanks in Support of the SDGs and Agenda 2063”, we made it clear that we needed strong and effective think tanks. Indeed, it is really important to change process in order for governments to ably mainstream the use of local think tanks to deliver on both Agenda 2063 and the 2030 SDG Agenda. This is why, during the Summit, regional organizations such as the AUC and NEPAD together with the ACBF and UNECA engaged member states on the importance of mainstreaming the function of think tanks at each step of development policies.

Think tanks can actually be efficient in various fields: for instance, the Africa Progress Panel (APP), chaired by Kofi Annan, promotes equitable and sustainable development for Africa. It produces annual reports (most recently on Africa’s energy and climate opportunities) and seeks to target decision-making audiences in Africa and all around the globe. Also, I deeply believe in the role of the ACET (African Center for Economic Transformation), an economic policy institute supporting Africa’s long-term growth through transformation. Their mission is to address some of the policy and institutional barriers that hampers sustained economic growth on the continent. They even take it further yet by advising governments through the implementation phase including strengthening their institutional capacities, as a ‘think and do tank’.

As a consequence, I would like to reaffirm my conviction that think tanks will remain an integral component in the quest for poverty reduction and sustainable development for some time to come. Today, governments need to be able to cleverly make use of think tanks’ academic and ground expertise, as they have a big role : as the continent works towards its new destiny, African thinkers are in charge. Those will build Africa’ sustainable future.

Next 10 years critical for Africa’s transformation

Following the recent World Economic Forum on Africa in Kigali, I have had the great honour to give an interview to the New Times journalists, Eugene Kwibuka and Anitha Kirezi.

This gave me the opportunity to emphasize that it’s time for African countries to have clear national and regional development plans and fast-track their implementation. The next 10 years are extremely critical for Africa: if we don’t achieve our transformation objectives we will fall back again.

This is why NEPAD acts every day all around the continent for Africa development : in infrastructures, for example, we have 16 projects on which we are working closely with the African Union Commission, the African Development Bank, and Regional Economic Communities. NEPAD’s role is to facilitate the acceleration of the implementation of these projects.

I also introduced the ‘MoveAfrica‘ initiative which aims at being the go-to place for policy advice on trade around Africa.

You will find out more about this interview here.

Liberian President Sirleaf assumes ECOWAS Chairmanship

Liberian President Ellen Johnson Sirleaf has assumed the leadership of the Economic Community of West African States (ECOWAS), promising to consolidate peace and security, and calling on member states to work even harder to defeat terrorism.

President Sirleaf takes over from Senegalese President Macky Sall whose hard work and ongoing commitment towards security in the region deserves a mention. President Sall has indeed achieved a great deal during this year !

I would like to wish good luck to President Sirleaf as she is going to cope with several missions whose achievement is crucial for our continent’s future : financial stability, regional integration and last but by no means least: defeat terrorism.

Indeed, ECOWAS member states will have to work even harder to beat terrorism, strengthen intelligence capacity and enhance coordination with the African Union, the United Nations and other partner institutions. Today, there is one main objective : Boko Haram must be totally defeated.

You will find more information here.

The CBN goes one step further in Lusaka

On the occasion of the AfDB 2016 Annual meetings in Lusaka, Zambia, the NEPAD co-organized the Second Continental Business Network (CBN) meetings with the African Union and the African Development Bank (AfDB) as well as a support from the Development Bank of Southern Africa and Barclays Bank. I strongly believe this initiative has the power to durably change the way Africa works.

This ambitious network serves as an exclusive infrastructure investment advisory platform engaging African policy makers and leaders in the private sector on a range of strategic issues related to infrastructure development. It is focused on the critical role that the private and public sectors need to play in de-risking infrastructure development projects identified under the Programme for Infrastructure Development in Africa (PIDA).

At the close of the meeting,some key recommendations and outcomes included many instrumental proposals to ensure the recruitment of competent infrastructure experts, development of local capital markets, standardizing and predictability of regulatory frameworks, de-risking priority projects through bilateral engagements with Heads of States and Government, improving incentives for institutional investments and increased transparency of funding plans and the need for reliable data.

It will be our pleasure to present the outcome of the gathering at the upcoming African Union Heads of State Summit in July in Kigali, Rwanda!

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NEPAD launches the MoveAfrica initiative, to bring down soft hurdles to continental trade

Today I feel honored to announce the launch of the MoveAfrica Initiative that aims to support the transformation of Africa’s trade by addressing soft issues related to cross-border transport and logistics challenges on the continent.

Indeed, we cannot hope for the industrialization of our continent without functional transport infrastructure. This requires not only a quantitative improvement of our infrastructure, but also a radical simplification and harmonization of regulatory conditions and procedures of business on the continent. For instance, it is staggering that an African businessman cannot move without a visa across the continent. This is why we are targeting in particular the laws governing cross-border transport, the regulations for crossing the border (eg. customs clearance, quarantine), and the systems and organizational resources for the operation and maintenance of “hard” infrastructure.

Current estimates indicate that the volume of trade in sub-Saharan Africa will more than triple, from 102.6 million tonnes in 2009 to 384 million tonnes by 2030, if trade corridors are completed. Thus it is essential to drive down costs and to increase efficiency for logistics companies and manufacturers in varied industries operating in Africa !

To achieve that, the MoveAfrica Initiative will kick-off key activities such as a consolidated stakeholder annual report to rank and track the continent’s ability to move goods and services, an annual stakeholder roundtable briefing, and a consultative group of business thought leaders on improving transport and logistics in Africa. The Initiative will be conducted through the process of planning, implementation and evaluation, based on intensive dialogue among a variety of key partners from public and private sectors at the highest level.

The MoveAfrica Initiative is part of the Continental Business Network (CBN). The CBN acts as an exclusive high-level private sector forum on Infrastructure Investment. It provides thought leadership on a range of strategic issues and is powered by high- level business people as well as public institution leaders.

To learn more about the program, please follow us on the Twitter accounts of NEPAD and World Economic Forum (#MoveAfrica #IndustrializeAfrica).

The mission of NEPAD? To be a driving force for Africa

Today, I want to explain what is NEPAD and what are the missions we execute every day. When I was appointed Chief Executive Officer of NEPAD in 2009, I set out to transform what was then a secretariat into a planning and coordination agency capable of leading projects on the ground. Indeed, I was convinced that what Africa needed was a driving force, an authority responsible for identifying projects and ensuring they were viable, for providing visibility for investors, for coordinating and serving as a catalyst for various initiatives while partnering with the private sector. Established under the aegis of the African Union and its 54 Member States, NEPAD serves this exact purpose, and want to be a catalyst for African integration.

This long-term vision for Africa is underpinned by six main pillars of development, that are key to meeting the continent’s development challenges.

First, there is agriculture, food, and nutrition security: in this field, NEPAD pursues a proactive approach to agricultural policy and works with over 40 nations across Africa through the Comprehensive Africa Agriculture Development Programme, which promotes sustainable changes in agriculture practices.

The second pillar concerns climate change and natural resource management, for which NEPAD helps countries to coordinate and promote regional and national programs designed to curb these threats.

The third pillar is about regional integration and infrastructure. Integration isn’t an end in itself: I firmly believe that it’s a prerequisite for the development of our continent. Indeed, how can we connect our countries to the power grid and lay asphalt on our roads without coordinating each country’s efforts?

The fourth pillar concerns human development: it is what makes economic growth possible. NEPAD plays an active part in efforts to eradicate poverty on the continent by developing synergy in areas vital to human development, including education, science, technology and healthcare.

Besides, moving forward with development and regional integration in Africa requires an environment conducive to good governance at both the micro- and macroeconomic levels: this is what the fifth pillar is about.

In addition to the five theme areas presented above, NEPAD focuses its efforts on several fundamental, cross-cutting issues: private-sector involvement, gender & development, capacity development and information and communication technologies (ICTs).

As such, NEPAD is active in every area of development, taking
 a long-term approach to developing key infrastructure, defining framework agricultural policies and bolstering capacity-building at a national level, while also pursuing short-term initiatives to combat crises requiring emergency measures, such as piracy and the Ebola epidemic. We have to continually anticipate future development challenges in Africa to stay ahead of the curve.

From coast to coast, we are beginning to break ground on the first major projects led by NEPAD. I would like to single out five of these initiatives that will be completed in a matter of years: the Abidjan-Lagos corridor; the Dakar-Bamako rail link; two hydroelectric dams, Sambangalou in Guinea and Ruzizi III in Rwanda; and the road from Serenje to Nakonde in Zambia.

These projects are only the first chapter in a story that we shall write together. For more information about the challenges that lie before us and how NEPAD intends to meet them, please feel free to visit our website. I am convinced that together we will realise our dream of an African continent whose countries are open both to each other and to the world.

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Netting the gains: malaria at bay

On April 25th people across the globe take part in a wide range of activities to mark World Malaria Day.

This interesting article in the Economist notes the significant progress made thanks to aggressive campaigns over the past 15 years to provide insecticide-treated mosquito nets and antimalarial medicines. These have helped to cut the rate of new infections by 37% and deaths by 60% in countries where the disease is endemic.

However these victories are fragile: prevention and treatment are patchy in the worst-hit regions, and international aid has flat-lined as rich-world economic growth has slowed. As the parasite evolves, some treatments become less effective.

A continuous effort is needed for controlling this disease that affects particularly our continent.

You will find more information on World Malaria Day on their website : http://www.worldmalariaday.org/

The NEPAD collaborates with Thomson Reuters to accelerate pace of innovation

Yesterday was announced a strategic partnership between Thomson Reuters and the NEPAD to spearhead the development and monitoring of innovative output across the region.

This collaboration comes on the heels of the African Union’s Science, Technology and Innovation Strategy for Africa (STISA) 2024 initiative, a continental strategy that aims to accelerate Africa’s transition to an innovation-led and knowledge-based economy by boosting production in the science, technology, and innovation sectors.

You will find more information about this partnership here.

African Transformation Forum – Kigali (14-15 March)

Today I attended the African Transformation Forum (http://acetforafrica.org/) as panelist on national transformation strategies. I had the occasion to reaffirm that I am convinced of the importance of a shift from economic development model to real transformation strategies. These strategies will require to strengthen the States and to involve civil society.

I need to say that I am really impressed by the ATF and by Rwanda. Thank you very much to all of you.