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02 Apr 2015 00:00
Outgoing President of the African Development Bank Donald Kaberuka. (AFP)
The next president of the African Development Bank must improve the livelihoods of the continent’s poorest people, address huge energy shortages and fill infrastructure funding gaps, according to the bank’s outgoing president, Donald Kaberuka.
“For the next leader of the bank … inclusion and broad-based growth is absolutely the number one [item on the] agenda,” says Kaberuka, who steps down in May after presiding over the bank for a decade.
With worsening levels of inequality and soaring population growth across Africa, Kaberuka calls on the biggest lenders to African countries to refocus their efforts on providing services and opportunities for the poor.
“How do you ensure that everything [financing institutions do] asks the question: Does this reach the ordinary citizen in our countries? Not simply, Senegal [has] 10% GDP growth – and a taxi driver says: ‘Well, I can’t eat the GDP.’”
For Kaberuka, a Rwandan who served as his country’s finance minister from 1997 to 2003, navigating the bank through the 2008 financial crisis and helping it to keep its credit rating intact are among his proudest achievements.
But plenty of challenges remain for the bank and for the continent. “Each time I land in a rich African country, I count the number of private jets and I think, what could be the origin of this wealth? It’s unlikely to be enterprise or innovation,” says Kaberuka.
Lifting people from poverty
“The test of a nation is not how many millionaires you have, it is how many millions of people you [lift] from poverty into the middle class.”
Kaberuka also warns that Africa’s economic development is being choked by chronic energy shortages: “Today, in every single African country, from South Africa to the north, the biggest impediment to economic growth is energy,” he says.
He adds that the continent must find an extra $92-billion every year to fill its infrastructure funding gap – to build new roads, schools, hospitals and airports.
Kaberuka has said climate change is one of the “greatest calamities” Africa faces, but he is encouraged by successful solar projects in Morocco and wind farms in Kenya.
The bank has an investment policy to finance renewable and nonrenewable energy projects in equal measure.
Kaberuka defends African countries using nonrenewable energy sources.
With oil, gas and mineral production at the forefront of Africa’s economic growth, Kaberuka has called for better management of the continent’s natural resources. China, the main buyer of Africa’s oil and minerals, has taken a prominent role in financing infrastructure projects, leading some to question the African Development Bank’s place in Africa’s funding ecosystem.
Last year, the bank announced a $2-billion partnership with the People’s Bank of China, known as the Africa Growing Together Fund, which will use African Development Bank’s policies, procedures and safeguards to help African governments strike better deals with Chinese investors.
But Kaberuka stands by the progress the bank has made under his stewardship, and shrugs off the suggestion that he could have done more for Africa’s poor. “Infrastructure is now 60% of everything we do, and we backed the mission of the bank, which was creating the single market in Africa.”
Merging into a single market
Regional integration has been the bank’s priority since its founding in 1964. Despite a number of false starts, Kaberuka is “very confident” that regional blocs, such as the East African Community and the Economic Community of West African States, will realise long-held ambitions to tighten political unions and merge into a single market.
Kaberuka bemoans the minimal role African governments have played in the Ebola crisis. The early stages of the response saw “thousands of NGOs with all these huge vehicles with radio antennas, but there was no involvement of communities or governments”, he says, adding that the bank’s priority has been to channel funds to governments dealing with the crisis. So far, the bank has given $230-million to Guinea, Liberia and Sierra Leone, he says.
The final cost of the Ebola crisis will be about $3.2-billion, according to Kaberuka. He applauds the international response to Ebola, describing it as “people putting their politics on the side, dealing with the problem”. But he criticises African governments for “failing to explain to the communities how Ebola could be contained”.
The bank will elect its next president in May. – © Guardian News & Media 2015.
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