This is according to President of the African Development Bank, Akinwumi Adesina. Speaking at the launch of the Bank’s 2018 African Economic Outlook report, Adesina said infrastructure, when well managed, provides the financial resources to do everything else.
Noting that economic diversification is key to resolving many of the continent’s difficulties, Adesina urged African governments to encourage a shift toward labour-intensive industries, especially in rural areas where 70% of the continent’s population resides.
The role of industrialisation
He made a compelling case for accelerating Africa’s industrialisation in order to create jobs, reduce poverty and promote inclusive economic growth.
“Agriculture must be at the forefront of Africa’s industrialisation,” he said, adding that integrated power and adequate transport infrastructure would facilitate economic integration, support agricultural value chain development and economies of scale which drive industrialisation.”
Adesina also highlighted the relatively unknown win-win situation that Africa’s industrialisation can generate within the developed world, citing data from the report, which notes that “increasing the share of manufacturing in GDP in Africa (and other Less Developing Countries) could boost investment in the G20 by about $485 billion and household consumption by about $1.4 trillion.”
Innovative approaches to finance
The Bank President highlighted various innovative ways in which Africa countries can generate capital for infrastructure development and what the Bank is doing through its ambitious High 5 development agenda to address the issues raised in the report.
He announced that the Bank would organise the Africa Investment Forum on November 7-8, 2018 in Johannesburg, South Africa, to mobilise funds for infrastructure development, to bridge an estimated funding gap of $130-$170 billion a year, up from previous estimates of $100 billion per year.
New infrastructure financing gap estimates and innovative ways through which African countries can raise funds for infrastructure development are among the highlights of the 2018 edition of the report, which was launched at the Bank’s headquarters for the first time in the publication’s 15-year history.