Africa – the Changing Face, the Face of the Future
The African Development Bank (AfDB) Group President, Donald Kaberuka, on February 25, 2008, gave a keynote address at Harvard University’s John F. Kennedy School of Government on the theme "Africa – the Changing Face – The Face of the Future." President Kaberuka sounded optimistic and hopeful about Africa’s development. His optimism was based on improved governance, policy changes and favorable international conditions on the continent, as well as a clear shift in perceptions about Africa both from within the region and the international community. In light of these developments, Mr. Kaberuka charted a goal for a prosperous Africa in 2030, when Africa would be as populous as India and China, and outlined the Bank Group’s role as a catalyst in this process in areas where it possesses a ‘comparative advantage.’ If the vision for a new Africa 2030 is far-fetched, Mr. Kaberuka said, so was the case of India twenty years ago or China after the Cultural Revolution.
Drawing on J.F. Kennedy’s wisdom, Mr. Kaberuka told the students that the world had changed. With the help of technology and better development wisdom, man was capable of abolishing all forms of human poverty. He pledged Bank Group support to millions of Africans trapped in grinding poverty, underscoring however that leadership was an essential component in the struggle to make poverty history.
He said that while poverty still remained a challenge across the continent, there was room for hope and optimism. He pointed to policy changes, improved governance and management which are enabling the continent to take advantage of favorable international market developments such as the strong demand for the continent’s commodities and favorable international initiatives such as comprehensive debt relief initiatives.
Mr. Kaberuka acknowledged that pockets of instability and arbitrary rule were still an uncomfortable presence on the continent, but pointed out that democratic change was also becoming the norm, and African-led efforts continue to reduce the scope and duration of conflicts. Africa, he said, was on the whole experiencing the longest period of growth in 50 years, adding that the proportion of the population living in poverty was not falling fast enough, but it was not increasing either. He said that despite the turmoil in the global markets, he was still hopeful that the continent’s economic growth would still stand at 6.5% in 2008.
Speaking about Sub-Saharan Africa, the continent’s poorest region, Mr. Kaberuka said that with the exception of one country, macro-economic conditions across the sub-region still remained benign, inflation contained in single digits, fiscal deficits checked and the business climate would steadily improve. Foreign reserves will be at an all time high, US$137 billion, while external debt at 11% of GDP will be at a 30-year low, he said, adding that the comprehensive debt cancellation of 2005 had ignited unprecedented private investment flows totaling US$22 billion over the last year. Most of the flows, he underscored, went to resource-rich countries, adding that estimates hold that about 20%, that is some US$4.5 billion, might have been attracted to resource-poor countries with stable systems, strong predictable policies and enabling business environments.
But the challenge, he said, was how to reconcile this story of hope and optimism with pervasive poverty, misery and instability on the continent. There are wide discrepancies between and within countries and there are many laggards whose fortunes have not changed significantly, he regretted. Not only do many countries start from a very low base – including many years of violent conflicts and increasing population numbers –, these countries still have to deal with new challenges such as the impact of climate change and urbanization. Africans and their leaders have to deal with issues such as rising inequalities and perceptions that growth benefits are not shared, and these conditions are partly to blame for the instability and social tensions that have been undermining the continent’s development efforts, Mr. Kaberuka pointed out.
In pursuing its development agenda and in working with other partners, Africa must fulfill its side of the deal - drawing lessons from the past where poor leadership led to decline and decay, Mr. Kaberuka said, adding that building true capable states was a joint venture between governments, the private sector and civil society organizations. He shared Bank Group efforts at consolidating the continent’s achievements with the students.
The Bank Group, he said, was seeking to effectively respond to the highly diverse expectations of all its member countries – middle-income countries, lower-income countries and fragile states, - while at the same time pursuing regional integration initiatives. Some regional member countries of the Bank Group, he continued, were not borrowing, but were aspiring to attain middle-income status and had a multitude of needs in terms of poverty and technical know-how to which the Bank must be equipped to respond, he stressed.
That is why the Bank Group is deepening its internal capacity to better respond to this constantly changing economic landscape, he said. In this respect, he told the students that there were efforts to bring Africa’s leading economists and think-tanks to reflect on the continent’s development issues.
The Bank Group, he said, had opted to be more focused and selective in order to be really effective. It is therefore engaged in carving out a set of distinctive activities and responsibilities in sectors and domains that can give it a clear "comparative advantage". The institution’s ability to work together in "strategic alliances" with other institutions, including universities such as Harvard University could enable it attain collective excellence.