Address to the Ninth CEMAC Summit by the AfDB President Donald Kaberuka
Event: Ninth Summit of Heads of State and Government of the Central African Economic and Monetary Community (CEMAC).
Given its wealth in mineral, water, forestry and human resources, the CEMAC region constitutes an enormous growth potential for the African continent. The region has recorded significant progress in terms of growth, economic reforms and governance. However, to consolidate these assets, challenges must be overcome.
Overall, CEMAC’s macro-economic situation has improved in recent years. The GDP growth averaged nearly 8% in the past four years. The quality of that growth, essentially driven by the oil and mining boom, has not yet brought in its wake any significant reduction in poverty against the backdrop of population growth, accelerated urbanization and the low growth in the agricultural sector.
I am aware that the poverty rate which ranges between 40 and 70%, depending on the country, remains a major concern to CEMAC states. The ongoing dynamics for strong and sustainable growth, as well as pursuit of the consolidation process, constitute key poverty reduction assets.
Within that purview, the strengthening of regional integration through the building of the Common Market remains an important lever for stronger and more inclusive growth.
Beyond the challenges specific to the CEMAC region, the international financial crisis that is largely due to malfunctions in the property market will lead to a decline in world growth. There is no doubt that this situation will have negative consequences for exports from African countries, especially those of the
CEMAC region, albeit limited for now.
For CEMAC countries as for the rest of Africa, the attainment of the MDGs requires continued efforts in:
- Maintaining peace and stability
- Food security;
- Consolidating the achievements of economic reforms, especially macro-economic stability;
- Improving the business climate; and
- Spreading the fruits of growth to the most disadvantaged population.
At the same time, we should ready ourselves to rise to a number of other challenges that will influence the long-term prospects of African economies, such as migratory flows, accelerated urbanization and the impact of climate change. We welcome increased efforts aimed at improving governance and especially the rational and effective utilization of mining and oil resources.
The Bank’s role in regional integration
Within the framework of its strategy for the 2008-2010 period, the Bank Group, your Bank, will give you significant support to the tune of nearly one billion United States dollars to help meet the challenge of economic growth, infrastructure reconstruction, improved governance and regional integration – one of the central pillars of our operations.
The projects/operations that our Institution will finance include major programs in the infrastructure sectors such as the Douala-Bangui and Douala-Ndjamena Transport Facilitation Program, already approved by the Board, and the future road project linking Cameroon to Congo via Ouesso.
The supplementary financing mechanisms within the framework of support to states emerging from conflict, which will benefit some countries in the sub-region, will enable eligible states to receive additional resources amounting to 600 million dollars. The purpose of this strategy is to more effectively assist states concerned in their transition from fragility, support countries at risk in their effort to prevent slippages and help countries in post-crisis and post-conflict transition situations to promote political stability and economic development.
CEMAC/ADB performance and prospects
Permit me at this juncture to share with you our cooperation experience with CEMAC, which is rich in lessons and greatly illustrates our efforts at regional integration. This cooperation principally focused on the strengthening of infrastructure, management of cross-border challenges and capacity building. So far, the Bank’s financing of multinational projects within CEMAC stands at CFAF 95 billion. These projects include electricity networks interconnection, transport, support to the textile sector, tertiary education, agricultural research, environment and capacity building. Furthermore, the Bank participated with the IMF in setting up an AFRITAC Center in Central Africa.
In future, our operations will continue to favour natural resources management in the Congo River Basin, support for river blindness control and eradication, technical and vocational capacity building, infrastructure projects in telecommunication and power – notably through the rehabilitation of the Inga 1 and 3 sites. Lastly, we will continue to encourage public/private partnership with regard to investments within CEMAC.
Within the context of this cooperation, I would like to particularly insist on mechanisms for financing the sustainable management of Congo Basin forest ecosystems for which the ADB has been charged to play the leader role. Financial partners have agreed to strengthen their coordination and dialogue efforts within the Congo Basin Forest Partnership (CBFP) and support COMIFAC and partner sub-regional institutions in implementing their activities within the framework of an Action Plan called the “Convergence Plan”. In that regard, a Congo Basin Fund has been set up and the African Development Bank delegated to manage it. Permit me to seize this opportunity to renew my thanks to the British and Norwegian Governments for already making an initial contribution of nearly 200 million dollars to the fund.
I would also like to mention that we are in the process of revising the assistance strategy paper on regional integration of CEEAC countries. The implementation of that strategy will indeed contribute to strengthening the synergy of actions between CEMAC and CEEAC.
Food crisis: short- and medium-term response
I could not afford not to mention the food crisis that has visited our continent. As you know, the Bank has joined the battle with its member states to uproot this scourge from our midst. For a number of reasons that we all know, African agriculture has suffered much neglect. Today, it is important that together, we join hands to correct past errors with a view to resolutely infusing African agriculture with the dynamics of irreversible development.
As a first response to the crisis, the Bank has adopted a series of measures. It has increased its agricultural portfolio by one billion US dollars, thus bringing it from 3.8 billion dollars to 4.8 billion dollars. At the same time, we have undertaken to restructure some agricultural projects in order to free resources with which to help member states to have access to the financing of agricultural inputs and new high-yield seeds. In addition, we have set up an African Fertilizer Development Financing Mechanism. However, we are convinced that our continent must address fundamental issues through tough medium- and long-term policies that would give new grounding to African agriculture, making food security and self-sufficiency in Africa a reality.
It is within that purview that the Bank is currently organizing a meeting in Tunis on the food crisis with representatives from African member countries, regional economic communities and development partners.
The meeting will enable us to decide together what actions to implement with a view to the sustainable restoration of food security. In that regard, I recommend that CEMAC embrace ownership of a regional program that would make IRAD a think-tank and a center of excellence for capacity building in the agricultural sector within the sub-region.
To conclude, I would again like to express my profound gratitude for your constant support. The African Development Bank, your Bank, will always be at your disposal to accompany your countries and your regional integration institutions in their sustained efforts for Central Africa’s prosperity.