World Bank to Africa’s rescue – Commits record US$14.7 billion

By Charles Benoni Okine

The World Bank Group committed a record US$14.7 billion to support economic growth in Africa in the 2013 fiscal year (July 2012 to June 2013).

The move is also intended to help improve the continent development prospects despite uncertain economic conditions in the rest of the global economy.

Although it is not clear what the proportion of the amount would come to Ghana, it is expected to be received as good news particularly at a time when the country is facing liquidity challenges.

In a report from the bank copied to the GRAPHIC BUSINESS, Mr Makhtar Diop, World Bank Vice President for the Africa Region said “The region has shown remarkable resilience in the face of a global recession and continues to grow strongly.”

“Africa is at the center of the World Bank Group 2030 goals of ending extreme poverty and promoting shared prosperity, in an environmentally, socially, and fiscally sustainable manner”, he added.

The World Bank Group continued its strong commitment to Africa approving US$8.25 billion in new lending for nearly 100 projects in the fiscal year under review.

These commitments include a record $8.2 billion in zero-interest credits and grants from the International Development Association (IDA), the World Banks fund for the poorest countries.  This is the highest level of new IDA commitments by any region in the Banks history, the report said.

 
Private sector leverages development investment
According to the report, IFCs total commitment volume in Sub-Saharan Africa, including mobilization, grew to a record US$5.3 billion, 34 per cent more than the year before.

Similarly, it said IFCs spending on Advisory Services programmes in the region increased to more than US$65 million, about 30 percent of IFCs total.

This led to increased results in fragile and conflict states and greater impact in IFCs primary areas of focus:  sustainable farming opportunities, access to finance for microfinance clients and individuals, improved infrastructure services, and greenhouse gas emissions reductions.

Supporting developmentally beneficial foreign direct investment into Sub-Saharan Africa is a priority for MIGA.

In 2013, the Agency issued US$1.5 billion in guarantees supporting investments into projects in the agribusiness, oil and gas, power, services, and water sectors.

A significant volume of this coverage is for investments in power generation projects in Angola, Côte d’ Ivoire, and Kenya.

Sub-Saharan African accounted for 54 per cent of MIGAs new volume this year more than doubling last year’s level of 24 percent.

The Bank Groups support focused on major transformational projects in agriculture and power, and also on social safety nets, conditional cash transfers for poor families, job creation programs for young people, and higher education.  

Stepping Up the Game in Fragile Countries

In FY13, the World Bank Group increased its focus in Africa on regional drivers of fragility and conflict, especially regarding the Sahel and the Great Lakes regions.

In May 2013, during an historic joint United Nations/World Bank Group mission to the Great Lakes, the Bank announced a $1 billion development pledge to help countries in the region provide better health and education services, generate more cross-border trade, and fund hydroelectricity projects in support of the Great Lakes peace agreement.

Sending the strong message that peace and development are inseparable and must be addressed together and also emphasizing the Banks commitment to increase its work in states emerging from conflict and its determination to help lift fragile states out of fragility and back on a positive development track.

 Addressing Climate Change
 The Bank has been at the forefront of identifying operational measures and partnerships (such as TerrAfrica) to integrate climate change in land management, water resource management, transport infrastructure, climate-smart agriculture, and disaster risk management and continues to advance innovative policy solutions, including through the first climate change Development Policy Loan, for Mozambique.

Climate change is also at the center of the growth agenda of the Region. Clean energy projects -- in hydro, geothermal, solar, and gas are part of the Banks Africa strategy to limit the carbon footprint of growth in the region and harvest enormous untapped potential for development. Many of these current and planned projects benefit from IDA, MIGA, and IFC working together across the World Bank Group to better leverage their development investments in the region. 

Accelerating the use of Science and Technology
The report said Africa’s future depends on adapting existing and future technology more rapidly. Large productivity gains are possible through better training of Africans in science and technology, and enhanced agricultural technology.

During the year under review, the report also noted that the Bank helped to bring higher education, with an emphasis on science, back into the development agenda.  African economies urgently need highly skilled technicians and engineers, especially for energy and infrastructure. They need agricultural scientists; medical workers; and researchers.

Quality learning outcomes in primary and secondary education require qualified teachers that only universities can develop. The Bank continued to build partnerships to support technological education.