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Watch out for Africa, says the World Bank

Africa economic opportunity
 
The World Bank's new report on Africa, published this week, concluded that that continent "could be on the brink of an economic take-off, much like China was 30 years ago, and India 20 years ago".
 
In its draft strategy for Africa, published on Monday, the bank said the continent's steady economic growth, progress on the millennium development goals and good rates of returns on investments give Africa "unprecedented opportunity for transformation and growth". Promoting Africa as an exciting and lucrative investment destination will be crucial to fulfilling this potential, it added.
 
"The emergence of new development partners such as China, the untapped potential of mobilising domestic resources, as well as the rise in private capital flows to Africa, calls for a new approach – Africa as an investment proposition – and points to the need for new partnerships among governments, development partners and the private sector," said the bank.
 
Based on data from the World Development Indicators, private cash flows (remittances and foreign direct investment) to developing countries totalled more than $650bn in 2009, while official development assistance fell to less than $130bn.
 
As the strategy's name – Africa's future and the World Bank's role in it – might suggest, the draft, which comes five years after its last Africa Action Plan, is both an optimistic reading of Africa's development and an assertive defence of the critical role the bank can play in its future. According to some, the emergence of new and very eager investors like China and India has left the bank worried about losing its footing on the continent.
 
Writing in the Nairobi-based Business Daily, Johnstone Ole Turana argued that: "The increased accessibility of grants from the BRIC [Brazil, Russia, India, China] nations, which is being provided with less conditionality compared to the World Bank and the western countries' bilateral aid, has forced sub-Saharan African nations to re-orient their engagement from the west to the east."
 
The draft moves away from a focus on single-issue projects – in an implicit critique of an MDG model of development with separate targets – and instead focuses on systems and structures, giving special attention to closing Africa's "infrastructure gap" and leveraging its investment potential. This means developing a more "attractive" climate for foreign investors, tackling "key constraints" from the regulation of labour and land to the lack of "financial (and overall business) literacy".
 
The bank is, of course, positioning itself as the essential partner for both developing countries and potential investors, willing and ready to exercise its "comparative advantage" in partnerships, knowledge, and financing. "From the reputational perspective, it's absolutely crucial for them to be seen as linchpins to African development, particularly with regard to private sector linkages" , said Soren Ambrose, from Action Aid Kenya, last month.
 
Yesterday, the bank's managing director, Ngozi Okonjo-Iweala, approached the China Mining Congress, being held in Tianjin, China, with a bid for how "the World Bank can help lay the ground work for larger investments", offering knowledge and guidance to investors and advice to governments on how to marry investment and development priorities. Okonjo-Iweala also advertised the bank's programme of providing "political risk" insurance to investors in case of war, civil unrest or expropriation.
 
Changing perceptions
The draft also sets out the bank's commitment to improve the otherwise poor perceptions of Africa, which can make attracting investors challenging. The paper claims the rate of return on foreign investment in Africa is higher than in any other developing region, but notes that "given its legacy of poverty, slow growth, conflict and disease, not everybody sees Africa as the emerging frontier".
The bank's wants to help change the public mindset, "not just in providing the evidence of the changes on the continent and educating the rest of the world, but also in supporting those, such as the media, who interpret this evidence to the public and thereby shorten the lag between perceptions and reality".
 
The bank also plans a shift in its own communications with the public, moving away from the stand-alone reports aimed at specialist audiences.
 
One early example of this shift is the bank's decision to make public a series of stakeholder consultations on the draft strategy, held in 36 countries between June and September this year, and uploading a promotional video on YouTube.

 

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Now, the bank has launched an online consultation alongside the draft, actively seeking comment from the public to feed into its final strategy for Africa, due early next year.
 
What feedback the bank chooses to incorporate into its strategies and programmes on the continent – if any – is the crucial question. In the past, critics, such as Beatrice Edwards, of the Governance Accountability Project, have come down hard on the bank for showing "transparency about the problem but no accountability or attempt to fix it".
 
But the online consultation does provide an opportunity to tell the bank what you think – and posting a comment isn't too arduous, at least from the UK. Feel free to cross-post your comments here.
(Report from the Guardian, UK)
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Africa Must Feed Itself

by Dr. Akin Adesina, Dr. Wangari Maathai and Dr. Graça Machel

Africa is rising. The 2010 Ibrahim Index of African Governance reveals some very good news: 40 out of 53 African countries have made significant strides in terms of economic and human development indicators. The Millennium Development Goals Report of the United Nations show that the agricultural growth rate has become positive, a first in almost thirty years. Between 1990 and 2005, the proportion of people living on less than $1.25 per day declined from 58% to 51%. The proportion of undernourished people declined from 31% in 1990 to 26% by 2005-2007. The African Development Bank has published an upbeat African Economic Outlook that points to a bright future for the continent.

Yes, our continent is scoring some major victories, but we are far from winning the war against hunger and poverty. Africa still has 300 million people living on less than $1.25 per day – nearly as many people as are living in the entire United States of America. The vast majority are smallholder farmers, about 70% of whom are women.

Africa’s average staple crop yield is still less than one ton per hectare, compared to a global average of 5 tons per hectare. For millions of farmers in Africa, accessing basic technologies to help them raise food production is a major challenge. Leaders have failed to urgently prioritize the challenges facing poor farmers in Africa. Leaders must act on their behalf.

Farmers should be able to at least feed their country’s population. In the USA, farmers represent only 1 % of the population, but they still feed the nation and generate enough surpluses to feed many more people around the world. Yet, in Africa, we see such shocking sights of farmers queuing for food aid. What a paradox! The 70% of our population working in agriculture cannot feed themselves, let alone the 30% that are not in agriculture. Many African countries still rely on food aid and the continent as a whole spends $25 billion every year importing food.

No politician hoping to become President in America dares ignore the American heartland. President Obama kicked off his historic election in Iowa, the breadbasket of America. But in Africa, the political cost of inaction on hunger and poverty has been zero. Our politicians count on constituents in rural areas who engage in farming for a living to keep them in office, yet they largely ignore agriculture.

But change is coming. What matters for millions of Africans is the ‘democracy of the stomach’. The food crisis and social unrest that the continent witnessed during 2007-2008, rekindled by the recent food riots in Mozambique in 2010, are tipping points. Political pressure is building as empty stomachs rumble. A growing number of countries are responding. For example, Mali is now spending 11% of its total budget on agriculture, Burkina Faso 15% and Ethiopia 17%.
But deeper changes are needed. Agriculture in Africa has for far too long been managed as a development program. Agriculture is a business and should be seen and supported as such. With 70% of our people engaged in the sector, African agriculture is a potentially very powerful engine of growth that must be kick-started to generate greater domestic income, savings and investment.
As the globe marks World Food Day, we need to ensure the right to food of every African. Begging for food is not the way to ensure that right. The right to food is only truly meaningful when a nation can feed itself.

Local solutions are working in Africa. Malawi, for example, is now self sufficient in food production, five years after it faced a major food crisis. It achieved this by significantly increasing government support for its farmers. Access to improved seed and fertilizer and the knowledge to use them turned the tide. Malawi fed its 15 million people. It also exported 400,000 tons of maize in 2009.

On the rolling hills of Rwanda an agricultural revolution has begun. The plan is bold and the payoffs substantial. Government support to farmers was provided to help them afford needed farm inputs. The result was an agricultural growth rate of 15% in 2009 and national food security.

What has brought about these emerging agricultural revolutions? The answer is simple: political will and government support for farmers. When leaders do their part, African farmers will stand and deliver.

African farmers are no different from farmers in other parts of the world. Our farmers, the majority of whom are women, are hard working and entrepreneurial. What they need are comprehensive farm support policies that will allow them to produce more food to feed the continent.

An African green revolution – one based on political will and country driven solutions – will help Africa feed itself by raising agricultural productivity in sustainable ways. When we are able to feed ourselves, our freedom will be meaningful. Only then will democracy and the right to food be truly meaningful for the 300 million of our people still living in extreme poverty.

Dr. Akin Adesina, Vice President of the Alliance for a Green Revolution in Africa, Dr. Wangari Maathai, Nobel Peace Prize Winner and environmental and political activist, and Dr. Graça Machel, former first lady of South Africa and Mozambique and a member of the Group of Elders, were recently appointed by the United Nations Secretary-General to the Millennium Development Goals Advocacy Group.
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