Following his recent clearance of breach of code of conduct by the Ethics Committee, experts in Nigeria say Dr. Akinwunmi Adesina in his second term as president of the African Development Bank (AfDB) must focus, as a matter of priority, on agriculture for food sufficiency, modern healthcare facilities for improved living standard, infrastructure, and enabling business environment that will attract foreign direct investment (FDI) to Africa, especially as the continent, like every other nation struggles to survive the shock of COVID-19 pandemic.
In an exclusive interview with Echotitbits, the Managing Partner of SIAO Partners, Ituah Ighodalo; the Director General, Development Agenda for Western Nigeria (DAWN) Commission and the Founder, Centre for Values in Leadership (CVL), Prof. Pat Utomi, all agreed that the AFDB under Akinwunmi Adesina’s second term as President has to be creative in raising the bar towards the development of Africa’s economy, especially on recovering from the shocks of COVID-19 pandemic.
Ituah Ighodalo described Akinwunmi Adesina as focused when the latter was Nigeria’s Minister of Agriculture and acknowledged his efforts, approaching various African countries, analysing their economies and offering them funding that will assist in the development of infrastructure and economy at large.
While highlighting Adesina’s achievements, DAWN Commission boss, Seye Oyeleye lauded the AfDB president for accomplishing increased private investors’ investment in Africa and initiatives that enhanced economic development in member states.
In his assessment of Adesina’s first term presidency, Oyeleye said: “He organised Africa investment forum in Johannesburg in 2018, the first of such investment forum by the Bank. At the completion of the forum, a total of $38.7 billion investment was raised. In the second edition of the forum, a total of $40.1 billion was raised. The forum is expected to attract $300 billion investment into Africa over the next eight years. The forum is the first of its kind by the bank and it has increased the participation of the private sector in the continent’s economic growth. This is in line with the president’s strong belief in the role of private sector in economic growth”.
Oyeleye further highlighted that the AfDB under Adesina intensified the bank’s commitment to Africa’s development.
“The bank’s strategy and operational priorities were revised to focus on five main areas: light-up and power Africa; feed Africa; Industrialize Africa; Integrate Africa and improve the quality of life for the people of Africa. The effort of the bank in the above areas is reflected in the support given by the Africa Union (AU) members during the Summit held in Ethiopia and the ECOWAS member head of states at the 56th Ordinary session held in Abuja.”
On engineering Africa’s economy to sustainability, which has worsened due to the shocks created by COVID-19 pandemic, financial services and management expert, Ighodalo tasked the AfDB president to focus on ensuring that across the continent, mineral resources, including agricultural resources that are inherently under African soil are developed and processed for both consumption and export.
“The first thing for Africa to do and where they must concentrate their resources is in developing what naturally comes out of the ground in Africa. We have abundant minerals and resources that the world needs but lay buried and hidden because of lack of skills, expertise, funding and sometimes the political or policy environment, and then sometimes corruption”, he said.
As far back as 1970s, Africa had become a net importer of agricultural products and by 1980s, a net importer of food products. According to a special report by the Food and Agricultural Organization of the United Nations (FAO) titled – ‘Why has Africa become a net food importer’, from 2007, the continent’s net food importation increase includes cereals, wheat, maize, rice and dairy products, sugar, vegetable oils, meat and so on. The FOA went on to state that African agriculture is no longer capable of feeding the current African population: “population growth coupled with low and stagnating productivity in food and agricultural production, on the one hand, and policy distortions, poor infrastructure and weak institutional support on the other hand, are the main reasons for the increase in the food-trade deficit in Africa”.
Over the years, food dependency has increased to a height of shame for a continent with about 874 million hectares of land suitable for agricultural production and made worse by a 21st century growth in population. These ugly scenarios and the image it paint – of not being able to feed its own people, if anything is why food sufficiency and value add should be taken seriously by all African leaders and other stakeholders, led especially by the AfDB.
In an attempt to drive home the logic of cultivating its land and processing its own agricultural products within Africa, Ighodalo emphasized, “Africa must be food secure.
“We must grow what we eat, and eat what we grow. We must not spend a dime of African money importing food into any African country. This must be one of the pillars of African Development Bank and I am glad that Mr Adesina is an Agro economist himself. So every part of Africa must become a food basket to feed itself and process food for export to other parts of the world.”
However, in modern 21st century, an agricultural revolution aimed to create wealth, jobs and abundance of food for nations cannot exist in an infrastructural vacuum.
“There’s still a big gap in Africa’s infrastructure connectivity – rail and road and power. I think he should develop a master plan for African connectivity, infrastructure that will help us get out our resources. And he should focus thereafter on empowerment and value add”, Ighodalo stated.
On his part, DAWN DG, Oyeleye noted that the goodwill and support Adesina has from the Africa Union (AU) and the Economic Community of West African States (ECOWAS) should drive him to do more in his second term.
“It is imperative for the bank to become more innovative in addressing the continent’s developmental challenges since the support (of African leaders) was based on the bank’s commitment to the advancement of African countries during his first term as the president of the bank.
” The second term serves an as opportunity for the bank to further open up the African economy to the private sector by increasing the level of their participation in the continent. The current amount needed to address the infrastructural deficit and reposition the continent is beyond what the member states could finance. Since infrastructure deficit is a major hindrance to the continent’s economic development, the bank needs to maintain and improve the annual investment forum to increase the participation of the private sector in the provision of infrastructural facilities; this will help in addressing the infrastructural deficit in the continent.
“Besides infrastructure, lack of access to electricity, food insecurity, low level of industrialization and poor governance contribute to Africa’s under-development. While the bank’s current strategy and operational priorities will expire by 2022, his re-appointment should ensure that the bank does not completely deviate from the current priority areas after its expiration but consolidate on those areas.
“In his second term, AfDB under Akinwumi Adesina is expected to intensify effort towards solving the electricity challenges in the continent. Similarly, the current agricultural innovation supported by the bank should be maintained and expand to ensure that African countries are self-sufficient in the production of food. The bank through her support to member countries should demand for more transparency and accountability in the usage of support facilities provided by the bank, thereby improving the level of governance in the continent”, Oyeleye said.
Giving his submission, Founder of CVL, Prof. Pat Utomi believes that Africa has not gotten its strategy right when it comes to foreign direct investment (FDI).
“Most capital are concentrated in few hands, a couple of young men in California own more capital than the whole of Africa. It is something that could be very helpful if we found a good way of managing COVID-19. But unfortunately, my fear is that Africa did not find the right strategy to enable that free and available capital move towards Africa.
“What has now happened is the shock created by the pandemic crisis and the truth is that many of those countries in Europe and North America are going to need huge new investments. So there are investment flows that if we have the right strategy we easily could have brought to Africa.
“This is now the time I think that the multilateral or continentals, finance organizations like the AfDB, Afrexim Bank and Co have to be very creative about – how do we revitalize African economies in the circumstances.
“I hope that he can put on his original hat as an Agric finance person so he can focus more on Africa’s latent comparative advantage in capital endowment around agriculture and then see how we can become more competitive in the global economy within agriculture value chain” Utomi stated.
Like others, Pro. Utomi agrees on priotizing investment in critical infrastructure as a catalyst to unprecedented development that Africa deserves after years of neglect by leaders.
He opined that: “To be able to make progress on that front, there is also the critical infrastructure challenge of power. I’m not quite sure how we harnessed the whole Obama power up Africa initiative, but an AFDB should be playing a catalytic role for general infrastructure and infrastructure that supports the agric value chain. That merging is where I think invention in the short run would lie”.
Oyeleye also shared the view that “in his second term, AfDB under Akinwumi Adesina is expected to intensify effort towards solving the electricity challenges in the continent. Similarly, the current agricultural innovation supported by the bank should be maintained and expanded to ensure that African countries are self-sufficient in the production of food. The bank through her support to member countries should demand for more transparency and accountability in the usage of support facilities provided by the bank, thereby improving the level of governance in the continent”.
According to the World Investment Report 2019, while foreign direct investment (FDI) into Africa rose to US$46 billion in 2018, an increase of 11%, the question- why Africa remains under-industrialized lingers. That question is obviously evident in a lack of infrastructural and supporting policy environment. So how much more can economic handlers do to retain the continent’s resources in Africa?
Ituah Ighodalo’s solution is that: “To attract foreign capital, number one, the environment must be suitable; the security must be there, the terms and conditions must be tougher and so on and so forth. So it’s going to be a mix of a pull and a push, you create an enabling environment for them and in some areas you compel them especially when there is enough market for them. For example Toyota should come and establish in West Africa, there’s more than enough market for them, we can threaten them that we won’t import any of your cars anymore if you don’t come here”.
Although sharing similar views, Prof. Utomi’s take is that: “It’s not a matter of compulsion, you don’t say because the resources come from Africa, all the processes of goods must be in Africa, this is a decree. Yes you can decree, it may work it may not work. What is important is dealing with the critical infrastructure that makes that possible and then the incentive structure that facilitates. It’s only a mad man who will take raw gold from Africa, go and process it in Europe and then sell it elsewhere. It is a matter of consideration for those infrastructures he uses, those incentives and so on. So, if we can concentrate on making those incentives available and getting this infrastructure right, we don’t even have to compel anybody”.
One critical infrastructure gap that should protect and preserve the lives of Africans, supposedly the continent’s main resources but for education gaps, is healthcare. In an article titled Financing Africa’s Healthcare written by Vera Songwe, Executive Secretary, United Nations Economic Commission for Africa and published on the GBCHealth websitein January 2019, it was noted that: “While a number of African governments have increased the proportion of total public expenditure allocated to health, overall health financing still remains a major constraint to effective health service delivery”.
By some rough estimation, Nigeria for example spends about 3%of its GDP on healthcare. In Tanzania, the nation’s healthcare spending is about 5.6% of its GDP. This translates as $51 per capita, when compared to UK’s $4,000 per capita. Likewise in Uganda, with about 7.2% of GDP spending on healthcare, it is a tale of non-functional public health facilities with a ratio of about 1 doctor to 1000 people.
While examining what country spends the most on healthcare, Investopediaquoted a data by the Organization for Economic Co-operation and Development (OECD) in 2018, which stated that “the U.S. rate was a staggering $10,000 per capita.
“Luxembourg had the second-highest healthcare budget, with expenditures at $8,000 per capita. Switzerland and Norway round out the top three, spending $7,000 per capita each.”
The data, and obviously the reality on ground in Africa tells the story of neglect of the well-being of the people of Africa. To make the situation worse, thus contributing to the disrepair in the continent’s healthcare is the attendant capital flight due to outbound medical tourism that costs the continent a whooping over $1 billion annually.
Consequently, the level of struggle that Africa’s healthcare system is facing, even in its response to COVID-19 pandemic is overstretching. It is in this light that Ighodalo admonishes Akinwunmi Adesina that “in the view of COVID-19, our healthcare is also very critical. And he must, if he can, develop a special fund to empower and enable self sufficiency in health care, both primary and tertiary healthcare. No longer should Africans be going anywhere to receive treatment for their health. The world has gone far beyond that”.
