Akinwumi Adesina, president of the African Development Bank Group (AfDB), says that insecurity in Africa is affecting investment space on the continent gravely.
Addressing heads of state of the Economic Community of West African States (ECOWAS) at its 59th ordinary session on Saturday (19 June) in Accra, Dr Adesina said the rapidly deteriorating security situation on the continent needs their immediate attention.
He said urgent steps must be taken to arrest the current insecurity on the continent.
“Your Excellencies, when we resolve Africa’s debt challenges, I can rest … but one thing will still keep me awake at night [is] Africa’s rising insecurity. As you well know, the situation is most precarious in the Sahel and the Lake Chad Basin,” Adesina said.
“I am sure, Your Excellencies, it keeps you also awake at night. The trend is disturbing as expenditures on defence are rising fast.
“The investable space in Africa is rapidly shrinking due to insecurity. Take the case of Mozambique, where the African Development Bank helped to structure a US$24 billion deal for its liquefied natural gas project. This transaction won the Global Deal Project of the Year 2020 award.
“This would have made Mozambique the third-largest producer of liquefied natural gas in the world, with projected revenues of US$66 billion.”
The French energy giant Total suspended its involvement in the deal in April over fears raised by the armed insurgency in Mozambique’s northern Cabo Delgado Province, where the exploration project is located.
“Insecurity would become a huge risk to our dream of an African Continental Free Trade Area,” the AfDB boss said.
Security index investment bond
Dr Adesina also urged the ECOWAS heads of state to link security to efforts aimed at shoring up investment, growth and development.
He proposed the establishment of a security index investment bond, which would be managed through special-purpose vehicles, to take advantage of long-term interest rates which would “allow Africa to leverage resources on the global capital markets to reinforce its security”.
“The revenue streams from the security index investment bonds can be used to, first, reinforce the security architecture of African countries and support dual-purpose infrastructure to enhance national and regional peacekeeping and security capabilities.
“Secondly, build destroyed or damaged infrastructure in conflict-affected areas and finance new investment projects to relaunch economic activities and create jobs in areas prone to security challenges.
“Thirdly, build social infrastructure for the populations, especially water, sanitation, schools, health, roads, ICT and agricultural infrastructure to improve access to basic services to support community livelihoods in fragile environments. And fourthly, protect strategic investments within countries or regions,” the AfDB boss said.
“The security index investment bonds can be delivered through special-purpose vehicles established on behalf of a pool of regional member countries. The bonds can be credited enhanced by the African Development Bank and other donors …
“The administration of the bond can be managed under the auspices of the African Union’s Peace and Security Council and regional economic communities, which includes the ECOWAS Commission. Then, Your Excellencies, we can sleep with our eyes closed to wake up the next morning, ready again to work relentlessly for Africa’s assured destiny of prosperity,” Adesina declared.
COVID-19 vaccines
Touching on Africa’s quest for COVID-19 vaccines, Dr Adesina noted that the AfDB has made significant investments, with the aim of helping African countries to revive their economies.
However, the success of the economic rebound is now largely dependent on the continent’s access to COVID-19 vaccines, he said, and the bank plans to offer support to the pharmaceutical industry across the continent to enable African countries to obtain the vaccines they need.
“Africa should not be begging for vaccines: Africa should be producing vaccines. The African Development Bank will ramp up support to Africa to produce vaccines as part of the vaccines plan of the African Union (AU).
“The bank will also commit US$3 billion to develop the pharmaceutical industry in Africa. Your Excellencies, it now time to rapidly build a health-care defence system for Africa to tackle this and further pandemics,” Adesina declared.
Wilberforce Asare
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