The Executive Secretary of the United Nation’s Economic Commission for Africa, Carlos Lopes has called on the international financial community to provide Africa with more investments than aid, as it is obvious that the latter cannot help the emerging continent achieve its desired growth and development.
Carlos was, on Monday, speaking at the opening of the Ninth African Development Forum holding in Marrakech, Morocco themed “Innovative financing for Africa’s transformation” with the aim of deriving measures to finance Africa’s transformation, when he laid bare these sentiments.
“This is a time when the continent, thanks to its growth and it’s new narratives, has the opportunity to join the other regions of the world that have ‘liberated’ themselves from overseas development assistance (ODA),” Lopes enthused.
The Africa Development Forum, is a biennial event of the ECA which offers a multi-stakeholder platform for debating, discussing and initiating strategies for Africa’s Development.
He explained that Africa, slowly diverting towards private investment and domestic resource mobilization, needs the alternative of private equity to create capital that spreads across infrastructure, health services, agriculture and possible return investment.
Africa has a wide range of opportunities in road, rail transport, energy, water, mineral resources exploitation, agro-business and industrial development. All of which will create employment and boost the economy thus financing the continent’s transformation.
Global impact investments accounted for about $8 billion in 2012, a third of it going to Africa in areas such as education, health and environment. This is a fast emerging source of finance which can complement local investments, showing sketchy but significant signs that Carlos Lopes’ assertion is attracting noticeable action.
Over the last four decades Africa has received 36 percent of total global aid, with a net increase of almost $10 billion in recent times. Yet aid-supported educational programmes have yielded little results as the presence of gender inequality and poor girl-child education still remain evident. The same could be said for several socio-economic challenges currently plaguing the continent, despite the surging inflow of foreign aid, making a case for alternative, more impacting financial support initiatives.
But the challenge to strengthen, build and manage capital in Africa remains key to generating innovative financing mechanisms that Africa is in need of to realise its development potentials. The real test however lies in the continent’s ability to cope with little or no financial aid from governments and other agencies to support the economic, environmental, social and political development.
Carlos believes the continent is ready for such a challenge; “The continent now has a more reliable and stable economic and political environment. We are witnessing a considerable sea change in attitudes and mentalities, with leaders that are reformers and practitioners that are dreamers”.
Notwithstanding, he admits that African governments have responsibilities to fulfil in order to create an enabling environment. “National, regional and continental ecosystems must be upgraded to better support large scale investments”.