President John Dramani Mahama has emphasised the need for African countries to mobilise more domestic resources to reduce the dependence on external financing and achieve sustainable growth.
He stated that Africa's economic journey had demonstrated resilience in spite of the numerous challenges, with projections indicating a recovery in growth to 3.7 per cent at the end of 2024 and 4.03 per cent at the end of this year.
This optimistic outlook highlights the inherent strength of our economies and the effectiveness of policy interventions,” President Mahama, who is the Champion of African Union Financial Institutions, stated.
He was delivering the keynote address at the Heads of State and Government breakfast dialogue held at the African Union (AU) Commission headquarters in Addis Ababa, Ethiopia, yesterd
It was a side event of the AU Summit and was held on the theme: “Africa at the forefront: Mobilising African Investment and Financing for Implementing Agenda 2063”.
Hosted by President Mahama, it was held under the auspices of the Alliance of African Multilateral Financing Institutions, also called the African Club.
Present at the meeting were high-level officials from various multilateral organisations within and outside the continent, including the Chairperson of the Governing Council of the Alliance of African Multilateral Financing Institutions (AAMFI), and President and Chairman of the Board of Directors of Afreximbank, Professor Benedict Oramah, and the Director-General of the World Trade Organisation (WTO), Dr Ngozi Okonjo Iweala.
Also present were the African Union High Representative for Financing of the Union and the Peace Fund, Dr Donald Kaberuku, and the Commissioner for Economic Development, Trade, Tourism, Industry and Minerals at the AU, Ambassador Muchanga, amountng others.
Despite the positive outlook, President Mahama cautioned that the continent still faced significant challenges.
“Notwithstanding these positive trends, we must confront the reality that our growth has not always translated into significant improvements in per capita income. Structural transformation remains uneven, with many economies still reliant on low productivity sectors,” he said.
President Mahama said the continent was facing numerous challenges, including a substantial financing gap of approximately $402 billion annually until 2030.
"This financing gap is not merely statistics. It represents the unrealised potential of millions of Africans whose dream for a better life depends on our ability to invest wisely in infrastructure, education, technology and health," he said.
Aside from the financial challenges, President Mahama indicated that the continent continued to face other forms of challenges, including climate crisis, geopolitical tensions, and widening gaps in multilateralism, while diseases and pandemics would disrupt the positive growth path that the continent was on to achieve sustainable development.
“We envision that strategic investments in health, education, energy, technology and infrastructure are crucial. It is noteworthy, however, that the financing gap for these investments is substantial,” he said.
Bridging gap
To address this gap, he advocated a multifaceted approach, including domestic resource mobilisation, improving tax administration and combating illicit financial flows.
President Mahama also underscored the importance of African multilateral financial institutions in financing sustainable development.
He emphasised the need to strengthen those institutions to effectively contribute to the transformation and realisation of Africa's Agenda 2063.
The establishment of the African Union financial institutions, including the African Central Bank, African Investment Bank, African Monetary Fund and Pan African Stock Exchange, is expected to foster investments and financing to achieve Africa's objectives.
President Mahama encouraged African countries to accelerate the implementation of those institutions and to leverage their collective strengths to bridge the financing and investment gaps in Africa.
"It is our responsibility to strengthen our African multilateral financial institutions to effectively contribute to the transformation and realisation of our Agenda 2063," he said.
President Mahama envisioned an Africa that was integrated, prosperous and peaceful, emphasising that it was a vision within reach if African countries mobilised their resources, reformed their financial systems, and invested in their peoples.
For her part, the Director-General of the World Trade Organisation (WTO), who also delivered an address at the meeting, called on African leaders to reduce their appetite for borrowing and rather find innovative ways to attract and sustain investments into the continent.
“We must take advantage of investment that comes to Africa and be able to sustain them for our own development,” Dr Iweala, Nigeria’s former Minister of Finance, said.
She said the continent could raise funds through value addition to natural resources, tapping into pension funds to raise patient capital to fund development and also pricing carbon emissions in innovative ways.
A high-level panel discussion on “Mobilising African Investment and Financing for Implementing Agenda 2063” highlighted key strategies and approaches for mobilising African finance for delivering on Agenda 2063 priorities.
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Is good to be self reliant in some way
Okay