The AfDB at the African Union Summit: A Quick Summary
Meetings of organisations like that of the African Union (AU) are often deemed to be talk shows by those looking from the outside in — they sometimes appear to be from the inside at times — however, they are anything but once you start to pay more attention to the small meetings, otherwise called side events, especially when the African Development Bank is involved. These and the bilateral meetings are where the details of the big meetings are ironed out. The African Development Bank has perfected the art of making these sorts of meetings worth their while. Projects, programmes and people take the centre stage. It was again what the bank got up to at the 37th Ordinary Session of the African Union Assembly in Addis Ababa.
Africa’s Macroeconomic Performance and Outlook (MEO) 2024 #AfricaMEO2024
The President of the Bank, Dr Akinwumi Adesina delivered the opening remarks at the launch of what is one of the most important documents released by the bank. The MEO is a biannual publication of the AfDB, released in the first and third quarters of the year, either side of the flagship publication, the African Economic Outlook (AEO), which is released at its Annual Meetings in May. The highlights of the President’s speech include the following:
- Africa continues to face multiple crises, including rising cost of living, weakening economic growth, a tightening of global financial conditions, shortage of concessional resources, increasing effects of climate change, lingering impacts of health pandemics, conflict, and geopolitical tensions.
- Africa’s average real gross domestic product declined to 3.2% in 2023, down from 4.1% in 2022.
- 15 African countries have posted output expansions of more than 5%. Africa is projected to remain the fastest growing region in the world, after Asia, exceeding the global average of 3% in 2023. Africa will account for 11 out of the 20 fastest growing economies in the world in 2024.
- Growth on the continent will rebound to 3.8% in 2024.
- Average inflation has remained high, at an estimated 17.8% in 2023, the highest it has been in more than a decade.
- Stabilisation of the average fiscal deficit at 4.9% in 2023, like 2022, but significantly less than the 6.9% average fiscal deficit of 2020.
- Economic growth will regain moderate strength as long as the global economy remains resilient, disinflation continues, investment in infrastructure projects remains buoyant, and there is sustained progress on debt restructuring and fiscal consolidation.
- Boosting Africa’s growth will require larger pools of financing and several policy interventions including (i) domestic resource mobilization. (ii) a reasonable balance be achieved between external and domestic borrowing, especially with greater focus on lending in local currencies. (iii) Countries need to do a better job of managing and deriving greater revenue from their enormous natural resources, through better governance, transparency, avoiding transfer pricing and ensuring that appropriate value is generated from royalties and taxes. (iv) the G20 common framework needs to be accelerated.
The panel session that followed delivered some notable insights too;
- We are seeing projections of growth rebounding in Nigeria on account of the government policies.
- The global financial system, the way it is built and the way it is structured doesn’t serve the financial interest of Africa.
- Our small economies don’t make us competitive in the global market.
- There is always liquidity risks and short-term borrowing is dangerous for long-term development.
- Long-term developments cannot be based on short-term loans. Loans for Africa should be at least 25 years long.
- Africa is paying a punishing risk premium on its finance.
The next major event by the bank was the African Leaders for Nutrition AU High-level Round #Leaders4Nutrition. The theme of this session was “Addressing Malnutrition, Catalysing Africa’s Transformation through Enhanced Multi-sectora”. Notable comments include the fact that, “We must bring nutrition into the heart of the education conversation” and “We have to make nutrition everyone’s business and everyone’s responsibility”. There were notable contributions on the agenda by representatives of Côte d’Ivoire, Rwanda and Malawi.
The last major event of the Bank at the #AUSummit was the Bank and the Lake Chad Basin Commission signing an MOU to mobilise resources for infrastructure development and to strengthen institutional capacity to rehabilitate the Lake Chad Basin. The Vice President for Regional Development, Integration and Business Delivery Marie-Laure Akin-Olugbade signed on behalf of the Bank whilst Mamman Nuhu, the Executive Secretary of the Commission signed on behalf of the LCBC. The MOU is the framework for the programmes and projects expected to deliver development for the people in and around the basin.
You can see some of the conversations under the following hashtags on X/Twitter: #AfricaMEO2024 #Leaders4Nutrition #FeedAfrica #LakeChadBasin. All photos are courtesy of the @AfDB_Group on X/Twitter
