African leaders call for increased World Bank funding
Apr 29, 2024
The Summit aimed at building support for Africa’s economic development is jointly hosted by the Government of Kenya and the World Bank Group.
President William Ruto during his keynote address to the African heads of state. (Courtesy PhotosS)
Mary Karugaba
Journalist @New Vision
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African heads of state have appealed to the World Bank to increase its financing to African nations to make meaningful development.
The over sixteen heads of state gathering in Nairobi, Kenya for the World Bank's International Development Association (IDA21) summit appealed to the rich nations to increase its funding to Africa from $93b to $120b this fiscal year given the enormity of challenges faced by the African nations.
In his keynote address, the host President William Ruto pledged on behalf of African nations to play their part by taking deliberate and robust actions to improve fiscal disciplines, increase domestic revenue mobilization, develop investor-friendly policies, and enhance anti-corruption measures.
“Significant capital injection to IDA is crucial. The G27 group of experts calls for tripling IDA's financial capacity to $ 270b by 2030 while maintaining the crucial concession nature of its financing. This recommendation is important if African nations have to benefit. We request the WB that its vision for Africa should be socio-economic driven and executed with transparency,” he said.
Ruto noted the high interest rates by the World Bank on loans which he said has driven many loan recipients into a state of debt distress or are at higher risk of debt distress though IDA remains most African countries’ dependable source of capital.
He further noted that sustainable growth remains elusive for many African countries with huge allocations directed to debt servicing rather than to crucial sectors such as Education, Health, and other development areas.
The Summit aimed at building support for Africa’s economic development is jointly hosted by the Government of Kenya and the World Bank Group.
It is intended to help African nations advance fundamental needs—like energy, health care, and infrastructure—that are cornerstones of development.
According to a statement issued by the World Bank, the Leaders will explore how to maximize IDA's impact during its current replenishment process, ensuring it receives the necessary support to effectively fuel investment at scale.
“Building a brighter future—and securing an ambitious IDA replenishment to get there—requires a united front. The summit will witness the launch of a powerful coalition of partners: Civil society champions and private sector leaders—including Bridgewater Associates, Global Citizen, Jacobs Ladder Africa, One Campaign, and others—will join hands with African governments. This broad alliance signifies a collective commitment to fully realizing Africa's ambitions,” the statement states.
The summit began on Sunday with a meeting of Africa’s Finance Ministers from IDA Member States.
The Finance ministers discussed the IDA’s policy and financing frameworks and highlighted key critical priority areas for development financing for Africa.
Ugandan President Yoweri Museveni asked the WB and other donor groups to change their funding models and focus more on private sector-led growth factors such as electricity, railways, irrigation, and skilling the youth.
Museveni noted that the World Bank has been talking about sustainable growth for years but not much development or growth is seen on the ground.
“The World Bank and other donor groups have been talking about sustainable development and I am almost 80 years but I have never seen a sustainable pregnancy; that a woman is pregnant this year, next year, three years, and so on. If this happens, the foetus will die in the womb. The pregnancy must sustainably develop quantitatively bigger and bigger, that a baby develops into a teenager, then a man. I have seen you using these words-sustainable growth, please change them because the main reason why there’s no growth is because the factors of growth are not funded.”
Museveni blasted the donors for preferring to fund ‘seminars, ICT and capacity buildings’ that do not translate to economic growth.
“We don’t need these seminars, capacity building, and ICT because ICT is all about communication, but you wonder communicating what? It should be linked to Agriculture. I have been looking for irrigation loans but I have not gotten. I asked for money to put into the Uganda Development Bank but they reduced it and said go to commercial banks. The person who can benefit from a commercial bank loan is a trader who goes to China, buys goods, sells them, and pays back the loan,” he said.
World Bank president Ajay Banga informed the meeting that IDA is changing its focus to more sustainable growth and development, especially in the area of Climate Change.
Some of the Presidents present at the summit include Julius Maada Bio – President of the Republic of Sierra Leone, Andry Rajoelina President of the Republic of Madagascar, Dr Lazarus Chakwera – President of the Republic of Malawi, Samia Suluhu – President of the United Republic of Tanzania, Hassan Sheikh Mohamud – President of the Federal Republic of Somalia, General Évariste Ndayishimiye – President of the Republic of Burundi, Mohamed Ould Ghazouani – President of the Islamic Republic of Mauritania, Azali Assoumani – President of the Union of Comoros, Faustin-Archange Touadéra – President of the Central African Republic and Robert Beugré Mambé – Prime Minister of Republic of Côte d’Ivoire, Nana Akufo-Addo - President of Ghana, Abiy Ahmed Ali - Prime Minister of Ethiopia, Amadou Oury Barh - Prime Minister of Guinea, Nadir Larbaoui - Prime Minister of Algeria.
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