Private sector, green growth central to AfDB’s new strategy

Investing in private sector partnerships and accelerating inclusive green growth takes center stage in the newly unveiled ten-year strategy of the African Development Bank (AfDB). ALSO READ: Industrial manufacturing must be at the core of AfCFTA –AfDB’s Adesina Launched at the AfDB Annual Meeting taking place in Nairobi, the new strategy (2024-2033) has key priorities, including promoting gender equality, investing in young people, responding to climate change, and investing in climate action, supporting fragile states, and promoting good governance and economic stability. It was developed against a background of heightened food insecurity and a debt crisis across Africa as a result of Covid-19 pandemic, the intensifying impacts of climate change, and a surge in conflict and political instability, compounded by a youthful demographic outpacing job creation. Akinwumi Adesina, President of the AfDB, said this strategy is an answer to the current complex hurdles facing the continent to which the bank must become operationally more efficient and bigger to address and urgently deliver scaled-up sustainable investments. He noted that this places an emphasis on strengthening regional integration, augmenting pharmaceutical and health capacity, sustainably utilising extensive natural resource wealth, ramping up infrastructure, expanding digitalisation, and tapping into Africa’s huge clean energy potential to boost green growth. “Over the next decade, Africa can create sustained growth, drive transformation, and contribute towards critical global solutions,” he said. Co-creating with private sector The fact that Africa’s businesses and entrepreneurs account for 90 per cent of jobs, 70 per cent of GDP, and 70 per cent of investment, AfDB leaders said means that there is a need to create a favourable environment for private investment in narrowing financing gaps and promoting inclusive green growth. “Over the next decade, the bank will substantially scale up and deploy its public and private sector operations in complementary ways. It aims to support entrepreneurs to invest in growth and job creation, including in the informal sector, where so much of Africa’s entrepreneurial energy lies,” the strategy statement reads in part. Investing in women, youth The new strategy was also developed based on the idea that Africa’s population, which is the youngest and fastest growing in the world, presents the continent with an unparalleled demographic window of opportunity. ALSO READ: AfDB seeks to set up youth entrepreneurship investment banks Under the new strategy, the bank will address disparities and promote inclusivity by empowering women and youth, enabling them to contribute meaningfully to sustainable economic growth and prosperous societies. AfDB launched Youth investment funds in three countries in 2023, and announced that more countries have submitted requests. Affirmative Finance Action for Women (AFAWA) has so far approved $1.7 billion and financed over 18,300 women-owned businesses. The bank also emphasised the importance of economic governance, including domestic resource mobilisation, transparent financial management, and anti-corruption measures. Additionally, sustainable debt management practices will also be prioritised to ensure long-term economic stability. Recognising Africa’s vulnerability to climate change, the bank seeks to promote low-carbon development pathways aligned with the Paris Agreement while safeguarding biodiversity and nature over the next decade. With an emphasis on sustainability, it says, it will strive to balance environmental concerns, equity, and economic advancement. Amid rising conflicts, fragility, and political instability in Africa, the bank will intensify efforts to assist fragile countries, it stated, with special attention given to tackling cross-border challenges and reducing the isolation of landlocked and remote areas.

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Private sector, green growth central to AfDB’s new strategy