African Development Bank : Fixing agriculture and energy key to Africa’s growth

African Development Bank

African Development Bank Group President Akinwumi Adesina paid a courtesy call to President John Dramani Mahama of Ghana on October 16, 2015 in the country's capital, Accra.

The two discussed the status of development cooperation with Ghana in the context of the changing global economic landscape, and how the Bank can further support development initiatives in the West African nation. President Adesina commended Ghana for its efforts in significantly reducing poverty over the years, but noted the variability in the level of poverty and inequality in the country. The poverty rate is four percent in the Greater Accra region while it reaches as high as 80 percent in the northern region, according to official statistics.

'I am particularly concerned about northern Ghana. We need to look at how to address poverty where it is highly concentrated,' President Adesina said.

The two cited agriculture as the game-changer, with the ability to create jobs for young people while at the same time ensuring food security. 'But not just agriculture for food production... we need to look at it from a different perspective- value addition. We need to begin looking at agriculture as a business,' he said.

President Mahama observed that the region had 11 million hectares of arable land with potential for development, saying 'we have not leveraged it fully.' The two leaders explored how the land resources could be utilised for rice production, turning the region into a huge producer of rice. President Adesina reaffirmed the Bank's commitment to support this initiative, in addition to giving continued support to the energy sector.
The Bank's portfolio in Ghana currently stands at USD 760 million, of which 52 percent is in the infrastructure sector - mostly transport and energy. Agriculture accounts for 20 percent, and the social sector 14 percent.

While in Accra, President Adesina also participated in the marking of End Poverty Day, and the launch of World Bank's report Poverty in a Rising Africa, ahead of the international day for Eradication of Poverty (October 17). The report highlights growing poverty levels despite economic growth on the continent, charting the parallel course of poverty-reduction and population increase. It also makes particular mention of the gender face of poverty, and the mechanisms in place to address it.

President Adesina reiterated the importance of fixing Africa's energy challenges in order to spur economic growth. 'Energy poverty in Africa drives up poverty rates. Without energy, micro, small and medium size enterprises - which account for over 90 percent of businesses - operate below capacity. Industrialization is stalled, and Africa loses two to four percent of GDP,' he said.
'If we get power right, we will get everything right in Africa,' Adesina stressed.

World Bank President Dr Jim Yong Kim noted that only 24 percent of Sub-Saharan Africa's population has access to energy, and when available, it can be unreliable and unaffordable. He emphasized the implications this has on business investments. 'In most countries, infrastructure is a major constraint for doing business. It has been found to depress business productivity by around 40 percent in some places,' he said.

President Mahama said his country had embarked on strategies to produce more power within the next five years. He observed that this would help in accelerating efforts towards the achievement of the Sustainable Development Goals that seek to end poverty.

Adesina also participated in a 'Shared Prosperity Forum' at the University of Ghana, Legon, alongside President Kim, Nigerian businessman and philanthropist Tony Elumelu, and Ghana's education minister, Jane Naana Opoku Agyemang. They debated the theme of ending extreme poverty by 2030, and boosting shared prosperity among the poorest 40 percent of the population in developing countries.

The forum focused largely on undertaking reforms in the education sector, so as to empower students not to become job hunters but job creators. It also addressed building health care systems with the ability to tackle threats of epidemics, as well as private sector participation, and transforming agriculture into a business and wealth creating sector.