Regional integration fundamental

While much of Africa has avoided the worst effects of the recession, we face significant risks and uncertainty.

The impact of the global turbulence though varying, from region to region, has been a major setback and a threat to our common achievement to date.

But, at the same time; much of Africa has demonstrated remarkable resilience.

The reform programmes and economic policies put in place by many African nations over the last decade have minimised pre-existing vulnerabilities, providing that surprising degree of resilience.

It is right to conclude that the African Development Fund (ADF) has contributed to that resilience.

By frontloading supportive action, the Fund and its partners provided additional capacity to resist the external shocks.

We are proud of the role which ADF played at this critical time while avoiding strategic drift.

Now, as the global economy begins to show fragile signs of recovery, preventing slippages and consolidating the gains in Africa is a call which we must respond.

Our aim must be to see countries progress significantly in prosperity creation and graduate, as Cape Verde has done, to less dependence on aid.

And that means acting on sources of growth, and growth drivers such as our core areas of operations.

The ADB has put forward what I believe to be a credible proposal as to how it intends to do so: Our projected pipeline for ADF-12 already has 336 national and multinational projects valued at UA12.35 billion ($18 billion).

This demand is fuelled mainly by the infrastructure gaps, particularly energy, the needs for regional integration, investment in climate change adaptation. All priorities of ADF-11 and ADF-12.

Secondly, much has been said about our institution’s capacity – on which there is much to do always.

Nonetheless, representatives of RMCs present here will confirm, the AfDB is becoming a lender and partner of choice both in normal and crisis times.

Our selectivity and focus has enabled us to deepen our understanding of the sectors and countries we operate in and we are more and more able to demonstrate results with each dollar.

Regional integration provides the underpinning for private sector development and economic diversification.

This is an area that has the full backing of African nations.

On Sunday, the Ministers and Governors at the Committee of Ten Ministers of Finance and Governors Meeting unanimously agreed that regional economic integration is central to Africa’s sustained growth.

Indeed, we heard from BEAC that in regions such as French speaking West Africa, unity was a source of resilience.

Since the turn of this decade, we have invested close to $9 billion, making the Bank the largest financier in the domain in Africa.

Regional operations are more complex and imply higher transaction costs in preparation, coordination, and close monitoring.

Regional integration is fundamental in ensuring Africa’s convergence with the rest of the world, and in facilitating growth on the continent.

We must learn how to do better as we do more – in partnership with others – but this is the Bank on whose shoulders lies this historic responsibility.

ADB needs to be relevant to all its Regional Member Countries (RMCs), and that includes fragile states.

These are states in need of our expertise and support.

We must continue to uphold the vision and boldness the Deputies had when they founded this initiative.

We must use all available instruments to respond to the needs of these states, including public support six instruments; of course tailoring the response to the circumstances.

The risk of operating in these states is high, but even higher is the return or the cost of failure.

We must therefore always and at all times continue to seek ways to mitigate the risks associated in operating in these fragile environments.

Under ADF-12, the Bank will continue to support these countries in rebuilding fractured institutions, infrastructure rehabilitation, capacity, and arrears clearance.

Tailoring our interventions to each country’s circumstances and taking into account the lessons we have learned during ADF-11.

We are currently strengthening our results measurement tools, quality-at-entry-operations, portfolio management framework, and country level engagement.

Budget support operations are an important instrument in our tool box.

Our ability to meaningfully be part of the harmonisation process, the Paris Agenda and the Accra Action plan is very much a function of what we do in this sphere.

Management will work on fortifying the areas that we have identified as needing improvements which include the fiduciary risk management framework.

Africa faces a huge energy gap. There are obvious consequences not just for economic growth, for the private sector, but also for health and education.

Dr Kaberuka is the President of the African Development Bank.