Dr. Akinwumi Adesina, the president of the African Development Bank Group, today unveiled an ambitious five-point programme to attract much-needed private sector investment to accelerate Africa's economic transformation and meet the challenges of a host of interlocking global crises.
"Essentially, the African Development Bank must re-invent itself... shifting from being a largely public sector driven financial institution to a more private sector driven institution. That will require changing instruments and processes to become more nimble and more appropriate for the private sector," he said.
"The private sector must therefore play a critical role, whether it is dealing with climate change, expanding the access of countries to global capital markets, supporting financing for businesses, or delivering more cost-efficient infrastructure through public-private partnerships," he said.To accelerate private sector investment into Africa, he highlighted five areas which he said needed attention by the Bank Group.
Third, there is need for an independent African Credit Rating Agency to provide fair assessments of risks in Africa, and to act as a counterfactual instrument to the current biases in credit ratings of African sovereigns and non-sovereigns. Adesina added that today Africa has over $2.5 trillion of assets under management by pension funds, sovereign wealth funds, insurance companies and collective savings. Creatively leveraging these funds into development can be transformational.Adesina stressed the Bank was also supporting the establishment of scalable private equity vehicles.
"We must take a hard look at ourselves if we want to do more with the private sector. If you ask the private sector, they will say we are too slow. That is true, because we still operate largely as a public-sector institution, with public-sector systems and processes," he noted.