Remarks by Atiku Abubakar, former
Vice President Federal Republic of Nigeria, at the Maiden University of Nottingham Africa
Summit, at the University of Nottingham Great Hall, University Park,
Nottingham, England.
16 June, 2017.
Protocol:
I have been asked to share with you
my thoughts on Africa’s quest for development with special reference to the
recent high 5s of the African Development Bank (AfDB). The development Bank,
under its current leadership, has identified five high priority areas that it
believes Africa must address in order to reach its development potentials.
Those high 5s include Light up
and Power Africa; Feed Africa; Industrialize Africa; Integrate Africa; and
Improve the Quality of Life for the People of Africa.
Any serious observer of Africa’s
development challenges will readily agree that these are indeed critical areas
that need urgent and sustained attention by Africa’s governments, development
partners and the private sector. They speak to the challenges of infrastructure
deficit; agricultural stagnation and food insecurity; lack of meaningful
industrialization and value-added production; the poor integration of Africa’s
economies, partly resulting from weak regional infrastructure and the legacy of
colonial trade patterns; and Africa’s dismal ranking in the indices of human
development, including life expectancy, infant and maternal mortality, poor
sanitation, high levels of illiteracy and poor access to education and skills
training.
The Current situation:
Despite enormous potentials for
energy generation, including renewables, energy generation in Africa has been
rather dismal. As the AfDB note, only about 40% of Africans have
access to electricity, the lowest access rate in the world. On per capita basis
Africans (outside of South Africa) consume 180 kWh of electricity. Compared to
13,000 kWh in the U.S. and 6,500 kWh in Europe, that is really dismal.
The
inadequacy of power is emblematic of the broader infrastructure deficit in
Africa, including transportation, health and educational infrastructure. This
inadequacy has had a huge impact on Africa’s development as it discourages
investment, raises the cost of doing business, worsens health conditions of
citizens and impedes access to education, among other effects.
The
AfDB has set a goal of universal access to electricity for the continent by
2015 and has mapped out clear principles and strategies for achieving that,
including greater investment, improving policy environment, improving sector
regulation, transforming the energy companies and encouraging regional projects
to drive integration.
Feed Africa through
agricultural transformation is the second high 5. Despite having 60% of the
world’s unused arable land, a quarter of Africa’s population is
under-nourished, making Africa the most food insecure in the world. This is
notwithstanding that agriculture employs 60% of Africa’s workforce.
The
Bank plans to transform Africa’s agriculture in order to unlock its potential
and improve job creation to help diversify Africa’s economies. It plans to do
this by developing an inclusive and competitive African agribusiness sector
with the goal of helping to end poverty, hunger and malnutrition, turning
African to a net exporter of food, and moving Africa to the top of
export-oriented value chains where it has comparative advantage.
On
industrialization and economic diversification the AfDB notes that Africa is at
the bottom of the global values chain with Africa’s share of manufacturing at
less than 2%. The continent continues to rely excessively on raw commodities
export. Thus the share of manufactured goods in Africa’s imports is three
quarters while the share of manufactured goods in its exports is less than
one-fifth.
The
Bank calls for a bold agenda of industrialization to be led by the private
sector, with its support.
Integrate Africa is the Bank’s
fourth high 5: Here
the Bank notes that weak integration of African economies evidenced by the
paltry intra-African trade. In a paper she published in 1993 Faezeh
Faroutan noted that Sub-Saharan Africa’s GDP was equivalent to Belgium’s and
wondered what it would look like if Belgium is divided into forty something
countries, each with a separate and independent economy trying to relate with
the rest of the world. That’s what, she pointed out, Africa looks like in its
fragmentation into several tiny economies. Yet as the AfDB notes intra-African
trade is the lowest in the world, roughly 15%. The comparable figure for the
North American Free Trade Area was 54% and the European Union 70% and Asia 60%.
Boosting African integration, it argues, will involve building regional
infrastructure, boosting intra-African trade and investment, and facilitating
the movement of people across borders. These will help Africa develop a truly
regional market.
Improve the Quality of Life for the People of Africa is the fifth high priority area for
Africa, according to the Bank. This is to be accomplished through the provision
of access to social and economic opportunities. Goals include creating jobs,
building critical skills, improving access to water and sanitation, and
strengthening health systems. The Bank notes that despite the improved economic
climate in Africa in the past decade, many African countries are still
bedeviled by widespread poverty and inequality, poor health and education
outcomes and inadequate access to sanitation and safe drinking water.
The
AfDB’s choice of priority areas and Plan to assist in addressing them will
surely make a huge positive difference. And, fortunately, Africa’s leaders also
recognize these challenges and the urgent need to address them. They are making
concerted efforts, including seeking out new development partners such as China
to help with infrastructure improvement. New railway systems, roads, bridges,
ports and gleaming new office buildings are springing up across Africa as a
result. But the current efforts are not adequate. Indeed progress has been made
in all five areas. Yet much more needs to be done.
These
inadequacies are real. As a businessman I can tell you about my
personal experience. A little more than decade ago, I founded the
American University of Nigeria located in Yola, my hometown, in Nigeria’s North
East, one of the poorest regions of the country. Before then I had created and
been supporting a first-rate boarding school – kindergarten through high
school – also in Yola.
Like
other Africans who have achieved modest success, I had been engaged in
different aspects of philanthropy. But education, I thought, would
be my best gift to society. To some people trying to build a world-class
university in Yola might seem irrational. To run the university we had to
provide access roads, provide our own water though boreholes, build and run our
own power plant, provide our own telephone and internet infrastructure, pay for
a private security force, and so on.
You
might wonder whether it wouldn’t be more cost effective, to just use that money
to provide scholarship funds for students to study elsewhere, such as
Nottingham. With the money now being used to run our AUN power plant, construct
our buildings, and pay our security force and the like, a great many more
students could be sent here to study.
But
I wanted to help develop my country in deeper and more holistic ways. It would
be counter-productive to facilitate the brain drain out of
Africa. We need these bright young people in Africa. We need them to
understand the problems in Africa. We need them to contribute towards Africa’s
development. And we need them to be able to tell the stories of
their accomplishments in the face of enormous odds.
But
the cost is huge and it is what typically confronts the typical investors. The
huge infrastructure gap means that as an investor you often have to provide
your own electricity, your own water, and you even fix roads to your business
locations. That discourages investors. Thus small businesses that would provide
ancillary services to a major establishment are often absent. For instance, in
the same town, Yola, where we have our school system, we established a printing
press, built our own hotel to carter to those who visit, established a beverage
plant to, among other things, manufacture still drinking water and fruit
juices. We established petrol and diesel filling stations to help
serve our businesses and the general public. We also established a
radio and television station to help publicize what we do, in addition to
providing distance learning. And we have a logistics company to help provide
logistics for these various entities. Because we have businesses
with healthy revenue streams, we are able to access financing with greater ease
than many others can. Currently the AUN contributes nearly $400 million dollars
annually to the Yola economy.
But
while we have some capacity to treat some of the infrastructure gaps as
important investment opportunities, many small businesses lack the resources to
engage in the kind of ‘self-help’ that we have engaged in regarding
infrastructure provisioning. Thus small businesses, the real engine of job
creation and employment, are most affected by the infrastructure and other
inadequacies.
It
is cheaper and more socially valuable for the state to provide much of the
needed infrastructure, including doing so in partnership with the private
sector. Infrastructure provisioning and a supportive regulatory environment
will encourage more private sector investment and employment generation.
What’s Missing from the high 5s?
Let
me say, however, that while security does not feature among the Bank’s top five
priorities, it is a top priority for African countries. Security is a huge
challenge and if not addressed may impede the implementation of the Bank’s
plans, especially for fragile states. Africa’s public security challenges
include terrorism, piracy, kidnappings, armed robbery, and banditry, herders
and farmers’ clashes, and inter-ethnic and sectarian conflicts. And
these are present to varying degrees in all of Africa’s sub-regions. It is
understandable that the Bank would select areas that are easily bankable. It is
also the case role of the private sector in ameliorating the major security
threats facing Africa, especially with respect to security policy has not been
clearly delineated. African states and development partners must deepen their
cooperation in the area of security, including security sector reforms to
instill democratic norms and respect for human rights.
I
also believe that Education should get more attention than the
Bank’s high 5s seem to allow. Education should indeed be one of the top
priorities for Africa. While education should be the primary responsibility of
governments, it also clear that Africa’s educational challenges, in the context
of competing demands and available resources, are beyond the capacity of many
African states. Thus the private sector should be encouraged to do more in
providing high quality education under clear standards maintained by the
governments. The AfDB and other development banks can identify some public and
private educational initiatives for support through, for instance, improving
educational infrastructure including libraries, ICT, laboratories and technical
workshops, and support for transitioning to renewable energy such as solar and
wind.
Let me also say that Africa
must get its politics right in order to accelerate its
development. This will include improvements in electoral systems,
deepening of democracy and accountability, and reduction in corruption. Let’s
not forget that these priorities have to be adopted by and implemented by
governments, by the political leadership. Therefore, Africa needs mechanisms
for producing leaders who privilege their countries and the continent over
personal or sectional gains and interests.
Thus Africa’s civil society and
Africa’s development partners have important roles in pressuring African
governments on important political reforms to help provide the democratic
spaces for policy dialogues and democratic interventions in Africa’s
development.
I thank the organizers of this
summit for inviting me to be part of this dialogue. Thank you for your
attention.
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