Africa must maintain 7% growth rate for 40 years to eradicate poverty — AfDB

To end poverty and achieve high income status, all 54 of Africa’s countries must constantly maintain a growth rate of seven percent for the ensuing forty to fifty years.

At the 2023 AfDB Annual Meetings in Sharm El Sheikh, Egypt, Dr. Akinwumi Adesina, Group President of the African Development Bank, addressed African economic leaders on the topic of “Key Actions to Achieving Inclusive Growth and Sustainable Development in Africa.”

He asserted that it is apparent that African leaders must speed up development in order to raise the continent’s population’s level of living.

Achieving the African Union objective for 2023 and the Sustainable Development Goals is also important, he noted.

Although accomplishing this objective may be challenging, according to Adesina, it is not insurmountable for the continent.

According to the AfDB projection study, the average growth rate of the continent’s gross domestic product fell from 4.8% in 2021 to 3.8% in 2022.

“And the deterioration is widespread. A worse growth rate was seen in 31 of the 54 African nations in 2022 compared to the year before.

“However, we expect growth to pick up to 4% in 2023 and to pick up even more speed to 4.3 percent in 2024. However, we must acknowledge the growth fluctuation that has characterised our roles,” he said.

Adesina expressed concern that several nations experienced amazing development rates before regressing in difficult times. So, in order to assure continued progress and prosperity, we must draw lessons from this.

Additionally, he added, “We understand that our continent has had its fair share of challenges, including growth-stagnation, decline, and even catastrophic growth, and these data serve as a reminder of the work that still to be done.

“The world we live in is getting more complicated and uncertain. Shocks in the areas of health, finance, socioeconomics, and the environment pose a threat to our progress towards the UN SDGs, AU Agenda 2063, and all other top-priority development targets.

The vulnerability of the health system and the brittleness of Africa’s growth pillars were further highlighted by some of the difficulties the continent was facing, such as COVID-19, conflict, and climate change.

“In particular, our substantial reliance on commodity exports and outside funding sources including loans, remittances, foreign direct investment, and development aid.

In addition, he said, “we must recognise the immense promise and opportunity that Africa holds, even as we acknowledge the problems that lie ahead.

He claims that this demographic change presents us with the possibility of a demographic dividend, a sizable work force to aid Africa’s industrialization efforts, and lower production costs.

He argued that investing in Africa’s youth is one of its greatest assets. We must provide them the tools and chances they require to move the continent forward.

Adesina stated that the creation of the Africa Continental Free commerce Area would be a game-changer since it could boost commerce by 52%.

“It will increase trade within Africa by up to $7 billion annually and decrease imports from outside the continent by $10 billion.

“Up to $45 billion and $21 billion, respectively, will be added to our industrial exports, and these figures show a more promising future for trade and economic growth ratio among African countries,” he said.

He advised economies on the continent to take advantage of the abundant natural riches that the continent possessed because doing so might boost economic growth, inspire young people, and promote job development.

According to Adesina, the research provided Africa with a crucial road map for the future, where each African country may see annual GDP growth rates of seven to ten percent over the following forty years.

However, he asserted that growth alone was insufficient and that Africa needed to address problems with equitable and prosperous governance, poverty, and inequality on the continent.

We have a responsibility to promote environmentally sustainable living, diversified growth sources, and creatively highlight the need to accept climate change, according to Adesina.

“We need to build an economically robust, socially just, and environmentally sustainable Africa.

“Today’s event, in which the study consortiums deliver their recent findings to this prestigious audience, is a critical turning point in our path.

“We eagerly anticipate the final report, which heads of state and governments will share.”

The head of the AfDB stated that as we moved forward, our views and involvement would be crucial in assisting Africa in defining its own growth trajectory.

“One that respects our different environment, institutions, and aspirations while striking the correct balance between a colonial, social, and environmental dimension

“Let us move forward together, united in our mission to build the Africa we want. Let us open a new era of shared prosperity and let us transform our continent into a beacon of hope, progress and opportunity for all Africa,” Adeshina stated.