President John Dramani Mahama has emphasized the importance of African countries mobilizing domestic resources to reduce their dependence on external financing and to achieve sustainable growth. He pointed out that Africa’s economic journey has shown resilience despite various challenges. Projections indicate that growth is expected to recover to 3.7 percent in 2024 and 4.03 percent in 2025.
“This optimistic outlook highlights the inherent strength of our economies and the effectiveness of policy interventions,” President Mahama said. President Mahama, who is the Champion on African Union Financial Institutions, delivered the keynote address at the Heads of State and Government breakfast dialogue held at the AU Commission headquarters in Addis Ababa, Ethiopia, today (Sunday).
The event, a side meeting of the AU Summit, was themed “Africa at the Forefront: Mobilizing African Investment and Financing for Implementing Agenda 2063.” Hosted by President Mahama, it was conducted under the auspices of the Alliance of African Multilateral Financing Institutions, commonly referred to as the African Club.
Present at the meeting were high-level officials from various multilateral organisations within and outside the continent, including the Chairperson of the Governing Council of the Alliance of African Multilateral Financing Institutions (AAMFI) and President and Chairman of the Board of Directors of Afreximbank, Professor Benedict Oramah, as well as the Director General of the World Trade Organization (WTO), Dr Ngozi Okonjo-Iweala.
Also in attendance were the African Union High Representative for Financing of the Union and the Peace Fund, Dr Donald Kaberuka, and the Commissioner for Economic Development, Trade, Tourism, Industry, and Minerals at the AU, Ambassador Albert Muchanga, among others.
Despite the positive outlook, President Mahama cautioned that the continent still faces significant challenges. “Notwithstanding these positive trends, we must confront the reality that our growth has not always translated into significant improvements in per capita income. Structural transformation remains uneven, with many economies still reliant on low-productivity sectors,” he said.
He emphasized that Africa faces a significant financing gap, estimated at around $402 billion annually until 2030. “This financing gap is not just a statistic,” he stated. “It reflects the unrealized potential of millions of Africans whose aspirations for a better life depend on our ability to invest wisely in infrastructure, education, technology, and health.” In addition to these financial challenges, he pointed out that the continent is also dealing with climate change, geopolitical tensions, growing disparities in multilateralism, and the ongoing threat of diseases and pandemics, all of which could hinder Africa’s progress toward sustainable development.
“We envision that strategic investments in health, education, energy, technology, and infrastructure are crucial. It is noteworthy, however, that the financing gap for these investments is substantial,” he said. To address this challenge, President Mahama advocated a multifaceted approach, including domestic resource mobilisation, improving tax administration, and combating illicit financial flows.
He also underscored the importance of African multilateral financial institutions in financing sustainable development. Strengthening these institutions, he said, would enable them to contribute effectively to the continent’s transformation and the realisation of Agenda 2063. The establishment of the African Union financial institutions, including the African Central Bank, African Investment Bank, African Monetary Fund, and Pan-African Stock Exchange, is expected to foster investment and financing mechanisms to achieve Africa’s economic objectives.
President Mahama encouraged African countries to accelerate the implementation of these institutions and leverage their collective strengths to bridge the financing and investment gaps. “It is our responsibility to strengthen our African multilateral financial institutions to effectively contribute to the transformation and realisation of our Agenda 2063,” he said.
Reduce borrowing
In her remarks, the Director General of the World Trade Organization, Dr Ngozi Okonjo-Iweala, urged African leaders to reduce their reliance on borrowing and instead explore innovative ways to attract and sustain investments on the continent.
“We must take advantage of investment that comes to Africa and be able to sustain them for our own development,” she said.
She suggested that Africa could raise funding by adding value to its natural resources, tapping into pension funds to generate patient capital for development, and exploring innovative ways to price carbon emissions.
A high-level panel discussion on the theme “Mobilising African Investment and Financing for Implementing Agenda 2063” further explored strategies for increasing African financial resources to meet the continent’s development priorities.
By: Kester Aburam Korankye
