“Progress as usual is not enough,” says Dr. Kalibata at the EU Cooperation Days
The AGRA President, Dr. Agnes Kalibata, has called for a different way of doing business if the world, and Africa in particular, are to achieve any meaningful and sustainable development. She said this in a keynote address to over 1,500 staff of the European Commission’s Directorate-General for International Cooperation and Development (DG DEVCO) and the Directorate-General for Neighbourhood and Enlargement Negotiations (DG NEAR).
She was speaking as part of a high-level panel on “Promoting Investment and Innovative solutions” that looked at how best to promote investment in developing countries.
Sharing her political vision on the present and future of sustainable investment and the role of the European Union therein, she noted that sub-Saharan Africa has witnessed a 35% growth in inflation-adjusted real per capita incomes in between 2000-2014.
Based on this and other growth indicators including dropping poverty rates represented by a decline in the percentage of people living on less than $1.90 from 54% in 1990 to 41% in 2013, Dr. Kalibata stated that Africa is still rising despite skepticism in certain quarters.
Despite this uptick in growth, she cautioned that a lot more still needed to be done as Africa still has some of the highest poverty levels with 43% of the population living in extreme poverty. Malnutrition and hunger are also still rife with close to 230 million people going hungry while unemployment, especially for the youth, is vast with 70% of the 10-12 million young people entering the job market annually unable to find decent jobs.
On investments, Dr. Kalibata noted that financing for agriculture and development, in general, is, in most cases, not the problem. There exist many different funds across the continent with the UN FAO, for example, listing 63 agriculture investment funds in their most recent study on agriculture investments.
She also acknowledged the role of the development community in supporting African countries move in the right direction and especially thanked the EU which has been the leading investor in Africa. She further welcomed the new EU External Investment Plan (EIP) noting that agriculture and SME finance are part of its 5 priority sectors.
Observing that more can still be done, Dr. Kalibata expressed concerns that African countries are not progressing as fast as they should. “Progress as usual is not enough for the years ahead. We need to do business differently if we’re going to be even more successful,” she said.
To promote investments in Africa, she shared her views on four points for improvement.
- Ensure the right allocation and coordination
Re-emphasizing that there are many players in the sector sometimes with minimal coordination, Dr. Kalibata called for better prioritization of sectors, development of national plans that are aligned, inclusive and prioritized, and better coordination and accountability across ministries, development partners, private sector and implementing partners
- Ensure it reaches those who need it most
Lamenting what she called the ‘perfect SME syndrome’ that makes all investment funds look for deals of $5 million or $10 million, Dr. Kalibata said that what African agriculture needs to thrive are investments of $100,00 or $500,000 to drive inclusive growth and creation of decent jobs and outcomes linked to the Sustainable Development Goals. As such, she called for a re-design of the investment funds and instruments to make them fit for purpose.
- Ensure it crowds in the private sector
Dr. Kalibata emphasized the role of the private sector in delivering real transformation. She, however, noted that the private sector does not just emerge but is catalyzed through public investments. Key public investment programmes including in the subsidies should, therefore, be re-designed not to hurt the private sector whose involvement is critical for sustainability.
- Ensure there is capacity to come through
Noting that most African countries use 20% – 40% of resources available mainly due to weak capacities for implementation and execution of projects and programs, Dr. Kalibata called for deliberate efforts to build state capacity and delivery systems. To illustrate this, she pointed out Ethiopia and Rwanda which have seen tremendous growth in the agricultural sector and economies. She noted that the two countries have strong implementation capacity and delivery systems through the Agricultural Transformation Agency and the Rwanda Agriculture Board respectively.
In conclusion, Dr. Kalibata stated that we have seen tremendous progress in many developing countries in the last 15 years. She underscored that this progress was not by accident but an outcome of consistent, sustained and prioritized investments within the Millennium Development Goals framework and other continental and national development priorities.