AfDB President Predicts Stable Economic Outlook for Africa in 2023

Dike Onwuamaeze in Lagos and James Sowole in Abeokuta

The President of African Development Bank Group (AfDB), Dr. Akinwumi Adesina, has projected that Nigeria would lift the Gross Domestic Product (GDP) of West African countries in 2023.
Adesina said this yesterday in Abidjan, Ivory Coast, during the launch of the maiden edition of, “2023 Africa’s Macroeconomic Performance and Outlook,” where he projected that the economic outlook for Africa would be stable in 2023/2024 at four per cent GDP growth in spite of slowing global demand, tighter financial conditions and disruptions in global value chains.  

“But despite the confluence of these multiple shocks, growth across all 54 African countries was positive in 2022. And the outlook for 2023/2024 is projected to be stable,” he said, while advocating for bold policy actions at national, regional and global scales that would help African economies to mitigate compounding economic risks.  
He said: “In the case of the rest of West Africa, country like Nigeria, though affected by decline in oil production by insecurity, will lift the weighted regional growth rate within the region.

“In West Africa, the recovery in agriculture and tourism sectors coupled with expansions in construction and renewable energy projects will ensure that the region grows by 3.6 per cent. What you see in Ivory Coast is massive construction and that is really very important in boosting domestic investments in the economy.”
He also projected that “the Southern African region will manage to grow by 2.5 per cent on the back of strong rebound in tourism activities and resumption of investment spending in mining sectors.”

Adesina also gave projected that North Africa would record an economic growth rate of 4.3 per cent “with the resumption of global economic activities and as the alternative source of Europe’s energy needs.  
“In Central Africa, policies that will stimulate demand and boost investments will see growth rise to 4.7 per cent while the economic diversification and expansion in infrastructure will ensure that growth in East Africa averages 4.2 per cent.”  

The former Nigeria minister also advised African countries that increasing food production in the continent would be more effective than monetary tightening in taming inflation since 60 per cent of consumer price index (CPI) is derived from food inflation.
He also observed that apart from the ripple effects of Russia’s invasion of Ukraine that was spiraling energy and food prices, massive devaluation of currencies are stoking inflation in African domestic markets. This is raising the risk of already high inflation.  

He said: “If we do not have an abatement in food and energy crises it could plunge Africa toward a wrong trajectory in terms of eliminating extreme poverty.
“Probably 60 per cent of CPI is the price of food. Tightening monetary policy can drag down inflation but if you want to deal with market level increase in food prices it is more effective if you produce more food.”  
The president of the AfDB noted that this edition of Africa’s Macroeconomic Performance and Outlook recognised the difficult challenges African economies faces in navigating these multiple overlapping risks.

He said: “First, the high interest rates environment could exasperate the cost of debt services and see some African countries flip into high risk of debt distress.
“Second, the increasing loses and damages due to more extreme weather events will continue to exasperate fiscal risks for countries.  
“Third, countries that continue to depend on commodity exports with minimum value addition will continue to be exposed to commodity price volatility rate and may miss significant opportunities in the global green transition.

“Fourth, continuing global and regional conflicts could exasperate a softer supply and demand chain disruption.”
“The report also reiterates the call for accelerated implementation of structural reforms that will drive private sector industrialisation. And of course in quality healthcare infrastructure and the pharmaceutical industries and in digitalisation and e-commerce.”

Meanwhile, Adesina, yesterday said the financial institution, has invested about $171 million in education in Nigeria.
Adesina said the bank, had equipped no fewer than 50 million young Africans with skills, particularly in science, technology, engineering and mathematics.
The AfDB President stated this in a lecture delivered at a colloquium on, “The Role Education in 21st Century Nigeria Development: BBHS Adventure,” as part of activities marking the 100 years Anniversary of Baptist Boys High School (BBHS), Abeokuta, Ogun State.

Adesina, who delivered the lecture virtually, said the various interventions produced more than 464 Master degree holders and 83 PhD holders.
He said, the AfDB would soon establish a Youth Enterprise Investment Bank in Africa to address high unemployment rate in the continent.

 He called on African countries to improve access to quality education by adequately funding the sector to reduce youth unemployment in the continent.
He warned that, the high unemployment rate in Africa if not checked could worsen the social and political fragility of the countries in the continent.
The event, was attended by the former Speaker of the House of Representatives, Dimeji Bankole and other alumni of the school
Adesina while delivering his lecture said for the United Nations (UN) goal for inclusive and quality education for all to be achieved, the global spending on education must rise from $1.2 trillion to $3 trillion per year by 2030.

He said, “Nigeria as a nation with rapidly growing population must do more to ensure that the younger generation receive access to the education they deserve.
“As a nation, the demands of a dynamic, fast-changing and integrated labour market globally required that we must significantly invest in building first grade and competitive human capital.

“We must also improve educational system to be more resilient and able to adapt to the rapidly changing environment.
“We must transform African’s educational systems to prepare students for this new digital world.
“The investment that any nation makes in education reflects hopes and aspirations for accelerated development.

“We cannot underfund education. A nation can only go as far as its quality of its human capital, so if you underfund quality education, get ready for underdevelopment.

“The greatest discouragement to education is lack of jobs. The unemployment rate in Africa is extremely high and it reduce the return on education. Furthermore, it leads to frustration among the youths and spurs social discontent which could worsen social and political fragility of countries.”

In his address, the National President of Old Boys Association of BBHS, Prof. Kayode Oyesiku said there was need for Nigeria to de-emphasis certification and focus more on technical and vocational education.

“This country place too emphasis on paper certificate. The issue of unemployment may not be resolved if we continue to place too much emphasis on paper certificate.

“Without vocational and technical education we are going nowhere. We are only deceiving ourselves, we must emphasis on vocational and technical in our schools starting from secondary up to the tertiary level”, Oyesiku said.