By Adedapo Adesanya
The African Development Bank (AfDB) has been named as the Best Multilateral Financial Institution in the world for 2021.
The recognition came from a prestigious United States’ based magazine, Global Finance, which specialises in financial markets and investment banking.
The bank noted that the award is a global recognition for the path-breaking efforts of the bank as it transforms itself into a solutions bank for Africa, through a combination of its operations, knowledge services and investment positioning, which continue to help accelerate Africa’s development.
It is also said it is an affirmation of the success of the operational strategy being pursued by AfDB under the leadership of Mr Akinwumi Adesina, who was unanimously re-elected to a second consecutive five-year term as President of the institution last year.
Speaking on this, the publisher and editorial director of Global Finance, Mr Joseph Giarraputo, while announcing the winning list, said, “With widespread expectations of consolidation in multiple sectors and all around the world, investment banks will play a leading role in reshaping the world economy post-pandemic.
“Companies need more than ever to understand the specialities and skills that investment banks bring to the table. Global Finance awards are a valuable guide.”
In 2020, AfDB received broad recognition for responding swiftly to the needs of the African continent in the wake of the COVID-19 pandemic and for its pioneering role in the global social bond market.
In the October of the same year, the bank was selected in a poll of global bond market players as the best issuer for its $3 billion dollar-denominated Fight COVID-19 social bond, issued on March 27, 2020.
The social bond was the largest ever US Dollar-denominated bond in world history, floated on the Luxembourg Stock Exchange, and listed on the London Stock Exchange and the Nasdaq Sustainable Bond Platform.
Also, in March 2020, AfDB received the Environmental Finance’s 2020 bond of the year award—SSA category— for a successful one billion Norwegian Krone social bond issued in 2019. It was the first social bond ever launched in the Norwegian market, and AfDB’s first transaction in Norwegian Krone.
Since 2017, the bank has launched nearly $5 billion worth of such instruments, denominated in US dollars, euros and Norwegian Krone.
Commenting on this, President Adesina, said: “I am delighted at Global Finance’s recognition of AfDB as the best multilateral financial institution in the world in 2021. I am proud that for the first time since its establishment in 1964, AfDB has risen to a position as a foremost globally-respected financial institution.”
Mr Adesina described the award as one which was “duly earned” and credited the bank’s continued success to a new culture of results, strong client orientation, leadership, creativity and continued innovation by a team of excellent staff across all its jurisdictions.
He added: “We are constantly innovating, developing and deploying financial, investment and knowledge products to meet the rapidly changing needs of African countries and the private sector.”
In February 2021, the rating agency S&P Global affirmed AfDB’s “AAA/A-1+” foreign currency issuer credit rating with a stable outlook.
The bank has continued to receive extraordinary support from its shareholders, including an increase in its subscribed capital from $93 billion to $208 billion, the largest increase in its capital since its establishment.
According to Mr Adesina “The extraordinary support of our shareholders and the strong corporate governance of the Bank’s board of directors have served us well. We will continue to leverage our resources to better serve our clients.”
IITA Laments Poor Budgetary Allocation to Agriculture in Africa
By Adedapo Adesanya
The International Institute of Tropical Agriculture (IITA) has blamed the insufficient budgetary allocation to agriculture as a major impediment in most African countries.
This formed part of the points raised by the Director-General of the agency, Mr Nteranya Sanginga, who added that this had been militating against the development of the sector in the continent.
Mr Sanginga, from the Democratic Republic of Congo (DRC), assumed office in 2011 and is the first African director-general of the 54-year-old international institute.
Speaking in Ibadan, Oyo State at an interactive session, said that except adequate attention was paid to agriculture by African leaders, it might be difficult to attain foof sufficiency in the continent.
He noted that African countries had more than enough resources to attain food sufficiency to rely less on importation, adding that the endemic leadership problems confronting them had been a clog in their wheel of progress.
Mr Sanginga said this had been further compounded by lack of commitment of most African leaders to agricultural development, as reflected in the quantum of resources being allocated to the sector on yearly basis.
Citing the example of his home country, he said that on the average, DRC usually had 1.7 per cent budgetary allocation to agriculture, while in Nigeria, it was not more than two per cent.
“With all the resources available to DRC, the country still imports more than 70 per cent of food items, such as rice, beans and fish as its annual budgetary allocation to agriculture is about 1.7 per cent, while in Nigeria, it is not more than two per cent.
“The situation is also the same in most other African countries. With these, how can we say that African leaders are serious about attaining food security in the continent?” he queried.
The director-general reeled out his achievements in the last 10 years, saying he had been in the saddle, especially in the areas of creation of business incubation platforms, setting up the youth agripreneur programmers, the implementation of ‘Start Them Early Project’ (STEP) and building of food processing units under the IITA leadership.
“One of my most important legacies has been the creation of IITA Youth Agripreneurs (IYA) programme which was aimed at addressing the high rate of unemployment among African youths, with agriculture sitting as a goldmine, waiting for explorers.
“More than 60 per cent of Africa’s estimated 1.2 billion people are under the age of 25 and yet with little job creation.
“Whereas agriculture remains an essential driver of economic development and an area of great opportunities for young people in the continent,” he said.
The IITA chief said that the IYA initiative had now been adopted by many organisations, especially African Development Bank (AfDB) which had been set up in to 24 countries.
He said that this had rekindled the hope of a new generation of African agricultural entrepreneurs who would feed the continent and create wealth and employment.
The director-general pointed out that these achievements, among others, had motivated the Ooni of Ife, Oba Adeyeye Ogunwusi, to honour him with chieftaincy title of Aare Afurugbin Ola of the Source.
The conferment of the chieftaincy title, meaning “Lead Sower of Wealth and Prosperity of the House Oduduwa” will take place at Ile Oodua, Ooni’s palace, Ile-Ife, on December 11.
While expressing appreciation to the royal father for the honour, Sanginga said that this would further fire his passion for the development of agriculture and agribusiness in the African continent.
Malawi, Mozambican Agree to Strengthen Economic Relations
By Kester Kenn Klomegah
Mozambique and Malawi, largely sharing borders, have agreed to forge cooperation in diverse economic sectors and take the advantages offered by the single continental market.
A number of African leaders have started looking at the African Continental Free Trade Area (AfCFTA), as it aspires to connect all regions of Africa, to deepen economic integration and boost intra-African trade and investment. It aspires to create a single market for goods and services across 55 countries and our continent, creating a market of as much as 1.3 billion people with a combined GDP of $3.4 trillion.
On November 22 to 24, President Filipe Jacinto Nyusi of Mozambique went on an official working visit to Blantyre, Malawi. It was to participate in the 5th SADC Industrialization Week in Lilongwe, according to a statement from Malawi’s Ministry of Foreign Affairs.
The first strategy for regional industrialization, he noted at the conference of the Industrialization Week, includes developing synergies linked to value chains, transport corridors, energy, and human potential. It will also involve bringing down barriers at the border to strengthen the economic identity of SADC. According to Nyusi, the impact of this strategy will be amplified through changes to the trade balance as exports are increased and imports substituted.
The second strategy is based on developing technology, employing thousands of people, creating a market to absorb agricultural surpluses from the rural population with a particular focus on women, agro-processing and associated logistics, which, he said, ends up becoming a “powerful weapon” for the well-being of the population and combating poverty.
While still in Malawi during the visit, Malawi President Lazarus Chakwera took his guest counterpart Filipe Nyusi to launch the construction works for the Mozambique-Malawi power transmission interconnection project at Phombeya in Balaka District. The power generation project planned to translate into improved access to electricity supply and ultimately strengthen the industrialization programmes in both countries.
Construction of the interconnection project includes laying transmission lines about 142km from Matambo substation and 76km into Malawi to Phombeya passing through Mwanza and Neno Districts – expected to be completed in 2023.
According to the Integrated Resource Plan of 2017, peak electricity demand will be 1,860MW by 2030 yet currently, Malawi’s installed electricity generation capacity is hovering at 50MW. The objectives of the interconnection project include supporting the economic growth of the region through sustainable power access by integrating the Malawi electricity market to the Southern African Power Pool (SAPP) in order to balance the power deficit through regional power trading.
Phase 1 of the project included a technical and economic feasibility study that was completed in 2017, project definition and scope and environmental and social impact assessment that was completed in 2019.
In his remarks, President Chakwera said like the railway rehabilitation project that the two countries have embarked on to connect Malawi to the Sena Line across the border from Vila Nova de Fronteira to Marka, “this interconnection project is yet another milestone in the linkages between our two nations.” He reminded Nyusi, that during his visit to Songo Province in Mozambique last year, Chakwera was privileged to tour the Cabora Bassa Dam which is the hub of the Southern African Power Pool (SAPP).
“It was at that time that we agreed to hold this joint ceremony launching the construction of the electricity transmission line for Malawi-Mozambique Interconnection. I am, therefore, glad to see this coming to pass as a step in the direction of integrating infrastructure across SADC for sustainable economic development. The project aims at creating avenues for trade in the SAPP, with the prospect of more exchanges of trade and power in the future,” he asserted in remarks.
President Chakwera says Malawi and Mozambique are strategic development partners and there is a need for the two nations to continue exploring economic relations in the areas of trade, transport and mining for the mutual benefit of their people. Both presidents also identified areas of rail transport, energy and mining for developing bilateral partnerships.
With the construction of The Malawi-Mozambique Interconnector, it marches towards the goal of adding 1,000 megawatts to the national grid over the next four years is making steady progress. The project is co-funded by the World Bank- IDA Credit at $15 million; European Union through KFW Grant at $20 million and the Malawi Government at $3.5 million.
Russia Assures Mozambique More Economic Cooperation
By Kester Kenn Klomegah
Russia is ready to support Mozambique in the fight against terrorism through cooperation in the field of intelligence, and further promises strengthening cooperation in various economic sectors, Russian Deputy Minister for Foreign Affairs Mikhail Bogdanov said at the end of a meeting with Prime Minister Carlos Agostinho do Rosário in Maputo.
Bogdanov, who is also Russia’s Special Presidential Representative for the Middle East and Africa, defended the importance of African countries, including Mozambique, launching initiatives on their own real needs for combating the phenomenon in international forums, especially at the level of the United Nations.
In the context of anti-terrorist cooperation between Moscow and the African continent, the Russian diplomat said it was important for Africans to help the world understand their efforts in this fight. Russia and Mozambique have consistently maintained that all problems, conflicts and crises, unfortunately, still remain on this continent, and should be resolved based on the approaches of Africans themselves, and of course with moral, political and material support from the UN and the UN Security Council.
Bogdanov considered the situation in Cabo Delgado a serious issue, which is why his country was offering to help address it. It is worth noting that during an earlier high-level visit to Maputo by Russian Foreign Minister Sergey Lavrov, it was announced that Russia would increase counter-terrorism cooperation with Mozambique. Since then, no reports have been made available publicly about concrete contributions in fighting terrorism in Mozambique.
Mozambique has been grappling with an insurgency in its northernmost province of Cabo Delgado since 2017, but currently improving after the deployment of a joint military force with the primary responsibility of ensuring peace and stability, and restoring normalcy in Mozambique.
Bogdanov also met Minister of Foreign Affairs and Cooperation, Verónica Macamo Dhlovo, with terrorism again dominating the conversation between the two. Themes related to bilateral cooperation in the areas of economy and trade, the humanitarian sphere and others of mutual interest were discussed. During tropical cyclone Idai in April 2019, Russia helped by sending humanitarian supplies to Zimbabwe, Malawi and Mozambique.
Mikhail Bogdanov said that Russia places special emphasis on relations with countries on the African continent, highlighted the holding, in October 2019, of the first Russia-Africa Summit, at which Mozambique was represented by President Filipe Nyusi.
“Preparations are now underway for the second [Russia-Africa] summit, which will take place in 2022, and we would be grateful if Mozambique were represented at the highest possible level,” Bogdanov said.
Russia has had economic cooperation with Mozambique. There is an increasing interest of the Russian business community in building partnerships with Mozambique, which matches Maputo’s intention to attract Russian investment and technical assistance. Until recently, reports on the “hidden debts” scandal amounted to a $2 billion loan scam involving two banks, Credit Suisse and Russia’s VTB bank. The secrecy and corruption surrounding the loans dealt devastating blows to Mozambique’s credibility and reputation.
It was the Wall Street Journal that first revealed the hidden debt in April 2016. By U.S. court ruling, the Russian bank VTB agreed to pay more than US$6 million to settle the US Securities and Exchange Commission (SEC).
In 2015, Rosneft was awarded three licenses to extract natural gas near the Rovuma basin, in partnership with Exxon Mobil. The plan is to create a consortium with the participation of a Mozambican company, Rosneft and ExxonMobil to develop offshore hydrocarbon fields near Mozambique. Besides that, Inter RAO-Export and EdM (Mozambique) also signed a memorandum of understanding in power generation.
Back in August 2019, when President of Mozambique Filipe Nyusi held talks with Russian President Vladimir Putin, both agreed on deepening economic cooperation especially in energy, oil and gas exploration, and the development of Russian-Mozambican cooperation in various other mutually viable sectors. A series of bilateral agreements to boost that expected cooperation were signed between the two countries.
With an approximate population of 30 million, Mozambique is endowed with rich and extensive natural resources but remains one of the poorest and most underdeveloped countries in the world.
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