A trader on the floor of the Ghana Stock Exchange in Accra, Ghana. (Image: Jonathan Ernst, World Bank)
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The World Bank Group has announced it spent a whopping US15.3-billion on development projects in sub-Saharan Africa during the financial year from July 2013 to June 2014 – a new record – most of it in zero-interest credits and grants from the International Development Association (IDA), the bank’s fund for the poorest countries.
“Africa is making significant progress,” Makhtar Diop, World Bank vice president for Africa, said in a statement. “‘We applaud the improved policies and prudent fiscal decisions many governments have made and we will continue to provide financing through loans and grants, technical expertise and to mobilise our unique convening power to leverage the resources of other development partners.”
The bank contributed $10.6-billion in new lending to 160 projects over the year, including $10.2-billion in zero-interest credits and grants from the International Development Association (IDA) – the largest sum the IDA has delivered in any region in the World Bank’s history.
The work of the bank’s International Finance Corporation (IFC) in the African private sector focused on building infrastructure and introducing new business approaches to help drive growth and job creation. During the year the IFC invested more than $4.2-billion in the continent: $3-billion went to IDA countries and some $800-million to fragile and conflict-ridden states. The IFC also spent $55-million on advisory service programmes in the region, 96% of it in the poorest countries.
The Multilateral Investment Guarantee Agency (Miga), also part of the World Bank Group, issued guarantees of $515-million to projects developing oil and gas, power, services, and telecommunications. The agency also teamed up with the Overseas Private Investment Corporation to establish a $350-million political risk facility to support planned investments in sustainable agribusiness in some 13 sub-Saharan African countries.
In collaboration with individual countries, the bank focused on regional projects in sustainable energy, irrigation, water management, and food security, as well as in job training programmes for the youth, the prevention of malaria and other tropical diseases, and social protection for poor families.
Fragility and emergency action
During the year, the World Bank also ramped up efforts to act quickly and effectively in emergency situations in Africa. In response to the crisis in Central African Republic, it delivered over US$70-million to help restore government services and support food distribution and healthcare.
Major regional initiatives by the bank also tackled fragility and conflict. In November 2013, World Bank Group president Jim Yong Kim pledged $1.5-billion to boost economic growth and lift the people of Africa’s Sahel Region out of devastating poverty. Kim’s pledge came during an historic joint trip to the Sahel with UN secretary-general Ban Ki-moon.
Investment in renewable energy
Sub-Saharan Africa has abundant hydropower resources, yet only 10% of its electricity-generation potential has been harnessed. Boosting access to affordable, reliable, and sustainable energy is a primary objective of the bank’s work in Africa. During the 2013-2014 financial year, its projects focused on developing hydropower potential and providing new forms of sustainable power.
In a major push, the IFC, Miga and the International Bank for Reconstruction and Development (IBRD) – another World Bank Group entity – launched a joint Energy Business Plan for Nigeria. This will support Nigeria’s energy reform programme and help increase generation capacity by some 1 000 MW, while also tapping into nearly $1.7-billion of private sector financing for Africa’s largest economy.
The bank also supported the 80-megawatt Regional Rusumo Falls Hydroelectric Project in Burundi, Rwanda, and Tanzania, and provided a $100-million grant to Burundi for the Jiji-Mulembwe hydropower project. Both projects are set to link millions of people to the power grid.
Improving agricultural productivity
The World Bank also supports countries’ individual efforts to improve agricultural productivity by linking farmers to markets and reducing risk and vulnerability, as well as increasing rural employment, and making agriculture more environmentally sustainable. Projects supported over the year included investments to improve pastoralism through community development and livelihoods in Ethiopia, boosting agribusiness in Senegal, and innovations in landscape management, notably in the Sahel.
Higher education centres of excellence
Higher education plays a key role in promoting economic growth and development especially for Africa’s fastest growing population group, the youth. The World Bank is one of the largest financiers of higher education on the continent. Its new $150-million Africa Higher Education Centres of Excellence project is funding 19 university-based institutions for advanced education in West and Central Africa. This will support regional specialisation among participating universities in mathematics, science, engineering and ICT.