The rapid decline in Africa’s GDP

RECENTLY, the president of the African Development Bank (AfDB), Dr. Akinwunmi Adesina,  painted a gloomy picture of governance and life on the African continent when he revealed its dwindling economic fortunes resulted in a $165 billion Gross Domestic Product (GDP) decline in 2020. In the same year, over 30 million jobs were lost while 26 million Africans joined the extreme poverty bracket. Adesina made the revelations in a paper titled ‘Mobilising Financing for Africa’s Accelerated Economic Recovery, Development and Integration’ and addressed to African leaders at the 35th Ordinary Session of the Assembly of the African Union in Addis Ababa, Ethiopia.  Acknowledging the African leaders’ efforts to tackle the COVID-19 pandemic, Adesina said: “We must learn from this experience. Africa can no longer outsource the security of the lives of its 1.4 billion people to the benevolence of others. We must secure African lives! It is time to build Africa’s healthcare defence system. This must be based on three strategic priorities. First, building Africa’s quality healthcare infrastructure. Second, building Africa’s pharmaceutical industry and third, building Africa’s vaccine manufacturing capacity.”

According to the AfDB boss, Africa needs between $600 million and $1.3 billion to meet its goal of attaining 60 per cent vaccine production by 2040, and investing in health is investing in national security. Therefore, he said, the bank would invest $3 billion to support pharmaceutical and vaccines manufacturing capacity for Africa. He said: “To address the socio-economic impacts of the pandemic and support economic recovery, Africa will need some $484 billion over the next three years. To eliminate extreme poverty by 2030, the continent will need $414 – $784 billion per year. Africa will need $7-$15 billion a year to deal with climate change. The continent will also need between $68 and $108 billion per year to fix the infrastructure financing gap.” To this end, he said, Africa must drastically increase its resource base, adding that with the help of the continent’s leaders, AfDB’s general capital had increased in 2019 by 125 per cent, rising from $93 billion to $208 billion, the highest since its establishment in 1964.

It is indeed gratifying that over the past six years, the bank has provided about $39 billion in financing to the continent in support of its High5 priorities, namely to light up and power Africa, feed Africa, integrate Africa, industrialise Africa and improve the quality of life of the people of Africa, being the accelerators for achieving Agenda 2063. These activities are at the core of its mandate and the positive development is an indication of what could be achieved with the right leadership in place. But as the AfDB boss himself recognises, the new goals he has outlined are not attainable without serious governance changes across the continent. To be sure, the COVID-19 pandemic has compounded inequality and tasked economic managers all over the world. But it is still a fact that with over  30 million jobs lost, African must rank as one of the continents worst hit by the pandemic. In any case, if economic indicators before the onset of the pandemic are anything to go by, the statistics on GDP decline and job losses are inevitable corollaries of poor leadership. Although the West is also implicated in the economic misfortune of African countries, as the depletion of the continental wealth has been at its instance on many occasions, the fact is that the continent has been consistently short-changed by bad leaders.

Africa’s GDP is not just declining: it is declining because the right leadership and policies are not in place. With its huge reserves of natural resources, Africa’s dismal economic fortunes can be drastically turned around, to the delight of its-long suffering populace. At the risk of being repetitive, it is still a question of leadership. In this regard, the African electorate must rise up and change the narrative. Across the continent, the indices of bad leadership are self-evident and we see no glimmer of hope on the horizon without radical tinkering with the extant situation. As we have said time and again, the leadership recruitment process must be reinvented. All too often, the continent has lacked political parties that have the goal of pursuing sustainable development as a core objective. Instead, it has witnessed the ugly spectre of political formations whose interest is solely, and quite simply, the pursuit of power. At the moment, there are hardly any ennobling examples we can point to for the continent’s redemption, but that does not have to be the case forever. The continent can, and should, witness the kind of leadership required to actualise some of the goals outlined by the AfDB boss.

We think that Dr. Adesina is correct in his postulation that the continent must build a better future for its youthful population. It is indubitable that the time has come to create youth-based wealth all across Africa, a scheme for which the bank is exploring the establishment of youth entrepreneurship investment banks designed to be “first-rate financial institutions run by the youth for the youth.” We applaud that move. However, we also call on African leaders to change the way things are run on the continent. That is the way to go if Africa’s consistently sad story is to end.

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