President John Dramani Mahama has emphasized the need for African countries to mobilize domestic resources to reduce dependence on external financing and achieve sustainable growth.
He noted that Africa’s economic journey has demonstrated resilience despite numerous challenges, with projections indicating a recovery in growth to 3.7 per cent in 2024 and 4.03 per cent in 2025.
“This optimistic outlook highlights the inherent strength of our economies and the effectiveness of policy interventions,” President Mahama said.
President Mahama, who is the Champion of African Union Financial Institutions was delivering the keynote address at the Heads of State and Government breakfast dialogue held at the AU Commission headquarters in Addis Ababa, Ethiopia today (Sunday).
It was a side event of the AU Summit and was held on the theme, Africa at the forefront: Mobilizing African Investment and Financing for Implementing Agenda 2063.
Hosted by President Mahama, it was held under the auspices of the Alliance of African Multilateral Financing Institutions, also called the African Club.
Present at the meeting were high level officials from various multilateral organizations within and outside the continent including the Chairperson of the Governing Council of the Alliance of African Multilateral Financing Institutions ( AAMFI), and President and Chairman of the Board of Directors of Afreximbank, Professor Benedict Oramah, the Director General of the World Trade Organization (WTO), Dr Ngozi Okonjo Iweala.
Also present were the African Union High Representative for Financing of the Union and the Peace Fund, Dr Donald Kaberuku, the Commissioner for Economic Development, Trade, Tourism, Industry and Minerals at the AU, Ambassador Muchanga, among others.
Challenges
Despite the positive outlook, President Mahama cautioned that the continent still faces significant challenges.
“Notwithstanding these positive trends, we must confront the reality that our growth has not always been translated into significant improvements in per capita income. Structural transformation remains uneven with many economies still reliant on low productivity sectors,” he said.
President Mahama said the continent was facing numerous challenges, including a substantial financing gap of approximately $402 billion annually until 2030.
“This financing gap is not merely a statistic,” he said. “It represents the unrealized potential of millions of Africans whose dream for a better life depends on our ability to invest wisely in infrastructure, education, technology, and health.”
Aside from financial challenges, President Mahama noted that the continent continues to face other forms of challenges including climate, crisis, geopolitical tensions, widening gaps in multilateralism, while diseases and pandemics will disrupt the positive growth path that the continent is on to achieve sustainable development.
“We envision that strategic investments in health, education, energy, technology and infrastructure are crucial. It is noteworthy, however, that the financing gap for these investments is substantial,” he said.
Bridging gap
To address this gap, he advocated for a multifaceted approach, including domestic resource mobilization, improving tax administration, and combating illicit financial flows.
President Mahama also highlighted the importance of African multilateral financial institutions in financing sustainable development.
He emphasized the need to strengthen these institutions to effectively contribute to the transformation and realization of Africa’s agenda 2063.
The establishment of the African Union financial institutions, including the African Central Bank, African Investment Bank, African Monetary Fund, and Pan African Stock Exchange, is expected to foster investments and financing to achieve Africa’s objectives.
President Mahama encouraged African countries to accelerate the implementation of these institutions and to leverage their collective strengths to bridge the financing and investment gaps in Africa.
“It is our responsibility to strengthen our African multilateral financial institutions to effectively contribute to the transformation and realization of our agenda 2063,” he said.
In his concluding remarks, President Mahama envisioned an Africa that is integrated, prosperous, and peaceful, emphasizing that this vision is within reach if African countries mobilize their resources, reform their financial systems, and invest in their people.
Reduce borrowing
For her part, the Director General of the World Trade Organization (WTO), Dr Ngozi Okonjo Iweala, who also delivered an address at the meeting, called on African leaders to reduce their appetite for borrowing and rather find innovative ways to attract and sustain investments into the continent.
“We must take advantage of investment that comes to Africa and be able to sustain them for our own development,” she said.
She said the continent could raise funding through value addition to natural resources, tapping into pension funds to raise patient capital to fund development and also pricing carbon emissions with innovative ways.
A high level panel discussion on the topic, “mobilizing African Investment and Financing for implementing agenda 2063”, highlighted key strategies and approaches for mobilizing African finance for delivering on Agenda 2063 priorities.
