LONDON, Oct 10 – Amid uncertainty that the global recession is not over yet, the World Bank is cautioning against cutting development aid to Africa saying such a move would be a ‘grave’ mistake.
World Bank Vice President for Africa, Obiageli Ezekwesili said although many developed countries are not out of the ‘global recession’ woods yet, they need to support African countries’ quest to become major players in the international market.
“The temptation is great when a crisis looms as it does now for rich countries to slash development assistance. This would be a grave mistake,” Ezekwesili told investors at the first ever African Investment Summit organised by the London Stock Exchange.
She was however quick to explain that her call was not informed by Africa’s dire need for aid, but the role an economically empowered continent can play in the global economy.
“Cutting aid would be a grave mistake not because Africa is desperate for aid, but because the global economy is desperate to see a high-performing Africa,” she maintained.
By prospering as a robust market for global goods and services, the continent can greatly contribute towards the expansion in global prosperity and a resumption of global economic growth.
The VP was speaking to a group of 125 investors estimated to have holdings of about $120 billion at the London Stock Exchange and with growing portfolios in Africa already where she highlighted the ‘exciting’ investment opportunities that abound in the continent.
“Africa is the now, no longer the future. Any global player that continues to ignore Africa does so at their peril,” Ezekwesili remarked.
Despite its various challenges, the continent has got some things right by for instance putting in place policies such as the macroeconomic reforms that support economic growth and enabled it to survive the global recession.
“Africa’s fundamentals appear strong and the continent’s outlook remains positive,” Ezekwesili said.
She further pointed to Africa as a friendlier and more profitable market saying this was responsible for its higher Gross Domestic Product growth rates projected to be 4.8 percent, 5.2 percent and 5.5 percent in 2011, 2012 and 2013 respectively.
And as investors, development partners and consumers continue to be bullish about the market, she made a case for Africa’s capital markets saying they offer some of the best returns on investments in the world.
Bill Mills, Chief Executive Officer of Europe, Middle East, and Africa at Citigroup, one of the summit’s co-sponsors concurred saying: “Strengthening Africa’s capital markets whose success is intrinsically linked to the economic success of the continent is essential if Africa is to fulfil its vast potential.”