African Development Bank Group president, Dr Akinwumi A. Adesina has again urged regional leaders to focus on vaccine production and access for the African continent as the Covid-19 epidemic continues to take lives and hurt economies and livelihoods.
Adesina addressed leaders of the Economic Community of West African States (ECOWAS) at a special summit held on Saturday, just days before the Bank Group’s 2021 Annual meetings, scheduled for 23-25 June.
“Africa needs solutions to help it navigate through the very challenging times posed by the Covid-19 pandemic,” Adesina said. “But the rebound will depend on access to vaccines.”
The African Development Bank will support the continent as part of the vaccines plan of the African Union. It is planning to commit $3 billion to develop the pharmaceutical industry in Africa, Adesina said. “Africa should not be begging for vaccines,” Adesina said. Africa should be producing vaccines,” he stressed.
In recent months, the African Development Bank president has publicly emphasized the need to rapidly build a health care defense system for the continent, to tackle Covid-19 and future pandemics.
The Bank has already channeled $2 million in emergency assistance to the World Health Organization to bolster the WHO’s capacity for infection prevention, testing, and case management. It has also provided $28 million in funding to the Africa Centres for Disease Control and Prevention (Africa CDC) for a Covid-19 response project. This will strengthen capacity to coordinate the Covid-19 response and future epidemics across Africa.
This year, the Bank’s is organizing its annual meetings around the theme, “Building Resilient Economies in Post Covid-19 Africa.” The meetings will provide a platform for its governors to share their countries’ experience in addressing the pandemic and the policy measures they are employing to rebuild economies and livelihoods.
In their communiqué, the ECOWAS heads welcomed the recent decision by G7 nations to provide additional vaccines to developing countries. They encouraged the West Africa Health Organization to intensify its efforts to mobilize partnerships to produce Covid-19 vaccines in Africa.
Adesina said the recent decision by the International Monetary Fund to issue special drawing rights (SDRs) provides a real opportunity to rebuild back better and greener and to tackle Africa’s debt challenges, more decisively. “The G-7 Leaders’ summit last week gave the green light for allocating $100 billion of SDRs to Africa. This will open the way for much-needed relief for Africa,” he noted.
African leaders, at a summit in Paris in May, called for the African Development Bank to receive SDRs on behalf of African countries, and to use them to on-lend to African public development banks. Adesina said it would be important to allocate some of this to buy down Africa’s “very expensive debt” owed to private creditors that will engaged with the international community.
The Bank president, who has proposed an African Financial Stability Mechanism to protect the continent against external shocks, said such a mechanism was critical. “It will require that we mutualize our resources, avoid regional spillover effects, regionalize fiscal policy rules, develop homegrown reforms and debt-resolution approaches, and provide a regional safety net that will complement the global safety net of the International Monetary Fund,” he said.
Adesina also touched on insecurity on the continent, highlighting that terrorist actions affect countries all across the continent, including the Sahel and the Lake Chad Basin as well as the Horn of Africa regions which must re-direct huge resources from their development programs.
He said: “These insecurity situations now pose the biggest risks to Africa’s development. We must now link security to investment, growth and development.”
The African Development Bank is calling for the development of security-indexed investment bonds. Taking advantage of low long-term interest rates, these bonds will allow Africa to leverage resources on the global capital markets to reinforce its security in support of growth and development, and to protect investments.
The bonds can be delivered through special purpose vehicles, established on behalf of a pool of African countries. The African Development Bank and other development partners can credit-enhance them. Administering the bond proceeds would be managed under the auspices of the African Union’s Peace and Security Council and regional economic communities.
The ECOWAS leaders’ communiqué commended the African Development Bank Group for launching a facility to support African countries — including ECOWAS member states — to address the challenges of the Covid-19 pandemic. It also welcomed the Bank’s support to the G5 Sahel countries as they seek to strengthen national health systems, and for its support to the West Africa Health Organization.