Simon Ateba covers the White House, the U.S. government, the International Monetary Fund, the World Bank and other financial and international institutions for Today News Africa in Washington D.C. Simon can be reached on email@example.com
The World Bank is “extremely concerned” African countries are not investing enough in human capital and may not be able to compete in an increasingly digitized economy, President Jim Yong Kim, warned on Thursday.
“So we’re extremely concerned that many African countries are not (prepared) to compete in what is increasingly becoming a digitized economy,” Dr. Kim said in Washington DC during the opening press conference of the World Bank and International Monetary Fund Spring Meetings.
World Bank President Jim Yong Kim listens to a questions by Today News Africa’s Simon Ateba during the opening press conference for the IMF and World Bank Meetings in Washington DC on 19 April 2018. Photo: Emmanuel Ikodor
“We also see lots of evidence that suggests that many of the low skill jobs will be taken over by technology”.
Asked by Today News Africa’s Simon Ateba to highlight three steps African leaders should take immediately to position their countries for growth, Dr. Kim highlighted a few of them. He said African leaders should be very focused on their debts and where they are taking their loans.
“Be very focused on the conditions, the interest rate, et cetera. So that’s one issue that you have to look at very carefully,” he said.
Dr. Kim expressed hope that many African countries would “leapfrog and go forward and find new ways of driving economic growth”, but, he added, this would only be possible by investing in education and health.
World Bank President Jim Yong Kim addresses journalists during a press conference for the IMF and World Bank Meetings in Washington DC on 19 April 2018. With him is David Theis, a Senior Communication Officer at The World Bank. Photo: Emmanuel Ikodor
He highlighted a new data from the World Bank that shows that failure to invest in education and health translates would have life lasting effects on children who would be at a disadvantage.
“When we say rates of childhood stunting over 30 percent, meaning these children their brains are simply not as well-developed as their non-stunted peers, and that they were learn less and they will earn less in the future. We have good date on that,” Dr. Kim said.
“That when stunting rates are over 30 percent, sometimes close to 50 percent that that group of young — of children will not be prepared to compete in the digital economy in the future. So human capital is a huge, huge issue”.
Dr. Kim recognized that African countries were having difficulties in increasing their resources for hard infrastructure, things like roads and energy, but argued they would need to look much more seriously at how they improve domestic resource mobilization.
“In other words, they should be better at collecting taxes, you know, to just provide the basic services we think countries should collect at least 15 percent of GDP in taxes. Many countries don’t reach that level”. “And things like tobacco taxes. Tobacco taxes have been shown to be very effective at raising revenue and decreasing smoking and can be used to finance all kinds of things,” he said.
Dr. Kim also recommended that African countries remove fossil fuel and agriculture subsidies because, according to him, they help the poor rather than the rich.
“They don’t help the small holder farmers, but they help others in the value chain,” he said.
However, to achieve all of these things, would require courage and reforms, Dr. Kim said.
So there’s so many things that can be done to help countries both invest in physical infrastructure and also invest in human capital, but it requires reform and it requires courage. And so I know these kinds of things that I’m talking about are difficult, but please let all the African leaders know that the World Bank Group’s ready to help them undertake all those measures.
- This article was contributed by Emmanuel Ikodor, International Correspondent, Today News Africa
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