The governance processes regulating agriculture in Africa were still fraught with weaknesses.
Appropriate macroeconomic policy framework was critical for the continent to foster structural transformation. “Land rights are not secure, the procurement process for inputs such as fertiliser and other inputs remains highly political in many country undermining the productivity of the sector and most of all profitability,”
“Of equal importance is the need to prioritise financing for development. While it is comforting to note that Africa’s domestic resource mobilisation efforts have improved over the last decade, the continent needs to do more.”
Estimates of Africa’s financing needs are enormous, she said, around $93bn per year to finance the infrastructure gap; about $60bn or more to finance the sustainable development goals (SDGs); $50bn annually to meet the cost of climate adaptation; and $25bn annually to achieve universal access to energy.
“The total funding is therefore big. We also know that Africa’s funding needs outstrip its current domestic resource capabilities – due to low domestic savings, shallow capital markets, weak financial intermediation, large informal sector, illicit transfer of funds and public financial management and governance challenges,” said Songwe, adding to achieve the SDGs, development finance strategies need to go beyond filling financing gaps.
“While official development assistance will remain a vital source of external public finance for the poorest and most vulnerable countries, it will not be sufficient. Effective domestic resource mobilisation will be at the core of financing sustainable development.”
Illicit financial flows
“The perverse effects of illicit financial flows on African economies” which continue to reduce the continent’s ability to make investments needed in education, health, science, technology and infrastructure to achieve its goal of industrialisation.
Africa loses $100bn annually to illicit financial flows representing around 4% of the continent’s GDP.
“As such, strengthening the institutional architecture designed to tackle these flows must be a priority for the continent,”