<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/Michael-Muhangi-HiRes-image-820x547.jpg" alt="" class="wp-image-429000" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/Michael-Muhangi-HiRes-image-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/Michael-Muhangi-HiRes-image-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/Michael-Muhangi-HiRes-image-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/Michael-Muhangi-HiRes-image-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/Michael-Muhangi-HiRes-image-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/Michael-Muhangi-HiRes-image.jpg 2000w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Michael Muhangi, Head of Trans-Regional Clients, Africa Regions for Business and Commercial Banking at Standard Bank Group</figcaption></figure>



The Africa of 2023 is a continent that is embracing new opportunities. As it moves to exploit commonalities existing between neighbours, the advantages of intra-Africa trade are taking cooperation between countries to new levels. Trade agreements are gathering momentum, and traditional trade barriers are crumbling.



With the gradual elimination of political, economic, and regulatory barriers has come a need for financial institutions to adopt a strong trans-regional focus. For South Africa, which has always been a dominant market and trading power, encompassing both local corporations and family-owned businesses that have the potential to expand into Africa, the challenge is to ensure that it is ready to accept the inevitable competition that is looming on the horizon, says Michael Muhangi, Head of Trans-Regional Clients, Africa Regions for Business and Commercial Banking at Standard Bank Group.&nbsp;&nbsp;



“Already, we are seeing a change across the continent. Levels of economic activity are increasing as intra-Africa trade gathers momentum. The potential future challenge for market share means that South African financial institutions, including Standard Bank, should be looking at how they take advantage of the changes sweeping across the continent.



“Competitive strategies and tactics are essential if the growing opportunities emerging from increasing trade and initiatives such as the African Continental Free Trade Area (AfCFTA) agreement are to benefit South African companies looking for opportunities on the continent.



“What is required is a focus on available opportunities and a strong commitment from South African institutions to identify and evaluate projects or market niches that their clients could explore.”



In this consulting and supportive role, significant contributions can be made to help accomplish a smooth transition and alter the status of clients from being substantial players in local markets to businesses with a growing, sustainable African footprint, says Muhangi.



He adds that South African institutions should use their insights into their clients’ businesses, stirring in ingredients such as their broad areas of expertise, their experience, and their presence in various African markets, as well as their ability to create bespoke solutions, in order to create a recipe for clients’ growth in Africa.



Companies generally require support as they expand into new markets and become trans-regional clients. This support can be provided in the form of trade information and market intelligence, assistance with the identification of opportunities in key sectors, guidance on regulatory and legal requirements, and introductions to potential local partners within existing bank client bases.



“Stronger integration within the political and economic unions of West Africa (ECOWAS), East Africa (EAC) and Southern Africa (SADC) is easing the process of expanding into those markets, and the AfCFTA with its continental reach is further accelerating the unification of those trading blocs,” says Muhangi.



“There is no doubt that a wide, exciting road into Africa is opening. Many companies making the journey will originate from South Africa, which has the distinct advantage of having large, mature, and advanced market sectors and experienced local corporate leaders looking for new ventures and opportunities.”



Driving South African companies’ interest in markets to the north are local realities that make up the challenging economic environment facing their enterprises. These realities include loadshedding, crowded and competitive market sectors, and reduced consumer disposable income. All these factors make the search for alternative markets a viable option.



“Ultimately, trans-regional clients want to do business through a full-service continental bank that connects the dots across regions and helps fulfil their business needs. They want a full suite of services delivered with uniform levels of expertise and quality.”



Meeting these client expectations as a continental bank is not fully possible unless the supporting relationship, service and risk models are optimised, and all stakeholders work together to achieve a common cause. A keen and deliberate focus on these fundamental requirements is essential if we are to become the ‘go-to’ business bank on the continent, says Muhangi.



For Standard Bank, being a truly continental bank positioned to service a growing trans-regional client base means being the dominant business bank in all the markets within which it operates.&nbsp;&nbsp;



“The Standard Bank Group is actively developing African strategies and preparing for a continental future. Our view is that Africa will increasingly become a desirable investment destination. Besides its diverse markets and vast labour pool, its attractions include countries showing steady GDP growth and opportunities for a wide range of businesses across a multitude of sectors.



“Africa is beckoning trans-regional businesses. Standard Bank will be there, helping them succeed,” says Muhangi.

Michael-Muhangi-HiRes-image

Africa’s continental integration offers opportunities for cross-border expansion

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-1760555842-820x547.jpg" alt="" class="wp-image-428829" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-1760555842-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-1760555842-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-1760555842-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-1760555842-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-1760555842-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/11/GettyImages-1760555842-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Attendees arrive for the African Growth and Opportunity Act (AGOA) forum in Johannesburg, South Africa, on Friday, Nov. 3, 2023. The US aims to ensure that its preferential trade pact with Africa is replaced without interruption when it expires in two-year&#8217;s time, while bringing it up to date. Photographer: Leon Sadiki/Bloomberg via Getty Images</figcaption></figure>



Africa is often characterised as a continent poised for economic growth and development. Often, prosperity and development in Africa can be linked back to exports and the benefits that they generate.



This brings to the forefront the African Growth and Opportunity Act (AGOA) and its role in opening American markets to 35 African countries, as well as the African Continental Free Trade Area (AfCFTA), which aims to increase socio-economic development, reduce poverty, and make Africa more competitive in the global economy through the elimination of tariffs on most goods and the promotion of intra-African trade.



The roots of AGOA and AfCFTA explain it all. AGOA, enacted by the United States in 2000, gives African countries duty-free and quota-free access to the American market for a wide range of products ranging from agricultural goods to manufactured items. Its aims are to promote economic development in Africa through trade, enhance US–African economic relations, and diversify the African export base. However, access is not unconditional and remains subject to ongoing assessment and compliance hurdles put up by the Act’s eligibility criteria.



The AfCFTA trade agreement, launched by the African Union, aims to create a single African market for goods and services by eliminating tariffs and non-tariff barriers to trade. To date, 47 countries&nbsp;have ratified their instruments of the AfCFTA agreement, and 46 have ratified and deposited their instruments of ratification. Seven countries have yet to ratify and only one country has yet to sign. &nbsp;



Progress in creating the world&#8217;s largest free trade area is, therefore, well underway towards achieving its objective of creating the world’s largest trading bloc by stimulating intra-African economic growth.



The synergy between these two initiatives is seen in the fact that AGOA offers significant opportunities for African countries to diversify their export markets whilst, AfCFTA enables African nations to reduce their dependence on traditional trade partners. To get the best of both worlds, African businesses should, therefore be simultaneously exploring both agreements and maximising their export opportunities.



AGOA offers incentives to encourage Africans to develop outward-looking sectors while AfCFTA, through its larger African market, will enable businesses to hone and specialise their activities by aligning themselves with the competitive advantages that the two treaties offer. Moreover, both programmes foster export-oriented industries.



As they gear up and prepare to embark on global export adventures, African industries can effectively use the increased opportunities offered by AfCFTA to build supply chains, increase capacity, and grow production volumes as they prepare to move into global markets.



Crucial to success, and a topic of everyday business conversation, is that regardless of whether we target only continental markets or also American markets, opportunities need infrastructure. Africa is moving strongly to put transport, logistics and communications networks in place. There can be no greater incentive for this growth than booming export opportunities and associated benefits for participating countries.



With trade comes regulation. It is in this field that massive benefits lie. If AGOA and AfCFTA work together to promote regulatory harmonisation across Africa by aligning regulations and standards, unsurpassed opportunities could be opened for African businesses. Compliance costs would be reduced, competitiveness would increase, and African products would be more attractive to international buyers.



Besides infrastructure development, Africa requires significant investment. Foreign direct investment (FDI) plays a pivotal role in fostering economic growth and generating employment opportunities. The synergy and collaboration between AGOA and AfCFTA have the potential to stimulate FDI, thereby promoting technology transfer, and job creation across the continent.



Investment in one country could spur the opening of multiple continental markets, plus access to preferential markets to the consumer base in the US.



Naturally, these economic benefits will not come without challenges, which include addressing non-tariff barriers, ensuring compliance with rules of origin, and overcoming infrastructure deficits.



In implementing their AGOA benefits, African countries cannot rely solely on capacity-building support but must help themselves. Furthermore, being AGOA-eligible does not guarantee that they will fully exploit AGOA benefits and achieve their AfCFTA goals.



The potential impact of global economic conditions and changing US trade policies on AGOA should also be considered<s>. </s>Barring these constraints, all of which are resolvable, AGOA and AfCFTA offers two powerful, complementary instruments for promoting African exports and economic growth and propelling African nations towards becoming global trading powerhouses.

The African Growth and Opportunity Act Forum

Exploring synergies between AGOA and AfCFTA: the case for African exports

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="437" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/10/cnbc-africa-1500-800-820x437.jpg" alt="" class="wp-image-428197" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/10/cnbc-africa-1500-800-820x437.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/10/cnbc-africa-1500-800-300x160.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/10/cnbc-africa-1500-800-160x85.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/10/cnbc-africa-1500-800-768x410.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/10/cnbc-africa-1500-800.jpg 1500w" sizes="auto, (max-width: 820px) 100vw, 820px" /></figure>



Television business news&nbsp;channel CNBC Africa is introducing a new newsreader on Friday – and it’s an artificial intelligence-powered avatar.



The avatar, a blend of AI and human likeness, is modelled on Chanel Retief, who works for Africa Business News (ABN), the parent of CNBC Africa.



The channel said the new AI is designed to augment human productivity, not replace it.



The AI newsreader will work in tandem with CNBC Africa’s team of journalists, analysts and anchors to create “a mix of human expertise and technological efficiency”.



The world’s first AI anchor debuted in November 2018 at an internet conference in China.



<figure class="wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio"><div class="wp-block-embed__wrapper">
<iframe loading="lazy" title="SA industry panel formed to advance digital transformation" width="500" height="281" src="https://www.youtube.com/embed/m_1FoKhFNjQ?feature=oembed" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen></iframe>
</div></figure>



Modelled on China’s state-run Xinhua News Agency’s Zhang Zhao, the new anchor learns from live videos and is able to work 24 hours a day, reporting via social media and on the Xinhua website.



Watch CNBC’s AI anchor in the video above — the AI newsreader is on from the one-minute, 2o-second mark.&nbsp; –&nbsp;© 2023 NewsCentral Media

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CNBC Africa gets a new anchor – and it’s an AI avatar

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="234" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/10/blog-2099x600-gfsr-ch-2-interest-rates-mongkolchon-adobe-stock-820x234.jpg" alt="" class="wp-image-428105" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/10/blog-2099x600-gfsr-ch-2-interest-rates-mongkolchon-adobe-stock-820x234.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/10/blog-2099x600-gfsr-ch-2-interest-rates-mongkolchon-adobe-stock-300x86.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/10/blog-2099x600-gfsr-ch-2-interest-rates-mongkolchon-adobe-stock-160x46.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/10/blog-2099x600-gfsr-ch-2-interest-rates-mongkolchon-adobe-stock-768x220.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/10/blog-2099x600-gfsr-ch-2-interest-rates-mongkolchon-adobe-stock-1536x439.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/10/blog-2099x600-gfsr-ch-2-interest-rates-mongkolchon-adobe-stock-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Credit: Mongkolchon/Adobe Stock</figcaption></figure>



The world’s central banks have unleashed the steepest series of interest-rate increases in decades during their two-year drive to tame inflation—and they may not be done yet. Policymakers have raised rates by about 400 basis points on average in advanced economies since late 2021, and around 650 basis points in emerging market economies.



Most economies are absorbing this aggressive policy tightening, showing resilience&nbsp; over the past year, but core inflation remains elevated in several of them, especially the United States and parts of Europe. Major central banks therefore may need to keep interest rates higher for longer.



In this environment, risks to the world economy remain skewed to the downside, as we detail in in our&nbsp;<a href="https://www.imf.org/en/Publications/GFSR/Issues/2023/10/10/global-financial-stability-report-october-2023?cid=pr-com-AM2023-GFSREA2023002&amp;utm_medium=email&amp;utm_source=govdelivery">Global Financial Stability Report</a>. Though this latest assessment of vulnerabilities is similar to what we noted in April, the acute stress we saw in some banking systems has since subsided. However, we now see indications of trouble elsewhere.



One such warning sign is the diminished ability of individual and business borrowers to service their debt, also known as credit risk. Making debt more expensive is an intended consequence of tightening monetary policy to contain inflation. The risk, however, is that borrowers might already be in precarious positions financially, and the higher interest rates could amplify these fragilities, leading to a surge of defaults.



<h2 class="wp-block-heading" id="h-eroding-buffers">Eroding buffers</h2>



In the corporate world, many businesses suffered closures during the pandemic, and others emerged with healthy cash buffers thanks in part to fiscal support in many countries. Firms were also able to protect their profit margins even though inflation had picked up. In a higher-for-longer world, however, many firms are drawing down cash buffers as earnings moderate and as debt servicing costs rise.



Indeed, the GFSR shows increasing shares of small and mid-sized firms in both advanced and emerging market economies with barely enough cash to pay their interest expenses. And defaults are on the rise in the leveraged loan market, where financially weaker firms borrow. These troubles are likely going to worsen in the coming year as more than $5.5 trillion of corporate debt comes due.


<div class="wp-block-image">
<figure class="aligncenter"><a href="https://www.imf.org/en/Blogs/Articles/2023/10/10/higher-for-longer-interest-rate-environment-is-squeezing-more-borrowers?utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noreferrer noopener"><img decoding="async" src="https://content.govdelivery.com/attachments/fancy_images/USIMF/2023/10/8343161/5018241/gfsr-chapter-1-chart-1_crop.jpg" alt="chart showing looming debt in maturing bonds and loans by year for various economies"/></a></figure></div>


Households too have been drawing down their buffers. Excess savings in advanced economies have steadily declined from peak levels early last year that were equal to 4 percent to 8 percent of gross domestic product. There are also signs of rising delinquencies in credit cards and auto loans.



Headwinds also confront real estate. Home mortgages, typically the largest category of household borrowing, now carry much higher interest rates than just a year ago, eroding savings and weighing on housing markets. Countries with predominantly floating rate mortgages have generally experienced larger home price declines as higher interest rates translate more quickly into mortgage payment difficulties. Commercial real estate faces similar strains as higher interest rates have resulted in funding sources drying up, transactions slowing, and defaults rising.



Higher interest rates also are challenging governments. Frontier and low-income countries are having a harder time borrowing in hard currencies like the euro, yen, US dollar and UK pound as foreign investors demand greater returns. This year, hard currency bond issuances have occurred at much higher coupon—or interest—rates. But sovereign debt concerns do not only apply to low-income countries, as the recent surge in longer-term interest rates in advanced economies has demonstrated.&nbsp;


<div class="wp-block-image">
<figure class="aligncenter"><a href="https://www.imf.org/en/Blogs/Articles/2023/10/10/higher-for-longer-interest-rate-environment-is-squeezing-more-borrowers?utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noreferrer noopener"><img decoding="async" src="https://content.govdelivery.com/attachments/fancy_images/USIMF/2023/10/8343148/5018242/gfsr-chapter-1-chart-2_crop.jpg" alt="chart showing levels of bond issuance in emerging market economies from 2010-2023"/></a></figure></div>


By contrast, major emerging economies largely do not face this predicament given better economic fundamentals and financial health, although the flow of foreign portfolio investment into these countries has also slowed. Material amounts of foreign investment have left China in recent months as mounting troubles in its property sector have dented investor confidence.



<h2 class="wp-block-heading" id="h-spillover-effects">Spillover effects</h2>



Most investors appear to have shrugged off mounting evidence that borrowers are having repayment troubles. Along with generally healthy stock and bond markets, financial conditions have eased as investors appear to expect a global soft landing, in which higher central bank interest rates contain inflation without causing a recession.



This optimism creates two problems: relatively easy financial conditions could continue to&nbsp;<a href="https://www.imf.org/en/Blogs/Articles/2023/07/27/inflation-remains-risk-confronting-financial-markets?utm_medium=email&amp;utm_source=govdelivery">fuel inflation</a>, and rates can tighten sharply if adverse shocks occur—such as an escalation of the war in Ukraine or an intensification of stress in the Chinese property market.



A sharp tightening of financial conditions would strain weaker banks already facing higher credit risks. Surveys from several countries already point to a slowdown in bank lending, with rising borrower risk cited as a key reason. Many banks will lose significant amounts of equity capital in a scenario where high inflation and high interest rates prevail and the global economy tips into recession, as we explore in a forthcoming GFSR chapter. Investors and depositors will scrutinize the prospects of banks if their stock-market capitalization falls below the value of balance sheet, causing funding problems for the weak bank. Outside of banking system, fragilities are also present for nonbank financial intermediaries, such as hedge funds and pension funds, that lend in private markets.



Reassuringly, policymakers can prevent bad outcomes. Central banks must remain determined in bringing inflation back to target—sustained economic growth and financial stability is not possible without price stability. If financial stability is threatened, policymakers should promptly use liquidity support facilities and other tools to mitigate acute stress and restore market confidence. Finally, given the importance of healthy banks to the global economy, there is a need to further enhance financial sector regulation and supervision.

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Higher-for-Longer Interest Rate Environment is Squeezing More Borrowers

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="234" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/blog-2099x600-gender-imf-photos-52054762405-364cf455bd-6k-820x234.jpg" alt="" class="wp-image-427750" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/blog-2099x600-gender-imf-photos-52054762405-364cf455bd-6k-820x234.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/blog-2099x600-gender-imf-photos-52054762405-364cf455bd-6k-300x86.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/blog-2099x600-gender-imf-photos-52054762405-364cf455bd-6k-160x46.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/blog-2099x600-gender-imf-photos-52054762405-364cf455bd-6k-768x220.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/blog-2099x600-gender-imf-photos-52054762405-364cf455bd-6k-1536x439.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/blog-2099x600-gender-imf-photos-52054762405-364cf455bd-6k-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /></figure>



Narrowing the gap between the share of men and women who work is one of the very important reforms policymakers can make to revive economies amid the weakest medium-term growth outlook in more than three decades.



With global growth predicted to languish at just&nbsp;<a href="https://www.imf.org/en/Blogs/Articles/2023/04/19/world-economic-outlook-shows-economies-facing-high-uncertainty?utm_medium=email&amp;utm_source=govdelivery">3 percent</a>&nbsp;over the next five years and with traditional growth engines sputtering, many economies are missing out by not tapping women’s potential. Only&nbsp;<a href="https://data.worldbank.org/indicator/SL.TLF.CACT.FE.ZS?utm_medium=email&amp;utm_source=govdelivery">47 percent</a>&nbsp;of women are active in today’s labor markets, compared with 72 percent of men. The average global gap has fallen by only 1 percentage point annually over the past three decades and remains unacceptably wide.



To blame are unfair laws, unequal access to services, discriminatory attitudes and other barriers that prevent women from realizing their full economic potential. The result is a shocking waste of talent, leading to losses in potential growth.



We estimate that emerging and developing economies could boost gross domestic product by about 8 percent over the next few years by raising the rate of female labor force participation by 5.9 percentage points—the average amount by which the top 5 percent of countries reduced the participation gap during 2014-19. As the <a href="https://www.imf.org/en/Blogs/chart-of-the-week?utm_medium=email&amp;utm_source=govdelivery">Chart of the Week</a> shows, that’s more than the economic “scarring,” or output losses, inflicted on countries by the pandemic.


<div class="wp-block-image">
<figure class="aligncenter size-full"><img loading="lazy" decoding="async" width="539" height="539" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/gender-blog-chart-v2_crop.jpg" alt="" class="wp-image-427749" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/gender-blog-chart-v2_crop.jpg 539w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/gender-blog-chart-v2_crop-300x300.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/gender-blog-chart-v2_crop-90x90.jpg 90w" sizes="auto, (max-width: 539px) 100vw, 539px" /></figure></div>


Policymakers can of course lift growth in many ways, from governance reforms to strengthen institutions, to financial reforms to unlock capital for investment, as discussed in a&nbsp;<a href="https://www.imf.org/en/Blogs/Articles/2023/09/25/how-reform-can-aid-growth-and-green-transition-in-developing-economies?utm_medium=email&amp;utm_source=govdelivery">recent IMF blog</a>. Complementing these reforms with measures to narrow gender gaps would greatly amplify these returns.



Unfortunately, present policies do not come close to closing gender gaps. Many researchers say it’s inevitable that women’s labor force participation will eventually reach that of men, even if it takes centuries. But gender gaps are unlikely to ever close if present policy trends persist, as we show in a new&nbsp;<a href="https://www.imf.org/en/Publications/WP/Issues/2023/09/13/When-Will-Global-Gender-Gaps-Close-537981?utm_medium=email&amp;utm_source=govdelivery">research paper</a>.



Our analysis of three decades of data shows that countries have made progress increasing women’s participation, but economies of all income levels experienced several setbacks—a result of shocks, crises and policy reversals. The pandemic, for example, eroded progress closing gender gaps, especially for&nbsp;<a href="https://www.imf.org/en/Publications/WP/Issues/2021/03/03/COVID-19-She-Cession-The-Employment-Penalty-of-Taking-Care-of-Young-Children-50117?utm_medium=email&amp;utm_source=govdelivery">women with young children</a>. Setbacks like this cause scarring that slows and often reverses progress toward gender equality.



As a result, gender gaps in labor force participation will narrow but never close if countries continue on their present policy path. Gaps would remain large for most countries, exceeding 16 percentage points in one out of ten countries.



Countries must step up efforts to break down barriers to women’s participation in the labor market—such as limited access to education, health, assets, finance, land, legal rights, and care services. They should systematically take account of how macroeconomic, structural, and financial policy packages impact women. The IMF’s&nbsp;<a href="https://www.imf.org/en/Publications/Policy-Papers/Issues/2022/07/28/IMF-Strategy-Toward-Mainstreaming-Gender-521344?utm_medium=email&amp;utm_source=govdelivery">gender strategy</a>&nbsp;aims to assist member countries in these efforts.

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Countries That Close Gender Gaps See Substantial Growth Returns

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="543" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/beautiful-african-agriculturist-farm-using-laptop-820x543.jpg" alt="" class="wp-image-427716" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/beautiful-african-agriculturist-farm-using-laptop-820x543.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/beautiful-african-agriculturist-farm-using-laptop-300x199.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/beautiful-african-agriculturist-farm-using-laptop-136x90.jpg 136w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/beautiful-african-agriculturist-farm-using-laptop-768x509.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/beautiful-african-agriculturist-farm-using-laptop-1536x1017.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/beautiful-african-agriculturist-farm-using-laptop-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Beautiful African agriculturist in the farm using laptop</figcaption></figure>



There is more than enough evidence that gender inequality has far-reaching ramifications for various sectors, with the toll heavily borne by women, limiting their potential to be agents of change. Tackling the inequalities facing women is not only a moral imperative; it just makes economic sense. If women had equal access to and decision-making power over productive resources, income-generating activities, education, and services, there would be direct positive impacts on the income, food security, and nutritional status of their households and, ultimately, society as a whole.



Urgent change is needed, and there is evidence that real change is possible. Recent findings suggest that system-level policy innovations to entrench women&#8217;s empowerment and gender equality in agrifood systems are underway across Africa, as revealed in a recent report by the&nbsp;<a href="https://www.mamopanel.org/" target="_blank" rel="noreferrer noopener">Malabo Montpellier Panel</a>&nbsp;of agriculture experts.



The report,&nbsp;<a href="https://www.mamopanel.org/resources/women-agrifood-systems/" target="_blank" rel="noreferrer noopener">BRIDGING THE GAP</a>: Policy Innovations to Put Women at the Center of Food Systems Transformation in Africa,&nbsp;demonstrates that agrifood systems that are purposefully designed to work equally for women as for men have the potential to contribute to more equitable, resilient, and healthier societies.



The research focused on four systematically selected African countries – Ethiopia, Ghana, Rwanda, and Togo, proposing an action agenda with crucial areas for policy intervention and scaling across the continent.



Several African countries have, in recent years, taken great strides in building greater access to agricultural services – including finance, extension, and more – which support more gender-equal agri-food systems.



Science and technology offer concrete avenues for women&#8217;s empowerment, with wide-ranging benefits and relevance for their participation in Africa&#8217;s agrifood systems. While the number of female graduates with core science, technology, engineering, and math (STEM) degrees in Africa is steadily growing and stands at 47 percent in 2023, women remain underrepresented in STEM careers. Science-driven education and information offer women opportunities to adopt and adapt new production technologies and methods, diversify assets and activities, and increase productivity and income. Technical training must go hand-in-hand with mentorship and targeted leadership to build a sustainable pipeline of female scientists at all levels of the agrifood value chain.



Another crucial area of intervention is Agricultural extension services to enhance productivity levels and incomes. Evidence suggests that having a greater share of women extension agents will facilitate food system transformation. For instance, the Ethiopian Network for Gender Equality in Agriculture (ENGEA), established by the Ethiopian Ministry of Agriculture and Natural Resources (MoANRs) in 2015, delivers interventions to ensure equal access to extension services through decentralization initiatives, bringing such services – which are vital in boosting farmer production and resilience – closer to farming households and traditionally marginalized groups, such as women, nationwide.



In the area of&nbsp;Finance, an incontrovertible sector with far-reaching impact on women’s involvement in Africa’s agrifood systems, several African governments are committing more funding to support women’s access to agricultural tools, technologies, and finance. For instance, Ghana’s agricultural investment package has committed more than $11 million to subsidize agricultural technologies for women. Meanwhile, Togo has committed to legislative reform guaranteeing women’s access to land ownership while abolishing taxes that hinder women’s entrepreneurship.&nbsp;



Political empowerment must be a key priority area for African countries. For example, Rwanda leads not only the African continent, but the whole world, in ensuring female representation in political participation and leadership. The Rwandan National Women’s Council, which oversees the election of Women’s Committees from village to national levels, plays a key role in ensuring women from rural areas are included in policy and decision-making – a vital prerequisite to gender equal food systems.



Filling the consumption gap to guarantee gender equality in nutrition is vital, not only for promoting a better standard of health for the entire population, but also for driving economic growth. African countries are now making progress on delivering gender equality in nutrition through greater investment and policy attention. Rwanda’s Village Nutrition Schools (VNS), for example, are an innovative approach to promoting mothers’ and children’s health through education and providing them with important nutritional information. Currently, more than 1,800 village nutrition schools operate across the country, helping more than 6,600 children recover from acute levels of malnutrition.



As shown by these four countries, policy innovations and interventions that are proven to boost gender equality in agri-food systems are sorely needed. These measures are achievable and can be accelerated by embracing some of the policy lessons presented in the Malabo Montpellier Panel&#8217;s report.



As Africa undertakes the pivotal task of defining its post-Malabo agenda, it is time to redouble efforts and level the playing field to mainstream women&#8217;s empowerment and ensure that future food systems work for them.

beautiful african agriculturist in the farm using laptop

Gender equality can accelerate Africa’s food systems transformation – Here are 5 ways to make this happen

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="216" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/ssa-country-focus-debt-crisis-hero-820x216.jpg" alt="" class="wp-image-427712" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/ssa-country-focus-debt-crisis-hero-820x216.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/ssa-country-focus-debt-crisis-hero-300x79.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/ssa-country-focus-debt-crisis-hero-160x42.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/ssa-country-focus-debt-crisis-hero-768x202.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/ssa-country-focus-debt-crisis-hero-1536x405.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/ssa-country-focus-debt-crisis-hero-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /></figure>



Public debt in the region has risen to levels not seen in decades



The average debt ratio in sub-Saharan Africa has almost doubled in just a decade—from 30 percent of GDP at the end of 2013 to almost 60 percent of GDP by end-2022. Repaying this debt has also become much costlier.



The region’s ratio of interest payments to revenue, a key metric to assess debt servicing capacity and predict the risk of a fiscal crisis, has more than doubled since the early 2010s and is now close to four times the ratio in advanced economies. As of 2022, more than half of the low-income countries in sub-Saharan Africa were assessed by the IMF to be at high risk or already in debt distress.



These trends have sparked concerns of a looming debt crisis in the region. A recent&nbsp;<a href="https://www.imf.org/en/Publications/Departmental-Papers-Policy-Papers/Issues/2023/09/15/Navigating-Fiscal-Challenges-in-Sub-Saharan-Africa-Resilient-Strategies-and-Credible-529230?cid=cf-com-APCFSFSSACEA">IMF paper</a>&nbsp;offers possible solutions to prevent this from happening. It identifies&nbsp;five policy actions&nbsp;African governments can take&nbsp;to preserve the sustainability of public finances, while also achieving the region’s development goals.



<figure class="wp-block-image"><img decoding="async" src="https://www.imf.org/-/media/Images/IMF/News/Country-Focus/2023/Charts/September/ssa-cf-debt-crisis-chart-1.ashx?w=1300px" alt=""/></figure>



1. Set a course: re-anchor fiscal policy through a credible medium-term strategy



In most sub-Saharan African countries, fiscal policy focuses excessively on short-term goals and is not guided by a clear medium-term strategy. This lack of anchoring has resulted in frequent breaches of fiscal rules and ever-increasing public debt levels.



A more strategic approach to fiscal policy would be preferable by setting explicit debt targets that integrate key policy trade-offs between debt sustainability and development objectives, rather than focusing narrowly on short-term fiscal deficits. The&nbsp;<a href="https://www.imf.org/en/Publications/Departmental-Papers-Policy-Papers/Issues/2023/09/15/Navigating-Fiscal-Challenges-in-Sub-Saharan-Africa-Resilient-Strategies-and-Credible-529230?cid=cf-com-APCFSFSSACEA">paper</a>&nbsp;suggests a novel approach to estimating country-specific medium-term debt anchors, which ensures that debt service costs remain&nbsp;manageable. According to this methodology, the median debt anchor for the region is about 55 percent of GDP; slightly more than half of the countries were above their anchor at end-2022.



2. Get ready: undertake fiscal adjustment to bring debt back to a safer level



IMF staff analysis shows that most countries in the region will need to reduce their fiscal deficits in the coming years. For the average country, the amount of adjustment is about 2 to 3 percent of GDP.



This adjustment seems feasible given historical experience—in the past, countries in sub-Saharan African countries improved their primary balance by 1 percent of GDP a year over two to three years.



But not all countries face the same challenge. About a quarter of the region’s economies still have some fiscal space and can use it to maintain and even increase vital investments in human and physical capital. On the other hand, a few countries have very large adjustment needs; for them, it is unlikely that fiscal consolidation alone will be enough to ensure fiscal sustainability. It may need to be complemented by debt reprofiling or restructuring.



<figure class="wp-block-image"><img decoding="async" src="https://www.imf.org/-/media/Images/IMF/News/Country-Focus/2023/Charts/September/ssa-cf-debt-crisis-chart-2.ashx?w=1300px" alt=""/></figure>



3. Chip in: mobilize more domestic revenue



Sub-Saharan African countries tend to rely excessively on expenditure cuts to reduce their fiscal deficits. Although this may be warranted in some circumstances, revenue measures, like eliminating tax exemptions or digitalizing filing and payment systems, should play a greater role. Mobilizing domestic revenue is less detrimental to growth in countries where initial tax levels are low, whereas the cost associated with reducing expenditures is particularly high given Africa’s large development needs.



While difficult to achieve, large and rapid increases in revenue have been observed in some countries like The Gambia, Rwanda, Senegal, and Uganda, which relied on a mix of revenue administration and tax policy measures.



4. Shore up the house: strengthen budget institutions to improve the implementation of fiscal plans



Policy changes are more likely to yield tangible results if fiscal institutions are strong and efficient. On the expenditure side, well-designed plans too often yield disappointing results due to budgetary slippages or an unforeseen materialization of fiscal risks. Adopting a medium-term fiscal framework, putting in place tools to better assess and manage fiscal risks, and enhancing controls over government expenditure during the budget implementation phase are key to avoiding such pitfalls.



Strong expenditure controls—by strengthening the legal budgeting framework, improving fiscal reporting, and empowering audit and control institutions—are particularly important, as they help countries avoid budgetary slippages, as well as decrease the risk of extra-budgetary commitments, which are widespread in the region.



5. Get people on board: anticipate public resistance to reforms



The sustainability of a new fiscal strategy also depends on the government’s ability to secure public support by linking the policy measures to longer-term benefits. Public acceptance should be a central consideration in policy design—for instance, by sequencing reforms carefully and introducing compensatory measures.



Communication campaigns that transparently and credibly outline the long-term benefits of the reform, its distributional consequences, and the costs of inaction are also critical. Public acceptance of reforms depends more generally on the ability of governments to convince the population that they will use public funds in an efficient, fair, and transparent manner.

FILE PHOTO: The IMF logo is seen outside the headquarters building in Washington

How to Avoid a Debt Crisis in Sub-Saharan Africa

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="567" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Patrick-Mweheire-Chief-Executive-Stanbic-Bank-Uganda-1-820x567.jpg" alt="" class="wp-image-427594" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Patrick-Mweheire-Chief-Executive-Stanbic-Bank-Uganda-1-820x567.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Patrick-Mweheire-Chief-Executive-Stanbic-Bank-Uganda-1-300x208.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Patrick-Mweheire-Chief-Executive-Stanbic-Bank-Uganda-1-130x90.jpg 130w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Patrick-Mweheire-Chief-Executive-Stanbic-Bank-Uganda-1-768x532.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Patrick-Mweheire-Chief-Executive-Stanbic-Bank-Uganda-1-1536x1063.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Patrick-Mweheire-Chief-Executive-Stanbic-Bank-Uganda-1.jpg 1864w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Patrick Mweheire, Regional Chief Executive, East Africa, Standard Bank Group</figcaption></figure>



East Africa is poised to unlock new pathways for trade, development and growth. This comes as businesses, regulators and banks find and drive new direct investment, launch projects and close gaps to financial inclusion, providing a powerful tailwind for broader Pan African trade.



It is little to no surprise that the recently published African Development Bank 2023 East Africa Economic Outlook says East Africa will register the highest regional economic performance on the continent in 2023 and 2024, with growth figures at over 5%. The key now is to move forward with initiatives that grasp the opportunities to accelerate growth.



These trends were also reflected in Standard Bank’s recent six-month results to 30 June 2023, where East Africa grew its headline earnings a stellar 55% to $95.6 million. Key markets like Kenya, Uganda, Tanzania and Ethiopia, where Standard Bank has a strong and growing presence, all helped drive this growth, with positive upside ahead, notably as incentives and commitment to drive investment and trade gain ground. Standard Bank is currently laying the ground to ignite further growth in East Africa through strategic capital and capacity interventions, as it positions itself as a leader in the region.



After all, there are approximately 10 million small and medium enterprises and other commercial businesses that spread across East Africa, which contribute significantly to the economies in which they operate, driving GDP growth and providing significant employment opportunities. These value chains will spark renewed avenues for trade, development and growth going forward.



An example of this potential in action on the ground, Stanbic Bank Uganda, part of the Standard Bank Group and Uganda’s largest commercial bank by assets, is making integral moves to help connect more Ugandans to the digital highway. This comes as Uganda prioritises smart policies to solve societal challenges and spark economic growth guided by the national development plan, Uganda Vision 2040. According to the United Nations Development Programme (UNDP), Uganda has made noticeable progress in its digitisation journey by strengthening its mobile network coverage to meet the needs of its growing digital-first population. Over four million new mobile subscribers are expected to be live by 2025 in Uganda. To open the doorway to these opportunities, Stanbic Uganda has already adopted IBM’s Cloud Pak for Integration to help in its broader drive to accelerate digital transformation, maximise operational efficiency, reduce integration costs while onboarding new application programming interfaces (APIs) securely, and offering banking-as-a-service.



The benefits and success of regional development is profound. For instance, Standard Bank recently assisted a Kenyan manufacturer to produce paper locally, replacing expensive international inputs with domestically sourced wastepaper and sugar cane by-products. As a result, many more local exporters now have branded boxes made to order at home, at a fraction of the cost of imported products.



Similar moves are taking shape in Ethiopia, where government has undertaken a wide range of activities over the past years to improve the financial sector and this is sparking digital banking (including the introduction of M-Pesa), interest free banking and capital market growth, among others. Within the last two years alone, more than 3 million Ethiopians have managed to get access to loans utilising the digital banking system.



The upcoming second Uganda-South Africa trade and investment summit on September 5-6 in Kampala is a good example of how local and foreign businesses are playing an increasingly prominent role in supporting the East African government in its drive to attract foreign direct investment. Areas being targeted include agro- industrialisation, steel manufacturing, tourism and the energy sector. Businesses across banking, financial services, telecoms, food and beverages as well as retail are all taking advantage of the broad value-chain opportunities and potential, including the easier framework for doing business.



I expect these and other trends to drive trade and investment to gather pace from here, judging by the commitment being shown by the likes of Stanbic Uganda to facilitate, support and grow these new trade avenues.



Available statistics from the Bank of Uganda show that the value of the country’s exports to South Africa continues to grow doubling to US$ 21.24 million in the past 10 years up to 2022. However, the pace of growth has slowed in recent years. According to Uganda Investment Authority, Uganda’s exports to South Africa include cotton, gold, fish fillets, tobacco, coffee, and fresh flowers. However, the value of South Africa’s exports to Uganda decreased from US$ 251.6 million to US$ 127.6 million during the same period. South Africa’s exports to Uganda include machinery, vehicles, plastics, chemicals, electronics, parts and accessories, petroleum, live animals, books and newsprint, textiles, footwear, aircraft, and household goods. There is today, a real commitment to improve and grow these trade opportunities, both in Uganda and further afield, into the heart of Africa itself.



The above progress and new commitments to do business and invest in East Africa is why the African Development Bank projects mid-term economic growth in the region to accelerate to 5.1% in 2023 and 5.8 % in 2024, outpacing all the other African regions. This will be largely driven by growth in Rwanda, Uganda, Ethiopia, Kenya, Djibouti, and Tanzania. East Africa’s real GDP will continue to be propelled by its excellent services sector, contributing almost half of the economic growth in 2022.



It is now up to the private and public sectors to continue this good work and for investors to take advantage of the immense opportunity on our doorstep.

Patrick-Mweheire-Chief-Executive-Stanbic-Bank-Uganda-1

Major investment drive sparks East African trade and development – sustaining the continent’s progression, including South Africa

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/kyle-glenn-nXt5HtLmlgE-unsplash-1-820x547.jpg" alt="" class="wp-image-427490" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/kyle-glenn-nXt5HtLmlgE-unsplash-1-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/kyle-glenn-nXt5HtLmlgE-unsplash-1-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/kyle-glenn-nXt5HtLmlgE-unsplash-1-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/kyle-glenn-nXt5HtLmlgE-unsplash-1-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/kyle-glenn-nXt5HtLmlgE-unsplash-1-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/kyle-glenn-nXt5HtLmlgE-unsplash-1.jpg 1920w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Credit: Unsplash/Kyle Glenn</figcaption></figure>



By Abir Ibrahim, Community Lead, Regional Agenda, Africa, and Marushia Gislén, Community Lead, Europe and Eurasia, World Economic Forum



The push to accelerate the green and net-zero transition presents both opportunities and significant challenges. For Africa and Europe, achieving a successful transition brings to light the importance of strengthening existing economic ties between the two continents. However, it is a historically complex relationship, and the question is whether it can be rebuilt on equal terms?



The vulnerabilities exposed in global supply chains during the pandemic emphasized the importance of sourcing critical raw materials closer to home. For Europe, the energy price shock following Russia’s invasion of Ukraine in February 2022 forced it to further rethink its supply chain dependencies, step up its net-zero ambitions and strengthen legislative measures, including through the proposal of a <a href="https://ec.europa.eu/commission/presscorner/detail/en/ip_23_1661">Critical Raw Materials Act (CRMA)</a>. In order to achieve its climate neutrality targets, Europe faces a pressing need to increase the availability of critical raw materials while, at the same time, it is imposing stricter <a href="https://www.hinrichfoundation.com/research/wp/digital/digital-standards-meet-a-rising-tide-of-extraterritorial-traceability-mandates/">sustainability and traceability</a> requirements for business. These may have direct impact on the ability of producers in developing countries to continue exporting to the European Union.



Africa is home to some 90% of global critical minerals needed for renewable energy, such as cobalt, chromium, platinum, aluminium and uranium. This, together with its geographical proximity to Europe, positions it as a key partner for Europe. The benefit of such a partnership is, however, far from one-sided. The International Energy Agency (IEA) estimates that 600 million people across the continent lack access to energy, almost half the continent&#8217;s population. Africa’s population will double by 2050 and will put additional upward pressure on energy demand; the need to step up energy efficiency measures and renewable capacity is clear. The green transition is key to unlocking sustainable long-term growth prospects and improving living standards.



While national climate plans in Africa go a long way to greening the economy, Africa is currently not fully benefitting from the opportunity created by the global transition to net zero. According to Climate Policy Initiative, Africa receives only about <a href="https://www.climatepolicyinitiative.org/publication/landscape-of-climate-finance-in-africa/">2% of global investments</a> in renewable energy and 12% of the finance it needs to successfully mitigate the effects of climate change and transition to net zero. Equitable trading partnerships, comprehensive green skill programmes, and net-zero technologies are essential to spur progress.



Creating tangible benefit for African countries becomes even more important in the context of geopolitics and strong regional voices seeking to detangle the region from European influence, instead looking to strengthen ties with other global players such as China and Russia. This burgeoning movement seeks equitable partnerships transcending historical disparities. Recognizing these goals and fostering collaborative initiatives for shared growth is crucial. Failing to cultivate a successful partnership between Europe and Africa would yield detrimental consequences for both continents: Africa’s growth prospects could suffer as Europe&#8217;s long-term competitiveness plummets.



<h2 class="wp-block-heading" id="h-a-partnership-with-mutual-benefits">A partnership with mutual benefits</h2>



Africa and Europe are progressively forging a path towards a more balanced and equitable collaboration, based on objectives of mutual growth and development. This direction was further underscored by European Commissioner van der Leyen in her State of the Union Address on September 13. A notable initiative in this direction is the <a href="https://commission.europa.eu/strategy-and-policy/priorities-2019-2024/stronger-europe-world/global-gateway_en">Global Gateway</a>; leaders from Africa and EU have committed a €150 billion investment to boost smart, clean and secure links in digital, energy and transport sectors and to strengthen health, education and research systems in Africa.



Africa is also strategically fostering regional value chains facilitated by the <a href="https://au-afcfta.org/">African Continental Free Trade Area (AfCFTA)</a>. However, the President of the African Development Bank, Dr. Akinwumi Adesina, stated that “to unlock AfCFTA’s potential, we must not just trade. We must turn the zone into an industrial manufacturing zone. Free Trade Zones that launch prosperity around the world have done so not by trading low value commodities, but by industrial manufacturing. Africa’s wealth must no longer depend on exports of raw materials but of finished value-added products.”



To industrialize, Africa must solve its major challenge with very low access to electricity. The future of electric cars in the world depends on Africa, given its extensive resource deposits in rare minerals, especially lithium-ion, cobalt, nickel and copper. The size of the electric vehicles market has been estimated to reach $7 trillion by 2030 and $46 trillion by 2050. Developing a labour market for the production of lithium-ion batteries in Africa will be three times cheaper than in other parts of the world.



This is where the EU can help Africa: “With its institutional knowledge and investment power to support capacity-building,” as noted by Valdis Dombrovskis, the Executive Vice-President of the European Commission. “This can promote better product quality, more innovation and reduce costs. As a result, our partner countries will be in a strong position to move up the value chain themselves.”



The EU&#8217;s engagement extends to close collaboration with both public and private stakeholders, underscoring commitment to nurturing economic connections and stimulating employment opportunities in Africa. The European Bank for Reconstruction and Development (EBRD) and the European Investment Bank (EIB) play pivotal roles in engaging the private sector, rendering financial support in the form of loans and related services. These financial endeavours are directed towards advancing sustainable progress in critical sectors, such as mining, infrastructure, and energy.



<h2 class="wp-block-heading" id="h-rebalancing-through-the-private-sector">Rebalancing through the private sector</h2>



The endeavours undertaken to improve and strengthen the economic collaboration are testament to the evolving nature of their partnership and the genuine aspiration to cultivate a future where historical imbalances are addressed in a diplomatic and constructive manner. While EU companies are the main source of direct investments in Africa, the European private sector could have an enhanced impact by adding higher value roles to their domestic hiring, setting up skills training programmes, and enabling leapfrogging by transferring modern technologies to increase productivity levels. Fostering skilled labour in manufacturing and green industries would propel Africa&#8217;s green economy and prepare it for evolving global sustainability standards. From a business perspective, Africa is set to constitute a significant portion of the global consumer market in the future, a fact that should incentivize companies to provide tangible value to the communities where they operate.

kyle-glenn-nXt5HtLmlgE-unsplash-1

How Africa and Europe together can sow the seeds of the green transition

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="567" src="https://cms.cnbcafrica.com/wp-content/uploads/2020/05/GettyImages-1189261957-820x567.jpg" alt="Bill Gates: ‘I wish I had done more’ to warn world about pandemic danger" class="wp-image-371281" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2020/05/GettyImages-1189261957-820x567.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2020/05/GettyImages-1189261957-300x207.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2020/05/GettyImages-1189261957-768x531.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2020/05/GettyImages-1189261957-1536x1061.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2020/05/GettyImages-1189261957-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Bill Gates, billionaire and Co-Chair of the Bill &amp; Melinda Gates Foundation. (Photo by Hou Yu/China News Service/VCG via Getty Images)</figcaption></figure>



A decade of research into why kids in the poorest places die is now unlocking ways to save millions.



It’s been almost a decade, but it’s still hard for me to tell this story without choking up.



It was 2016, and I was visiting a hospital in Johannesburg, South Africa—specifically, Soweto, the township on the city’s outskirts, which had some of the highest child mortality rates in the world.



Even at wakes and funerals it’s sometimes shocking for me to see a dead body, but this didn’t look like any dead body I had seen before. It was so small, covered in plastic. Only after I stepped closer did I recognize it was a newborn baby, maybe a day or two old.



Afterwards, I collected myself and went outside. The child’s parents were there.



I had met parents who’d lost children before, but not like this. When children died in poorer countries, they were never brought to a hospital or a morgue. Sometimes, a health worker would travel to the home and ask what had happened, but medical examiners and doctors didn’t perform an autopsy—not until CHAMPS.



Child Health and Mortality Prevention Surveillance, CHAMPS, is an initiative our foundation started in 2015. The idea was to learn more about the root causes of child death by taking blood and tissue samples from children who’d died, but no one was quite sure whether, on the worst day of their lives, the parents would agree. The couple outside the Soweto hospital were among the first to volunteer, and I wanted to learn why.



“We just don’t want this to happen to another family,” they told me.



That&#8217;s what sticks with me—not simply the tragedy, but the kernel of hope. Those parents saw a bigger picture on the day their greatest fear was realized. And it was up to the rest of the world to do better by them and millions of parents like them: We had to find out why children were dying to keep them alive.



Even ten years ago, public health officials had only the vaguest information about why babies were dying. Back then, any record of a child’s death would generally list one of the four most common causes: diarrhea, malnutrition, pneumonia, or premature birth. But each was a vast ocean of different illnesses, with scores of different causes and cures. Pneumonia, for example, is linked to more than 200 types of pathogens.



Answering “Why did a child die?” felt a little bit like being asked to find a child lost at sea—except you were only told which ocean to search in, Atlantic or Pacific. There was an expanse of missing information, so our foundation decided to help fill that void by funding research including three landmark studies. In addition to CHAMPS, which was aimed at explaining the most inscrutable causes of death, there was also the Pneumonia Etiology Research Child Health Study, PERCH, which examined the causes of childhood pneumonia, while the Global Enteric Multicenter Study, GEMS, did the same for diarrheal diseases.



As doctors compiled and compared case after case, a clearer (and often surprising) picture of child death emerged. For instance, some pathogens were less likely than was expected, like pertussis, which causes whooping cough, but others were more likely than we expected, like Klebsiella, which can be harder to treat.



Imagine if doctors didn’t know why American men were susceptible to heart attacks—and then, in the span of two years, they discovered the links to high cholesterol and smoking. That’s what happened with infant pneumonia, and the new information about Klebsiella is leading doctors to change what antibiotics they use.



More precise understanding of why children die



 CHAMPS data provides hyper-detailed information about which pathogens are causing deaths, guiding the development of improved treatments and vaccines.



<figure class="wp-block-image size-large is-resized"><img decoding="async" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/GoalKeepers_2023_Bill-01-800x800.jpg" alt="" class="wp-image-427426" style="width:731px" width="731" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/GoalKeepers_2023_Bill-01-800x800.jpg 800w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/GoalKeepers_2023_Bill-01-300x300.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/GoalKeepers_2023_Bill-01-90x90.jpg 90w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/GoalKeepers_2023_Bill-01-768x768.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/GoalKeepers_2023_Bill-01.jpg 1080w" sizes="(max-width: 800px) 100vw, 800px" /><figcaption class="wp-element-caption">FILE PHOTO: More precise understanding of why children die graphic from the 2023 Goalkeepers Report. Source: Bill &amp; Melinda Gates Foundation</figcaption></figure>



This is the crux of what I call “the baby knowledge boom.” Thanks to studies like CHAMPS, GEMS, and PERCH, the medical field has begun to understand precisely when and why some babies are dying, which allows them to keep others alive.



Another great example is how doctors are helping premature babies breathe—by using novel methods to “fast-forward” their lung growth. If a doctor sees that a mother is going to give birth prematurely, they can give her antenatal corticosteroids, or ACS. The ACS “exercises” the fetus’s lungs, which accelerates their growth, packing a few weeks’ worth of maturation in just a few days. Our foundation estimates that ACS could save the lives of 144,000 infants in sub-Saharan Africa and South Asia by 2030 and nearly 400,000 by 2040.



But that’s just a fraction of the lives we can save if we apply what researchers learned about nutrition in the past decade.



Gut check



 If you’ve seen medical TV shows like CSI or House, MD, you already have some sense for how an initiative like CHAMPS works. Doctors and pathologists sit on a “decode panel,” reviewing cases, batting ideas back and forth, until they come to a full conclusion on all the steps that led to a person’s death.



This level of detail is important because, outside of unexpected accidents, few people die for just one reason. Instead, death is a chain reaction. For example, a baby who dies of pneumonia likely wasn’t just fine before getting sick. She likely was born premature or was undernourished. The best way to keep a child alive isn’t to treat the pneumonia that will kill her. That’s a last resort. Rather, we should try to stop the first link in the causal chain from being formed in the first place.



Studies like CHAMPS helped us understand that often that first link is malnutrition.



Believe it or not, I think this is positive news. Because our growing understanding of why children die has proceeded alongside a second, arguably bigger knowledge boom—this one involving our grasp of nutrition.



If we’ve packed 100 years of learning about maternal and child mortality into the past decade, researchers have probably crammed 1,000 years’ worth of knowledge about the microbiome in the same decade, which is the teeming universe of bacteria that lives inside our digestive tracts. For example, the child health field used to think of breastmilk as only food for the newborn. But we’ve now learned that it’s also food for the bacteria that naturally live in the gut of the baby.



These bacteria—the most common ones are called bifidobacteria—break down specific sugars in the milk, turning it into nutrients. Without these good bacteria it doesn’t matter how well you feed your baby; their digestive system would still have a really hard time absorbing the milk’s nutrients. Which is why doctors are now recommending that babies—especially those born too soon or too small—are given a probiotic supplement with bifidobacteria in it.



This next part is gross, but amazing. Bifidobacteria are different depending on where you’re from. Babies in India have different gut bacteria than babies in the United States, so these probiotics have to be tailored hyper-locally—or in this case, “diaper locally.” Researchers swab the poop of a baby, isolating the bacteria that live in their intestines, then analyze the unique way they work in their digestive tract and can create locally tailored probiotics based on that research.



There are other new supplements to fight malnutrition, but maybe the biggest innovation is when doctors are providing them: in the womb. The medical field used to think that you couldn’t treat malnutrition until a child was about six months old and started eating. But new research has found that the baby’s microbiome and the mother’s are connected. If a pregnant woman has abundant bifidobacteria, good bacteria can spread from her digestive tract to the child’s; this way, the baby is born already having a healthy gut.



Studies show these probiotics help babies gain an additional 5 grams of weight per day in the late stages of pregnancy and can improve baby’s growth when given to the baby after birth.



Remembering Soweto



 “We just don’t want this to happen to another family.”



What those parents in Soweto said to me has echoed in my mind for over seven years, and I’ve often wondered how I might respond if I saw them again.



I think I would be honest. It might not be possible to protect every family, to guarantee a world of zero newborn deaths. Zero is a hard number.



But that doesn’t mean we can’t come very, very close.



Over the past decade, the field of child health has moved faster and farther than I thought I’d see in my lifetime. And if our delivery can keep pace with our learning—if researchers can keep developing new innovations and health workers can get them to every mother and child that needs them—then doctors could all but guarantee a baby would survive their crucial first days.



That’s what I would tell them. That’s what, together, I believe we can show them.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">
&#8220;Over the past decade, the field of child health has moved faster and farther than I thought I’d see in my lifetime.&#8221;
<cite>—Bill Gates</cite></blockquote>

Bill Gates: ‘I wish I had done more’ to warn world about pandemic danger

The baby knowledge boom

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Gates-Foundation-820x547.jpg" alt="" class="wp-image-427419" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Gates-Foundation-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Gates-Foundation-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Gates-Foundation-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Gates-Foundation-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Gates-Foundation-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Gates-Foundation.jpg 2000w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A woman breastfeeds her newborn child. Source: Bill &amp; Melinda Gates Foundation/Facebook.</figcaption></figure>



New breakthroughs could ensure more women survive pregnancy and childbirth.



In February, I was with my daughter, Jenn, when she gave birth to a daughter of her own. Welling up inside me were all the emotions a new grandparent feels: joy, excitement, pride—and, above all, immense gratitude.



In the best of circumstances, childbirth is an exhausting, emotional experience, something I knew from my own experience. It felt like just yesterday that I was giving birth to Jenn in a 14-hour labor that left me utterly drained and barely able to walk.



But in the worst of circumstances, childbirth isn’t just draining—it’s deadly, for mother and baby. Several years ago, I traveled to Malawi, where almost everyone I met had lost someone they loved. At a maternity clinic, the staff, dazed with grief, told me that just the week before, one of their own nurses had given birth, and they couldn’t save her.



I’ll never forget the pain I saw on their faces as they told me about the women they’d lost. The worst part is, so many of these deaths could have been prevented.



For nearly all of human history, we simply didn’t know enough about preventing or treating the common childbirth complications that lead to death, such as postpartum hemorrhage or infection. Today, we know a great deal. Yet, as is so often the case in global health, innovations aren’t making their way to the people who need them most: women in low-income countries like Malawi, as well as Black and Indigenous women in high-income countries like the United States, who are dying at three times the rate of white women, even when holding for economic and education levels.



Brilliant researchers have developed new interventions that could ensure more women have access to lifesaving care. Their work is opening up new—and, importantly, low-cost and mobile—avenues of preventing and treating deadly childbirth complications. When combined with better primary health care and more resilient health systems, the three innovations that follow have the potential to save thousands of mothers’ lives in LMICs around the world by 2030.



Here’s how.



<figure class="wp-block-image size-large is-resized"><img decoding="async" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/GoalKeepers_2023_Melinda-01-800x800.jpg" alt="" class="wp-image-427416" style="width:731px" width="731" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/GoalKeepers_2023_Melinda-01-800x800.jpg 800w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/GoalKeepers_2023_Melinda-01-300x300.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/GoalKeepers_2023_Melinda-01-90x90.jpg 90w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/GoalKeepers_2023_Melinda-01-768x768.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/GoalKeepers_2023_Melinda-01.jpg 1080w" sizes="(max-width: 800px) 100vw, 800px" /><figcaption class="wp-element-caption">FILE PHOTO: A big impact for mothers graphic from the 2023 Goalkeepers Report. Source: Bill &amp; Melinda Gates Foundation.</figcaption></figure>



Treating postpartum hemorrhage



Postpartum hemorrhage (PPH) is the number one cause of maternal death. The World Health Organization estimates that PPH, which means losing more than half a liter of blood within 24 hours of childbirth, affects 14 million women every year—killing 70,000 of them, primarily in low-income countries. Those who survive often face long-term, disabling complications, such as heart or kidney failure.



Dr. Hadiza Galadanci, an obstetrician and researcher from Nigeria, explains that there is a critical flaw in the way PPH is diagnosed: Health care workers often have a hard time recognizing how much blood loss is too much blood loss. The only tool they have is a rough visual estimate. In a study they called E-MOTIVE, Dr. Galadanci and a team of researchers in four African countries with high maternal mortality found that about half of the women who experience PPH were never diagnosed at all. Therefore, they never got lifesaving treatment.



There is a simple, low-cost way to identify when blood loss is dangerously excessive: a drape that looks like a V-shaped plastic bag. When this calibrated obstetric drape is hung at the edge of the bed, collected blood rises like mercury in a thermometer. And in a busy hospital ward, that visual gauge tells providers which patients are in danger in just a single glance.



When PPH is identified, doctors, nurses, and midwives have long relied on a series of five treatments to stop the bleeding: uterine massage, oxytocic drugs, tranexamic acid, IV fluids, and genital-tract examination. But those interventions were being delivered sequentially—and far too slowly. So the researchers asked providers to bundle the interventions, administering all five at once.



The results were dramatic: In a trial of 200,000 women, providers who used drapes and followed the updated E-MOTIVE guidelines were able to decrease cases of severe bleeding by a remarkable 60 percent.



Preventing PPH in the first place



A common cause of postpartum hemorrhage is anemia, or severe iron deficiency.



Anemia affects as many as 37 percent of pregnant women around the world. In some places in South Asia, that rate jumps as high as 80 percent. Anemia is a dangerous condition on its own, but it is also deeply intertwined with PPH: If a woman has severe anemia, she is much more likely to bleed heavily during her delivery. And even worse, because anemia reduces how much oxygen the blood can carry, anemic women cannot survive the same volume of blood loss as nonanemic women. It’s a vicious cycle.



Symptoms of anemia include fatigue or feeling faint or dizzy—things that might happen simply because you’re pregnant. Every pregnant woman should have access to maternal micronutrient supplements—high-quality prenatal vitamins that include iron—which can prevent most mild maternal anemia cases. But diagnosis and targeted treatment are necessary to address moderate and severe cases of anemia. So once again, a primary challenge is diagnosis. Screening for anemia during pregnancy is one of the most important tests we can do to ensure a woman’s health and survival. And just one example of why antenatal care is so important.



If anemia is diagnosed, the traditional treatment is supplemental iron delivered via tablets. But taking iron orally can cause unpleasant side effects and requires women to keep up with a consistent regimen for up to 180 days.



But a Nigerian obstetrician and researcher named Dr. Bosede Afolabi is working on bringing a promising new intervention to her home country: a one-time, 15-minute intravenous (IV) infusion of iron. It’s an IV drip that can replenish women’s iron reserves during pregnancy—or even after pregnancy—and it could help treat severe cases of anemia quickly and effectively.



Anemia isn’t just a cause of postpartum hemorrhage; it’s also an effect—one that can lead to long-term consequences ranging from heart disease to depression. So this solution could mean not just saving women’s lives but also helping them lead better ones.



Preventing infections



Another leading cause of maternal death and disability is infection that leads to sepsis—an extreme, full-body inflammatory reaction. In recent years, researchers have discovered that one of the most promising new ways to prevent infection during pregnancy happens to be one of the most commonly used antibiotics in the world.



For decades, azithromycin has been used to treat a variety of bacterial infections, most commonly eye and respiratory infections. Now we’re learning that when given during labor, azithromycin also reduces maternal infections, therefore preventing those infections from spiraling into sepsis. During a trial across sub-Saharan Africa, it reduced sepsis cases by a third. That’s a remarkable discovery—one that could be very useful in places where most births are at home.



And it could also be a game-changer in the United States, where 23 percent of maternal deaths are from sepsis.



The United States has some of the most abysmal—and most inequitable—maternal mortality rates among high-income countries. American women are more than three times more likely to die from childbirth than women in almost every other wealthy country. But, as I noted earlier, the biggest crisis is among Black and Indigenous women.



I still remember the shock I felt when I read tennis star Serena Williams’s account of how close she came to dying from serious blood clots after giving birth—simply because her own doctors wouldn’t believe her that something was wrong. That shock only grew when I read, just this past April, that Tori Bowie, a Black American track and field Olympian, died from childbirth complications in her home. And these are just the stories we hear about in headlines.



It’s remarkable that a common antibiotic like azithromycin has the potential to address the cause of nearly a quarter of American maternal deaths.



But as Serena’s harrowing experience and Tori’s tragic death demonstrate, one antibiotic is not enough. The systemic inequalities that deny the highest-quality care to Black and Indigenous women also need to be addressed—urgently.



A powerful engine for progress



These are three of the innovations that are reshaping maternal health—and there are others just on the horizon, especially as researchers learn more about how to use AI to improve maternal health care.



Of course, these breakthroughs aren&#8217;t silver bullets on their own—they require countries to keep recruiting, training, and fairly compensating health care workers, especially midwives, and building more resilient health care systems. But together, they can save the lives of thousands of women every year. And that’s not all.



Improving maternal health also means improving infant health and survival. It means stronger families, more vibrant communities, and more prosperous societies. We have seen over and over again that when countries actually prioritize and invest in women’s health, they unleash a powerful engine for progress that can reduce poverty, advance gender equality, and build resilient economies.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">
&#8220;Improving maternal health also means improving infant health and survival. It means stronger families, more vibrant communities, and more prosperous societies.&#8221; 
<cite>—Melinda French Gates</cite></blockquote>



That’s why, more than anything, we need to rally the will to invest in these breakthroughs—so they actually get to the women who need them most—and fund the remarkable researchers who will discover the next ones.



Dr. Afolabi explained that in the Yoruba language, the traditional greeting to a woman who has given birth is “Eku ewu omo,” which translates to, “Well done for getting through the danger of childbirth.”



Thanks to her, and others like her, more women will live long enough to hear those words. And maybe one day, when breakthroughs have reached women all around the world and childbirth is far less dangerous, all they&#8217;ll hear is “Well done.”

Gates-Foundation

Delivering hope

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2022/04/GettyImages-1236313690-820x547.jpg" alt="" class="wp-image-416649" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2022/04/GettyImages-1236313690-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2022/04/GettyImages-1236313690-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2022/04/GettyImages-1236313690-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2022/04/GettyImages-1236313690-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2022/04/GettyImages-1236313690-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2022/04/GettyImages-1236313690-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">IMF managing director Kristalina Georgieva speaks during a panel discussion at the COP26 UN Climate Summit in Glasgow on November 3, 2021. (Photo by Daniel LEAL / AFP) (Photo by DANIEL LEAL/AFP via Getty Images)</figcaption></figure>



Washington, DC &#8211; September 7:&nbsp;Kristalina Georgieva, Managing Director of the International Monetary Fund, and Ajay Banga, President of the World Bank issued today a joint statement:



“The world confronts significant economic challenges, the existential threat of climate change as well as a digital transition, all in the context of more frequent shocks, high debt levels, limited policy space in many countries and rising geopolitical tensions. Well-designed and appropriately sequenced policies are critical to help accelerate growth, alleviate policy trade-offs, and support the green and digital transitions. The Bretton Woods institutions have a critical role to play to help member countries address the challenges and leverage the opportunities, working closely together and with partners.



“The world confronts major transformational challenges and more frequent shocks at a time of rising economic and geopolitical tensions.&nbsp;Growth in the world economy has slowed, with the medium-term outlook at its weakest in over three decades. Progress in poverty reduction has come to a halt. Conflict and fragility are on the rise. The world is facing geoeconomic fragmentation, extreme natural disasters exacerbated by climate change, and increasing levels of public debt. Rapid digitalization and technological transformations create new challenges, but also opportunities. With well-designed and appropriately sequenced reforms, the digital and green transitions can bring tremendous economic, social and environmental gains, and add to welfare and prosperity.



“The Bretton Woods institutions, with their universal membership and specialist expertise, are well placed to make a critical contribution to help countries tackle these challenges.&nbsp;The challenges are too great for individual actors to address. International financial institutions, national governments, philanthropic foundations, as well as the private sector, must work together. The Fund and the Bank, working jointly, can play a key catalytic role in this broader collective effort, as they have done in the past. The Bretton Woods institutions were established in 1944 to help rebuild a world economy devastated by global depression and war. As the world economy has changed over the past 80 years, the Bank and the Fund have continued to adapt and worked closely together to serve their members’ needs.



“We are committed to enhancing our collaboration to deliver tangible benefits for people, businesses, and institutions of our member countries.



“We will do so by drawing on our respective mandates and expertise—the World Bank’s diverse skills and experience, including on sustainable growth and structural transformation and its significant footprint in client countries; the Fund with its capabilities to support macroeconomic and financial stability, and promote economic conditions conducive to growth and sustainability. We will coordinate closely our global, regional, and country level engagements to ensure that our resources are deployed efficiently and effectively, driven by a focus on results for our members.



“We will do so by building on our long history of joint action and collaboration frameworks.&nbsp;Past efforts have resulted in strengthened coordination of policy advice to countries and the establishment of joint programs and initiatives. Examples include our joint assessments of financial sector soundness in emerging markets and developing economies and of debt sustainability in low-income countries; and broader collaboration frameworks, such as the 1989 Concordat and the 2007 Joint Management Action Plan.



“Today, we need to enhance further our collaboration, in particular with regards to climate change, renewed high debt vulnerabilities, and digital transition.



“Climate change.&nbsp;Climate change is a threat to global peace, security, economic stability, and development. To address this challenge, our institutions need to help all our member countries integrate their climate and development goals. Given the critical nature of this work stream, we will put Bank-Fund collaboration in this area on a more structured and institutionalized footing.



· The Bank and the Fund will promote complementarity and synergies in their climate-related works. The updated core mandate of the World Bank puts climate explicitly as one of the core areas of the Bank’s efforts and builds on an ongoing multiyear engagement on climate action and development. Building on its Climate Change Action Plan, the Country Climate and Development Reports (CCDRs), and extensive country-level policy work, the World Bank provides policy advice on climate issues to member countries, supports policy reforms through Development Policy Financing and provides financing for specific investments at the sectoral level through investment and program for results loans. The Fund has adopted a new climate strategy that includes coverage of macro-critical climate issues as part of Article IV consultations and expanded technical assistance in areas where it has specialized expertise. It has also established the Resilience and Sustainability Trust (RST) to provide affordable long-term finance to vulnerable countries implementing macro-critical climate reforms. The two institutions are successfully co-hosting the Secretariat of the Coalition of Finance Ministers for Climate Action.



· The two institutions will further strengthen coordination and focus on results. We will formalize the regular meetings of the new Bank-Fund Climate Advisory Group, tasked with ensuring coordination of our climate related work streams. The group will meet every two months to discuss global and country level engagements, including the results of CCDRs, country level climate analytical work, and the pipeline of key projects and policy-based lending (World Bank’s DPLs and Fund’s RST engagements). We will also incorporate climate considerations in our ongoing work on debt sustainability, including through the revised joint Low Income Country Debt Sustainability Framework.



“Debt Vulnerabilities.&nbsp;The Bank and the Fund have long worked closely together on debt challenges, both in operational work in individual countries and at the global level. The current context of elevated debt vulnerabilities gives renewed urgency to intensified collaboration, building and leveraging on our respective areas of expertise. We will enhance our joint work to help prevent further build-up of debt vulnerabilities, assisting countries to strengthen debt management and transparency and public finances, while improving the joint Low Income Country Debt Sustainability Framework to better account for current challenges. We will also deepen our support to creditors and debtors engaged in a debt restructuring and will work further with our partners to improve restructuring processes, including under the Common Framework, building on the work we launched at the Global Sovereign Debt Roundtable.



“Digital transition.&nbsp;The ongoing digital transition is at the forefront of development and provides a unique opportunity for countries to accelerate economic growth and connect citizens to services and jobs. Yet in 2022, nearly 3 billion people remained offline, the vast majority of whom live in developing countries, and the wide gaps in usage of digital products between and within countries remain a challenge. The Bank works with governments in emerging and developing countries to address regulatory and infrastructure constraints to digital inclusion and transformation, and to promote financial inclusion and low-cost payments systems, expand digitalization of government services and operations. The Fund focuses on supporting digital transformation in the financial sector to promote wider use of new financial technologies while maintaining the integrity and stability of the financial system. We will step up our joint work to help countries increase the effectiveness of revenue collection and expenditure systems in governments and reap the benefit of new digital technologies while mitigating the risks, including on ways to improve cross-border payments, support implementation of the G20 Roadmap to enhance cross-border payments, and ensure that payment innovations spur growth, poverty reduction and job creation.



“The Bank and the Fund will work with shareholders and partners to mobilize the substantial resources needed to meet the complex challenges the world faces today.&nbsp;This requires both domestic and external resources. To this end, we will increase our support to help countries build strong tax policy and administration and fiscal institutions that deliver efficient public spending and sound debt and public financial management, along with our ongoing work to support development of strong domestic financial markets.



“The world can, and must, come together to address global challenges. The IMF and World Bank are committed to help advance this common effort.”

BRITAIN-UN-CLIMATE-COP26

Joint Statement of the IMF Managing Director and of the World Bank President

Today in Mali, one of the main rice baskets of West Africa, it’s not unusual to find <a href="https://www.africarice.org/post/valuing-women-s-involvement-in-agriculture-as-full-actors-first-successful-results-with-the-aiccra" target="_blank" rel="noreferrer noopener">young women</a> and men equipped with tablet computers loaded with an app called <a href="https://www.riceadvice.info/en/" target="_blank" rel="noreferrer noopener">RiceAdvice</a>, advising local farmers on best-fit management practices to implement under weather extremes caused by climate change. RiceAdvice can, for example, help farmers choose the best rice variety to grow and the right amount of fertilizer to apply to reduce the risk of fertilizer loss due to flooding. The collaboration has helped thousands of small-scale rice farmers in Mali increase their rice harvest yields by about a ton per hectare.&nbsp;&nbsp;



What is at work here goes beyond farmers using digital technologies to achieve a sizeable bump in food production. It’s an example of what needs to happen at scale to ensure that agriculture in large areas of the world can cope with a climate crisis that risks spiraling out of control.&nbsp;&nbsp;



This week, leaders from across sub-Saharan Africa are gathering in Nairobi, Kenya, for Africa Climate Week. With the world having recently experienced the&nbsp;<a href="https://www.axios.com/2023/07/07/earth-four-hottest-days-thursday" target="_blank" rel="noreferrer noopener">four hottest days&nbsp;ever recorded</a>, this will be a critical moment for African leaders to unite behind a shared agenda for the global climate summit (known as COP28) that will take place in November in the United Arab Emirates.&nbsp;&nbsp;



For agriculture-dependent regions across sub-Saharan Africa, and much of South Asia as well, avoiding disastrous effects on agriculture inflicted by climate change will require a major global effort to help small-scale farmers adapt to the changes.&nbsp;&nbsp;



There is an urgent and compelling need for action; these regions are home to about 3 billion people, including small-scale farmers like those rice growers in rural Mali. Their operations supply most of the food and, in Africa in particular, they generate <a href="https://blogs.worldbank.org/jobs/africa-more-not-fewer-people-will-work-agriculture" target="_blank" rel="noreferrer noopener">most of the employment</a>. Today, small-scale farmers have become a major focus of global efforts to fight hunger and poverty. In many African countries, growth in the agriculture sector, achieved through investments in small-scale farmers, stimulates a much larger <a href="https://documents1.worldbank.org/curated/en/587251468175472382/pdf/41455optmzd0PA18082136807701PUBLIC1.pdf" target="_blank" rel="noreferrer noopener">reduction in poverty</a> than growth in other sectors.&nbsp;&nbsp;



This is not a new or geographically specific economic phenomenon. Small-scale farmers were central to <a href="https://openknowledge.worldbank.org/server/api/core/bitstreams/8d8ad2dd-5c98-5042-8aad-744fdd7b034f/content" target="_blank" rel="noreferrer noopener">China’s historic achievements</a> in poverty reduction a century ago. They were also an engine of economic progress for North America and Europe.&nbsp;&nbsp;



What’s different today is climate change. I grew up in Sierra Leone and I’ve spent decades working with African farmers in humid and arid regions across Africa. I know what it means to grow food in challenging environments. Yet, what farmers face today — a surge in droughts and floods, and increasingly unpredictable and shifting patterns of rainy seasons — is unlike anything I have ever encountered.&nbsp;



The science confirms my observations. Much of sub-Saharan Africa lies in a tropical zone where climate change has caused temperatures to rise faster and weather patterns to shift more dramatically than almost anywhere in the world. As a result, climate-related losses on farms in sub-Saharan Africa, in terms of yield, are predicted to decrease by 10 percent.&nbsp;&nbsp;



That makes climate change a threat to our food systems and a menace to our best opportunity for achieving economic progress. And that’s why, at Africa Climate Week, African leaders must present a strong case for a global response, noting that our farmers are suffering the most from climate change while contributing the least to causing it with all of Africa accounting for <a href="https://data.worldbank.org/indicator/EN.ATM.GHGT.KT.CE?end=2018&amp;locations=ZG-1W&amp;start=1970&amp;view=chart" target="_blank" rel="noreferrer noopener">only about four percent</a> of the world’s carbon emissions.&nbsp;&nbsp;



Of equal importance, African leaders must point to sustainable solutions as well as the many partnerships now working across Africa to deliver innovations that can be rapidly scaled up to help millions of farmers adapt.&nbsp;&nbsp;&nbsp;



For example, farmers in Kenya, Tanzania, Malawi, Nigeria, Uganda, and many other places are embracing new, improved varieties of locally adapted food crops such as <a href="https://www.nextgencassava.org/" target="_blank" rel="noreferrer noopener">cassava</a>, <a href="https://aiccra.cgiar.org/news/drought-tolerant-crops-provide-relief-smallholder-farmers-kenyas-drylands" target="_blank" rel="noreferrer noopener">millets</a>, <a href="https://www.cgiar.org/news-events/news/climate-smart-pigeonpea-sparks-phenomenal-expansion-across-malawi/" target="_blank" rel="noreferrer noopener">pigeon pea</a>, and <a href="https://nation.africa/kenya/brand-book/how-nutritious-sweet-potato-is-helping-african-farmers-to-recover-from-climate-stresses-4274642" target="_blank" rel="noreferrer noopener">sweet potatoes,</a> which are naturally <a href="https://cipotato.org/blog/climate-smart-potatoes-sweetpotatoes-boost-resilience-tropics/" target="_blank" rel="noreferrer noopener">suited to stressful growing conditions</a>. Livestock experts are working with small-scale dairy and <a href="https://www.ilri.org/news/african-chicken-genetic-gains-transforms-tropical-poultry-genetic-solutions-build-outcomes-and" target="_blank" rel="noreferrer noopener">poultry farmers</a> to identify more resistant cattle, small-ruminants, pigs and poultry, as well as <a href="https://alliancebioversityciat.org/stories/genetic-breakthrough-tropical-grass-could-help-develop-climate-friendly-cattle-farms" target="_blank" rel="noreferrer noopener">resilient feeds,</a> to help them sustainably increase production as temperatures rise. Affordable digital technologies are powering new early warning systems like one that is preventing <a href="https://www.cimmyt.org/news/scientists-develop-an-early-warning-system-that-delivers-wheat-rust-predictions-directly-to-farmers-phones/" target="_blank" rel="noreferrer noopener">wheat rust outbreaks</a> in Ethiopia and another helping Africa’s pastoralist herding communities <a href="https://www.ilri.org/news/after-10-years-kenya-and-ethiopia-are-we-ready-scale-livestock-insurance-horn-africa" target="_blank" rel="noreferrer noopener">cope with drought</a>. There are many such climate-smart innovations available.&nbsp;



A call to invest in adaptation should not be viewed as an excuse to abandon efforts to reduce emissions. Both are equally important. Today, however, investments in adaptation, especially for African farmers, are far below what’s needed.&nbsp;&nbsp;



This year’s COP28 global climate summit is supposed to be a “COP of solutions.” There can be no solution to the climate crisis that does not include a rapid and massive effort to ensure African farmers can continue supplying our region with food while generating economic growth. At Africa Climate Week, it will be of utmost importance for our leaders to acknowledge that the climate crisis in Africa is largely a food and agriculture crisis, and to lead the way in showcasing the solutions our farmers can use to overcome this unprecedented threat.   


<div class="wp-block-image">
<figure class="aligncenter size-full"><img loading="lazy" decoding="async" width="320" height="320" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Harold-Roy-Macauley-1.jpg" alt="" class="wp-image-427246" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Harold-Roy-Macauley-1.jpg 320w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Harold-Roy-Macauley-1-300x300.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/09/Harold-Roy-Macauley-1-90x90.jpg 90w" sizes="auto, (max-width: 320px) 100vw, 320px" /><figcaption class="wp-element-caption">Harold Roy-Macauley is the Managing Director of Regions and Partnership at CGIAR. </figcaption></figure></div>

Harold-Roy-Macauley-1

We Can’t Solve the Climate Crisis Without Africa’s Farmers

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="786" height="800" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/08/Sanda-Ojiambo-Headshot-AT-1-MB-2-786x800.jpg" alt="" class="wp-image-427136" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/08/Sanda-Ojiambo-Headshot-AT-1-MB-2-786x800.jpg 786w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/Sanda-Ojiambo-Headshot-AT-1-MB-2-295x300.jpg 295w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/Sanda-Ojiambo-Headshot-AT-1-MB-2-88x90.jpg 88w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/Sanda-Ojiambo-Headshot-AT-1-MB-2-768x782.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/Sanda-Ojiambo-Headshot-AT-1-MB-2-1509x1536.jpg 1509w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/Sanda-Ojiambo-Headshot-AT-1-MB-2-scaled.jpg 2013w" sizes="auto, (max-width: 786px) 100vw, 786px" /><figcaption class="wp-element-caption">Sanda Ojiambo is CEO and Executive Director of the UN Global Compact</figcaption></figure>



Climate change is an existential threat to businesses and communities across the world, with the African continent at high risk, but determined action can build a more resilient and prosperous future for all, writes Sanda Ojiambo



From 4 to 6 September, global leaders will meet in Nairobi at the<a href="https://eur02.safelinks.protection.outlook.com/?url=https%3A%2F%2Fafricaclimatesummit.org%2Fabout&amp;data=05%7C01%7Cpagaza%40un.org%7Ca6a8632fa2fc4709926c08db9cbc3bdd%7C0f9e35db544f4f60bdcc5ea416e6dc70%7C0%7C0%7C638276104501505144%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&amp;sdata=B%2FrFJRucrDAt3Ccv2%2BDLf%2FDJrB0eiqeWP6huPE8rSNE%3D&amp;reserved=0"> Africa Climate Summit</a> to discuss the disproportionate impact of global warming on the African continent. As innovators, employers and creators of wealth, businesses are active participants in the design and adoption of climate solutions. It is their gateway to a greener, more resilient and more prosperous future.



The African Development Bank estimates Africa has been losing<a href="https://eur02.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.afdb.org%2Fen%2Fnews-and-events%2Fpress-releases%2Fafrica-loses-15-its-gdp-capita-annually-because-climate-change-african-development-bank-acting-chief-economist-kevin-urama-54660&amp;data=05%7C01%7Cpagaza%40un.org%7Ca6a8632fa2fc4709926c08db9cbc3bdd%7C0f9e35db544f4f60bdcc5ea416e6dc70%7C0%7C0%7C638276104501505144%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&amp;sdata=DBSmQaQzBAjBivvFznEQzn7Ph%2FhHUS8PGN8o7YsJ5UA%3D&amp;reserved=0"> 5 to 15 percent of its per capita GDP growth</a> every year because of climate change and its related impacts. For businesses, this translates into billions of dollars of losses or foregone opportunities each year.



Africa’s Business leaders understand the urgency of the climate crisis and the need to act. Whenever climate disasters strike, businesses struggle with disrupted supply chains, increased operating costs and the loss of production and assets.



<h2 class="wp-block-heading" id="h-united-in-the-climate-fight">United in the climate fight</h2>



In response, businesses are coming together to take action. Last year, more than 55 CEOs representing one million employees and $140 billion in revenues formed the <a href="https://unglobalcompact.org/take-action/africa-business-leaders-coalition">UN Global Compact African Business Leaders Coalition</a>. These private-sector actors are important because they represent a large slice of the economy. They come from many sectors, including construction, telecoms and medical services, and have all experienced the impacts of climate change on their businesses . They have the size and networks to act as strong advocates for investment opportunities in Africa, and they are also willing to invest and scale up green solutions.



This is the first time a group of African private-sector leaders from north, south, east and west<a href="https://eur02.safelinks.protection.outlook.com/?url=https%3A%2F%2Fungc-communications-assets.s3.amazonaws.com%2Fdocs%2Fpublications%2FThe%2520African%2520Business%2520Leaders%25E2%2580%2599%2520Climate%2520Statement.pdf&amp;data=05%7C01%7Cpagaza%40un.org%7Ca6a8632fa2fc4709926c08db9cbc3bdd%7C0f9e35db544f4f60bdcc5ea416e6dc70%7C0%7C0%7C638276104501505144%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&amp;sdata=IyFIPl7EUBDWylkED0MQGdzsztvbEP6D%2FrQDWF88DWI%3D&amp;reserved=0"> has committed to the climate fight.</a> Now we need more companies to join them.



The goal of the coalition is to call for more businesses to fulfill their climate commitments and become resilient to climate change. For example, the group has pledged to increase the share of renewables in their energy use. Members have also pledged to invest in climate-adaptation solutions and create them where they don’t exist. And they are committed to a just and equitable&nbsp; transition – one which ensures that their supply chains, value chains and local customers are the first to benefit from the switch to clean energy and greener forms of production. This will not be a wasted effort or a sunk cost – it’s estimated that the climate-adaptation market could be<a href="https://eur02.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.bloomberg.com%2Fnews%2Farticles%2F2021-11-17%2Fwhy-investing-in-climate-adaptation-will-soon-be-very-profitable-green-insight%3FleadSource%3Duverify%2520wall%26sref%3D3kquNlQO&amp;data=05%7C01%7Cpagaza%40un.org%7Ca6a8632fa2fc4709926c08db9cbc3bdd%7C0f9e35db544f4f60bdcc5ea416e6dc70%7C0%7C0%7C638276104501505144%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&amp;sdata=8U4zChQ83U9inxj5zRC9v05icfulvbdJUS63mgDnCAE%3D&amp;reserved=0"> worth $2 trillion a year globally by 2026</a>.



<h2 class="wp-block-heading" id="h-accelerating-solutions">Accelerating Solutions</h2>



But to achieve these goals, African businesses need a fair and equitable playing field. In particular, the global community must act to dismantle barriers that are limiting the access of African companies to affordable finance and clean technologies. To be clear, businesses are not asking for grants or other forms of aid. They are asking for equitable access to the resources that will enable Africa’s green transition.



At present, African governments and businesses pay an unfair “perception risk premium” when they borrow on the international financial markets. They continue to be perceived as riskier than their counterparts elsewhere in the world despite the measurable progress of the past two decades – with extreme poverty down by one-third, life expectancy up by one-fifth and<a href="https://eur02.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.imf.org%2Fen%2FNews%2FArticles%2F2019%2F12%2F01%2Fsp12022019-development-and-debt-finding-the-right-balance&amp;data=05%7C01%7Cpagaza%40un.org%7Ca6a8632fa2fc4709926c08db9cbc3bdd%7C0f9e35db544f4f60bdcc5ea416e6dc70%7C0%7C0%7C638276104501505144%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&amp;sdata=Bs%2BEHR4axbLPTelu8bQB%2FrZ6wKSTM2Eb%2FqxZg%2FeDeiY%3D&amp;reserved=0"> real per-capita incomes up 50 percent on average.</a>



Despite these visible improvements, the<a href="https://eur02.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.undp.org%2Fsites%2Fg%2Ffiles%2Fzskgke326%2Ffiles%2F2023-04%2FFull%2520report%2520-%2520Reducing%2520Cost%2520Finance%2520Africa%2520Report%2520-%2520April%25202023.pdf&amp;data=05%7C01%7Cpagaza%40un.org%7Ca6a8632fa2fc4709926c08db9cbc3bdd%7C0f9e35db544f4f60bdcc5ea416e6dc70%7C0%7C0%7C638276104501505144%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&amp;sdata=3JuWgr2lSIAyMCGsLFw5RFeQG33ypfALwX9N4ojYsyk%3D&amp;reserved=0"> UNDP estimates</a> African countries and businesses are paying $74.5 billion in excess interest and foregone funding a year as a result of this unfair risk premium. For context, $74.5 billion a year would cover 80 percent of Africa’s annual infrastructure investment needs. Meanwhile,<a href="https://eur02.safelinks.protection.outlook.com/?url=https%3A%2F%2Fafrican.business%2F2019%2F08%2Feconomy%2Fcredit-where-credit-is-due&amp;data=05%7C01%7Cpagaza%40un.org%7Ca6a8632fa2fc4709926c08db9cbc3bdd%7C0f9e35db544f4f60bdcc5ea416e6dc70%7C0%7C0%7C638276104501505144%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&amp;sdata=tsQVegm0K8X5Ei96yrR0m0OMzfp2opv%2BiIE5AR7ata8%3D&amp;reserved=0"> the International Finance Corporation</a>, the World Bank’s private lending arm, estimates small and medium-sized enterprises (SMEs), which account for 90 percent of all businesses, 50 percent of employment and 40 percent of GDP across the continent, face a funding gap of $330 billion a year.



<h2 class="wp-block-heading" id="h-tackling-the-future-together">Tackling the future together</h2>



This funding gap acts as a severe constraint on growth and limits Africa’s potential. For example, the continent accounted for just<a href="https://eur02.safelinks.protection.outlook.com/?url=https%3A%2F%2Fabout.bnef.com%2Fblog%2Fafrica-clean-energy-investment-sees-no-post-pandemic-rebound%2F%23%3A~%3Atext%3DSouth%2520Africa%252C%2520Egypt%252C%2520Morocco%252C%2C%252416%2520billion%2520over%2520that%2520time.&amp;data=05%7C01%7Cpagaza%40un.org%7Ca6a8632fa2fc4709926c08db9cbc3bdd%7C0f9e35db544f4f60bdcc5ea416e6dc70%7C0%7C0%7C638276104501505144%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C3000%7C%7C%7C&amp;sdata=D7dBYG4UJyDHZFUBuCzLqAQr3%2BmdmbM4l6pcSWNDbng%3D&amp;reserved=0"> 0.6 percent of the $434 billion invested in renewables worldwide</a> in 2021, despite Africa’s outstanding natural resources, rapidly growing electricity demand and improving policy frameworks.



African business leaders in the African Business Leaders Coalition&nbsp; argue that if finance and capital were accessible, it would be much easier to fund the transition to a greener and more resilient economy.



Next week’s Africa Climate Summit is therefore a great opportunity for the continent’s private sector to engage with governments, donors and multilateral institutions to gain traction on some of these issues. It is their chance to demonstrate the commitment of Africa’s private sector to climate action and accelerate inclusive and sustainable business opportunities&nbsp;

Sanda-Ojiambo-Headshot-AT-1-MB-1

It’s time to advance real action for climate

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="234" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/08/BLOG-2099x600-AFR-MCD-Climate-JurgaR-iStock-by-Getty-Images-iStock-493314794-820x234.jpg" alt="" class="wp-image-427132" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/08/BLOG-2099x600-AFR-MCD-Climate-JurgaR-iStock-by-Getty-Images-iStock-493314794-820x234.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/BLOG-2099x600-AFR-MCD-Climate-JurgaR-iStock-by-Getty-Images-iStock-493314794-300x86.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/BLOG-2099x600-AFR-MCD-Climate-JurgaR-iStock-by-Getty-Images-iStock-493314794-160x46.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/BLOG-2099x600-AFR-MCD-Climate-JurgaR-iStock-by-Getty-Images-iStock-493314794-768x220.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/BLOG-2099x600-AFR-MCD-Climate-JurgaR-iStock-by-Getty-Images-iStock-493314794-1536x439.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/BLOG-2099x600-AFR-MCD-Climate-JurgaR-iStock-by-Getty-Images-iStock-493314794-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Credit: JurgaR/iStock by Getty Images</figcaption></figure>



International partners must support the continent’s most vulnerable countries to adapt to extreme weather—or spillovers could become more disruptive



Climate change poses grave threats to countries across Africa—but especially fragile and conflict-affected states. As the continent’s leaders converge on Kenya for&nbsp;<a>next week’s&nbsp;</a><a></a><a href="https://africaclimatesummit.org/" target="_blank" rel="noreferrer noopener">African Climate Action Summit</a>, it is vital that they come up with solutions to support these vulnerable countries.



From the Central African Republic to Somalia and Sudan,&nbsp;<a href="https://www.imf.org/en/Publications/fandd/issues/Series/Analytical-Series/financing-peace-and-stability-franck-bousquet" target="_blank" rel="noreferrer noopener">fragile states</a>&nbsp;suffer more from floods, droughts, storms and other climate-related shocks than other countries, when they have contributed the least to climate change. Each year, three times more people are affected by natural disasters in fragile states than in other countries. Disasters in fragile states displace more than twice the share of the population in other countries.



And temperatures in fragile states are already higher than in other countries because of their geographical location. By 2040, fragile states could face 61&nbsp;days a year of temperatures above 35 degrees Celsius on average—four times more than other countries. Extreme heat, along with the more frequent extreme weather events that come with it, will endanger human health and hurt productivity and jobs in key sectors such as agriculture and construction. <img decoding="async" src="blob:https://cms.cnbcafrica.com/9ea4aaa1-814e-49b5-a1ae-cfec0d8cf797">



A new IMF paper [link] finds evidence that climate change indeed inflicts more lasting macroeconomic costs in fragile countries. Cumulative losses in gross domestic product reach about 4 percent in fragile states three years after extreme weather events. That compares with around 1 percent in other countries. Droughts in fragile states are expected to cut about 0.2 percentage points from their per-capita GDP growth every year. This means that incomes in fragile states will be&nbsp;<a href="https://www.imf.org/en/Blogs/Articles/2022/01/21/fragile-and-conflict-affected-economies-are-falling-further-behind" target="_blank" rel="noreferrer noopener">falling further behind</a>&nbsp;those in other countries.



The more harmful effect of climate events in fragile states is not only because of their geographical location in hotter parts of the planet, but also because of conflict, dependence on rainfed agriculture, and lower capacity to manage risks.



Conflict undermines the capacity of fragile states to manage climate risks. For example, in Somalia, the areas most severely affected by food insecurity and hunger due to the prolonged drought in 2021-22 were under the control of terrorist groups that thwarted delivery of humanitarian assistance.



<h2 class="wp-block-heading" id="h-conflict-and-hunger">Conflict and hunger</h2>



Climate shocks also worsen underlying fragilities, such as conflict and hunger, further exacerbating the effect they have on the economy and people’s wellbeing. Our estimates [link] indicate that in a high emissions scenario, and all else equal, deaths from conflict as a share of the population could increase by close to 10 percent in fragile countries by 2060. Climate change would also push an additional 50 million people in fragile states into hunger by 2060.



The higher losses from climate events also reflect the dependence of fragile states on rainfed agriculture. Agriculture represents close to one-quarter of economic output in fragile states, but only 3 percent of cultivated areas are irrigated with canals, reservoirs, and the like. Rainfed farms are especially vulnerable to droughts and floods. Where irrigation infrastructure does exist, it is often poorly designed, left to crumble, or damaged by conflict.



In central Mali, for example, floods along the Niger river are partly caused by farmers fleeing fighting and drainage ditches falling into disrepair. Sudan’s Gezira irrigation scheme once covered 8,000 square kilometers of fecund farmland but has shrunk to less than half that area owing to poor maintenance.



Finally, the higher losses from climate shocks are also because of the lack of financial means. With the financing needed for climate adaptation well beyond what fragile and conflict-affected countries can afford on their own, sizable and sustained support from international development partners—both concessional financing and capacity development—is urgent to avoid worsening hunger and conflict that can fuel forced displacement and migration.



<h2 class="wp-block-heading" id="h-policy-considerations">Policy considerations</h2>



For policymakers in these countries, critical interventions include policies to facilitate immediate response to climate shocks, such as building buffers through more domestic revenues, lower public debt and deficits, and higher international reserves. The paper indeed finds that fragile countries with such buffers see a faster recovery from extreme weather events. Strengthening social safety nets and leveraging insurance schemes are also key to financing recovery in the case of catastrophic events.&nbsp; In addition, fragile countries need to implement policies to build climate resilience over time, including scaling up climate-resilient infrastructure investments.



The IMF is stepping up support to fragile states dealing with climate challenges through carefully designed policy advice, financial assistance, and capacity development. Our&nbsp;<a href="https://www.imf.org/en/Publications/Policy-Papers/Issues/2022/03/14/The-IMF-Strategy-for-Fragile-and-Conflict-Affected-States-515129" target="_blank" rel="noreferrer noopener">strategy</a>&nbsp;promotes a deeper understanding of the drivers of fragility, tailoring of programs, scaling up capacity development, and synergies with other partners that work in these countries. We are also providing financial support through standard facilities, emergency financing and, more recently, our new&nbsp;<a href="https://www.imf.org/en/About/Factsheets/Sheets/2023/Resilience-Sustainability-Facility-RSF" target="_blank" rel="noreferrer noopener">Resilience and Sustainability Facility</a>.&nbsp;



These efforts by the IMF and other ongoing initiatives by international partners are still a drop in the big effort needed across the entire international community to protect the most vulnerable. The Africa Climate Summit could be a step forward towards generating effective solutions for mitigating the devastating impact of natural disasters and droughts on the continent’s people and economies.

BLOG-2099×600-AFR-MCD-Climate-JurgaR-iStock-by-Getty-Images-iStock-493314794

Africa’s Fragile States Are Greatest Climate Change Casualties

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="234" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/08/BLOG-2099x600-Fragmentation-AvigatorPhotographer-iStock-by-Getty-Images-iStock-840803724-820x234.jpg" alt="" class="wp-image-427066" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/08/BLOG-2099x600-Fragmentation-AvigatorPhotographer-iStock-by-Getty-Images-iStock-840803724-820x234.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/BLOG-2099x600-Fragmentation-AvigatorPhotographer-iStock-by-Getty-Images-iStock-840803724-300x86.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/BLOG-2099x600-Fragmentation-AvigatorPhotographer-iStock-by-Getty-Images-iStock-840803724-160x46.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/BLOG-2099x600-Fragmentation-AvigatorPhotographer-iStock-by-Getty-Images-iStock-840803724-768x220.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/BLOG-2099x600-Fragmentation-AvigatorPhotographer-iStock-by-Getty-Images-iStock-840803724-1536x439.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/08/BLOG-2099x600-Fragmentation-AvigatorPhotographer-iStock-by-Getty-Images-iStock-840803724-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Photo: AvigatorPhotographer/Getty Images</figcaption></figure>



In a shock-prone world, economies must be more resilient—individually and collectively. Cooperation is critical, but greater protectionism could lead to fragmentation, and even split nations into rival blocs just as fresh shocks expose the global economy&#8217;s fragility.



While estimates of the cost of fragmentation vary, greater international trade restrictions could reduce global economic output by as much as 7 percent over the long term, or about $7.4 trillion in today’s dollars. That’s equivalent to the combined size of the French and German economies, and three times sub-Saharan Africa’s annual output.



More deliberate global cooperation clearly is needed. International institutions can play a vital role, bringing countries together to help solve global challenges, as IMF Managing Director Kristalina Georgieva writes a new essay for Foreign Affairs.



There are signs cooperation is faltering. As the Chart of the Week shows, new trade barriers introduced annually have nearly tripled since 2019 to almost 3,000 last year.


<div class="wp-block-image">
<figure class="aligncenter"><a href="https://www.imf.org/en/Blogs/Articles/2023/08/28/the-high-cost-of-global-economic-fragmentation?utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noreferrer noopener"><img decoding="async" src="https://content.govdelivery.com/attachments/fancy_images/USIMF/2023/08/8110045/4932670/cotw-trade-restrictions_crop.jpg" alt="chart showing trade restrictions imposed worldwide"/></a></figure></div>


Other forms of fragmentation—like technological decoupling, disrupted capital flows, and migration restrictions—will also raise costs. In addition, global flows of goods and capital have leveled off since the global financial crisis. IMF research shows geopolitical alignments increasingly influence both foreign direct investment and portfolio flows.



The IMF continues to underscore that the international community, supported by global institutions such as ours, should pursue targeted progress where common ground exists and maintain collaboration in areas where inaction would be devastating.



“Policymakers need to focus on the issues that matter most not only to the wealth of nations but also to the economic well-being of ordinary people,” Georgieva wrote in Foreign Affairs. “They must nurture the bonds of trust among countries wherever possible so they can quickly step up cooperation when the next major shock comes.”

BLOG-2099×600-Fragmentation-AvigatorPhotographer-iStock-by-Getty-Images-iStock-840803724

The High Cost of Global Economic Fragmentation

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="492" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/bill-and-melinda-gates-t-820x492.jpg" alt="" class="wp-image-401148" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/bill-and-melinda-gates-t-820x492.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/bill-and-melinda-gates-t-300x180.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/bill-and-melinda-gates-t-768x461.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/bill-and-melinda-gates-t.jpg 1200w" sizes="auto, (max-width: 820px) 100vw, 820px" /></figure>



Global call for locally led innovation will help build an evidence base for use of artificial intelligence (AI) large language models in low- and middle-income countries to improve the livelihood and well-being of communities globally



SEATTLE (August 9, 2023) –&nbsp;Following an overwhelming response to its most recent Grand Challenges request for proposals, the Bill &amp; Melinda Gates Foundation today announced a group of nearly 50 grant recipients who are developing global health and development solutions for their communities using AI-enabled large language models (LLMs). Guided by the goal of reducing global inequity, the call for proposals specifically targeted researchers and innovators in low- and middle-income countries (LMICs).



Responsible and safe use of AI-driven LLM&nbsp;technology has the potential to help solve some of the world’s toughest health and development challenges. However, for these models to be useful in LMICs, researchers in LMICs need to participate in the design, application, and testing of this technology as it rapidly evolves.&nbsp;A robust evidence base will fill gaps in access and our knowledge about the application of such tools to address problems across LMICs in an equitable way.



“Too often, advances in technology deliver uneven benefits in many parts of the world due to existing patterns of discrimination, inequality, and bias,” said Juliana Rotich, co-founder of iHub, an incubator for Nairobi’s young technology entrepreneurs and who has agreed to serve on the foundation&#8217;s new AI Ethics and Safety Advisory committee. “AI is no different, with most of the tools being developed in the Global North using data from lower-resourced regions that is often incomplete or inaccurate. To realize the full potential of AI, it must be developed responsibly and ethically, with the needs of the end user in mind. Solutions can be transformative when they are locally inspired.”&nbsp;



Today’s announcement is part of the foundation’s Grand Challenges program, a family of initiatives fostering innovation to solve pressing global health and development problems. The foundation received more than 1,300 proposals, more than 80% of which were from LMICs, within two weeks of posting its request for proposals. The nearly 50 selected projects from 17 LMICs are aligned with the foundation’s goal of fostering&nbsp;a global innovation ecosystem in places where it will have the most impact. Each recipient will receive up to US$100,000 to advance its research project, for a total of US$5 million in grants. The findings of these projects will be shared at the Grand Challenges Annual Meeting in Dakar, Senegal, this October.



“The vibrant energy, boundless creativity, and unwavering commitment from innovators to tackle the most vexing challenges has sparked a wave of interest and excitement in the positive impact AI can have in the lives of the vulnerable,” said Zameer Brey, interim deputy director for Technology Diffusion at the Gates Foundation. “These local innovators are harnessing the seismic power of AI and LLMs in ways that can be paradigm-shifting for their local communities and beyond. We believe the most impactful technological advancements include those that begin and end with the people they affect most.”



Prompted by Grand Challenges to build upon existing technologies, researchers will work to address a wide range of health and development challenges throughout LMICs. Examples include how LLMs can help frontline health workers in India, where one woman dies every 20 minutes in childbirth, improve the management of high-risk pregnancies; tailor agricultural advice to individual smallholder farmers in Uganda, who are exposed to the devastating effects of crop diseases and pests; provide teacher coaching to improve educational outcomes in Mali; and give critical financial advice through a voice-to-text interface to rural women farmers and business owners in Nigeria. A full list of selected projects from Africa can be found&nbsp;<a href="https://gcgh.grandchallenges.org/grants/JTdCJTIyc29ydCUyMiUzQSUyMmRlc2NlbmRpbmclMjIlMkMlMjJzb3J0RmllbGQlMjIlM0ElMjJkYXRlJTIyJTJDJTIybnVtYmVyUGVyUGFnZSUyMiUzQTEwJTJDJTIycGFnZU51bWJlciUyMiUzQTAlN0Q=/JTdCJTIyeWVhcnMlMjIlM0ElNUIlNUQlMkMlMjJjaGFsbGVuZ2VzJTIyJTNBJTVCJTIyMzEyJTIyJTVEJTJDJTIydGVybXMlMjIlM0ElNUIlNUQlMkMlMjJpbml0aWF0aXZlcyUyMiUzQSU1QiU1RCUyQyUyMmxvY2F0aW9ucyUyMiUzQSU1QiU3QiUyMmNvbnRpbmVudCUyMiUzQSUyMkFGJTIyJTJDJTIyY291bnRyeSUyMiUzQW51bGwlMkMlMjJzdGF0ZSUyMiUzQW51bGwlN0QlNUQlN0Q=" target="_blank" rel="noreferrer noopener">here</a>.



“For 20 years, the foundation has sought and seeded innovation to solve the world’s hardest problems. We believe that accelerating progress in health and development requires collaboration among innovators from as many disciplines and as many countries as possible,” said Kedest Tesfagiorgis, deputy director of Global Partnerships &amp; Grand Challenges at the Gates Foundation. “Maximizing the potential of AI requires a global community of creative thinkers bringing their unique perspectives and learning from each other.”



As these projects get underway, the foundation is eager to continue working with and learning from partners around the world to ensure the benefits of AI are relevant, affordable, and accessible to everyone, with an emphasis on LMIC communities, in a manner that upholds safety, ethics, and equity.

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