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World Bank Group

07/15/2021 | Press release | Distributed by Public on 07/15/2021 11:39

ABIDJAN’S DECLARATION

Following the Meeting of Heads of State and Government of Angola, Benin, Burkina Faso, Cameroon, Côte d'Ivoire, Democratic Republic of Congo, Ethiopia, Ghana, Guinea, Guinea Bissau, Kenya, Liberia, Madagascar, Mauritania, Mozambique, Niger, Nigeria, Uganda, Rwanda, Senegal, Sudan, Tanzania and Togo

to Support

A Twentieth (20th) Ambitious Replenishment of the Resources of the International Development Association (IDA20)

Preamble

1. We, Heads of State and Government of Angola, Benin, Burkina Faso, Cameroon, Côte d'Ivoire, Democratic Republic of Congo, Ethiopia, Ghana, Guinea, Guinea Bissau, Kenya, Liberia, Madagascar, Mauritania, Mozambique, Niger, Nigeria, Uganda, Rwanda, Senegal, Sudan, Tanzania and Togo, met in Abidjan, Republic of Côte d'Ivoire, on 15th July 2021.

2. We thank His Excellency Mr. Alassane Ouattara, President of the Republic of Côte d'Ivoire, for the initiative of this important meeting and for welcoming us in African hospitality, to discuss the common development challenges of our countries, to agree on common objectives and goals to guide the economic recovery of our countries, and to discuss the essential role of external financing, particularly through an ambitious replenishment of the resources of the International Development Association (IDA), in a context marked by the COVID-19 pandemic.

3. We express our sincere thanks to all our partners and donor countries for the actions already implemented and their interest in the 20th replenishment of IDA, a key instrument for Sub-Saharan African countries (SSA) to finance an inclusive and sustainable African economy for the well-being of its populations.

4. We welcome the World Bank Group's engagement model of promoting a collaborative spirit manifested by listening, understanding, and sharing challenges to better support governments in the implementation of their national strategies, through financing instruments adapted to their needs, as demonstrated by this Abidjan initiative.

5. This document, 'Abidjan's Declaration', represents the outcome of our discussions and should constitute the framework for prioritizing World Bank Group interventions in the coming years.

Recent economic and social developments and challenges related to COVID-19 recovery.

6. Sub-Saharan Africa (SSA) experienced its most significant economic underperformance in decades in 2020, due to the global crisis caused by the COVID-19 pandemic. The region's economic growth rate was -1.9% in 2020 according to the International Monetary Fund's latest regional economic outlook report, versus 3.6% initially planned. The pandemic has severely affected social indicators and hindered progress towards the achievement of the 2030 Sustainable Development Goals (SDGs) achievement as well as those of the African Union's Agenda 2063. Employment declined́ by about 8.5% in 2020, and over 32 million people fell into extreme povertý. Similarly, progress in building human capital, particularly in reducing spatial and gender inequalities, has been slowed due to closure of schools, which is estimated to have affected nearly 253 million students, potentially resulting in learning and training losses. The crisis has further exposed certain vulnerabilities in Africa, particularly in terms of food security, access to drugs and vaccines, especially against COVID-19, and industrialization.

7. In addition to the COVID-19 pandemic and its economic, health and humanitarian impacts, there is the security crisis experienced by many SSA countries, its risk of expansion and the need for states to devote significant resources to it, instead of other development spending. These problems have the potential to lead to increased conflict and violence, increased fragility, and instability in the region. Aware that poverty and precariousness are among the main causes of terrorism and migration in the world, we must face these challenges.

8. Budgetary and cash flow constraints have increased for the countries of the region, leading to an increase in our debt, particularly non-concessional debt. While the capacity to mobilize tax revenues has been challenged by the closure of many companies or the drastic decline in economic activity, foreign direct investment has dwindled and immediate expenditures to cope with the crisis have become more significant.

9. Several countries around the world have launched large-scale stimulus packages, using the monetary and fiscal instruments at their disposal to combat the adverse effects of COVID-19. However, most African countries do not have similar instruments.

10. Given the additional financing needs in Sub-Saharan Africa, estimated at $285 billion over the next five years, to fight the pandemic, climate change, and accelerate economic recovery, African countries must adopt a sustainable strategy for financing their development including, in addition to their own domestic resource mobilization efforts, the mobilization of concessional and non-concessional financing, and the private sector.

11. This particularly difficult context calls for greater solidarity of all our partners and an appropriate and flexible response that includes solutions to short-term social, economic and security issues and adequate support for policies to restore economic growth and reduce poverty and inequality.

Priorities for Building Back Better in Africa

12. It is therefore time to ACT and IDA resources must enable us to revive our economies as well as the development process to help our people recover from the impact of COVID-19, collectively rethink our development approaches, and focus on the most critical obstacles preventing a greener, more resilient and more inclusive recovery. Knowing that most of the people who will fall back into extreme poverty are those who have low levels of education, vulnerable jobs, or are already in precarious situations affected by droughts and other climatic calamities, we are targeting our actions on three (3) major themes, namely (i) human capital improvement; (ii) job creation through private sector development policies; and (iii) economic recovery.

13. Investing in and protecting human capital will be critical to rebuilding a high-productivity, inclusive, and more resilient economy. This implies the improvement of health and education systems as well as the socio-professional integration of young people through the quality of professional and vocational training. Our duty is to protect our people from future shocks through robust and adaptable safety nets and resilient service delivery systems. In addition to improving access to vaccines against COVID-19, we hope that IDA-20 will offer the possibility of consolidating gains in human capital, to achieve a true human transformation of our populations. In these areas, the introduction of digital technology will be a catalyst and a transversal means of optimizing financial and human resources. In particular, it will contribute to the development of telemedicine in remote areas and distance learning, thus reducing spatial inequalities. This requires increased investment in accessible, integrated, and resilient systems, with a focus on universal health coverage, labour market adjustment, as well as second-chance schools and young girls' education. In this respect, the development of vocational training and its alignment with needs, in a regional approach that covers the entire territory, will be key assets. This will make it possible to reduce the proportion of young women and men with no prospect of a sustainable professional integration.

14. We want to promote job creation through the development of the private sector, a key player in the transformation of our strategic economic sectors. The challenge of private sector development requires the continuation and amplification of efforts to improve the business climate, and major investments to increase energy supply, including access and cost reduction for populations and businesses. It also requires accelerating the dynamism of the digital economy and reforms and programmes that can stimulate the establishment of factors of production and private sector green, resilient and inclusive investments. We are thinking specifically of the development of Agro-industry, the strengthening of the manufacturing sector, manufacturing of pharmaceuticals, vaccine production in Africa through industrial partnerships, technology transfer, and sharing of intellectual property. We aim to integrate our industries into international value chains and strengthen intra-African trade, in order to capture a greater share of the added value that is essential for improving people's living standards and well-being. IDA allocations must thus make it possible to increase our access to larger volumes of financial resources, on favourable terms, thanks in particular to the establishment of innovative and competitive financing mechanisms, such as 'blending' and guarantees backed by IDA resources.

15. Economic recovery is a priority. Our region must quickly emerge from the crisis to start the virtuous process of improving economic and social indicators and the well-being of the population. It will involve the structural and spatial transformation of our economies, through the transformation of our raw materials, a better economic diversification, the development of intra-country trade, as well as the strengthening of cooperation between our States, particulary through African Continental Free Trade Area (AfCFTA). African countries need, like all countries in the world, appropriate fiscal space to face the crisis, and revive their economies without, however, jeopardizing debt sustainability and macroeconomic stability. Thus, we support all initiatives aimed at improving the access of African countries to long-term resources at attractive conditions. The restoration of economic growth must be accompanied by the development of a system for strengthening crisis preparedness to protect economies and populations from possible pandemics, humanitarian crises, natural disasters, and food insecurity. Thus, IDA could support the strengthening of national crisis prevention systems, particularly climate and food, and policies to improve agricultural productivity, through better access to seeds, fertilisers, and mechanisation equipment.

16. The specificity of our region requires that, in addition to the three (3) priority areas mentioned above, issues related to security, fragility, and peace, be considered as prerequisites for a sustainable economic recovery. Indeed, we must continue to fight radicalisation and terrorism effectively. In this respect, it is important, in the framework of IDA's support, to develop regional programs targeting in particular young people and women, to put in place a package of infrastructure and viable income generating activities. This systemic approach could be integrated into the dynamics of balanced regional development and harmonised management of border areas exposed to fragility.

17. This is an ambitious but achievable agenda for Africa. A program, which requires significant internal and external resources, and which will allow us to achieve the Sustainable Development Goals in particular '(i) Eradicate extreme poverty in sub-Saharan Africa by 2030; (ii) Achieve universal health coverage at a lower cost; (iii) Accelerate the local production of medicines and vaccines, (iv) achieve, by 2030, universal access to electricity and water, (v) Guarantee, by 2030, access to quality education for all children under 16, and significantly increase the proportion of literate adults, (vi) Increase the number of young people and adults with the skills, particularly technical and vocational, necessary to obtain employment and entrepreneurship, (vii) Promote policies favouring innovation and the development of small and medium-sized enterprises, (viii) Promote the industrialization of our economies, in particular through the local processing of raw materials.'

18. To do this, We:

a. Reiterate our call at the Africa Finance Summit in Paris, 18th May 2021, for increased support to the continent to better rebuild after the crisis ensuing from the COVID-19 pandemic.

b. Call IDA donors to support an ambitious and significant IDA20 replenishment of at least USD 100 billion by the end of 2021, in order to meet the development goals set in this statement.

c. Will work to significantly improve our capacity to absorb resources for the diligent execution of projects and programs.

d. Undertake to continue efforts to mobilize tax revenue, and to use transparently and efficiently the mobilized resources, while strengthening governance.

July 15th, 2021 in Abidjan, Republic of Côte d'Ivoire

List of meeting participants who adopted the declaration

Countries:

Angola, Benin, Burkina Faso, Cameroon, Côte d'Ivoire, Democratic Republic of Congo, Ethiopia, Ghana, Guinea, Guinea Bissau, Kenya, Liberia, Madagascar, Mauritania, Mozambique, Niger, Nigeria, Uganda, Rwanda, Senegal, Sudan, Tanzania and Togo

As well as the President of the African Union Commission, the President of the Economic Community of West African States (ECOWAS) Commission, the President of the Economic and Monetary Community of Central Africa (CEMAC) Commission, the representative of the President of the West African Economic and Monetary Union (UEMOA) Commission and the World Bank Group.