President Dr. Akinwumi Adesina of the African Development Bank Group emphasizes Africa’s potential and the importance of energy access, infrastructure, and industrialization. He discusses the bank’s pivotal role in initiatives like the New Deal on Energy for Africa, where the bank is actively involved in financing and implementing projects, and the commitment to connect 300 million Africans to electricity by 2030. 

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The 2024 annual meeting takes on a different dimension because it is the 59th annual meeting of the bank and the 68th celebration of the establishment of the African Development Bank. It is a time to reflect and to look at the journeys we have come through, what we have done and achieved as a bank group over the last 60 years. We can take pride in our achievements and be reassured of our capabilities as we face the challenges ahead.

Therefore, we must consider the role of the African Development Bank as we look to the future. We must look back, see what we have achieved, consider the many challenges, and ensure we are well-positioned to deal with the future.

Africa’s transformation 

We are critical for that to happen as we strive to mask the fact that global issues are coming up. We have to review our business model, look at what we can do, and consider how to do it with others to achieve it.

I believe strongly in Africa’s potential. We have the potential to be great as a continent. Take a look at Africa’s population in terms of its potential. It is the size of China and Europe taken together. That is what Africa’s population is going to be.

Another demographic advantage we have is the demographic advantage of our youth. We have 477 million young people below   35, which means Africa will be the world’s workforce. This youth population, with its skills, capacity, entrepreneurship, and innovation, gives us hope and optimism for the future.

Energy Transitions

Globally, we have been talking about global energy transitions. We should talk about it because everybody is worried about continued CO2 emissions and the need for us to contain them. As we move to renewable energy, we must also acknowledge the challenges Africa faces in this transition, such as the need for significant investment, technological advancements, and international cooperation. This is my view; 

Firstly, Africa will drive the global agenda on renewable energy. With our plentiful sunshine and high solar potential, we are well-positioned to lead the way in the transition to renewable energy. This should give us confidence and a sense of security about our energy future.

For example, In the Sahel region, we have a project called Desert to Power, which will enable 250 million people to access electricity from 10,000 megawatts of solar power.

As you know, there is much interest in green hydrogen and ammonia, which will drive the world. Whether it is fertilizers or jet fuels, they will all require the use of renewable energy, which is solar energy. That is Africa’s position in influencing and shaping the world’s future in energy transition, and the continent will be very significant.

Today, about 85 percent of all our energy financing goes to renewable energy.

Natural gas remains a fundamental part of Africa’s energy mix. We will not be able to industrialize without it. Therefore, natural gas is also included in the nationally determined contribution that African nationals signed in Paris. I was present with President Samia Suluhu Hassan of Tanzania, Dr Fatih Birol of the International Energy Agency, and Prime Minister Jonas Gahr Støre of Norway. We co-chaired the summit on clean cooking in Africa.

We can’t change the goalposts and suddenly say Africa can’t use natural gas. Why is it that Europe is using natural gas, and others are using natural gas? Why has it suddenly become bad for Africa to use natural gas? Africa needs natural gas for three things: gas to power, natural gas to fertilizer for self-sufficiency, and clean cooking solutions.

Today, we have 300,000 African women who die while they are trying to cook a meal. Three hundred thousand children backs also die because of indoor pollution. I didn’t start using glasses because I suddenly got bright from the university. As a child, I was blowing charcoal, and I know the damage it did to my eyes. We are in the 21st century; why should people cook like that? We, the African Development Bank, decided to allocate US$2 billion to support clean cooking in Africa. That means we will invest in LPGs because they are the fastest and cleanest way to access clean cooking energy. African women should not have to die while cooking a meal.

Secondly is what happens with green metals. Today, Africa has 90 per cent of all the platinum in the world. It has well over 60–70 per cent of all the copper worldwide. Fifty per cent of all other metals, such as nickel and lithium, are abundant in Africa, shaping the future of electric vehicles worldwide, and how Africa harnesses that will be critical for positioning itself globally in those value chains. So, within the global context, Africa has potential, opportunities, and positioning issues in electric vehicles and battery energy storage systems.

When we talk about transformation, we speak in the context of what Africa has. Transformation has to happen in Africa, and it will happen depending on how Africa harnesses it. When the private sector wants to invest in Africa, governments constantly give them massive tax exemptions. This is not acceptable. Countries have to rationalize their need to raise more resources for what they have. If your economy is good and you have good micro-economic stability, you need some incentives, but they should be manageable.

Companies that work in Africa and benefit from Africa must pay taxes in Africa. Africa can’t be a free bin from which people take things.

Mineral Value Addition

Today, the world is geared towards manufacturing solar panels or battery energy storage systems. Countries such as DR Congo have about 75 percent of platinum and are rich in many other minerals.

We commissioned an analysis by Bloomberg; they found that the cost of making lithium-ion precursor batteries in Africa is three times less than in China, Poland, or the United States. What needs to be done is to make sure that Africa develops those value chains and that it develops joint ventures with those that have the skills, capacity, resources, and experience to locate manufacturing plants close to the source where the minerals are.

We have much illegal mining that goes on; young children are being exploited to mine many of these resources, and the state doesn’t collect any money from them. This would solve a lot of that, create a lot of jobs, ensure that investment comes to Africa in a very organized way, and also reduce issues of tensions and conflicts that we have as people riot over natural resources.

That is why the African Development Bank is working with other partners, such as the African Finance Corporation and others, to ensure we can benefit all of Africa’s minerals, gas, and metals.

Exporting raw materials is the door to poverty, but processing and adding value to what you have is a highway to wealth. Africa is tired, and it needs to get smarter and add value to what it has.

Why Energy is Important to Africa’s Transformation 

You cannot industrialize in the dark, we cannot be competitive, and you cannot grow economies without power. Electricity is the body’s lifeblood; your economy dies if you don’t have it.

Since I was elected President of the African Development Bank in 2015, we have taken it very seriously because I knew we were wasting time without electricity. We launched the new deal on energy for Africa. Since we launched that in 2016, the average access to electricity on the continent, which was 32 percent, has moved to 57 percent within a very short period. At the spring meetings of the World Bank, Ajay Banga, the President of the World Bank Group, and I got together. We announced that we would connect 300 million Africans to electricity by 2030.

When you see us walking that way, it signifies that the times have changed. No single institution, regardless of how much money you have, will be able to solve our challenges. We can only solve them by working together.

My principle is the baobab approach. You can’t solely put your hands around it, but if you join with other people, you can put your hands around that tree. That is what we do: work together with others to accelerate actions and allow Africa to fast-track its economic transformation.

Africa’s Continental Free Trade Area

We need to turn AfCFTA’s potential into reality. To do that, we require industrial policies allowing industrial manufacturing. This will allow us to specialize in value chains on which we have a comparative advantage for national, regional, and global markets. It would be a bad mistake if we didn’t because simply trading is insufficient.

Industrial manufacturing must be at the core of Africa’s economic transformation. This outward-looking process allows Africa to expand its exports around the world.

So, when I think about infrastructure as a bank, it is not just about connecting a village to another. We are talking about the African corridors because these infrastructure platforms will allow Africa to stand firm and become competitive. We are talking about projects like;

Lobito Corridor is a corridor linking Angola to Zambia and DR Congo. The African Development Bank is investing 500 million dollars in the Zambian side to construct the corridor, working closely with the US government and the Africa Finance Corporation.

Lagos-Abidjan highway: This is 15.6 billion dollars. We have mobilized all that interest for recommitment to make it possible.

Central corridor for railway: linking Tanzania to Burundi and DRC about 3.5 billion dollars that we are trying to raise to make it happen for them.

We need infrastructure, and we all need connectivity, which is the only way we can move. You cannot trade or be competitive if people cannot move. There must be a soft side to the economic transformation we are discussing. There must be ease of movement.

This is my pride

Sixty years ago, the founders of this bank set it up to help Africa move forward. And we have moved Africa forward in many ways. Today, we are an excellent global financial institution—not just an African institution—thus bringing innovation to the marketplace through reforms of global financial architecture.

The bank launched 50 million dollars of hybrid capital, the first hybrid capital issued by any multilateral development bank. The bank is innovative in using its balance sheets to leverage capital.