The African Development Bank (AfDB) President, Dr Akinwumi Adesina, says the highway to wealth on the continent is from the export of value-added agricultural products.
Akinwumi said this during the inauguration of the Alliance for Special Agro-Industrial Processing Zones (SAPZs), at the ongoing 2023 Africa Investment Forum (AIF) Marketplace in Marrakesh, Morocco on Wednesday.
The theme of the Forum is: “Unlocking Africa’s Value Chains”.
According to him, Africa must help feed the world by becoming a global player in food and agriculture.
“To do so, Africa must end the export of raw agricultural commodities. We must recognise that the fastest way to poverty is via the export of raw commodities, while the highway to wealth is from export of value-added products.
“And that is why SAPZs are important. They provide critical infrastructure to support agro-industrial development in Africa.
“The aim is to unleash the power of its agricultural potential, with the establishment of food processing and manufacturing companies within the zones.
“The zones will support the transformation of the agricultural sector, raise productivity, scale economies and efficiencies of food and agricultural value chains.”
According to Adesina, SAPZs offer the infrastructure enabled platforms for Africa to turn its massive agricultural lands into real sources of wealth.
He said that the bank provided the financing of $853 million and mobilised over $661 million from other development partners to support the establishment of SAPZs.
“Our valued partners include the Islamic Development Bank, the International Fund for Agricultural Development, the Arab Bank for Economic Development, the European Union, and the Korean Export-Import Bank.
“We are also working with the African Union to support the Common Africa Agro-Parks Program.
“Our collective effort has mobilised $1.5 billion in support of the establishment of 25 SAPZs in 11 African countries,” he said.
The zones will support the transformation of the agricultural sector, raise productivity, scale economies and efficiencies of food and agricultural value chains.
The AfDB President said to expand SAPZs across African countries and take advantage of the Africa Continental Free Trade Area (AfCFTA), Africa must scale up resources, partnerships, and alliances.
He expressed excitement that the number of partners joining hands to rapidly scale up the SAPZs across Africa was expanding.
“The Alliance has the goal of mobilising at least two billion dollars in financing and investment commitments from Alliance members and partners over the next five years.
“Meeting this financing goal will deliver an additional 15 to 20 SAPZs projects in various countries across the continent.
“The Alliance will raise funds through various investment windows for project preparation, project development and construction, and financing for tenant companies,” he said.
Adesina said by doing so, the Alliance would bridge the critical financing gap, complement existing initiatives, and mobilise resources towards the common goal of enhancing agricultural value addition in Africa.
He said the Alliance would also provide project preparation finance, equity and debt investments, technical assistance, and project tracking and oversight.
Also speaking, Dr Benedict Oramah, the President, African Export-Import Bank( Afreximbank) said that political instability in Africa was a challenge to financing major projects.
Oramah, however, called for a comprehensive idea and proposal for project financing on the continent.
He said that budget financing was a major threat to enabling financing and project implementation, adding that allocation of resources was crucial.
“There should be continental regulations that countries should respect and justify for anything that is good for business.
“It is important to sign constitutional agreements and concessions. It is also important to support products with high profitability,” he added.
The News Agency of Nigeria (NAN) reports that an additional commitment of about $3 billion was pledged by the partners during the inauguration of the SAPZs. (NAN)