The President of the African Development Bank (AfDB), Dr. Akinwunmi Adesina has said food insecurity will be over in the continent five years from now noting that they have the investment and capacity to make it a thing of the past.
Speaking on the sidelines of the UN General Assembly meetings in New York, Adesina highlighted the success of special agro-industrial processing zones, stating that in Nigeria alone, their coverage could expand from eight states to 35 following a recent request.
These zones are rural areas targeted for infrastructure investment, enabling food and agribusiness companies to establish operations.
- Speaking to Reuters, he said “As far as I’m concerned, we shouldn’t be talking about food security in Africa more than five years from now. There’s no reason for it. We have the technology and the financing to do it at scale.”
Africa’s shaken food system in recent times
Programs supported by the African Development Bank (AfDB) in over 30 African countries have helped produce approximately $12 billion worth of food, and the bank’s $25 billion objective is “well on track,” according to AfDB President Akinwumi Adesina, who made the announcement on Friday.
The global grain markets were shaken by Russia’s invasion of Ukraine in February 2022, a major grain exporter, posing a threat to food supplies in some of the most vulnerable nations, including many in Africa.
The emergence of the El Niño weather pattern and the breakdown of an agreement to transport Ukrainian food through the Black Sea have further compounded global concerns about food security.
- Adesina mentioned, “Twenty-seven more states in Nigeria made a request to us to continue supporting them in this particular area.”
The AfDB reports that undernutrition and stunting affect 216 million children in Africa, and poor nutrition is responsible for nearly half of the continent’s child deaths. The economic cost of inadequate nutrition is estimated at 11% of Africa’s gross domestic product.
More funding for the agricultural sector
Adesina anticipates that the International Monetary Fund board will advance plans to channel $100 billion in lending to vulnerable countries through multilateral development banks before governments gather for global climate talks in Dubai in late November.
- “This is the way for us to crack how to get more resources, at scale, For the African Development Bank, a $20 billion allocation channelled into us automatically becomes up to $80 billion for Africa,” Adesina explained, emphasizing the bank’s three-to-four-times leverage capacity.
Regarding a hybrid note, Adesina did not provide specific details but mentioned that investor calls began earlier in the month with a “very optimistic response.”
S&P Global, which rated the notes AA-minus compared to the bank’s AAA rating, expects the issuance to range between $250 million and $1 billion, “subject to market conditions.”
Adesina indicated that pricing for the note will be announced “very, very soon.”
Without specifying an amount, Adesina highlighted the need for recapitalizing the bank after the last round in 2019, with the ultimate goal of becoming a $100 billion lender. The bank’s lending portfolio closed at $27.5 billion in 2022.
- “The ambition is there with our shareholders. Now we’ve got to make sure that we just work this out and see where there’s a comfort zone for everybody.”