Africa needs to build strong and resilient financial institutions if it wants to accelerate her development and growth, President Nana Addo Dankwa Akufo-Addo, has said.
He said Africa could not continue rely on financial institutions in the developed economies to raise financial resources to build her economy.
President Akufo-Addo said this at the opening of the Annual Meetings of the 30th Anniversary of the African-import-Export-Bank (Afreximbank) in Accra, yesterday.
The event is being attended by African Heads of State and captains of industries and participants from across the world on the theme: ‘Delivering the Vision: Building Prosperity for Africans.’
President Akufo-Addo explained that Africa in the past had created promising financial institutions but were left to collapse before they could grow into strong financial institution.
“The reality is that unless we have strong financial institutions, we are not going to develop. We have learnt over the past decade that relying on foreign capital is costly and risky,” President Akufo-Addo stated.
He stressed that “relying on foreign capital had resulted in huge financial leakages and high cost of default driving interest rates and undermined the growth of our financial institutions and affected domestic resource mobilisation and private sector growth.”
He said the meeting should consider what could be done to strengthen Afreximbank to better serve Africa.
“The ownership of our financial institutions should be strengthened overtime to enhance their importance and relevance,” he stated.
President Akufo-Addo urged African countries to increase their investment in Afreximbank and promptly honour their financial obligations to the Bank to enable it to raise financial resources to deliver on their mandate.
He said Afreximbank $6 billion capital was not enough to meet the needs of Africa.
“Whatever affects Afreximbank will affect the development of the continent,” he stated.
He called on African governments to help combat illicit financial flows to help retain capital in Africa to facilitate the development of the continent.
President Akufo-Addo called on the African Union to adopt Afreximbank as a specialised development agency of the Union.
Prof. Benedict O. Oramah, President and Chairman of the Board of Directors, Afreximbank said Afreximbank had brought a new kind of hope to Africa including the capacity to confront global challenges without going abegging.
He said the COVID-19 pandemic and Ukraine crisis exposed the vulnerability of Africa in many ways.
“These events dramatised our over-dependence on others for our basic needs of food and healthcare. It also exposed our inadequacies in financing these dependencies in times of emergency. It is to the credit of those who founded Afreximbank that the catastrophe that loomed was averted,” he said.
“From the break of the pandemic in 2020 to the Ukraine crisis in 2022, the Bank has disbursed over 45 billion US dollars into the continent, which enabled many governments, central and commercial banks, corporates, and Small and Medium Enterprises to weather the combined effects of these crises by helping countries to honour maturing trade debt payment obligations; to pay for critical imports and to pursue strategic investments,” he said.
The support of Afreximbank he said was, by far, one of the most significant investments by a single entity in the last three years.
“In an era where international banks are exiting the continent, from where would Africa have gotten 45 billion US dollars to fight a global crisis if not from within?” he asked.
“We are fully aware that the dream of continental integration and self-reliance can only be built on a robust and dynamic domestic economy that produces what it consumes. If we don’t produce the goods that can be traded within the continent, others would do so and export the jobs, wealth, and the continent’s prosperity,” he said.
Prof. Oramah said it is in that context that the Bank was proactively mobilising continental and global resources and partnerships to build industrial complexes across Africa.
BY DAVID ADADEVOH & KINGSLEY ASARE
