maxresdefaultThe African Development Bank should increase private sector lending to curb widening inequality on the continent, according to Dr. Akinwumi Adesina, Nigeria’s candidate to be the next president of the lender.

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Adesina, Nigeria’s minister of agriculture, is vying with seven other candidates to replace Donald Kaberuka of Rwanda, who is due to step down in May after a decade leading the Ivory Coast-based organization.

While economic growth has averaged about 6 percent across Africa in the past decade, the expansion failed to create jobs for swelling ranks of unemployed youth, something that is adding to political instability in the region, Adesina said in an April 14 interview in New York. He wants to attract sovereign wealth funds, issue diaspora bonds, and take first-loss positions on debt deals to increase private investment in energy and transportation.

“I see a bank that needs to do more in the private sector,” Adesina said. He would focus on “new financial instruments that can tap into these pools of money, give us lower interest rates and long-term capital that Africa can use towards development.”

Adesina would focus the bank’s own lending on projects that have trouble attracting private investors, such as water and sanitation in the poorest countries. The African Development Bank’s private sector lending was about $2.1 billion in 2013, up from $250 million in 2005, he said.

If elected, increasing access to energy through infrastructure expansion would be his top priority, followed by growing private sector jobs and industrialization, youth employment, reviving rural economies, and regional integration, he said.

 

 

Source: Bloomberg