ECONOMIC DEVELOPMENT

Africa’s Unique Opportunity to

Promote Inclusive Growth
by Jonathan Berman
JULY 09, 2015

Six years after the global recession began, many parts of the world are still struggling to achieve
growth. For the last decade, Africa’s GDP has been growing quickly. According to the IMF, it’s likely
to remain that way for the foreseeable future:
The question Africans ask of their leaders now is: Will we grow fairly?

Income inequality is challenging the credibility of institutions and leaders everywhere in the world
and Africa is no exception. But with robust growth rates and economies unburdened by legacy
structures of the last century, Africans can innovate beyond what others are doing.

The African Development Bank (AfDB) is the most visible organization tasked with shepherding that
inclusive innovative growth. Based in Abidjan, the economic capital of the Ivory Coast, 60% of the
bank’s shares are held by the 54 countries in Africa, and a minority stake is held by 27 partner
countries, including the U.S., China, and most countries of Western Europe. The AfDB has the
strongest credit rating of any organization in Africa and in 2008, it surpassed the World Bank in
lending to Africa, a signal of Africa’s growing agency in its own development.
In the coming years, expect the AfDB to pioneer approaches to inclusive growth. In May, AfDB
shareholders elected former Nigerian agriculture and rural development minister Akinwumi
Adesina as AfDB President. Inheriting a strong institution astride a growing continent, few tasks
rank higher for Adesina than achieving more equal, inclusive growth. “As I travel across Africa, I
notice two things about how we’re growing,” Adesina told me recently. “I see the sparkle in the eyes
of a few. I get a sense of disenchantment and exclusion from many, many more.”

Adesina competed for the AfDB presidency against several accomplished bankers and finance
ministers. He prevailed, in part, because his background is well suited to the task at hand. Adesina
grew up in modest surroundings (“in a building with fifty people using one toilet”). He earned his
way to a scholarship in Nigeria and a doctorate in agriculture economics at Purdue University. Later,
as a project officer at the Rockefeller Foundation, he channeled resources to risk mitigation schemes
that allowed banks to better serve small farmers. Then as Nigeria’s agriculture minister, he
implemented a new e-voucher program to directly connect farmers with fertilizer producers and
distributors – making the process more efficient by removing government as the middleman. He also
partnered with Nigeria’s central bank to create a $350 million risk-sharing fund to encourage more
banks to lend to farmers. Agriculture as a share of total lending in Nigeria has since grown from
nearly zero to 7% in three years. Adesina’s success in applying market mechanisms to create
widespread opportunity lead Forbes to name him African of the Year in 2013.

As Adesina takes the helm of AfDB, he has a unique opportunity to lead inclusive growth in Africa,
and influence a world looking for markets that better serve people. Three actions will amplify his
impact:

Modeling a new collaboration with the corporate sector.  The relationship between government and
business is under suspicion everywhere. Each country I’ve been to in Africa has some cronyism.
However, the trans-African economy that extends across national boundaries is new and lacks
calcified relationships. It displays a healthier, more transparent dialogue that can advance public
policy and catalyze investment. That’s a nascent trend in need of a champion. In setting AfDB
strategy, Adesina has the opportunity to engage the finest business minds around the world in the
task of building a more inclusive growth model from the ground up.  
Innovating away from past exclusion. From infrastructure to consumer purchasing, the current
global financial architecture has mostly been built by the Western economic powers of the last
century, using Western technologies. Africa has begun to develop its own systems, and small
startups play a significant role. The Kenyan venture Cellulant produces many of the solutions that
power that country’s mobile revolution, not to mention the mobile fertilizer e-voucher Adesina
deployed as minister. Senegalese start up Volo recently beat the world’s largest credit bureaus in a
competition to establish the first consumer credit bureau across West Africa, using biometric
solutions and credit algorithms to redefine who gets credit. Adesina can challenge such disruptors to
multiply the impact of the AfDB, and model financial architecture that is more accessible and
transparent.

Using the bully pulpit. For all the global rhetoric around inequality, the absence of credible global
voices on the topic is notable. The World Bank, beset by internal struggles in the short term, is facing
challenges to its influence over the long term.  The IMF’s mandate is more financial stability than
fairness, which often puts it at odds with those at the base of society. The U.N. suffers from neither
of these, but also has scant financial resources to actually participate in growth.

In another era, the leader of the AfDB might not have an opportunity to shape global issues of the
day. But today, when new models of capitalism are sought and legacy structures are widely
questioned, the leader astride a growing, resilient Africa can be the central figure of great change.

The world is not used to looking at Africa as a pioneer, and it is only beginning to grasp the region’s
importance as a locus of global growth. Inside Africa, leading change agents often decry African
inequality, instead of seeing it as part of a global phenomenon that Africa is singularly suited to
address. Overcoming those dynamics is a challenge fit for a great institution that’s properly led.

Jonathan Berman is CEO of J.E. Berman Associates, an investment and advisory rm, and the author of Success
in Africa: CEO Insights from a Continent on the Rise. You can learn more about him at www.JonathanBerman.net and follow
him on Twitter @Jonathan_Berman.
This article is about ECONOMIC DEVELOPMENT
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Related Topics: EMERGING MARKETS | AFRICA

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