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Key speaker to address investment options at Indaba

MAKHTAR DIOP 
Despite the slowdown of Africa’s biggest economies, the gross domestic product in the region is expected to pick up to an average of 4.4% and 4.8% in 2016 and 2017, respectively

MAKHTAR DIOP Despite the slowdown of Africa’s biggest economies, the gross domestic product in the region is expected to pick up to an average of 4.4% and 4.8% in 2016 and 2017, respectively

Photo by Duane Daws

22nd January 2016

By: Mia Breytenbach

Creamer Media Deputy Editor: Features

  

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International financial institution World Bank Group VP Makhtar Diop will be a key speaker at this year’s Investing in African Mining Indaba as well as be part of the market panel titled ‘Driving Investment in African Infrastructure – what are the investment options?’.

The Mining Indaba will take place from February 8 to 11 at the Cape Town International Convention Centre.

In September, a World Bank Group report noted that a shortage of long-term financing since the 2008 crisis was choking the investment-backed growth of companies in developing countries.

The report, called ‘Global Financial Development Report 2015-2016: Long-term Financing’ further noted that this shortage of long-term financing meant that emerging and developing countries were struggling to mobilise the billions of dollars in financing needed to build and progress necessary infrastructure as well as stimulate regional and national economic growth.

Therefore, extending the maturity structure of finance is considered to be at the core of sustainable financial development.

The report, therefore, suggests that the securing of long-term financing, “depends on the same fundamentals essential to tackling the current volatility in global capital markets . . . policymakers need to focus on institutional reforms, such as promoting macroeconomic stability, establishing a regulated and legally enforceable banking and investment system that protects creditors and borrowers, and setting a framework for capital markets and institutional investors”.

The World Bank Group further states on its website that, “despite the slowdown of Africa’s biggest economies, the gross domestic product in the region is expected to pick up to an average of 4.4% and 4.8% in 2016 and 2017 respectively”.

This increase will be driven by domestic demand, which in turn, will be supported by continuing infrastructure investment and private consumption fuelled by lower oil prices. “External demand is also expected to support growth, because of stronger prospects in high-income economies,” the website notes.

In April last year, the group projected that sub-Saharan Africa’s growth was to slow in 2015 to 4%, from 4.5% in 2014. This forecast, which reflected in the fall of oil prices and other commodities, was noted by the twice-yearly World Bank Group analysis ‘Africa’s Pulse’, which highlights the issues shaping Africa’s economic prospects.

However, Diop said that, “despite strong headwinds and new challenges, sub-Saharan Africa is still experiencing growth. And with challenges come opportunities”.

He added that, “the end of the commodity supercycle has provided a window of opportunity to push ahead with the next wave of structural reforms and make Africa’s growth more effective at reducing poverty”.

In fiscal year 2015, the World Bank delivered $15.7-billion in new lending for more than 160 projects across Africa. This includes $10.2-billion in zero-interest credits and grants from the International Development Association (IDA), the World Bank’s fund for the poorest countries, representing the highest level of IDA delivery by any region in the World Bank’s history.

Bankable Leadership
Under Diop’s leadership, the World Bank Group committed $15.3-billion to subSaharan Africa in the 2014 financial year to assist in tackling development challenges, such as increasing food security and agricultural productivity; improving access to affordable, reliable and sustainable energy; creating economic opportunities for Africa’s youth; and responding quickly and effectively to emergency situations such as the recent Ebola epidemic.

Diop has, since being appointed the World Bank’s VP for Africa in May 2012, visited countries, such as Ghana, Guinea, Rwanda, Sierra Leone and Burkina Faso, to meet with officials on key development issues.

“With world-class development knowledge and innovative financing, we can help support Africa’s momentum and ensure that all Africans, especially the poor, share in the continent’s economic and social transformation,” Diop noted in 2012.

Before taking up this VP position, was World Bank country director for Brazil, based in Brasilia, between January 2009 and April 2012. Previously, he held the positions of director of strategy and operations and sector director for finance, private sector and infrastructure, both in the Latin American and the Caribbean regions. Between 2002 and 2005, Diop was the Bank’s country director for Kenya, Eritrea and Somalia.

Diop previously worked at financial institution the International Monetary Fund, focusing on the Central African Republic. He also served as Minister of Economy and Finance of Senegal. In 2014, media publication Jeune Afrique named him “one of the 50 most influential Africans”. Diop is fluent in four languages: English, French, Portuguese and Wolof, a language of Senegal.

Edited by Tracy Hancock
Creamer Media Contributing Editor

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