Between August 1 and 3, the Finance Ministers and central bank governors from the African continent converged in Abuja for an all-important meeting under the aegis of the “African Caucus.” The three-day meeting with the theme, “Facilitating Intra-African Trade: Catalyst for Sustainable Development in Africa,” was declared open by President Bola Tinubu, who the Vice-President, Sen. Kashim Shettima, represented.
By Kadiri Abdulrahman
The African Caucus was established in 1963, with the objective of strengthening the voice of African Governors in the Bretton Woods Institutions (BWIs), as represented by the International Monetary Fund (IMF) and the World Bank Group (WBG), on development issues of particular interest to Africa.
Membership of the Caucus is open to all African countries who are members of the IMF and WBG. Currently, all 54 countries on the African continent are members.
The countries are represented by their finance and economic development ministers and their central bank governors, who are referred to as the African Governors.
Views and concerns of African Governors are conveyed to the heads of the BWIs through a Memorandum at the Annual Meetings of the BWIs.
At the Abuja meeting, President Bola Tinubu called for global cooperation among African countries to tackle their shared economic challenges and take advantage of opportunities.
Tinubu acknowledged that Africa was grappling with numerous challenges across economic, humanitarian, and social spheres.
He, however, advised that countries on the continent must take necessary measures to translate opportunities in natural resources and human capital into growth, innovation, and collaboration.
He said that the African Caucus Meeting was an opportunity to brainstorm on the major challenges and strategies for fostering inclusive growth and sustainable development in Africa.
The Nigerian president urged African countries to improve the quality of life for people across the continent by ensuring that democracy, good governance, and economic institutions work together.
He described the caucus meeting as a vital platform to share experiences, forge partnerships, and chart a collective path forward.
Nigeria’s Minister of Finance and Coordinating Minister of the Economy, Wale Edun, said that the meeting underscored the point that trade could stimulate economic growth by creating opportunities for increased production, investment, and job creation.
According to Edun, who doubled as Chairperson of the caucus, trade can also provide access to larger markets, new technologies, and capital.
“The African Continental Free Trade Area (AfCFTA) aims to promote trade among African countries by reducing trade barriers, harmonizing regulations, and facilitating the movement of goods and services within the continent,” he said.
He said that based on available data, 41 African countries were set for stronger growth of up to 3.8 per cent from about 3.4 per cent in 2022 and rising to 4.3 per cent in 2025.
“These exceed the global average of about 3.2 per cent,” he said.
The Governor of the Central Bank of Nigeria (CBN), Yemi Cardoso, urged African countries to leverage the support of global partners for sustainable economic growth.
According to Cardoso, the theme of the 2024 meeting, “Facilitating Intra-African Trade: Catalyst for Sustainable Development in Africa,” was indeed timely and fitting.
He said that Africa stood at a crossroads, with unprecedented opportunities for development alongside significant challenges.
“To navigate this complex landscape and set the continent on a path of sustainable economic growth, we must leverage the support of our global partners.
“This is where the IMF/WBG play a critical role. Their expertise and resources can provide the essential impetus needed to unlock the continent’s vast potential,” he said.
He said that the continent now stood on the threshold of a new era in economic cooperation through the AfCFTA.
“AfCFTA is the largest such agreement in the world by both area and number of countries.
“According to data from the World Trade Organization, intra-African trade accounts for an estimated 13 per cent of the continent’s total trade, compared to 60 per cent in Europe and 40 per cent in North America.
“This indicates that significant efforts are needed to build a robust, economically diversified, and prosperous Africa.
“As monetary authorities, we have the responsibility to formulate policies that enhance trade among countries on the continent.
“We can achieve this by fostering a financial landscape that encourages collaborative research and development to support our industries and generate economic wealth for our growing populations,” Cardoso said.
According to him, decisions on currency convertibility, cross-border transactions, payment systems, cross-border movements of our peoples, goods, and services, as well as financial policy, will be instrumental to determining the success of AfCFTA.
He urged African countries to share experiences, and take useful lessons from the experiences of countries in their peer groups to address individual national challenges.
“Nigeria, like many other African countries, faces economic challenges. Nonetheless, we are committed to the vision of a united and economically integrated Africa.
“By sharing our experiences, including both successes and setbacks, we aim to contribute to paving the path toward sustainable and inclusive economic growth that benefits all citizens across the continent.
“Let us leverage our diverse experiences and expertise to tackle the obstacles hindering intra-African trade,” he said.
The Governor of the Central Bank of South Sudan, James Garang, said that equitable financing will accelerate economic growth of countries in the continent of Africa.
According to Garang, equitable financing is one of the issues that would be tackled in the memorandum and also in the declaration of the meeting.
He said that there was the need to reform the global financial architecture to reduce the cost of borrowing, enhance access to finance, and also harmonize policies to ensure that the voices of Africa are heard.
“We have to ensure that Africa sits at the table where decisions around global financial architecture are made.
“There are also issues concerning access to energy, an area where the Africa Development Bank (AfDB) and the World Bank are taking lead roles to support the continent,” he said.
Garang said that discussions were mainly centered on improving trade among African countries.
He said that the Africa central bank governors were also concerned about the level of youth unemployment in the continent.
“The discussions are centered around the challenges with intra-Africa trade, and around huge opportunities within the continent that we need to tap into.
“There is to be a session in the memorandum that focuses on improving youth employment and opportunities across the board.
“The various discussions in this meeting have agreed that Africa is on a good path, but there are things to be done to realize our full potential,” he said.
He said that the meeting also presented an opportunity for South Sudan to showcase areas in which foreign companies and financial institutions can invest.
As the IMF/WBG prepare for their Annual Meetings in October, Africans are waiting for their responses to the resolutions reached by the African Governors at their caucus meeting in Abuja.
The caucus has called on the IMF and World Bank Group to ensure that their support to member countries continues to be guided by principles of balance and evenhandedness, and consistent with their own policies.
It said that these considerations are all the more important at a time when countries are being assailed by adverse exogenous shocks and facing immense financing needs.
Africans also wait to see the seriousness of the African Governors in implementing some of their key resolutions.
The resolutions include strengthening the pan-African payment ecosystem, enhancing energy access, affordability, and connectivity; leveraging partnerships with Multilateral Development Banks (MDBs), and reforming the global financial architecture.
NANFeatures
