Benin, Guinea and Niger are expected to gain long term benefits from the development support offered by AfDB.
Benin, Guinea and Niger will benefit significantly from the development support provided by the African Development Bank Group (AfDB) following the Board’s approval to open offices in the three countries in order to strengthen its operational presence, visibility and address their needs effectively.
In line with the Bank’s decentralization action plan and the new Development and Business Delivery Model, the decision to open the offices places emphasis on the mitigating factors of fragility and transition, portfolio issues, development aid coordination, dialogue, the countries’ specificities and the reduction of costs. The Bank expects long-term benefits to flow principally from improvement of the Bank’s portfolio quality in these countries, its development impact, and the opening of new possibilities especially in the private sector.
The outstanding performance recorded in both Burkina Faso and Angola where offices were opened in in 2006 and 2011, respectively, does provide plausible models that can be replicated in Benin, Guinea and Niger.
Furthermore, the Bank’s physical presence in states in situations of fragility is seen to be key to addressing their enormous development challenges, especially in governance and inadequate institutional capacity. On-the-ground presence will also strengthen policy dialogue and coordination of Bank activities with other development partners, building strategic alliances, and contributing to promoting participatory approaches with other stakeholders; clearly essential activities that cannot be effectively undertaken from a distance.
For instance, in Benin where the Bank only maintains a country economist, the opening of the field office is expected to grow the portfolio from US $355 million to US $747 million; the disbursement ratio would jump from 39% to 60% and the ratio of flagged projects (not necessarily projects at risk) will drop from 60% to 20% by 2019. The office would also act as a boon to the private growth and development.
AfDB’s effective presence in Guinea with a country economist dates back to 2013. However, with its natural resources potential, the Bank estimates that opening a country office would by 2019 push up the portfolio from US $275 million to over US $1 billion. In the same vein, the proportion of projects at risk would drop from 78% to 20% while the disbursement rate will increase from 27% to 55%.
And in Niger, with no Bank presence, security risks, climate fragility and severe portfolio underperformance are considered to pose significant challenges. However, the growing size of the public sector portfolio as well as several private sector projects recently identified in the transport and energy infrastructure sector estimated at more than US $302 million would raise the country’s project portfolio to US $621 million. Thus, a country office endowed with adequate expertise, would result in a decline of projects at risk from 83% to 20%, while the disbursement rate would improve from 31.24% to 65%. There would also be improved opportunities to grow the private sector.
In a brief comment on the need to open the offices, AfDB President Akinwumi Adesina asserted that the Bank should not be absent in African countries. “Our Presidents are asking for these offices because they see us as partners of choice. Experience has demonstrated that shuttling in and out of these countries does not yield viable solutions,” he said.
The Bank has made a provision of US $7.3 million in its 2017 budget to cover the cost of opening and functioning of the three Country Offices.
The Bank currently has field or liaison offices in 35 African countries, two Regional Resource Centers in Nairobi and Pretoria, and a representation Office for Asia in Tokyo.