The war in Ukraine creates misfortunes, but also an opportunity for Africa, according to the president of the development bank

  • Africa’s pandemic rebound slows even before war
  • Crisis in Ukraine pushes up prices and jeopardizes wheat and maize supplies
  • AfDB launches emergency food production plan
  • Africa ready to welcome investors withdrawing from Russia

JOHANNESBURG, March 25 (Reuters) – The African Development Bank (AfDB) is aiming to raise $1 billion to rapidly boost agricultural production in Africa and avert a possible food crisis caused by Russia’s invasion of Ukraine, its chairman told Reuters on Friday. .

But the war, which has sent commodity prices soaring, is also an opportunity for the continent to position itself as a supplier of natural gas to Europe and a haven for investors fleeing Russia.

During the coronavirus pandemic, Africa has not experienced infection and death rates at the same levels as many more developed regions. Its savings, however, took a beating and its rebound proved slow.

Join now for FREE unlimited access to Reuters.com

Register

Like much of the world, African countries are facing rapidly rising consumer prices, with the war in Ukraine jeopardizing global supplies of wheat and maize and sending fuel prices skyrocketing.

“Already, coming out of COVID, we have 24 million people falling even further into extreme poverty, and that’s going to make it worse,” Akinwumi Adesina said in an interview.

To avert a food crisis, he said the AfDB planned to launch an emergency food production plan that would focus on rapidly increasing the production of wheat, maize, rice and soybeans on the continent.

“The plan is to produce about 30 million metric tons of food and put the technology in the hands of 20 million farmers. So you’re looking at large scale with small farmers,” he said.

The International Monetary Fund (IMF) had already expressed support to help implement the plan, which will produce staple foods worth $12 billion, Adesina said.

The bank plans to raise the $1 billion needed to fund the initiative from various emergency support facilities, concessional financing and the $50 billion resilient sustainability fund offered by the IMF.

African Development Bank President Akinwumi Adesina speaks during an interview with Reuters in Johannesburg, South Africa March 25, 2022. REUTERS/Shafiek Tassiem NO RESALE. NO ARCHIVES

“When COVID hit, we weren’t ready. But this time, we’re totally ready,” he said.

ALTERNATIVE TO RUSSIA

While Adesina denounced the impact of the war on Ukraine and its people, he acknowledged that the conflict and the geopolitical changes it has triggered could work in favor of Africa in some regions.

“The biggest challenge facing Europe is to secure its energy supply,” he said. “Europe must and is looking for alternative gas supplies. Africa can be that place.”

Africa has a host of major oil and gas producers, including Algeria, Nigeria and Angola.

And new offshore gas discoveries – the viability of which had been questioned due to the global shift to renewables – could now become key to Europe’s energy security as it weans itself off Russian supplies.

The French TotalEnergies (TTEF.PA), the American company Exxon Mobil (XOM.N) and the Portuguese Galp (GALP.LS) are currently developing projects to exploit Mozambique’s estimated 100 trillion cubic feet of gas reserves and turn them into a major player in liquefied natural gas. .

Africa, meanwhile, is ready to welcome investors currently pulling out of Russia, Adesina said.

“There are a lot of investors who are going to diversify out of Russia, of course… It’s a real opportunity, I think, for Africa right now.”

Join now for FREE unlimited access to Reuters.com

Register

Reporting by Joe Bavier

Our standards: The Thomson Reuters Trust Principles.

About Virginia Ahn

Check Also

The Great Commodities Shock: COVID-19 and War in Ukraine Mean Big Price Increases

Here comes the big shock of commodities – The World Bank released a new forecast …