UK should support faster disbursement of African Development Bank funds to promote COVID-19 recovery on continent – World
To help African countries recover from the impact of covid-19, the Independent Commission for the Impact of Aid Subcommittee on Work called on the UK government to push for faster disbursement of aid. funds held by the African Development Bank.
The subcommittee’s latest report looked at ICAI’s review of UK support to the African Development Bank, which rated UK participation in the Bank as green / amber, stating “ satisfactory achievements in most areas, but partial achievements in others ”. The UK has the smallest stake in the Bank of any G7 country, but its involvement has been positive in advancing UK aid goals, including key cross-cutting priorities such as fragile states and genre.
Amid the uncertainty over the UK’s future official development assistance (ODA) spending, the subcommittee was reassured by assurances from Minister James Duddridge that, given the Bank’s positive work, the British government would like to continue working in close development experience. This was reinforced two weeks ago by the Minister of Foreign Affairs who confirmed ODA spending for the African Development Fund, within the African Development Bank.
As Africa recovers from the impact of covid-19, the subcommittee learned how more paid-in capital can help communities get back to normal. The subcommittee urged the UK government to consider supporting the faster disbursement of this capital.
The Bank is already focusing on low carbon investments and has not made any investment in coal since 2015. This is impressive and important ahead of COP27, which will be led by Africa, and could lead to more investments in greener energies. Supporting the Bank in this area will allow African countries to develop economically without increasing associated emissions.
The subcommittee was concerned about the current skills shortage at the Bank, recommending that the UK government do everything in its power to encourage filling these gaps. The UK should put pressure on the Bank to act quickly and regularly monitor progress in recruitment and retention.
Overall, the Sub-Committee found that the UK’s engagement with the African Development Bank has been beneficial and was pleased to learn that this has continued since the establishment of the Foreign Office, the Commonwealth and Development.
The chairman of the subcommittee on the work of the Independent Commission for the Impact of Aid, MP Theo Clarke, said:
“Since its inception, the African Development Bank has offered valuable financial assistance to developing countries across the continent. The sub-committee report demonstrates that UK support to the Bank must be seen as a real success story for UK aid, promoting economic development while delivering UK priorities ranging from supporting fragile states gender equality.
“However, Africa faces the major challenges of the coronavirus pandemic and the growing threat of climate change. I hope that the Bank will meet these challenges, supported by its donors. Funds should be made more accessible to support recovery from covid-19. After COP26 in Glasgow, eyes will be on the continent as there will be an African host for COP27, so investment in green technologies and innovation is essential, and the African Development Bank can play a major role. in realizing this potential.
The recommendations are:
- One of the main challenges facing the African Development Bank is to mobilize private finance for its major infrastructure projects. The current financial situation due to the coronavirus pandemic is likely to exacerbate this problem. One possible action that could improve the prospects for infrastructure financing is faster disbursement of paid-in capital from the Bank. We urge the government, through its position as Executive Director of the United Kingdom, to consider encouraging this and other possible avenues to maintain financial support for African infrastructure.
- The UK government should do everything in its power to encourage sustained progress in closing the skills gap at the Bank. Bearing in mind the need to respect the independence of the Bank and maintain a multilateral approach, the UK should urge the Bank to act quickly and regularly monitor progress in recruitment and retention. An update on the staffing situation is expected to be provided to the Committee by the end of October 2021.
- UK’s future support to the African Development Bank should reflect the Bank’s key role in complementing bilateral aid.