 Good afternoon, everybody. Thank you all for being here at the Institute. My name is Barry Colferp, and I'm the director of research at the IEA. It's really lovely to have so many people here at our headquarters in Centre Dublin and indeed hello to those joining online. I have the easiest job of the afternoon because I got to enjoy a lovely lunch with the speakers. And it's just for me to introduce our chair today and just to say we're really privileged to have the speakers with us here today and indeed to be joined by one of the great figures of development studies and development economics, not just in Ireland, but in Europe with Helen O'Neill. And Helen is Professor Emeritus of Economics at UCD. Helen set up the Centre for Development Studies at UCD, which is going very strong and indeed recognises one of the great places of study and learning of development matters in Europe. And indeed Helen was the head of the European Association of Development Research and Training Institutes. I think I got the acronym correct. Helen has worked in many parts of Africa. She tells me especially in its west, east and south, not so much the north or the centre. This includes with the World Bank in Zambia, with the EU in Senegal and indeed important work with the UN Industrial Authority. You can't count all the countries in Africa you've been in. So I can't think of a more appropriate person to convene or to chair this event. And just finally for me before handing to Helen, just to say a thrill we are to be working as ever with colleagues in the Department of Finance and Development and Foreign Affairs. It's always great to reconvene and around such important matters as this. So Helen, I'll hand over to you and thanks again to the speakers. Thank you very much, Barry. Well it's a great pleasure to be here today and to be chairing this session in the IIEA. I haven't been here in person since the pandemic, but I attend at least one of these webinars every week online. So I know the drill, but I want to remind you all of the drill, just in case. Professor Yurama makes his presentation. There will be a question and answer session and I just want to remind you of a few things about that. Those of you who are online will put your questions through the question and answer button on your computers on Zoom. And I hope that those of you who are sharing this online will also join the discussion through Twitter or whatever it's called today. And that's through the handle at IIEA. You can send in your questions at any time. I mean, from the very beginning you'd say, oh, I want to ask him that question. I want to ask her that question. So the questions will be collected, and then I'll be handed this. I'm as blind as a bat. I hope I'll be able to read them. And I'm delighted to see so many people here in person and representatives of Foreign Affairs and Department of Finance here too. Now, the way we're going to run this show is I have two very, very interesting people who are going to speak today. First we'll have Mette Knudson from Denmark, and she's a member of the Executive of the Bank, the African Development Bank. And she will speak for a few minutes, and then after that we'll have Professor Heaven, good Irish name, Chika Yorama, and you'll speak for about 20, 25 minutes, whatever you like. And then we'll have the question and answer session. I was always very keen for Ireland to be a member of the African Development Bank. And every year I wrote this paper for the Royal Irish Academy about everything to do with Ireland's foreign policy with regard to aid. And Africa was, of course, the main focus of Ireland's aid policy. And we weren't a member of the African Development Bank. In 2018 and 2019, I got extremely impatient about the whole thing, and I said, we're conspicuous by our absence on this bank, we've just got to join the bank. So we did actually, in quick order after that, nothing to do with me. And we joined in 2020. The bank has been in existence since the 1960s, but we've only been a member for three years. But I'm very happy to see you here today, because I'm very happy we had finally joined the African Development Bank. So I'm going to ask you first, Mette, to speak to us, but I want to introduce you first of all. You're a most distinguished and experienced diplomat from Denmark. You have been, most recently, before you joined the bank and the executive of the bank, you were in Afghanistan. You represented the UN in Afghanistan, I think that's the way to put it. And before that you were Denmark's ambassador in Afghanistan. But before that you represented Denmark in many countries in Africa. And they included Senegal. What? No, not Senegal. Oh dear. Well, never mind. Maybe you like to go there sometime. Now, you've been Denmark's ambassador in Kenya, Somalia, Eritrea and Seychelles. I just got the essence mixed up, that's all. Now before that, you were Danish ambassador to Greece and Cyprus, Ethiopia, and two international organizations, the African Union and ECOWAS. And you also served as head of the African section in the Danish Foreign Ministry. And you were in your early career in Zambia and Tanzania. So you're most experienced. And I'm now going to ask you to say a few words by way of introduction. Thank you very much. And I'm very pleased that you have made this push to convince Ireland to become a member of the African Development Bank, because I agree very much with you. That is the place to be. And I now represent the four Nordic countries, India and Ireland in the board of the bank. And we're very happy to have Ireland as a very active member, both at the sort of day-to-day level with the officials from the Ministry of Finance, but also your president was kind enough to attend the food summit that the bank was hosting the beginning of this year. And he stayed for several days and interacted with the officials. And I think that actually puts Ireland very much on the front of the agenda in the bank. I won't take a lot of time because I'm sure everybody has come to hear our chief economist and vice president, but I just want to say that the African Development Bank might be a quite small bank. It's share of its investment level in Sub-Saharan Africa is at the same level as the European Investment Bank and of course in no way as high as the World Bank. But this bank has this special profile and the specific advantage of being owned by the African member countries. The majority of shares in the bank, they have the majority in the board. And the bank is very much seen as an African institution by governments in Africa. So it has an access to governments that some of the other multilateral institutions do not have. It also has a very high level of quality amongst its staff and it has a presence in most of the African countries. So it comes to the table with a lot of knowledge and a lot of access. And I think that when we have the discussion that's going on right now about reforms in the multilateral system, the multilateral financial system, one very important thing that I hope will come out of it is a much closer to the cooperation and partnerships between the multilateral development banks and the IFIs where we can draw upon the strength that each of us have and come with a more united offer of assistance to African governments. So I think that's just one point I would like to say and then of course that this bank can also play an important role in the whole issue around green transition, responding to climate change, responding to other global challenges. And I think that is what you will hear in detail from the chief economist. So I will not steal any more of the time but I'm of course willing also to ask questions from the audience and just hand over to you. Thank you very much, Mette. That's great. Now, the bank publishes a number of books every year. The most important one is African economic outlook. And this year's one is the one that Professor is going to speak to. It also produces same kind of publications for the various regions of Africa, like North, South, East, West and Centre. And this year it also began to publish a macroeconomic one study twice a year to keep the data up to date and so on. So it's a very busy department that you run. Now I'm going to introduce Professor Kevin Urama, a good Irish name as I say that you have. You're the chief economist and vice president in charge of information in and research in the bank. The bank has its headquarters in the Ivory Coast. So the views you have out of your windows must be wonderful. That West Coast of Africa, which I know to some extent, it's lovely. Well, Professor Urama is Nigerian. But he has his academic background is impeccable. He has a bachelor's and a master's degree in agricultural economics from the University of Nigeria. And then he went to Cambridge in England where he got his master's and PhD in land economy. So he has four wonderful degrees. He has several prizes, of course, not surprisingly, while he was a student and since then is published numerous articles in peer reviewed journals. He's an elected fellow of the African Academy of Sciences. And he has contributed to many international and intergovernmental panels and reports. You could be an academic tool if you weren't where you are. He has held numerous prestigious academic appointments in Switzerland, in London, in Scotland, in Africa, in Australia and so on. I may have left out one part of the world, but that's as far as I remember. He's a marvelous academic history, but he's on numerous boards and advisory committees and international organizations. And he's currently a member of the Intergovernmental Panel on Climate Change. He's also a member of the OECD Green Growth and Poverty Reduction Task Team. So I'm going to ask you to speak to the 2023 African Economic Outlook publication. And so would you like to take the floor. Thank you. Thank you. Thank you very much. And thank you so much for having us in this prestigious institute to present on this subject of on mobilizing private sector financing for climate and green growth in Africa. The reason for us focusing our report this year on this team was very simple. We've done some analysis on the financial needs to implement the SDGs in Africa and the figures we get are mind boggling. We did the same on implementing the nationally determined contributions of African countries in order to be able to achieve the climate transitions. We all care about the numbers are mind boggling. If you think about implementing the agenda 2063 of the African Union Commission, you find the same humongous numbers running in trillions. And then we did analysis of all the other types of financial flows that come into Africa to boost the fiscal space of countries to be able to implement these agendas from the public sector. One thing came out very clearly if we combined all the resources from official development assistance from foreign direct investment from portfolio investment and everything you have coming into Africa together. It cannot even implement just one objective the nationally determined contributions of Africa. We have to look elsewhere. And looking elsewhere then means how do we use those natural capital that we get finance the small fiscal space that countries have. And also the small fiscal space that contributions from our development partners give us to leverage the private sector in order to implement the global goals that we all care about. Even here of these 145 trillion US dollars of assets on the management in the private sector. But when you look at Africa, those financing is not coming the way issued and at the scale issued in order to be able to address green transitions. So this report for this year focuses on three key areas. One is a bird's eye view on Africa's economic prospects is performance and future prospects. Then second, how do we leverage the private sector to do what I've just talked about. And third, addressing the issues about leveraging natural capital of the continent to contribute to financing the green transitions and SDGs in Africa. And then we make some policy recommendations and conclusions. So on Africa's growth performance chapter one and outlook, we see that Africa has had this quality of resilience in this growth history. If you go back to the 1960s and even the pre independence era in Africa, you'll find that African economies are good at absorbing global shocks. Several reasons are there for it, large sizes of informal economy, but also huge diversification in the economic structures and fundamentals across the countries of the continent. And here for this year, we see that Africa is growing at 3.8%, which is higher than the global average growth rate of 3.4% in 2022. And our projection is that it will even grow better in 2024 and and going forward by above 4%. And interestingly, half of the top 10 fastest growing economies in the world today are in Africa. So one can conclude from this simple slide that Africa is a major growth pole for the world. But when you try to look deeper into the underlying structures of the economy, you'll find that dependence on natural resources is natural resources and commodities still denies Africa, other things that are fundamentals for sustained growth in other countries. Private sector consumption and investment is low, and then industrial sector growth and manufacturing remain very low on the continent. So for the continent to be able to grow and reach the levels that we can have some fiscal space to address the challenges of the continent, we need to focus on building private sector consumption and investment and also industrial capacity of the countries. Next is the fact that Africa is diverse, a diverse continent, not a country. Quite often out here, we discuss Africa with the context of as if it is a homogenous continent, country. So but when you look at risks on Africa, we'll talk about risk in sub-Saharan Africa. That number is deceptive because there are several countries within this huge block, 54 countries that have different fundamentals, different macroeconomic capabilities, and also different growth prospects and risks. So the message here is also whether it is international development assistance for indirect investment or any form of investment decision making on the continent. Let's look at the country levels. And for some countries, even at the sub-national levels, before we jump to conclusions about risk profiles and prospects. If you look at the regional differentiation of growth there, you find that all the regions are doing very well, but some regions are doing better than others because of different fundamentals you are going to find in the report. Another aspect is that even within the countries, the dependence, even within the regions, the dependence on different forms of growth drivers, natural resources dependence, tourism, and other things also shape how these countries respond to global and domestic shocks. Again, it would be important to look at key sector focuses when we are trying to make decisions regarding the continent. But there are two major underlying constraints or challenges that we find consistent over our reports. One is exchange rate dynamics on the continent, which we find that currency devaluation often changes the matrix for growth, changes the matrix for debt repairment costs, and changes the matrix for basically the market environment in the countries. So forest risk becomes one of the major issues that deters private sector participation, as we will see going forward. But again, because of that, consumer price inflation has bigger implications for Africa's consumption and the middle class, and especially the more vulnerable populations. On the right there you see in some countries consumer price inflation because of the impacts of COVID and impacts of the Russia's invasion of Ukraine hit the roofs. On average, we saw the highest level of inflation at 14.7% in 2022, but we project that it's going to get better in 2024 and 2025, coming back to below double digits. And the implications of these two fundamentals is the implications on debt, the capacity to repay debts on the continent. My challenge on debt is not about debt stock, which people talk about debt to GDP ratio, because if you compare to other countries of the world that is still low in Africa at about 65%. But the challenge is the structure of debt, which is now that the Paris Club group is receding in its share of debt on the continent. It has halved in the past decade, while the non-Paris Club group is growing and the commercial debt is also growing. And that means the quality of the debt becomes also another challenge in terms of transparency of the debt instruments and repairment, the loan times and everything, which makes debt restructuring and resolution very difficult. So that diversification of participants in Africa's debt structure and this queuing towards non-Paris Club group and commercial creditors is a major challenge that we need to think about. And I think it has some foreign policy implication for the global knot. Now, the drivers of debt in Africa, specifically if you try to decompose the debt architecture, the debt dynamics, you find that exchange rate depreciation is a major cause of debt vulnerabilities on the continent. Because even without borrowing more just because of the appreciation of the US dollar and fiscal consolidation in the global knot, countries have to pay more to service existing debt. Currently countries are using up to 11% of total revenue to service debt, not to repay but to service debt. In some countries that figure is beyond 35%, like if you look at some earlier there, that figure you see is basically speaks for itself. So then tell me these countries low fiscal space in the beginning and then it's been constrained more and more by all these challenges that exposes a number of risks. We identify four major risks to watch on the continent. High interest rates and debt service costs have explained that. Second, it is subdued growth in the global economy also affects import-export dynamics for the countries of the continent. So we're struggling with the general deceleration of growth globally, but the high interest rate for policies made external to the continent is driving debt repayment challenges. And the debt repayment challenges is raising debt vulnerabilities and susceptibility to downgrades in terms of sovereign ratings. The cost of capital will go up when you are downgraded and your access to the global market will reduce. It's just a vicious cycle that will lock Africa into permanent poverty if nothing is done about that. On top of that physical risks of climate change is costing Africa 7 to 15 billion US dollars annually. And our projections is that if nothing is done by 2050, it will reach 50 billion annually US dollars just in trying to rebuild infrastructure that is destroyed by climate events. I have not talked about cost of adaptation, which is estimated to be about 50 billion annually. So if you put all these things together, the continued dependence of Africa on trading raw materials in the global market will go nowhere in addressing the fiscal challenges on the continent. So public resources, ODA and so on are not sufficient. Domestic revenue mobilization cannot go anywhere near. The conclusion is we need to find ways of mobilizing the private sector. And that is why this chapter. Then when we looked at this chapter, something jumped out to me. Over the years, right from when I was in St. Edmond's College in Cambridge, studying land economy, environmental economics and everything. There was these questions that finance ministers used to ask me in Nigeria. Why are you studying environmental economics? We haven't even addressed poverty. It's a pertinent question. Because they say that environmental economics is the prerogative of the rich. If you have already addressed immediate needs, then you think about long term sustainability. But this study shows us actually that for countries that have embraced green growth positively, that's high correlation with the GDP growth as well as well as climate resilience and climate readiness. Which debunks that advice I was getting. Meaning, if we want to invest in climate, we need to invest in the economy. Because by growing the economy of countries, what we found in that study is that you have like a sigmoid curve in relationship between emissions and time and GDP growth and time. The higher you go, the less the marginal output of externalities. And because of that, more incomes in countries leads to better environmental management in countries. Simply, even if you had no environmental policy, because of a decoupling effect of technology. So we can talk about that for a long time, but I don't have the time now. But when you look at Africa, then you see what I call a green development paradox. Africa has huge human capital, 1.42 billion people currently estimated to be 3.56 billion by 2100. By 2100, about 25% of global youth population will be in Africa. Now we have natural resources endowments in all sectors of the green economy. If you think about Cobalt, over 51% is in one country. DRC Congo. Platinum over 70% in Africa. Every resource you think about, Africa has an abundance of it. Even land to grow food to feed the global community in the rest of the coming decades, 65% of that are in Africa. So how Africa relates with East natural capital will define the shape of green transitions of the world. The shape of food and green transitions in the world. And we also have green technology potentials, humongously. Over 350 megawatts of renewable energy of geothermal potential. Solar energy, we have almost 11 terawatts. 60% of total renewable energy potential in the world is in Africa. 60%. And then we have low legacy in emissions locked in technology and infrastructure. So the issues about asset stranding is not major on the continent if we invest in better technologies for the green transitions. And we have very high political will. But when you look back on green growth performance indicators of all the indicators that has been developed, Africa is not doing well. That for me is a paradox, huge opportunities for investment, huge opportunities to drive the green transitions, huge opportunities to meet the social and economic needs of people, but we're not doing it. Look at the private sector. Just take one example, climate change. Total climate finance flows to Africa as at 2019 was 18.3 billion US dollars. By 2020 it grew to 29.5 billion US dollars, but only 14% of it 4.2 billion came from the private sector. That's a leverage factor of 0.16 compared to about 8.6 in North America. And that means that when ODA resources and public resources go to investments in Africa, it only leverages 0, I mean, $1 of ODA leverages 16 cents in private sector investment. So we really need to do a lot more to change this relationship between investments, growth, investments, green transitions, investments and social inclusion in Africa. That reverse relationship needs to be addressed. Otherwise, we will not achieve any of the global goals we have set. To implement the SDGs, sorry, just the NDCs were focusing on climate just SDG 13. If we implement the NDCs of countries in Africa, we take 2.7 trillion US dollars. Remember, Africa is receiving 29.5 billion annually. This 2.7 translates to 242 billion annually. So that gives you a financing gap of over 213 billion US dollars. And the whole world is going around discussing 100 billion for all the developing countries. So out of that 100 billion, only 29 billion is going to Africa. So the NDCs is a no-brainer if we continue to focus on public resources. But that then gives huge opportunities for investment by the private sector. And when we look at also where this public resource is, the 29 billion I've talked about is going to mitigation, basically solar panels and renewable energy. And that means that adaptation and loss and damage, which are the major areas where the poor and fragile countries need financing, is being forgotten. And again, that climate finance is short-changing development on the continent. Now, what huge opportunities for investment in agriculture, a market of 1 trillion in Africa, energy 1.03 trillion by 2030, ICT growing at over 100 billion annually, electric vehicles, current growth, about 22% growth annually. But as the green transition progresses and electric vehicles take more dominance in the markets, that market share is supposed to even grow even further. This is only to say the private sector need to do more in terms of going in to invest in this huge gap, huge need, huge resource potential. You have the feedstock, you have the demand, and you also have the market. What's keeping us? Now, if you look at, people talk about all innovative financial mechanisms and technologies will solve climate change. No, you don't do that in Africa and in developing countries. Empirical evidence, look at green bonds in the total green bonds that's already been issued in the world. As at the time we did this study, Africa has only 4.7 billion in green bonds. That's 0.2% of the global. And if you look at all the other instruments, including a lot that we champion as the African Development Bank, it's not really going to Africa quite a lot. Why the underlying economic structures, the underlying global financing architecture penalizes poverty and rewards wealth. It penalizes no emissions and rewards emissions. The climate finance today, if you look at it globally, it's going to countries that are emitting more, not the countries that don't have the capacity to emit. And I'm wondering, I thought climate finance was supposed to address climate vulnerability, but there is an inverse relationship. So we need to think about that. So I wondered what then are the enablers of private sector finance in Africa and globally, and then economics takes a center place here. You find that the level of public resources available to countries defines is the major determinant of the level of climate finance that they can receive. So when ODA is being rebranded to go to climate technologies, you are reducing the capacity of countries to access climate finance. So this tells me that helping to address poverty, grow the economy is a very smart way of actually driving green transitions. Second, GNI per capita of countries, the higher the GNI per capita of countries, the higher the access to climate finance that they get. And of course, the risk environment is there. So we need to think about this because I've been involved in discussions where we're saying, oh, we need to do more of climate. Well, if you want to do more climate by buying solar panels and putting it on the roof of poor people in a poor neighborhood, they're just going to steal it. A few years after over the time. But if you build your capacity to have access to better technologies, better clean cooking, you save 600,000 people in Africa from dying from indoor smoke. That's 300,000 women and 300,000 children. These are not statistics. These are human beings. So when we have discussions about what type of technology to use to give them access. I say this remember is life and that versus environment tomorrow. Let's think about it. Now, what are the key barriers that we have lack of strategies for implementation things we take for granted here. Many countries don't even have their long term plans. They don't have the capacity to develop them. We need public resources to go and help them to put those strategies together. And because of that, we also have weak regulatory structures and environment because you don't even know what to regulate. There are no plans. So we need to support countries in doing that lack of investment ready projects and pipelines. You hear it repeatedly. No bankable projects and but no institutions leads to no bankable projects. That's a very visual cycle that continues to play out and that leads to limited access to markets. From the global public private sector has huge limited experience about the continent. People think about Africa as a nation. One time I was going home from Cambridge for my holidays and one of my tutors gave me a letter for a former student in Kenya. I was going to Nigeria. I was going to Nigeria. So information asymmetry has big implications for denying access to Africa's markets. And that leads to perceived high investment risk and poor credit rating, creating the same visual cycle that I've talked about. And one simple example of information asymmetry. If I ask you about Africa, you think risks. Correct. But Moody's analytics is a long-term panel study and found that Africa's rate of default on long-term infrastructure invest projects is 1.9% compared to 12.4% in East Europe. So that perception is because of information asymmetry lack of information. Then if the private sector is not playing game and the public sector resources is not enough, what can Africa do? Look at your natural resources. Africa is awash with natural resources everywhere in for the green transition. How the world leverages this will drive how the green transition happens. Now we have so many policies and programs to get that done, but that's not happening as you can see from chapter two. And I give two examples, the Great Green Wall. The bank has a program and I would call Desert to Power to be able to harness this solar energy potentials in the Sahel region. That region alone is enough to power African Europe with solar energy. So we have invested 12.5 billion US dollars, but that project, that program is about 25 billion. A good opportunity for people to come in to help produce solar panels using cheap resources from those places, train people to be able to know how to mount these panels, reduce the cost of production, reduce the carbon footprint of even solar panels, which are not carbon neutral in Africa, because they're all imported. Green hydrogen is huge opportunities and electric vehicles have just picked three opportunities that are there in the energy sector. You have the same in agriculture in ICT and everywhere. Currently, the global community is playing here. I don't know how to do the pointing. At the first level here, mining everybody thinks about Africa, let's go dig out the resources and take it home. What you're doing is you are taking the stock that you have not processed. They are often heavy, large, bulky, and you are shipping them thousands of miles away. That is carbon footprint of that product you are going to produce. So even if you are producing solar energy, you are not carbon neutral. But it's also the cost of logistics, huge, because you ship back those products again to sell to that 1.4 billion people in Africa. So my recommendation here is instead of playing in the low value chain, let's go up the value chain so that if you are thinking of going to invest in Africa, don't invest in an 11, this is the global value of mining of green minerals in Africa, 11 billion are estimates. But then the market value of electric vehicles today is 7 trillion. Business sense, will you rather play in a market of 11 billion or 7 trillion? Good for business, good for the environment, and also good for people. Because you create the jobs in the place that these things are, reduce social fragilities, reduce the drive for you to migrate to come and become challenges for home land security. In our countries and so on, let's think about that. So many barriers, I won't go through it because of time is similar to the same barriers that prevent the private sector from accessing resources in Africa. What then should we do? African governments have a lot of homework to do. Both in macroeconomic policy management, both managing inflation, coordinating debt treatment and debt borrow, sustainable borrowing, fiscal reforms and incentives, all of them are there that they need to do. But development community need to help them with developing long term strategies and implementation plans. Within changing the strategic industrial policies we use today, which is not good for the environment or good for markets as well. But helping them to boost domestic revenue mobilization and several issues that we have there like the Africa payments is them to address forest risks. MDBs, we need to implement the bridge town initiative, but also expand concessional financing and grants for capacity building to build institutions, because that's the basis for markets. Institutions define the transaction costs, defines creative destruction, it defines technology, it defines the behavior of organizations where the institutions don't exist, solar panels are not the solution. Okay, and then provide risk, more risk agnostic and catalytic capital, risk guarantee instruments, and even take higher risks. But not socializing market risk, but take higher risks in making sure that we're not investing in the prime risk free infrastructure projects and then live in private sector with nothing to invest in. The private sector themselves need to take market leadership and stewardship. We can't wait for risks to be zero in the green transition markets before we become market leaders. And then also credit rating agencies need to review their methodologies and broaden frameworks because they're actually at the center of the high risk ratings of countries that deny them access to resources and so on and so forth. There is so much that we can talk about. Well, let me just settle on five things, our high fives in the bank. National strategies and development plans, building institutions to incentivize green industries and to spur growth, providing guarantees and risk agnostic instruments, developing pipeline of projects of green projects that can be invested in to provide high risk adjusted returns to the private sector, but also this global discussion on institutional reforms and asset recycling within the public and public banks and private sector and the mdbs so that we can actually be able to deliver better public goods. Thank you.