The eighth president of the African Development Bank (AfDB), Akinwumi Adesina, is entering his final month at the helm of Africa’s leading financial institution after a decade of service. The Nigerian leader, who has built countless bridges between Africa and Europe, America, and Asia, shares his insights on his legacy, global challenges, multilateralism, private sector development, and more in this exclusive interview.
After a decade leading the AfDB, you’ll soon pass the torch to your successor, who will be elected this May. What kind of institution will they inherit?
The African Development Bank turns 60 this year—I’m 64 myself. When it opened its doors in 1964, we had just 10 employees. Today, our workforce exceeds 2,000. The initial capital was a modest $250 million. By the time I took office in 2015, it had grown to $93 billion—already substantial. Under my stewardship, working hand in hand with our shareholders, we’ve more than tripled that figure to $318 billion. The numbers tell their own story. We’ve become a truly global institution. Two years ago, we were recognized as the world’s premier multilateral financial institution. For two consecutive years, we’ve been hailed as the most transparent financial institution globally. This is the foundation I wish to leave for my successor. I’ve been fortunate to build upon the work of my predecessors, shaping the Bank into what it is today. But there’s still more ground to cover.
Your decade at the helm coincides with Africa’s emergence as a global game-changer, particularly regarding critical issues like climate change, energy transition, and food security. How do you view the Bank’s role in global multilateralism?
The AfDB has significantly amplified Africa’s voice in the global financial landscape. I am regularly invited to G20 Compact meetings with African heads of state – I was recently at the Rio de Janeiro summit. Africa’s voice is now heard at the negotiating table. More importantly, Africa’s priorities and solutions are part of global discussions. This is a transformed African Development Bank.
We are also taking the lead on initiatives like Mission 300, developed with the World Bank, aiming to connect 300 million people to electricity. Throughout my nearly 10-year tenure, I’ve focused on accelerating development. We’ve evolved into a Bank that provides solutions to Africa’s development challenges. That’s what sets us apart.
Challenges exist, but they don’t intimidate me. That’s how I view development: each challenge is an opportunity to innovate and find solutions because that’s what we were elected to do. It’s a responsibility, and I’m very proud of what we’ve achieved.
You concluded 2024 by chairing the Africa Investment Forum in Rabat, Morocco—your final AIF as Bank president. History will remember you as its founder. Is this Forum, which brings together financial ecosystems from Africa, Europe, America, and Asia, achieving its initial objectives despite international challenges?
We launched the AIF because I believed it was crucial for the world to recognize Africa’s opportunities, not just its challenges. Challenges aren’t unique to Africa – every region faces them. Africa holds immense opportunities that citizens sometimes aren’t aware of or are misinformed about, so I felt we needed a platform to showcase these opportunities. In agriculture, 65 percent of the world’s remaining arable land is in Africa. Our continent has a young population, with 477 million people under-35 who will be tomorrow’s workforce, while the world transitions toward an aging population as Africa grows younger.
Africa is the world’s fastest-organizing region. Housing demand will surge – approximately 56 million new homes need to be built, representing a significant market opportunity. Moreover, global energy transitions highlight Africa’s crucial role, with its essential minerals from platinum to lithium, cobalt to copper, graphite to platinum group metals, etc. All this indicates that if the world doesn’t know how to engage with Africa, capital won’t flow to our continent.
The AIF mobilized $35 billion in 2023, compared to $29 billion in 2024. What explains this difference?
It’s similar to how the economy functions – years vary. 2024 saw global inflation and geopolitical tensions. Due to restrictive monetary policies in Europe and the U.S. Federal Reserve, interest rates rose significantly. Capital fled emerging markets, with investments concentrating in U.S. and European treasury bonds. Despite this, we managed to reverse the trend and attract substantial investments in a very challenging global environment. That’s no small achievement.
The AfDB’s new ten-year strategy (2024-2033) emphasizes collaboration with African and international private sectors. One goal is to triple the Bank’s non-sovereign operations. This is quite novel. Are we witnessing a transformation in how development is financed in Africa?
Absolutely! It’s well-known that public money alone can’t address Africa’s challenges, and at AfDB, we believe the private sector must play a crucial role. That’s why we’re tripling our financing to it. We created Africa 50, a private equity platform focusing on infrastructure, with $1 billion in capital and an $8 billion investment portfolio.
The AfDB has also launched the Alliance for Green Infrastructure in Africa, which will mobilize $10 billion for green infrastructure development.
Ultimately, what matters for the private sector is how essential industries are supported. That’s why the AfDB focuses much of its work on key industries like agriculture.
At the last AfDB annual meetings, you told several heads of state that “any company working in Africa and drawing from African resources must pay taxes in Africa.” Are governments and multinationals heeding this wake-up call?
Africa has abundant natural resources but doesn’t benefit as it should, simply because many multinational companies don’t pay their due taxes or royalties. They also engage in profit shifting. We observe numerous illicit capital flows leaving Africa. Thus, even when countries have assets, their exploitation impoverishes rather than enriches them.
When a company operates anywhere in the world, whether in Europe or the United States, it pays taxes there. Why shouldn’t they pay taxes in Africa? To reverse this trend, we first supported reforming the global corporate tax structure to have uniform rules applicable to all countries and proportion tax payments to resource exploitation. Currently, African heads of state strongly advocate the need to reform the global tax regime to ensure they can benefit from their assets. Secondly, more proactively, the AfDB has the “African Legal Support Facility,” essentially composed of lawyers whom we make available to countries to help review their tax situation, debt, etc. For example, we managed to reduce one country’s debt to another by 94 percent, simply because that country didn’t understand the agreements it was signing. We’ve also worked with other countries facing global arbitration because vulture funds were trying to take advantage of them, and we provided them with the African Legal Support Facility, helping them resolve several of these issues. But ultimately, I believe we need responsible investments that benefit the communities and countries involved.
In my view, countries themselves realize their fiscal space is very limited, so there aren’t many gifts to give. Africa’s investment proposition is clear: the market is vast; purchasing power is increasing because the middle class is growing; the rate of return in African countries is higher than in many others; the default rate on the continent is the lowest in the world, according to the data…
Should we end tax incentives, in your opinion?
I’m not saying we shouldn’t offer incentives. But tax incentives are like sugar – too much leads to diabetes. Giving too many incentives is like giving investors too much sugar. States that go down this path lack fiscal space, which is harmful to their economy.
Discussion about this post