Director Explains AfDB’s Vision

Human Development Director of African Development Bank (AfDB), Agnes Soucat, has said that remittances and microfinance are the two key components of the bank’s inclusive financial services.

“Access to finance is a key component of our new human capital development strategy.

“Increasing opportunities for the poor and marginalised and particularly for the African youth is crucial in order to ensure social inclusion as well as job creation,” Soucat said at one of the seminars at the  AFDB, annual general meeting (AGM).

With an estimated Africa’s Diaspora fund of 40 billion dollars annually, 21 .5 billion dollars were remitted to Sub-Saharan Africa in 2011.

Participants at the seminar said remittances not only helped African communities to cope with crisis and lack of economic prospects but also contributed to enterprise development and human capital.

They also said remittances was a major driver in African poverty reduction scheme.

“There is no doubt that remittance inflow has been an important factor in Africa’s economic development, a significant proportion of that is handled by Dahabshiil, an African web-based money transfer system.

“Microfinance initiatives are equally enabling some of Africa’s poorest to plan for the future,” said Abdirashid Duale, the CEO of Dahabshiil.

According him, the share of remittances to GDP has remained stable for the last decade, averaging about 2.4 per cent per annum.

But the World Bank said the effects of the economic crisis and the Arab spring on remittances flows were felt more in Sub-Saharan Africa.

World Bank calculations also showed that remittances flows to Cape Verde, Senegal and Guinea-Bissau are exposed to worsening economies.

Donald Terry, a professor at the Boston School of Law and former Manager of the Multilateral Investment Fund of the Inter-American Development Bank , said: “Access to finance for the vast majority of Africans is an important goal for the AfDB’s drive for more inclusive growth.”