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EGYPT: Allocation of 12.5 million m2 for New Textile Investments in Egypt
EGYPT: Allocation of 12.5 million m2 for New Textile Investments in EgyptThe most recent report by the Egyptian Industrial Development Authority (IDA) of the Ministry of Trade and Industry, asserted that the areas of land allocated to new textile projects have reached 12.5 million m2, with investments of 2.9 billion USD.
Engineer Amr Assal (President of IDA), said that these areas included allocation of 5 million m2 in the second stage for industrial developers with investments of 5 billion Egyptian Pounds.
He also added that these areas include 2 million m2 at the Polaris Industrial Zone, with investments of 600 million USD in the 6th of October City.
One million m2 was allocated to the Jordanian Investment Congregation Group of real estate development, whose investments are 300 million USD in Zezinia Zone in the 10th of Ramadan City, in addition to 160 million USD and 150,000 m2 in Greater Mahallah with investments of 42 million USD, in the framework of the program of reuse of the assets owned by the public sector companies.
Source: Al-Ahram Newspaper
Egypt
The Bank Group’s Country Strategy Paper (CSP) for Egypt covers the period 2007-2011. The CSP is well aligned with the government’s development agenda. The design of the assistance strategy is underpinned by Egypt’s vision 2022, its fifth Five-Year Plan (2002-2007) and its Ten-Point Action Plan, whose objectives are to promote private sector-led growth, modernize the Egyptian economy and integrate it into the global economy. Given that the CSP period goes beyond Egypt’s fifth Five-Year Plan, the Bank Group’s short-to medium-term business plan covers the period 2007-2008, corresponding to the end of the fifth Five-Year Plan period.
Egypt is an economically diversified middle-income country with a private sector that employed 77% of the country's active population and accounted for 62.9% of GDP in the 2007/08 financial year. The prospects for medium term growth are good and could further be enhanced by accelerating structural reforms. The country has substantial natural resources, including oil and gas, which are important sources of foreign exchange earning. The country is also sufficiently diversified in terms of its agriculture and industry and can therefore expand its agro-based production and light manufacturing. Egypt can also further capitalise on its strategic location to increase revenue from the Suez Canal, and on its historic, cultural and geographic endowments to attract tourists.
Source: African Development Bank Group
ETHIOPIA: Textile, Garments Export Revenue Growing by 28% Annually
The income generated from textile and garments export has been growing by 28 percent annually, according to the Ethiopian Textile and Garment Producers Association.
Association Secretary General Endalkachew Sime told WIC that out of the 54 members of the association some 26 have been exporting produces to Europe, the US and Africa.
The government is providing various incentives such as helping producers to import raw materials tax free and enabling them to secure 70 percent of running cost in loan to motivate the sector and make it competitive, he said.
The government envisages securing over 500 million USD by 2010, the Secretary General said, adding that the revenue obtained from the sector is at present low despite the continuous growth.
Although the set direction and plan is consistent with the cotton production and capacity of manpower in the country, producers have failed to seize the tax free opportunity available in various countries, he indicated.
Over 12.6 million USD was obtained from textile and garment last Ethiopian year,it was learnt.
Source: Waltainfo.com
Ethiopia
The Bank Group's 2006-2009 Country Strategy Paper (CSP) for Ethiopia aligns with the country’s new Poverty Reduction Strategy Paper (PRSP) known as the Plan for Accelerated Progress and Sustained Development to End Poverty (PASDEP).
Drought in parts of the country has contributed to shortfalls in the food supply and the surge in staple food prices. Most affected is the country’s Somali Region. The government has introduced wheat subsidies to ease the impact of inflation on the urban poor and the vulnerable rural population.
Major economic development challenges include weak infrastructure, low agricultural productivity, structural food insecurity, environmental degradation, and weak human and institutional capacity. Macro-economic challenges facing the country have opened up opportunities for the country's private sector to increase its involvement in financing Ethiopia’s growth, especially in the infrastructure sector. The AfDB is ready to serve as a catalyst in expanding the flow of financing to Ethiopia’s private sector
Source: African Development Bank Group
Tunisia:
A middle-income country, achieved an annual average growth rate of 5.2% for the 2005-2008 period. The active, but prudent policy of opening up the country's economy, accompanied by support and incentives for businesses and industry, made it possible to successfully establish the Tunisia-EU Free Trade Zone in January 2008 and to end the Multifiber Agreements. Tunisia has also entered into a new phase of opening up its economy, which will have to diversify its products and trading partners: the EU, with 80% of exports, is its leading partner. The impact of the current crisis is thus mainly expected on the real economy, and investment will be the key variable to achieve the growth target of 5% in 2009.
Source: African Development Bank Group
Algeria:
Foreign exchange revenues have almost reached US$ 60 billion per year, its public debt has stabilized and the foreign exchange reserve cushion has exceeded US$100 billion. In 2007, the country's GDP had risen by 4.8%, but the economy still hadn’t taken off. Algeria’s population was estimated at 34.8 million in 2008. The estimated average annual demographic growth rate is 1.7%. With a gross national product per capita of US$ 3,620 in 2007, Algeria is ranked as a middle-income country.
Source: African Development Bank Group
Libya:
Libya joined the African Development Bank Group in 1972 and has since become one of its leading shareholders. On the political front, the country in 2008 began a process of renewal with a thorough overhaul and restructuring of the government system following the People’s Congress held in March 2008.
Real GDP was expected to rise by more than 7 per cent in 2008 after reaching 6.8 per cent in 2007. However, Libya still faces challenges linked to the duality of its economy. While the hydrocarbon sector allows the country to accumulate large amounts of capital, there are inadequate linkages between the petroleum and non-petroleum sectors.
Source: African Development Bank Group
Mauritania:
Mauritania’s population was estimated at 3.1 million in 2007, distributed across a vast geographical area covering approximately 1,030,700 km², 80% of which is desert. The country is faced with two major challenges, desertification and recurring drought, both of which have severely hampered its economic and social development. About half of its population (46.7%) lives below the poverty line. With a per capita GDP of US$ 952 in 2007, Mauritania is classified as a Least Developed Country (LDC) Mauritania's Human Development Index (HDI) was 0.550 in 2007, ranking it 137th among the countries classified by the UNDP.
Source: African Development Bank Group
Sudan:
With some 2.5 million square kilometers, Sudan is the largest country in Africa, with a population estimated at 38.6 million in 2007. It borders nine countries and reflects the religious, ethnic and cultural diversity of the region. Arabic, the official language, is spoken by some 60 per cent of the population. Sudan has been involved in one of Africa's longest-running conflicts since it became independent in 1956 and at the centre of it all has been widespread poverty, regional inequalities and disparities and competition for scarce natural resources. It was the signing of the Comprehensive Peace Agreement (CPA) in January 2005 that brought to an end more than two decades of hostilities between the North and South. The CPA paved the way for the establishment of the Government of National Unity (GNU) and the Government of South Sudan (GOSS) to form a Confederation system for governance under the ‘one country, two systems’. The CPA is based on a vision of wealth and power sharing that seeks equity, guarantees political rights and civil liberties, aims to prevent political and economical monopoly, and provides for a reformed and fully developed system of governance in which all Sudanese are equal. Administratively, sixteen states constitute the North, which includes the three Darfur states. The other 10 states constitute the South.
Source: African Development Bank Group
Burundi:
Burundi faces the significant challenge of consolidating peace and security and strengthening overall governance, while at the same time, reconstructing and rehabilitating its economy and becoming an active member of the regional community.
Burundi made a successful transition to a multi-party political system between 2000 and 2005. Political progress and attempts to consolidate security since 2005 have, however, been mixed. Recent struggles between political parties in the coalition government to position themselves before the general elections scheduled for 2010 have paralysed parliament and slowed the government’s legislative programme.
Although the situation remains fragile, but since the May 26, 2008, agreement between the government and the Palipehutu (FNL), political commitment to the peace process has evolved positively and reforms have managed to keep the transition towards peace on track.
Source: African Development Bank Group
Uganda:
The Ugandan economy has performed well in the past decade and a half, showing considerable resilience against external shocks – including weather and energy shocks. GDP growth has averaged 6 percent per annum since 2000 and 8.3 percent over the past five years.. The country has achieved a degree of economic diversification, with manufacturing increasing in importance. Inflation has declined from 8.5 percent in 2005 to 6.4 percent in 2007, but has been in double digits since April 2008, standing at 11.5 percent in October 2008. Economic growth was forecast at 8.0 percent for 2008, supported by growth in construction and services. Rising food prices, exacerbated by low productivity in agriculture, poor transportation infrastructure, and high energy prices, remain the main determinant of inflation, forecast at 5.0 percent for 2008.
Real GDP growth rates of 7 to 8 percent a year are required to make an impact on poverty. Poor electricity supply, due to an inadequate generation, distribution infrastructure, and spillover effects from the global financial turmoil will, however, make the attainment of these figures a challenge. Consequently, real GDP growth rates have been downgraded from 8.0 percent to 7.3 percent.
Economic policy is broadly focused on the government’s Poverty Eradication Action Plan (PEAP) and its successor, the National Development Plan (NDP). Agricultural modernization is the main long-term policy objective, along with improvements to infrastructure and a solution to the electricity crisis. Financial sector development and improved governance are also important goals.
Source: African Development Bank Group
Tanzania:
Born out of a union between Zanzibar and Tanganyika in 1964, Tanzania’s economic performance was expected to remain strong in 2008. GDP growth for 2008 was estimated at 7.5 per cent, up from 7.2 per cent in 2007 and an improvement over the 2002-2006 period when the economy grew by an average of 6.0 per cent. Recent growth has mainly been attributed to construction, tourism and mining. Economic reforms have been key growth drivers and have transformed the economy from a relatively controlled one to one that is liberalized and market-driven.
Inflation has remained in single digits and averaged 5.0 per cent per annum from 2000-2006 but shot up in 2008 and is expected to edge over 9 per cent in 2008, as a result of the globally high food and fuel prices. The current account deficit was forecast to stay at about 13 percent of GDP due to higher imports as a result of strong economic activities and a construction boom.
Source: African Development Bank Group
Kenya:
Kenya’s real GDP growth was projected at about 4 per cent in 2008, a decline from the 6.5 percent estimated for 2007, but is expected to start recovering to pre-crisis levels in 2009. This fall is due to the disruption of the free flow of goods, labor and services that occurred in the first two months of 2008. Tourism was highly affected and manufacturing and agriculture also declined. Following the political settlement, economic activity is returning to normal. Tourism may take longer to recover and the displacement of over 300,000 people, including farm workers, will continue to hamper agriculture. However, favorable weather conditions, including timely rains in 2008 are expected to help recovery efforts. Meanwhile, inflation shot up as the domestic disruption added to already existing pressure due to high food and oil prices, and is expected to be 18.5% in 2007/08 before moderating in 2009.
On the fiscal front, pressure for extra spending will rise to fund reconstruction, resettlement of displaced people, the large size of the national coalition government and the newly established commissions. Additionally, with a slowdown in the global economy, remittances are likely to fall. The Government has estimated the cost of reconstruction and related measures at KSh31.5 billion, equivalent to US$500 million. The government is seeking additional financing from the donor community.
The Kenya's economic outlook remains positive as economic reforms will continue to shape policy. Reconstruction is the main priority in the short term. An economic recovery package is in place and investor conferences and consultative group meetings are also planned. In June 2008, the government launched the long-term development strategy, Vision 2030 and the first Medium Term Plan for 2008-2012. The focus will be on reconstruction, deepening structural reforms and governance, improving infrastructure, reducing income inequality and creating jobs.
Source: African Development Bank Group
North Africa:
North Africa is linguistically, socially and economically the most homogeneous region of Bank Group operations. It has made significant progress towards the attainment of MDGs.
The region is made up of predominantly Middle Income & AfDB category C countries with average per capita GNP over US$ 2000 in 2007. The countries access mainly AfDB resources with only Mauritania undertaking studies to move smoothly into Middle Income Countries category.
Cumulative average country Bank Group loan/grant portfolio is about UA 2.2 billion, with most important beneficiaries of the Bank Group loans being Morocco, Tunisia and Egypt.
Multisector and power predominate Bank Group lending to the region.
Countries, total land mass and population
North Africa is made up of six countries: Algeria, Egypt, Libya, Mauritania, Morocco and Tunisia, with a total population of 160.1 million people or 17.3% of Africa's population and a total land mass of 7.04 million sq. km.
Per capita GDP/GNP and Bank Group country categories in the region
In 2006, the sub-region's average per capita GNP was as high as US$2,455 which was nearly three times the continental average. With the exception of Mauritania whose per capita GNP in 2006 was US$560, all the countries in the sub-region are classified as Middle Income Countries and are among 13 AfDB Category C countries that access only the Bank’s non-concessionary resources. Libya is, however, not a borrowing country, leaving Mauritania as the only ADF country in the region. As an ADF country, Mauritania only obtains concessionary resources.
Cumulative Bank Group lending in the region as at the end of 2007
Although the Bank only commenced its operations in North Africa in 1968, a year behind other sub-regions, the sub-region has obtained the largest amount of Bank Group cumulative loans and grants from 1967 to 2007, amounting to UA 12.91 billion (US$ 20.40 billion), or about 31% of the total amount. Of this amount, only UA 0.54 billion (US$853 million) or 4.2% is from ADF concessionary resources, the bulk being from ADB non-concessionary sources. The bulk of ADF resources to North Africa is allocated to Mauritania. North Africa is to ADB what East and West Africa are to the ADF, the concessary window of the AfDB Group.
Summary of country share of Bank Group lending to the sub-region
Morocco and Tunisia have, at all times, been the major beneficiaries of Bank Group commitments with about 33% and 27. 8% respectively of cumulative lending to the region from 1967-2007, followed by Egypt with 21.2%, Algeria 15.0 % and Mauritania about 3 % . As at the end of 2007, the region had the 3 biggest beneficiaries of the Bank Group cumulative approvals, namely; Morocco (US$ 6.8 billion), Tunisia (US$ 4.8billion), and Egypt (US$ 4.3 billion) Algeria (US$ 3.0 billion), Mauritania (US$580 million).
The absorptive capacity of the four category C countries have contributed in sustaining the AfDB's loan portfolio and credibility, thereby indirectly assisting in the institution’s credit rating and overall resource mobilization, including non-concessionary resources for Bank Group operations in other regional member countries.
Sectoral distribution of Bank Group lending to the region
Over the 1967-2007 period, sectoral distribution of cumulative Bank Group loan approval to the sub-region showed that the finance sector received UA 3.1 billion (approximately US$ 5.0 billion) or 23.8%, multisector UA 2.21 billion or about US$ 3.5 billion or 17.1%, power UA 2.2 billion (US$ 3.4 billion) or 16.7%, transport UA 1.7 billion (approximately US$ 2. 7 billion) or 13.2%, agriculture UA 1.3 billion (US$ 2. 0 billion) or 10%, social UA 0.9 billion (US$ 1.4 billion) or 6.7% , water and sanitation UA 0.7 billion (US$ 1.1 billion) or 5.2% , industry UA 0.5 billion (US$ 0.82billion) or 4 % while communications received UA 0.4 billion (US$ 0. 6 billion).
It is highly informative to compare the sectoral distribution of Bank Group lending to North Africa with that of West Africa. There are regional development reasons which tend to explain why finance, multisector and power are the key sectors of Bank Group lending in the region above the social, water and sanitation sectors as in some regions.
Some successful projects in North Africa
Egypt-Fund for Development (SFD) (Phase II) - Project (PCR 2006)
Following its establishment in 1991 to help cushion the effects of the country’s structural adjustment programme, the country's Social Fund for Development has become one of Egypt’s main institutional mechanisms for reducing poverty in the country. It operates by helping to extend basic social services and small enterprise support to the poorer segments of the population. It does this by building infrastructure and financing services via contracts with government and non-governmental agencies. It is a large and professionally run body which has earned the respect and support of the international donor community. So much so that it succeeded in raising over UA 440 million for its second phase (1997-2000).
The AfDB approved a UA 15million loan through its ADF window in late 1997 against a government counterpart of UA 50 million. Intended as a four-year project financing, the loan only came into force in mid 2001 due, in part, to loan ratification delays, requiring therefore some significant changes to its design. Located mostly within the Community Development Programme of the Social Fund, the project focused on the extension and strengthening of health services to poor communities in 5 governorates in Upper Egypt where poverty levels were particularly acute.
The social fund used UA 8.7 million of project finance through a contract with the health ministry to implement the health component. By mid 2006, 32 health units had been extensively upgraded while 18 new ones had been constructed. All 50 health facilities had been supported with equipment, materials and training both for health staff and communities, and they were delivering health services using the new integrated health care approach. Over 7,000 health staff were trained and the involvement of local communities in the management of the health facilities had been enhanced.
The project also supported a functional literacy programme which enabled the delivery of over 2,700 classes to almost 60,000 beneficiaries, 60% of whom were women. Awareness-raising on important cross-cutting issues such as reproductive health, family planning and nutrition was integrated into the training, thus boosting the self-confidence of trainees to participate more actively in community affairs.
The third element of the project was the credit component which accounted for UA 4.7 million. This comprised the provision of funds to the state agriculture and development bank (PBDAC) for on-lending to small-scale entrepreneurs as well as the financing of 11 NGOs to run micro-credit programmes, together with some small business management training. Although the bulk of ADF funds went to the PBDAC (rather than to the NGOs) which made larger loans and benefited mostly men, the PCR states that some 80% of loan beneficiaries were women who accessed smaller loans through NGO programmes. The project has reportedly resulted in significant improvements in the institutional capacity of NGOs to manage such programmes.
Both forms of loans put together benefited over 33,000 people and almost 11,000 micro-enterprises. The social fund shows that about 40,000 jobs were created, but a multi-donor review conducted in late 2004 questioned the Fund’s basis for its job-creation data. The review also raised the sustainability of the Fund’s micro-finance programme, given that it was using certain practices such as the provision of subsidized credit.
The multi-donor review assessed the partly ADF-financed Community Development Programme as reasonably effective. The infrastructure services provided were appropriate and of good quality. However it recommended that more community-empowering approaches be used in order to give the poor a greater ability to interact with service providers and local governance processes. It also recommended that the Fund shift away from delivering assistance through government agencies and focus more on NGO-led community development interventions.
Mauritania-Poverty Reduction Project (Micro-finance)
The project aims at establishing 7 savings and loan associations and strengthen local micro-finance institutions (MFIs). Components included the establishment of a loan fund of UA 1.82 million, capacity building of selected MFIs, IEC work and literacy training. The project began in 1999 and was completed in mid 2004, using UA 3.2 million of ADF funds.
By the end of 2005:
The 35 supported microfinance agencies had over 56,000 members compared to an expected 13,000;
Savings collected had reached UA 4.7 million against a projected amount of UA 0.5 million;
Loans had been extended to over 20,750 borrowers against a projected 7,500. Of these, over 5,500 loans were granted using ADF funds. Approximately 12,450 of the borrowers were women.
An estimated 4,530 jobs were created as a direct result of the loans.
Most borrowers interviewed report that the loans have helped to improve their socio-economic conditions through educational, health benefits or through income-generating activities.
The project also changed attitudes to microfinance:
Leaders of supported MFIs reported that they had become much more conscious of organizational development and governance issues, whereas prior to the project, they had managed the organizations in a generally disorganized manner.
The population and local development agents also changed their attitude towards credit programmes. A substantial educational campaign was implemented targeting women. This helped to establish a culture of discipline with regard to savings, loan management and repayment.
The project also included a large functional literacy training component which was combined with basic training on issues such as basic health and hygiene. This training was given to over 4,800 people, over 80% of whom were women. Anecdotal evidence suggests that women achieved increased self-esteem and ability to participate in community affairs as a result of the training.
The project helped to promote the concept of micro-finance and helped to pave the way for the expansion of the sector, especially to some previously neglected regions. In 1998, 10 micro-finance bodies operated in the country. By 2005, this had increased to 67.
The project also stimulated the government action to improve the Mauritania’s regulatory and institutional framework for micro-finance with the adoption of a national micro-finance strategy in 2003 and the preparation of a new law addressing the needs of this emerging sector. However, sustained success is still not guaranteed, given that micro-finance institutions have still not achieved the level of financial stability necessary to ensure their long-term survival and the wholesale market has not developed to the point where MFIs can easily obtain new finance for their operations.
Tunisia-Rural Electrification Project
The objectives of the Tunisia Rural Electrification Project are to:
improve the standard of living of the population;
reduce rural exodus by transforming the environment by providing electricity. The project targeted the electrification of 1,000 locations or agglomerations involving 45,000 households and 320 irrigation pumps
The project benefited small-scale operators and had a positive impact on the population in the project area. The main project components included the procurement of equipment, construction work, studies as well as supervision and management of work.
The project was successfully implemented and audit performance was satisfactory since the expected outcomes were largely surpassed. The outcomes included the electrification of 1,000 villages in rural areas and the supply of electric power to 52,657 households and 87 irrigation pumps. As a result, the rate of rural electrification in Tunisia rose from 86.9% in 1999 to 97.3% in 2004. Project implementation performance was assessed as satisfactory from the standpoint of adherence to cost, schedule, supervision performance and efficiency in the use of installed capacity.
Operational performance was considered satisfactory, as demonstrated by increased customer subscription for power supply and a 19% rise in the sale of electricity, which combined with higher electricity tariffs increased revenues on the power utility company, STEG. The cost of electricity production remained well above the average cost due to higher oil prices.
Institutional performance was also satisfactory in all aspects with the exception of the financial system and integrated management, which was assessed as less satisfactory since the audit was confined to Bank-financed components rather than the entire project audit financing.
Source: African Development Bank Group
This region is marked by the dominant influence of South Africa which is the strongest African economy. South Africa is the single largest beneficiary of the total Bank Group approvals to the region.
Over the past few years the situation in Zimbabwe, particularly the exponential inflation rate in the country has been a concern to the SADC Heads of State.
Cumulative Bank Group lending to the region is fairly more evenly distributed than other sub regions, with agriculture which is the largest beneficiary, receiving about 16.0 % of the total and communications 4. 4%.
Countries, total land area and population
Southern Africa is made up of the following 12 countries: Angola, Botswana, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, South Africa, Swaziland, Zambia and Zimbabwe.
The total land area of the countries is 6.574 million sq km. or 21.7% of the area of the continent, while the total population is in 2006 was 149.3 million or 16.1% of that of the continent.
The GNP per capita of the countries range from US$ 160 for Malawi to US$ 5260 for Mauritius, the third highest on the continent after those of Seychelles and Libya. The following five countries in the region with relatively high GNP per capita incomes are eligible for AfDB resources: Botswana, Mauritius, Namibia, South Africa and Swaziland.
GDP/GNP per capita and Bank Group country categories in the region
The other seven countries can only access ADF concessionary resources with limited AfDB funds for private sector and enclave projects. Although Zimbabwe’s GNP per capita in 2006 was barely US$ 340 below those of Lesotho (US$ 960) and Zambia (US$ 490), Zimbabwe has been a blend country with access to funds from both AfDB and ADF window.
Cumulative Bank Group lending in the region as at the end of 2007
Bank Group operations started in Southern Africa in 1969, two years later than most other regions. From 1969 to 2007, cumulative Bank Group commitments to Southern Africa amounted to UA 6.54 billion (US$10.3 billion) or 15.7% of the total loan and grant approvals to all regional member countries. Of this amount, as high as UA 3.1 billion (US$ 4.9 billion) or 47.6% was from ADF concessionary resources.
Summary of country share of Bank Group lending to the sub-region
The largest beneficiaries in order of importance included Mozambique (approximately US$1.7 billion), followed South Africa (US$1.3 billion), Zimbabwe (US$1.2 billion) Madagascar (US$ 1.1 billion), Zambia (US$1.1 billion) and Malawi (US$1.0 billion).
Sectoral distribution of Bank Group lending to the region
Sectoral distribution of Bank Group operations in Southern Africa shows that Transport received the highest loan and grant approvals with UA 1.11 billion (USS$ 1.75 billion) or 16. 9% , followed by agriculture (15.8%); finance (12.8%),multisector (12.7%); social sector (11.6%); power supply (10.9%); industry ( 7.7%); water and sanitation (7.1%); and communications ( 4.4% ) Like in some other sub regions infrastructure as a whole comprising transport, power supply, water and sanitation received 39.3% of the cumulative commitments to Southern Africa.
Selected successful projects in Southern Africa
Mozambique - Electricity II
The project involved an ADF loan in the amount of UA 14.7 million, for financing infrastructure needed for resettlement of displaced persons from the civil war. The infrastructure consisted of the extension of the electricity grid to the rural areas of Maputo and Gaza provinces in the South of the country.
The project successfully achieved its objectives, although it took longer than expected (1997 to 2003). The project provided significant social benefits:
A constant electricity supply to 4,600 (mainly poor) rural families - some 1,600 more than planned. Electricity delivery and payment mechanisms were deliberately designed to enable poor one or two-room households to have lighting.
A number of schools and health clinics were connected and plans are in place to connect more.
Provision of electricity encouraged displaced communities to re-settle in the villages they had abandoned during the conflict.
A prison has been relocated to the area to take advantage of the electricity and this will enable prisoners to learn certain crafts.
The project also provided electricity supply for local businesses, as follows: i) four factories and 11 tourist lodges. The provision of a 24-hour electricity to local tourist lodges has enabled them to reduce energy costs, expand their level of services and hence to hire more local labour and consume more local products. Many of these economic benefits were found to accrue to women; and ii) a local sugar factory was revitalized following the restoration of a constant and reliable electricity supply.
A good example of the impact on local economic development is that of the Ponta de Ouro tourist area, where the rate of development of new businesses has increased substantially since the community first received electricity under the project 5 years ago. In 2002 the electricity company had only 50 customers and there were few tourist lodges. Now it has 700 individual customers and 11 lodges with each lodge paying about USD 600 per month and employing on average 30 to 40 people.
Additional secondary benefits generated by the project included an increased level of social, cultural and educational activities in the communities served with street lighting, as well as the extension of cellular telephone sites to new areas, thereby improving the general level of local telecommunications.
Zambia - Kitwe Water Supply Rehabilitation (Phase 1)
Financing infrastructure for improving rural and urban water supply has been one of the Bank’s priorities in Zambia since 1977. To-date it has financed 7 projects and two studies in the sector.. Due to the state of dilapidation of the system and the poor management by the city council, the level of water supply was far below what the system was designed for, the water quality was poor and only 30-40% of the water produced was accounted for through the revenue collection system. Prior to the rehabilitation programme, there had been a number of cholera outbreaks which resulted in the deaths of hundreds of people.
Going from project identification to approval took several years and several reappraisals owing partially to a lack of sufficient ADF finance to cover the full rehabilitation need. Finally it was broken into two phases with the first phase focusing on the rehabilitation of the existing system. Though there was no commitment to finance the second phase it was expected that this would complete the rehabilitation and expand the system to new areas.
Phase 1 was approved in mid 1997 for a total of about UA 21 million, of which ADF provided almost UA18 million. Unfortunately it took almost another two years before the actual work began, due mainly to delays on the part of the government in satisfying some loan effectiveness conditions, such as the hiring of the project manager. Implementation was completed in mid 2003, some 19 months later than anticipated in the appraisal document, and within budget.
All the major planned outputs of the project were completed. These comprised of: i) rehabilitation of the main water treatment plant at Kafue and 5 water distribution centres (one more than originally planned); ii) rehabilitation of the trunk mains and the final distribution system to the water users; iii) modernization of the water flow monitoring and testing systems and iv) strengthening of the operation and maintenance capacities of the water management company.
The project had numerous positive outcomes including the following: i) the level of unaccounted for water was reduced from over 60% to 40%.; ii) the water quality had improved markedly due to the more than 60% increase in treated water production; iii) system reliability and average water pressure had increased; iv) water connections had been installed to over 13,000 households and the water company was reporting significantly fewer complaints from clients. The project’s impact is also demonstrated by the reduction of the incidence of water-borne diseases. There has been no recurrence of the serious cholera outbreaks experienced previously. The Bank’s self-evaluation rated the overall level of project outcomes as fully satisfactory.
Another positive impact of the project is that through appropriate loan conditions, the Bank was instrumental in getting the local government to place the newly created water company on a commercial footing. This included the establishment of efficient accounting systems, adopting a sound plan for achieving appropriate tariffs and reducing the level of outstanding debts from customers.
On the whole, the newly established local-government owned Nkana Water and Sewerage Company (NWSC) was being managed on a far more professional basis than its predecessor, the Water Department of the Kitwe City Council. Improvements needed related to its long-term financial stability which required continued improvement such as the control of the large number of illegal connections and the management of accounts in arrears.
The project experienced some implementation problems such as the technical inappropriateness of some of the water monitoring technology, the fact that the community did not like some of the constructed water sales kiosks and the serious delays brought about by a cumbersome procurement process The increased quantity of water flowing through the system increased the strain on the sewerage system, which had not been rehabilitated, thus causing more system blockages.
The project has generated some useful lessons for both the Bank and the Zambian Government related to improving the management of projects, particularly at the appraisal, launching and procurement management stages. There is now a substantial expectation by local stakeholders that the Bank will proceed to finance the second phase of the system’s rehabilitation and expansion.
Namibia - Basic Teacher Education Project
The project aimed to improve the quality of pre-service basic teacher education through the establishment of two new teacher education colleges, the Caprivi College of Education at Katima Mulilo and the Rundu College of Education. Each is a three-year boarding teacher training colleges with an initial intake capacity of 300 students, turning out 100 graduates a year. The UA 9.2 million ADF loan provided was mostly for infrastructure works and the provision of equipment and books, but also included some management support to the Ministry of Education. Project funds also supported infrastructure upgrades at another college (Ongwediva) including the construction of a library and extra classrooms. The project was started in 1994 and its projected outputs were completed in 1996. However there was a significant amount of unspent funds which were used for the previously unplanned Ongwediva work but this was only completed in 2002.
The two colleges have produced approximately 2,000 graduates since the initial project elements were completed in 1996 – which is twice the figure projected at appraisal (1000). The project has led to fewer student repetition and drop-out rates in the supported colleges and to generally improved examination performance results. Since these additional teachers have gone on to support the expansion of primary education in the rural areas the overall impact of the project has been significant.
The most successful project component was the construction of teaching and housing facilities in nearby rural areas. This enabled students to conduct teaching practice under comfortable conditions, which turned out to be a significant motivating factor for them. The experience corroborates the known correlation between the quality of facilities and student motivation.
Madagascar - Basse Betsiboka Rice Rehabititation Scheme
The project’s principal development objectives included:
increasing farmers’s incomes and alleviating poverty;
achieving food self–sufficiency.
Project specific objectives comprised:
restoring the production potential and the environment;
rehabilitating poorly irrigated or non-irrigated areas;
mobilizing and utilizing water resources judiciously;
ensuring the sustainability of rice irrigation structures;
conserving the ecology of the catchment basins in the project area;
environmental protection and restoration through establishment of reforestation islands;
physical protection against erosion gullies;
pasture improvement; and commissioning of specific studies.
As designed at appraisal, the project had the following principal components:
rehabilitation of irrigation infrastructure;
water and soil conservation; iii) irrigation engineering;
equipment and operating cost component;
research, development and training; and establishment of monitoring and evaluation.
The project’s physical outputs consisted of:
Increased acreage, yields and output levels by 6,762 hectares, 3 tonnes per hectare and 23,066 tonnes of rice, respectively;
The completion of the construction of 23 village wells, equipped with hand pumps Improved rice cultivable land was increased by 5,122 hectares;
The construction of 2.75 km of canals interconnection between Bekara and Karambo Basse schemes was completed;
The completion of the expansion of two dams, increasing their combined capacity by 13.5 million cubic meters;
The protection of the catchment basin was achieved by completing the development of pastures, cashews, eucalyptus by 5,800 hectares, 300 hectares and 1400 hectares, respectively.
The project’s outcomes were wide-ranging.
The project’s contribution to macroeconomic policy and sector objectives by promoting food self sufficiency, reducing food imports, increasing rice production and access to potable water supply was not at all in doubt.
Most of the project’s components, with the exception of research, were successfully implemented.
The participation of women in project benefits was also enhanced.
The project’s outcome on environment was positive since measures were taken to minimize potentially negative environmental effects.
By encouraging individual farmers, the project contributed directly to private sector development in the project area.
On the whole, project performance was satisfactory from the standpoints of implementation, the role of the Bank and project results (outputs and outcomes).
Southern Africa
Source: African Development Bank Group
Central Africa
A notable emerging country of the sub region is certainly Equatorial Guinea, which in 2007 had the second highest GNP per capita (US$8250) in Africa after Seychelles (US$ 8650). Most countries in the sub region are becoming important oil producers - Equatorial Guinea, Chad, Gabon, etc.
The Central Africa sub region is important in the terms of the protection of the world environment and eco-systems. In July 2008, the Bank and a number of development partners, notably DFID, Canada and the Nordic countries established the Congo Basin Rain Forest Trust Fund.
To assist the countries of the region in their loan administration and portfolio management, the Bank has established a regional office in Libreville and number of country offices, including in Chad, Cameroon and RD Congo.
Countries, total land area and population
Central Africa comprises the following 8 countries: Cameroon, Central Africa Republic, Chad, Republic of Congo, Democratic Republic of Congo, Equatorial Guinea, Gabon and Sao Tome and Principe.
The total land area of the region is 5.366 million sq. km or 17.7% of the total area of the continent and a total population of 96.2 million people or 10.4% of the overall population of the continent.
GDP/GNP per capita and Bank Group country categories in the region
The GNP per capita of the region ranges from US$ 120 for Congo DR, to US$ 5010 for Gabon. In the sub-region, Gabon and Equatorial Guinea are eligible to borrow from the ADB window while the other six countries can borrow from ADF concessionary resources; they have with very limited access to ADB financing for private sector and enclave projects.
Share of Cumulative Bank Group lending in the region as at the end of 2007
The total cumulative Bank Group loan and grant approvals to the region from 1967 to 2007 amounted UA 4.3 billion (US$ 6.8 billion) representing 10% of the cumulative approvals for the period. The Democratic Republic of Congo received the highest allocations (US$ 2.2 billion), followed by Gabon (US$ 1.5 billion), Cameroon (US$ 1.4 billion), Chad (US$ 644.3 million ), Congo (US$ 479.4 million), Central Africa Republic (US$ 235.8 million), Sao Tome and Principe (US$163.7 million) and Equatorial Guinea (US$ 106.2 million).
Sectoral distribution of Bank Group lending to the region
Infrastructure is the main beneficiary sector of cumulative Bank Group commitments to Central Africa in the total amount of about UA 2 billion (about US$3.1 billion) or 45.6% of the total approvals. Other key beneficiary sectors are multisector (18.3%), agriculture and rural development (16.5%) and social (10.4%).
Selected successful projects in Central Africa
Gabon-ADB Education Project (III)
The sectoral objective of the project is to develop human capital resources in response to the country’s development policy. In specific terms, the project was intended to upscale the intake capacity and improve the quality of technical and vocational education.. Approved in December 1997, the project received an ADB loan in the amount of 19.945 Euros.
The main components of the project consisted of : i) rehabilitation and expansion of existing institutions ; ii) construction of an industrial vocational center in the Estuary province ;iii) provision of technical equipment and teaching materials as well as school and administrative furniture ; iv) the provision of teaching manuals and v) retraining of teachers and strengthening the administrative capacity of the Department of Teaching and Professional Education (DETP) and Project Management
The project generated wide-ranging outputs including : i) rehabilitation of 10 institutions, training of 118 teachers, 60 laboratory and maintenance technicians, retraining of 600 science teachers, training of 7 inspectors, 10 teaching advisors and 100 teacher trainers as well as training of 25 managers of documentation and information centers and overseas training of 5 maintenance technicians
The project has had social, economic and financial impact. First, it has contributed to employment creation and poverty reduction. Second, by generating jobs, the project contributed to the management of social conflicts. Third, the project contributed to human capital development. Fourth, the economic impact involved the creation of new productive activities, improved competitiveness in the business arena and increased fiscal revenue. |
