AFRICA - CONTINENT OF OPPORTUNITY - FC THE FINANCIAL COOPERATION MAGAZINE - KFW ENTWICKLUNGSBANK
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FC
The Financial Cooperation magazine
Special edition
October 2019
Media partner
Africa – continent
of opportunity
Working together to create perspectives
Cooperation with Africa has never been this exciting! Interview with Helmut Gauges, head of KfW’s Africa Division, about the continent’s progress and opportunities. Which three challenges do you while severe weather events will You have travelled to Africa see for Africa that KfW also has increase in other areas and ultimate- many times to have a look at to deal with? ly the food supply will dwindle. Take projects on the ground. What has At first glance, the challenges are the example of Mozambique, which made a lasting impression on you very similar to those of other has already been hit hard by two and what makes you optimistic in continents and developing countries. cyclones this year. Incidentally, spite of the challenges? The biggest problem in Africa is poor malaria has also returned to the When you are on site, you can see governance, dysfunctional govern- country with the floods. and measure the progress that’s ment administrative structures and If all four challenges are taken been made. For example, you meet widespread corruption. The second together, it’s easy to predict that children who are happy they are serious challenge is inadequate migratory pressures will increase – if allowed to go to school; women who infrastructure in all areas. The we don’t overcome these challenges. can now take family planning into inadequacies are much greater than their own hands. on all other continents – they span Africa is high on the agenda – We meet mothers who have got education and health systems, but also due to the issue of migra- access to safe drinking water so also transport systems and energy tion. What does this mean for that their young children don’t and water supply. For example, it is KfW Development Bank? become ill or even die from wa- more expensive and takes longer to The migration and refugee flows that ter-induced diseases. We see transport goods from one side of we have experienced in recent years households with electricity – where Africa to the other than from China have made it clear to politicians and the people who live there can now to Africa. society that Africa’s problems are not read and study in the evening. Not The third major challenge is the just problems faced by a neighbour- to mention the many young entre- rapidly growing population that ing continent. Europe’s well-being is preneurs that we extend loans to continues to grow. Africa has a very inextricably linked to that of our and who want to grow their young population structure, com- neighbour Africa. A prosperous Africa businesses and create new jobs. bined with the risk of high youth is essential to achieving sustainable These observations are underpinned unemployment and lack of opportu- growth and stability, both in Africa by socio-economic evaluations that nities. and in Europe. Human trafficking and show significant progress in terms I would also like to mention a illegal migration can only be over- of life expectancy, infant mortality, fourth challenge, which is perhaps come if there are economic prospects school enrolment rates, growth not yet quite as visible: we are all for young people. In this respect, one rates and more. talking about climate change, about of the measures adopted by both the The image of Africa conveyed in an increase of two degrees in the German Federal Government and the the media, poor and without hope, global average – this poses a particu- European Commission is to increase lost in wars, plagued by epidemics lar challenge for Africa, because there funding for development cooperation – is not the full picture from the is no resilience or capacity to deal in Africa, and this of course also ground. Sure – the positive trends with the consequences of the change. applies to KfW. As a result, we have just mentioned are not as newswor- This means that droughts in parts of significantly increased our FC thy as the renewed outbreak of Ebola Africa will continue to increase, commitments with Africa. or a military coup... 2 Financial Cooperation
KfW director
Helmut Gauges
on the road in
Morocco.
Africa is a very, very rich conti- The German Federal Government has fund to improve financing for small
nent. Africa has so many resources, realigned some things with its focus and medium-sized enterprises and in
for example, the potential for on Africa. The Federal Ministry for risk hedging for private-sector
renewable energy – enough to supply Economic Cooperation and Develop- investments. We are seeing the first
the entire continent, but untapped to ment (BMZ) has presented a Marshall reform steps, for example in Tunisia,
date. Africa has wind and hydropow- Plan with Africa that addresses the and are confident that other coun-
er but also solar energy – with twice above problem areas with an inte- tries will follow suit.
as much potential as Germany. grated and partnership-based Last but not least, I want to
Experts estimate the capacities for approach and supports six selected mention that we are working very
solar energy at 9,000 to 11,000 “reform champions” in “reform hard on the development investment
gigawatts – in Sub-Saharan Africa. partnerships”. In these new partner- fund of EUR 1 billion announced by
By way of comparison: in 2016, the ships, reform commitments are Chancellor Angela Merkel at the
region generated a total of only 122 agreed as well as substantial finan- Africa Summit. The aim is to support
gigawatts. cial support, i.e. requirements and European and African companies,
So, Africa is a rich continent and expectations are defined. Where we both in the SME sector and young
there are good reasons to be optimis- can, we finance these reform efforts innovative enterprises, with their
tic. The potential has either not yet both with the BMZ’s federal funds as investments in Africa. Given the
been fully exploited or is unevenly well as with our own funds. The scale, this will trigger completely
distributed. reforms aim to improve the overall new catalysts to stimulate economic
conditions for private investments. development in Africa.
What new approaches is the We at KfW Development Bank Cooperation with Africa has never
German Federal Government support partner governments, for been this exciting!
pursuing and how is KfW helping example, in reforming the energy The questions were asked by
to implement them? sector, expanding a deposit guarantee Susanne Schröder
3
Paradigm shift in cooperation with
Africa: focus on investments
Africa harbours great potential: abundant resources, entrepreneurial spirit, innovative
capability and cultural diversity.
S
ub-Saharan Africa shows and banking sectors. Since 2017, the
robust economic growth of 3 Dr Stefan BMZ has supported the implementa-
per cent on average; Ethiopia, Oswald tion of the first three reform partner-
Côte d’Ivoire, Ghana and Head of ships with additional funds totalling
Directorate-
Rwanda are even higher than 7 per around EUR 800 million. Three other
General 2,
cent. The population is also growing reform partnerships with Ethiopia,
Marshall Plan
rapidly: Africa’s population will with Africa; Senegal and Morocco are set to be
double by 2050. The continent will displacement finalised by the end of 2019. The new
have the largest labour supply in the and migration “Special Initiative Training and
world by 2035. 20 million new jobs Employment” and the Development
will be needed every year. To actively the African Union: the reform Investment Fund also support private
address the challenges, the countries partnerships. Under these partner- investments with EUR 1 billion.
of the African Union adopted Agenda ships, we strengthen the principle of
2063 in 2015. personal accountability and ask for First successes: reform partner-
This is the starting point for our more reforms and personal contribu- ship in Tunisia
cooperation: we must help our tions from our partners. The first pilot In Tunisia, the reform partnerships
African partners to better leverage projects are underway in Côte have triggered important reforms in
economic potential and create more d’Ivoire, Ghana and Tunisia. In Côte the financial and banking sectors. For
jobs. The private sector can and must d’Ivoire and Ghana, the reform example, the anti-corruption authori-
make a much bigger contribution to partnership focuses on the private ty was expanded and the state credit
sustainable development. Against sector’s expansion of renewable guarantee fund was reformed to
this background, the German Federal energy and energy efficiency; in the enable more investment in reliable
Government is now increasingly reform partnership with Tunisia, overall conditions.
focusing on improving overall cooperation focuses on the financial Dr Stefan Oswald
investment conditions. This was also
the aim of the Compact-with-Africa
initiative launched under the German
G20 presidency in 2017. In “com-
pacts” between individual African A Marshall Plan with Africa
countries, international organisations Africa needs African solutions. As a result, the Federal Ministry for Economic Coopera-
(World Bank Group, African Develop- tion and Development (BMZ) has realigned its cooperation with Africa.
ment Bank, IMF) and bilateral http://www.bmz.de/de/laender_regionen/marshallplan_mit_afrika/index.html
partners, all participants coordinate
concrete measures to mobilise local You can read about how KfW is sustainably improving living conditions in Africa on KfW
private-sector investment. Stories in the Africa dossier. Learn more, for example about clean energy from the
The Federal Ministry for Economic Moroccan desert, the expansion of mobile communications in the Congo and smart
Cooperation and Development (BMZ) national park management.
also established a new cooperation https://www.kfw.de/stories/dossier-afrika.html
model to implement Agenda 2063 of
4 Financial Cooperation
German farming machinery technology
for Ethiopian vocational schools
Ethiopia is a multi-ethnic country that is home to 100 million people and has incredible
potential in the fields of agriculture, industry and tourism. In recent years, the country’s
economy has seen some of the strongest growth in the world.
I
t is a nation with breathtaking opportunities for its growing popula- for Economic Cooperation and
landscapes, its own script and a tion. Since the 1960s, KfW Develop- Development (BMZ). Teachers and
history that stretches back ment Bank has been committed to students are trained in operation,
thousands of years. Not without improving vocational schools and maintenance and repair. To this end,
reason is Ethiopia called the “cradle of teacher training – including in the a training cooperation was agreed
humanity”. The country was already agricultural sector – and has provided with the German agricultural
inhabited about 3 million years ago, more than EUR 1 billion to date. machinery manufacturer Claas,
as proven by a skeleton discovered in Problems that stand in the way of which supplies the necessary
1974: “Lucy” is now housed in the increased productivity: a low level of machinery including spare parts and
National Museum in Addis Ababa. mechanisation, defective agricultural – as the only company in the country
Coffee, an important export product, machinery and spare parts that are – operates a training centre with
originated in Ethiopia, while other difficult to procure. In many places, twelve mobile workshops.
agricultural products include cereals there are no mechanics who can Samrawit Kiros Haylu has been
and cut flowers. Agriculture is the maintain and repair the machinery. working as a teacher at the Wukro
cornerstone of the economy, account- In 2019, KfW Development Bank will Agricultural College since October
ing for more than 40 per cent of GDP provide EUR 8 million to twelve 2018. She holds a bachelor’s degree in
and about 85 per cent of exports. agricultural vocational schools to agricultural engineering and was one
The education sector plays a key equip them with tractors and other of the first to benefit from the
role in advancing the country’s “medium technology level” machin- practical training after the tractors
economic development and creating ery on behalf of the Federal Ministry arrived. What exactly does her job
involve? “I work as a driving instruc-
Samrawit Kiros Haylu in front of one of the new tractors. She is the first driving in- tor – this of course also includes
structor ever in Ethiopia. driving with auxiliary equipment like
a plough. But I’m also responsible for
repairs and maintenance, along with
instruction in safety and theory.”
About half of the almost 800 stu-
dents and about 40 per cent of the
teaching staff are women. And what
is it like for male students to be
taught mechanics and tractor driving
by a woman? “When we have the
opportunity as women to prove
ourselves in a job, we are very tough
and conscientious. A good prerequi-
site for successful instruction,”
Samrawit says.
Susanne Schröder
5
Help with digital technology
For ten years, KfW Development Bank has been participating in the Social Cash Transfer
Programme (SCTP) in Malawi, which helps to ensure that the basic needs of the poorest
families are met. The donors use digital technologies to guarantee targeted and efficient
disbursements and transparent processes.
T
he programme targets the table and IT equipment supported by processes,” says department director
poorest ten per cent of needy a mobile power unit at the paypoint, Bettina Tewinkel.
households in Malawi. They as there is almost no public electrici- External evaluations attest to the
receive cash payments not ty supply in Malawi. The administra- success of the programme: “It has
subject to conditions, so they can tive employee goes through the made an effective contribution to
decide for themselves how to spend process from identification to alleviating poverty in Malawi and the
the money. The government sets the payment with each client on site. living conditions of the families have
amount of the transfer payments KfW would like to make more use improved. They eat more regularly,
based on the need for food, clothing, of digital processes such as e-pay- more children go to school and stay
health care, school attendance and ment in Malawi in the future. Howev- in school longer overall,” explains
other things. er, the necessary conditions have not Tewinkel.
Cash payments are limited to a yet been created for this to be KfW Development Bank is imple-
certain period of time. The plan is to possible across the board. The menting the SCTP on behalf of the
support the selected target group for beneficiaries – often elderly people – German Federal Ministry for Econom-
four years. Data will then be collected lack the most basic technical ic Cooperation and Development
again. knowledge and have not yet used (BMZ) and the European Union (EU)
Since many poor families in more modern payment methods. This in 14 of Malawi’s 28 districts,
Malawi do not have a bank account, makes it difficult to use these covering around 130,000 households
other ways had to be found to technologies. “The administrative occupied by more than 580,000
disburse the money. The families can workload has already been considera- individuals.
collect their money every two bly reduced through improved Sabine Balk
months at paypoints, which are set
up on a village square or in front of a
school, for example. The process is At the paypoint.
coordinated via a management
information system – a computerised
database that stores all the data.
The beneficiaries are issued an “ID
card” that proves their status as
authorised claimants. The card
contains a barcode, which the
employees of the district authorities
scan on site. This allows the recipi-
ent’s data to be accessed directly. The
district officials then know how much
the person is due to receive for his or
her household and the sum is handed
over in cash.
The process is still quite complex.
The district official sets up a folding
6 Financial CooperationA pioneer in challenging markets
They learn how to expertly assemble gypsum boards, how to install windows and doors
in drywall construction or how to ensure good soundproofing and fire safety: since April,
carpenters, painters, architects and even young people with no formal education have been
trained at the Knauf training centre in the Ghanaian capital Accra.
T
he courses last between one The first course is looking forward to start.
day and two weeks and
there are about 800 spots
per year. “The construction
sector in Ghana is booming, yet
there is a huge shortage of skilled
wor-kers,” explains Daniel Thomann,
specialist coordinator for the
develoPPP.de programme at DEG –
Deutsche Investitions- und Entwick-
lungsgesellschaft. “This is very much
in line with the project.”
The centre, which opened in
February, is part of a large-scale
training campaign by Knauf, an
internationally operating building
materials manufacturer based in
Germany, DEG and the Federal
Ministry for Economic Cooperation
and Development (BMZ). A total of doing very well – the company has increasingly important there: drywall
nine drywall construction training professionalised the training process.” construction requires less energy and
centres in six African countries and Graduates have a good chance of water and houses can be completed
Iraq are planned in the current finding a job or, if they had previous- more quickly and designed more
project phase. The centre in Tanza- ly worked in the construction sector, individually.
nia opened in June 2018, Ghana is more opportunities than before. Many For Knauf, the main advantage is
the second and a centre in Erbil will also go freelance. This was shown by to make its products better known
follow in October. Knauf is provid- evaluations in Tunisia. “We want to and tap into new markets. DEG has
ing EUR 2.8 million for the project systematically collect data about already supported several of the
and DEG a further EUR 2.3 million what happens to the people in the company’s investments and sees it as
from the BMZ’s develoPPP pro- new centres,” says Thomann. a “pioneer in challenging markets”, as
gramme. In subsequent project The overall goal of the project is to Thomann says. “Knauf is an early
phases, drywall construction create at least 2,000 jobs. According mover and has a pull effect for other
training centres will be built in to Thomann, this is a conservative German companies.” It is important
other African countries as well as in estimate considering that 12,000 peo- to DEG to offer more than just
the Middle East and Asia. ple are to be qualified within three financing: its support gives Knauf
“Knauf already has many years of years. Drywall construction is still more confidence in Ghana and other
experience with training centres of unusual in Africa – brick construction countries and opens up new sales
this kind, for example in Tunisia and is the prevailing method – but it has channels.
Algeria,” says Thomann. “They are advantages that are becoming Katja Dombrowski
7Desks, tables, windows – and dry floors
What a difference a good learning environment can make: a primary school teacher in
Maputo explains.
T
he children used to sit on her disposal. “Now the students can has set itself the goal of increasing
the floor. They had no desks, concentrate on learning,” says the the rate of school enrolment in line
no chairs and in most teacher. with the sustainable development
classrooms there was also goals (SDGs) and noticeably improv-
no electricity. This was uncomforta- ing the quality of teaching.
ble, especially for the girls, some of The first successes have already
whom still wear a capulana, a been achieved: almost 85 per cent of
traditional dress. “This made it all six-year-old children now attend
difficult for them to sit on the floor,” school, compared with just over 80
recalls primary school teacher per cent a few years ago. On behalf of
Felizarda Zaqueu. the German Federal Government,
She generally found it difficult to KfW is financing construction
provide a creative environment under measures in the education sector
these conditions. “I couldn’t create a together with a number of other
pleasant learning environment,” says donors to remedy the serious
the 55-year-old teacher, describing shortage of adequately equipped
the situation several years ago. classrooms. The shortfall was
Especially since the school was also recently estimated at 38,000 class-
built on a kind of swamp. When it rooms throughout the country.
rained, everyone’s feet got wet and Escola Unidade 30 with Professora
dirty. Water and moisture were not Felizarda Zaqueu is no longer
only unpleasant; they also posed a Professora Felizarda Zaqueu in Maputo. included in this figure. She has been
serious health hazard. teaching there for 23 years and does
Thankfully things have changed She teaches at Escola Unidade 30 not, under any circumstances, want
since then. Today the pupils sit in a in the capital of Maputo, a primary to return to the old learning environ-
dry place: in renovated classrooms, school that has been renovated in ment. “Everything is easier today,”
on sturdy desks, on solid stone floors. recent years with support from says the mother of three. “Now we
The walls are nicely painted, the Germany. The work was part of a have everything we need to encour-
windows let in enough light. And: larger programme to build or age the children’s development. I am
Felizarda Zaqueu also has teaching modernise 1,000 classrooms a year in very happy about this.”
materials, books and blackboards at Mozambique. After all, the country Friederike Bauer
Imprint Publisher KfW, public agency, LGc2, Palmengartenstraße 5 – 9, 60325 Frankfurt am Main, Germany Editors Nicolai Tust,
Susanne Schröder (all from KfW) Authors Sabine Balk, Friederike Bauer, Katja Dombrowski, Dr Stefan Oswald, Susanne Schröder
Contact info@kfw-entwicklungsbank Design Jan Hofmann (FAZIT Communication GmbH) Photos KfW Group / photo archive, title;
KfW Group / Alexander von Kap-herr, p. 3; Dr Stefan Oswald, BMZ, p. 4; Dr Josef Most, p.5; KfW Group / Jonas Wresch, p. 6; KfW
Group / photo archive, p. 7; KfW Group, Ricardo Franco, p. 8 Print FAZIT Communication GmbH, Frankfurt am Main
Press deadline 19 September 2019
This publication was printed on climate-neutral FSC®-certified paper.
8 Financial CooperationYou can also read
