Africa poses critical challenge for World Bank, IMF

WASHINGTON (AFP) – Global heat maps of extreme poverty show Africa in deep red.

And the problem will only accelerate as population on the continent grows in coming decades.

“The problems are very real and are large,” newly installed World Bank President David Malpass told AFP in an interview.

The International Monetary Fund (IMF) and World Bank have had a mixed record in addressing the longstanding challenge of poverty on the continent since the institutions were founded 75 years ago.

Now they must confront the need for massive investment in infrastructure and job creation in the coming years just to keep pace with the growing population on the continent – all while simultaneously managing the threat posed by climate change in a region perhaps least able to confront the costs.

Malpass has made that mission a priority.

“I have put emphasis on having the bottom 40 per cent of the population see more jobs, more cash income but also more of the inputs to a better living standard,” Malpass said.

“That might mean access to healthcare, to education. And that would be better environmental practices – all of that contributing to a more prosperous… society.”

In the most recent numbers available, World Bank data show extreme poverty fell worldwide to a new low of 10 per cent in 2015. The number of extremely poor people – those who live on USD1.90 a day or less – has fallen by more than one billion since 1990. However, that number is on the rise in Sub-Saharan Africa, which was home more to than half of the world’s extreme poor in 2015.

Malpass prefers to focus on country programmes that tailor policies best suited for each situation.

For example, getting state-owned monopolies out of the way of private enterprise, and improving the legal system “allows businesses to start, that allows people to get skills that they need for jobs,” he said.

A recently approved concessional loan in Kenya includes freeing up agriculture markets to allow small farmers to have better access to seed and other supplies.

Countries can meet the “huge” challenges” but they will need private investment including from expatriates, he said.