Exclusive Interview with African Markets, by Joseph Martial Ribeiro, ADB Deputy Director-General for West Africa.
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The AfDB and the importance of PALOPs in Africa.
For the AfDB, the importance of the PALOP in Africa is not as small as many people think. In this conversation we had with Dr. Joseph Ribeiro, the Deputy Director of the African Development Bank (BAD), for the West African region, we realized that, despite being “insignificant” among the Anglophone and Francophone countries, the PALOP, they matter.
In this conversation, we learned that the Portuguese-speaking African Countries (PALOP) that from five, became six, with the admission of Equatorial Guinea, a former Spanish colony, located in the Gulf of Guinea and rich in oil and gas , are:
“Countries of some weight, of significant economic and population weight, with a strategic position on the continent”.
“Which do not have geographic continuity, but we are connected by the sea, since ancient times and also by migration”.
We also learned that, since the time when Akinwumi Adesina assumed the Presidency of the ADB, the Bank started to give equal opportunities to all and the PALOP became included in the agenda, ensuring that Lusophones feel that they are having the same treatment they deserve.
Another topic addressed was the so-called “Lusophone Compact”, a novelty by the AfDB that has to do with an investment program created with the aim of accelerating low-cost private investments in the PALOP, and the main objective of this investment program is to increase volume and reduce investment risk.
There was also talk about economic recovery, and Joseph Ribeiro indicated that growth will be heavily taxed in the fiscal space and that countries will have to relaunch their economies. He also underlined that for this to happen, a part of the income has to be used to service the debt.
In this sense, the ADB is “fight on two fronts”, by advising on the debt issue and ensuring that the economic recovery translates into improving people's quality of life, improving the economic competitiveness of African countries and sustainable and inclusive growth.
There was also talk about the lack of information circulating about the work of the AfDB in the PALOP and the fact that Portuguese does not appear in the ADB's news and press releases, which despite not being an official language of the ADB, is used as a language of work.
Interestingly, after this interview, the ADB website began to provide part of its information in Portuguese.
Another interesting coincidence that occurred after this conversation was related to ECOWAS, in which we talked about the low weight of Guinea-Bissau and Cape Verde in the organization and the need to unite to have more strength in decisions and thus manage to reach the presidency and, a few days later, we published the news of the nomination of Guinea-Bissau to the Presidency of ECOWAS.
In short. It was a very interesting conversation, so I advise you to watch the video with the entire interview or, alternatively, read here, the full transcript of the pleasant conversation we had on the program "Great Interviews” from our YouTube channel, +Africa.
The interview
More Afrika (MA): Dr. Ribeiro, thank you for giving us this interview. For those who don't know him, I would be grateful if you could tell us, in a few words, who you are and tell us about your background, where you come from and what roles you currently occupy at the African Development Bank, aka AfDB.
Joseph Ribeiro (JR): My name is Joseph Ribeiro, I am the Deputy General Manager for the West Africa region, I started this role this year and, before that, I was in Angola where I represented the Bank with Angola and São Tomé and Príncipe and I have also been representative of the African Development Bank in Mozambique.
I have a career as a civil engineer and economist. I did higher education in Canada and after that, for 20 years, I have been working on development in Africa.
MA: Dr. Ribeiro, let's talk about us. We are the so-called PALOP, or Portuguese-speaking African Countries, which also include Equatorial Guinea.
The PALOP are 6 countries spread across Africa, without common borders with other countries that speak the same language, unlike the Anglophone and Francophone countries. This clearly hampers their integration into the African continent as a whole.
Bearing in mind that these countries are integrated in regions with structurally different languages and economies, how does the ADB see this situation and what plans does it have to help us?
JR: Very well, I must say that the AfDB has paid special attention since the Presidency of President Adesina, to the PALOP, for several reasons, because they are also important economies.
We have Angola and Mozambique, which are countries of some weight, with an important economic and population weight, we also have Cape Verde and São Tomé and Guinea-Bissau and Equatorial, which also have a strategic position on the continent.
Therefore, they are countries that do not have geographic continuity, as you mentioned, but we are connected by the sea, since ancient times and also by migration. Therefore, we know the poor history, the movement of people from one country to another in the PALOP.
There are very old ties and the blue economy that I mentioned just now serves as a tie for all of us. The ADB took the initiative to propose a Portuguese-speaking compact, with the Portuguese authorities and the PALOP authorities, which has already been signed since 2018, the compact that aims to accelerate private investment in the PALOP.
It is the ADB's perspective that the PALOP deserved more attention from the international private sector and in this sense we have had the guarantee of 400 million euros from the Portuguese government, to advise or improve the financing of projects in the PALOP that have Portuguese, private content.
And, therefore, this guarantee is not yet effective, activated, because it lacks some technical details that, incidentally, we had a meeting within the framework of the annual meetings of the month of June and, we think that in 2 or 3 months we will be able to close this guarantee and in such a way that it complies with all applicable laws in Portugal and also with ADB rules.
This is where we are, but to say that we are making progress, because with São Tomé and Príncipe, by the end of the year, we intend to adopt or finance a project, which the São Tomé and Príncipe government has already prepared to contribute with part of the its resources from the African Development Bank fund which are around 5 million Dollars.
So the project is from the Compact fund in São Tomé and Príncipe, so it will aim to finance small projects that ADB, as a rule, does not finance directly.
The ADB directly finances private projects that are budgeted at least $30 million and often, in some economies, do not necessarily correspond to the needs of the local private sector.
Often, for example, we can talk about 500.000, 1 million, 2 million, so the Compact fund in São Tomé aims to respond to this type of request.
Cape Verde has also started a fund, in this sense, which is quite advanced. We noticed a lot of initiative on the part of the government, also in this sense, and Guinea-Bissau is also in advanced discussions to establish such a fund. There is a lot of interest on the part of the Guinea-Bissau authorities.
As far as Angola and Mozambique are concerned, we have already identified projects, of a certain scope, but we will wait until the Portuguese guarantee is finalized to put the Compact into effect. But I must say that it is arousing, and quite rightly, a lot of interest by the PALOP private sector, in relation to the Portuguese guarantee.
MA: What are the obstacles to the fact that this guarantee has not been implemented until now, considering that it was signed in 2018. And by the way, why Portugal? Why not other countries that might be interested in the PALOP?
JR: Yes, it is obvious that looking at the PALOP economies, Portugal is obviously an important, strategic partner and, for many countries, a significant part of the public debt is also with Portugal or with Portuguese institutions. Therefore, we couldn't help but look at this partner who is also a member of the ADB and who welcomed this initiative with open arms.
That said, the guarantee has not yet been implemented, because there are elements of the Portuguese guarantee law that must be verified, in relation to the Lusophone Compact, and also elements that the ADB requires, in order to comply with its implementations.
So these are technical issues, but if there is political will that has been reconfirmed, on the occasion of the annual meetings, we have all the confidence that we will achieve.
Now this Compact is not limited to Portugal, in fact we have already received expressions of interest in the IFC, the private sector arm of the World Bank. There are other partners that we are also working with, with whom we are working, to join the Lusophone Compact.
For example, Cape Verde has already mobilized the interest of some entities such as USAID. The World Bank was also ready to give some advice or technical help, so it's open and we call it the Lusophone Compact, looking at the PALOP countries.
It does not mean that it is limited to Portugal, which has also accepted with very good eyes the participation of other partners.
MA: In addition to the “Lusophone Compact”, probably the best known ADB action in relation to the PALOP, what are the other AfDB interventions towards the PALOP?
JR: Yes, it is necessary to remember that since 1975, in general, 77, all PALOPs, joined the ADB, after independence. Going for example from East to West, today in Mozambique we are participating with 400 million dollars for the gas exploration project in Cabo Delgado, which is the largest project of its type and which received an award.
Our participation received a prize, because the ADB has a catalyzing and reassuring effect on private investors at an international level, taking into account, bearing in mind, our performance in the financial markets and the Triple A listing.
For example, this is an example, we also financed gas pipelines from Mozambique to South Africa.
In Angola at the moment, a structuring project is underway that will connect what will be done, a High Voltage Transmission line, in 340 km from Huambo to Lubango, which is in the south of Angola.
And then, in the following year, I mean, we thought with the Angolan authorities that we could make the connection from Angola to Namibia and from there to the Southern African Power Pool, for its Southern African electricity market.
What will make Angola an exporter of energy, because Angola has a very large capacity of hydraulic energy, it is around 20.000 megawatts, so it is an important source of income for Angola and ADB, invested in this case, about 450 million of dollars. This was in 2019 and the project is ongoing. It is an example.
We invest in agriculture in Cabinda, we also invest in sanitation in Angola and many other projects.
We are talking about São Tomé, we also invest in energy efficiency, energy plays a very important role because it is the first area of focus for the ADB, because without energy, savings do not work. Our President Dr. Adesina, usually makes the parallel between blood circulation in the body and the circulation of electrical energy in a country in the country's economy.
So in São Tomé, we are, for example, in renewable energy, not only in São Tomé, but also in Príncipe, with hydro, hydropower projects, we are present, we financed, in fact, the first University of São Tomé in the past and we are present in several areas and obviously we gave very important support in the context of COVID-19.
And remember that the ADB, launched an initiative of assistance to African countries of 10 billion dollars, against COVID-19, was distributed many times to budget support.
São Tomé benefited for example and was very well received and we also launched a “social bond”, a social bond of 3 billion, it was the first that was made and which also deserved an award.
Going to Guinea-Bissau, it is a partner in which we work a lot in agriculture, at the moment we have 2 projects in progress, we work on energy with the OMVG which is the organization for the use of the Gambia River that will also facilitate the consumption of electricity which at the moment in Guinea-Bissau, is far short of needs.
And in Cape Verde, we did several projects. For example, the extension to Praia airport. We are financing, with the European Union, the requalification and rehabilitation of the ports on the islands of Maio and Sal, so that is to say that we are very present in the PALOP, perhaps we will see how to increase publicity in this regard.
MA: doctor Ribeiro, we usually read all the ADB notes and communiqués when we are looking for interesting news to publish in Mais Afrika and we noticed one detail, there is very little news about the PALOP in your press releases. Why?
JR: First, to say that in many ADB meetings, in fact in all meetings, including general assemblies, we have Portuguese as the working language.
We have Portuguese interpretation and, even in the meetings with the PALOP, we also use the Portuguese language, as far as possible and the institution has made a lot of effort to have teams that are Portuguese speakers.
It is not an official language, the official languages are in English and French, but there is a lot of openness and with the current presidency of Dr. Adesina, Portuguese has been greatly supported as a language within the ADB and also remember that we have PALOP officials.
We have Dr. Mateus Magala who is the vice president of the administration who is Mozambican. Here I am, as Deputy Regional Director for West Africa, as a Cape Verdean. We also have a colleague from Guinea-Bissau and others. So there is an opening and we even encourage PALOP citizens, students and professionals to apply more.
In terms of news about the PALOP, we must say that francophone countries, for example, have an older tradition, I would say.
The English-speaking economies are also very aggressive, but in the good sense of the term, in terms of seizing opportunities, in terms of the performance of the private sector, of solidifying those of all the ADB windows, and that is why we are keeping our eyes on in the PALOP which are also newer countries.
It is not, therefore, most of the other African countries, they had independence in 1960 and the PALOP, it was more or less 15 years later.
Since there is also an influence in terms of the development of the private sector, opening up to the rest of the economies. We are monitoring this process, but we are absolutely certain that we are gaining ground in this matter.
MA: After the prospects for economic growth, forecast for 2021, how does the ADB see the possibilities for recovery, in terms of percentage of economic growth, throughout this year 2022.
JR: At the continental level, we bet between 2 and 3% and there was a significant contraction of GDP in many countries.
Obviously we know, for example in the case of Angola, with the drop in oil prices, Cape Verde with tourism, so it's a general situation, but the recovery will be heavily influenced by the fiscal space, the countries will have to relaunch the economy , because it is necessary for the country, the government, to be able to make expenses to help relaunch the economy.
That is, if most or a significant part of the income is used for debt service. In short, it will not be possible, so that is why we are fighting on 2 fronts, namely, to see how to advise on the debt issue.
We have already talked about some of the mechanisms that we are proposing and also, to see how to revert to the fundamental ones, so that these recoveries are not only numerical, to say that, for example, we are saying at the moment that Africa is experiencing the worst recession in 25 years, because there was a lot of growth and so on.
It's true, but to what extent was this growth shared at the level of people, in people's purses, this is a question, there is a question of growth in terms of volume, aggregated at the national level.
But this must be translated into terms of improving people's quality of life, improving the country's economic competitiveness, which was not always the case.
Therefore, we are working to return to growth, but this growth must be sustainable growth, inclusive growth and this also involves an issue, economic governance issues that we have already touched upon and that I believe.
I am positive, because in international meetings on Africa that concern Africa, we are no longer afraid to talk about corruption.
We are no longer afraid to talk about the accountability of actors, so we are no longer afraid, in fact, on the contrary, to say that it is important to achieve transparency and in this respect we strongly support digitalization, we support e-governance in many countries.
Guinea-Bissau, we are, we have a project, until the end of the year of institutional support, for the reform of diversification, in this sense, because in Guinea-Bissau, it is about 40% more or less that the income is used for salaries and this it's very important.
Digitization will help to have more transparency and efficiency, the government has also chosen this path and in general we are also working on this… countries.
MA: In relation to the recovery, specifically the recovery in the PALOP countries, will it be similar, different, will it depend on whether the countries are oil exporters, as is the case with Angola, will it depend on the gas issue in Mozambique, or on the countries like Guinea-Bissau, will it depend on Caju, or in Cape Verde and São Tomé, will it depend on tourism, or will there be a different recovery for everyone?
JR: Yes, immediately, we can only be guided by what we have. Governments are moving forward, for example in Angola, there is a more favorable evolution for oil, but I know that there is a lot of desire to transform oil even more locally, at the moment the country produces about 20% of its needs in terms of products refined and there is ambition to raise this rate.
In Mozambique, we are already aware of the efforts that the government is making with the headquarters, to be able to control the insurgencies and reverse the data and there is very strong pressure, we have already garnered support from France, so that TOTAL can continue to explore gas in the country , which is very important, as a partner and key investors.
And Cape Verde is working on advancing the vaccination rate for the resumption of tourism, etc. São Tomé, that's it, it is now possible to use the Visa card in the most extensive way, the ADB has also worked in this direction, in terms of means of payment and Guinea-Bissau, also has its valences, we are talking about Cashew, but also agriculture in general.
So right away, that's it, but Equatorial Guinea, I forgot to mention, also has oil as an important element of its economy. But beyond that, I believe it's important to have ambition.
Development is nothing beyond, nothing that comes from beyond, there are many countries that have passed through there and I don't know, there is no reason why African countries, including the PALOP, cannot develop economically and diversify their economy. Diversification means exporting more goods and services to the outside world and this will build resilience.
Therefore, the recovery must be immediate, with what we immediately control, but also with a focus on diversifying the economy and also making the states more independent.
For example, I recently heard from the director of the IMF that it is very important to move forward in the digital direction, why not? Because we have a very important penetration rate in mobile phones in Africa and the digitization of the internal fundraising system would be one way.
Therefore, we cannot neglect the importance of working with agriculture either, we are using very old-fashioned means in Africa and, nowadays, agriculture must be modernized, we have no other way out, because 70% of the population in general , are in agriculture and have always worked in agriculture.
We will continue with the rural nitrogen, joblessness and insecurity programs as well. These are elements that we had to take into account, because the occupation of the State's space by the population is also a very important stabilizing element.
MA: Cape Verde and Guinea-Bissau are the only 2 PALOP countries that are part of ECOWAS. 2 countries out of 15 that have relatively small economies compared to the others, obviously excluding the Gambia. How does Dr. Ribeiro, do you analyze the position of these 2 countries in the ECOWAS framework?
JR: Guinea-Bissau is, from the start, being a.... let's say the mainland, in addition to having a part with many islands, it is more integrated, let's say geographically, with ECOWAS, but we have ties between Cape Verde and Guinea-Bissau that are very important, hence the idea of joining forces to light the Presidency.
This would be a perfectly normal thing, these countries also host institutions in the region, whether in the city of Praia or in Bissau, I also know that even in sports, there are also competitions that will take place in these countries and, for me, it is a matter of affirmation, no country is small, the economy can be small at a given moment, but this is an issue that can evolve.
I believe that with more diplomacy, more economic diplomacy, too, the two countries will manage to have more weight in ECOWAS decisions. I also believe that ECOWAS is open to giving equal opportunity to all countries to access the Presidency in due course.
MA: Dr. Ribeiro, that's all for me, if you have anything you want to add or that you think is relevant, for those who will listen to your interview, please do so, we are at your disposal.
JR: I am very grateful for this opportunity, again, to say that it is not always necessary to see a path, to know that it exists, I am referring to the path to development, all African countries have the possibility to develop.
We have seen what has happened in other parts of the world, so we must approach this issue of economic development, its complex, in a frontal way and, to assert, our capabilities and our opportunities that we have in all countries and more especially in the PALOP . Thank you very much.
MA: Dr. Ribeiro, thank you so much for giving us this interview, I know his time is precious. To the next.
JR: Thank you and good morning.
What do you think of this conversation with Dr. Joseph Ribeiro, about the PALOP? Did you learn more about the importance of Portuguese-speaking countries in Africa? We want to know your opinion, do not hesitate to comment and if you liked the article, share and give a “like/like”.
Picture: © 2022 Francisco Lopes-Santos