Addis Ababa, Ethiopia – Ghana's President Nana Addo Dankwa Akufo-Addo, in a bid to bolster Africa's economic self-reliance, has proposed that a minimum of 30% of the continent's sovereign reserves, currently held in foreign banks, be redirected to its own financial institutions. The President made this suggestion during a Presidential Dialogue on the African Union's (AU) Financial Institutions, held on the sidelines of the 37th Ordinary Session of the AU Assembly in Ethiopia.
President Akufo-Addo emphasized the need to strengthen the capital base of institutions such as the African Development Bank (AfDB) and Afreximbank. He argued that reinforcing these institutions would enhance their balance sheets, allowing them to play a more significant role in facilitating resources for the continent's development and growth.
The President pointed out that the majority of African countries stored their reserves in foreign banks, attracting predominantly negative interest rates. “If we find a way to increase the financial power of our own institutions, we are in a better place to finance our development,” he stressed.
During the dialogue, President Akufo-Addo highlighted the critical roles played by AfDB and Afreximbank in addressing the challenges posed by the COVID-19 pandemic. He urged African leaders to ratify the decision to designate Afreximbank as a specialized agency of the AU.
As a champion of global financial architecture reforms, President Akufo-Addo stressed the importance of monitoring investments in African banks to ensure accountability. He urged leaders to collaborate on developing a robust global financial architecture that prioritizes African development and addresses issues like illicit financial flows from the continent.
The dialogue also focused on the acceleration of efforts to establish the African Monetary Union and three AU financial institutions – the African Central Bank (ACB), African Monetary Fund (AMF), and African Investment Bank (AIB). Additionally, plans for the creation of a Pan-African Stock Exchange (PASE) were discussed.
The 37th Ordinary Session of the AU will witness the launch of the Alliance of African Multilateral Financial Institutions – the Africa Club. This initiative aims to bring together member institutions to collaborate on finding solutions to financing challenges, supporting Africa's sustainable economic development, and promoting integration objectives.
