World Bank President Ajay Banga issued a compelling call to action during the mid-term review of the International Development Association’s (IDA) $93 billion replenishment package, highlighting the urgency of addressing Africa’s energy crisis.
Mr. Banga emphasized that providing reliable electricity is critical to unleashing the potential of Africa’s vast youth population, with 1.1 billion young people expected to reach working age over the next decade. He pointedly stated, “We can’t hope to make even adequate progress while 600 million people in Africa – 36 million of whom live here in Tanzania – still don’t have access to reliable electricity.”
He stressed the need for increased investment in the IDA, a vital resource that provides zero- or low-interest loans to low-income countries. He expressed his desire for donor countries to set another record in the upcoming IDA replenishment round scheduled for December 2024. “We are pushing the limits of this important concessional resource and no amount of creative financial engineering will compensate for the fact that we need more funding,” he said.
Mr. Banga’s call to action aligns with the growing recognition of the severe impact of energy poverty on Africa’s development. The lack of access to electricity hinders economic growth, limits access to essential services like healthcare and education, and creates significant challenges for poverty reduction.
The high cost of electricity and inadequate infrastructure are significant contributors to the continent’s energy crisis. Addressing these challenges requires a multi-pronged approach, including investments in renewable energy sources, grid modernization, and innovative financing mechanisms.
Mr. Banga’s commitment to tackling this issue is bolstered by his experience as the former CEO of Mastercard Inc., a global leader in financial technology. He brings a strong understanding of the need for innovative solutions to address the complex challenges facing developing countries.
His participation in COP28, the recent climate summit in Dubai, further underscores his commitment to supporting sustainable development initiatives on the continent. He expressed optimism about the momentum building around addressing climate change and the growing political will to take decisive action.
The World Bank, under Mr. Banga’s leadership, is poised to play a crucial role in mobilizing resources and supporting African nations in their efforts to achieve universal energy access. By working together, governments, financial institutions, and private sector actors can ensure that Africa’s energy crisis is not left behind as the world moves towards a more sustainable future.
