In 2016, African economies grew by about 3.7%, a more moderate rate than the previous year due to weaknesses in the global economy and lower commodity prices. Sub-Saharan Africa witnessed average economic growth of 1.6% in 2016, down from 3.4% in 2015. This sharp decline reflects the challenging conditions for both the region’s largest economies and for commodity exporters as they continue to face reduced commodity prices, tighter financing conditions and droughts. Slower growth deepens the challenge of reducing extreme poverty, which remains widespread across the continent.
Africa made significant progress on the MDGs, notably the realization of universal primary schooling by 70% of countries, a 54% drop in under-five mortality and a 45% reduction in maternal mortality. However, the continent is also characterized by unequal access to social services, high unemployment, and vulnerability to shocks. The African Union has adopted Agenda 2063, a 50-year long term development framework that aims to materialize Africa’s vision of an integrated, prosperous and peaceful region driven by its own citizens. This continent-wide plan, combined with the global-level transition from the MDGs to the 2030 Agenda for Sustainable Development will help Africa achieve its socioeconomic transformation.
In keeping with its mandate to prioritize the low-income nations, OFID’s presence in Africa extends to 49 countries, including all 33 of the region’s LDCs. This focus has resulted in the continent receiving by far the largest share of OFID’s cumulative assistance.
In 2016, 32 African countries shared total OFID financing of US$646.5m, or 48% of approvals for the year. In keeping with development priorities on the continent, US$261.9m (41%) went to the energy sector for a wide range of initiatives, both large and small, utilizing traditional as well as renewable technologies. Agriculture was also high on the agenda, with around US$140m (or 22% of aggregate approvals) committed to boost food and nutrition security and to help small-scale commodity producers access export markets. Some US$100m (15%) was channeled to the transportation sector to promote socioeconomic integration, chiefly through more efficient road links.
With regard to the type of financing, the private sector accounted for the biggest portion of approvals, attracting 34.8% (US$224.8m) predominantly for projects relating to the strengthening of energy infrastructure. Trade activities accounted for US$239.5m, or 37% of approved financing to the continent and concerned support exclusively to ITFC schemes benefiting a number of priority sectors. Twelve countries shared concessional public sector funding of US$179.6m (or 27.8% of aggregate approvals), the bulk of it for projects in the energy–water–food nexus. The region also benefited from generous grant funding in 2016, with some US$2.8m supporting eight initiatives across a number of sectors.