Washington - A new World Bank strategy for Africa unveiled on Wednesday focuses on creating jobs and making economies more competitive, while also tackling problems of climate change, disease, food shortages and conflict.
The poverty-fighting institution said its new approach was driven by the increasing role of China, India and Brazil in Africa and growing investments in the region's private sector.
The bank said its new plan was a shift from its former general focus on economic stability and fundamentals.
Uprisings in North Africa highlighted the need to address high unemployment among the youth, the bank said, particularly for the 7 million to 10 million young people entering the labor market each year in Sub-Saharan Africa.
"It is clear that youth underemployment, if unaddressed, can increase the risk of urban unrest and possibly violence," the World Bank said.
The bank's new strategy was upbeat about economic prospects for Africa and the untapped potential of a rising middle class.
"We conclude that Africa could be on the brink of an economic takeoff, much like China was 30 years ago and India 20 years ago," the World Bank said.
It noted that returns on investment in Africa were among the highest in the world and there was a surge in private capital into countries.
But the biggest obstacles to increased investment was the lack of infrastructure, skilled workers and business-friendly conditions, it said.
Birth of the middle classThe World Bank said the priorities were reforms and public investments in areas with the highest growth potential, developing a skilled workforce, empowering women and supporting programmes that integrate regions more.
The bank said Africa had an "unprecedented opportunity for transformation and lasting growth" in 2011 for four reasons:
- Growth in at least 22 non-oil exporting countries has been more than 4% a year since 1998, including in Mozambique, Sierra Leone, Liberia and Uganda, whose economies were once hobbled by war.
- Sound economic policies have helped the region rebound quickly from the global economic downturn and financial crisis.
- Africa's private sector is attracting more investment with much of the funding coming from domestic banks and investors, and the rest from the United States and Europe. It is creating an emerging middle class of hundreds of millions of consumers in Africa.
- Pro-market reforms and prudent economic policies continued, despite the global economic crisis and contradicatory policies elsewhere.
Still, the World Bank said Africa was beset by poverty and other development challenges. It noted that just 5% of the eligible population was enrolled in universities. Corruption is still rife with nine of the bottom 17 countries on a worldwide corruption index in Africa, while most mineral exporters have been unable to transform that wealth into sustained growth.
It expressed concern that growth and employment may not be enough for the chronically poor, who suffer from food insecurity and under-nourishment.
The bank also said it worried that belt-tightening in rich nations means aid levels may fall, despite pledges by donor countries that that is not their intention.
It said promises by the world's richest countries to double aid to Africa were running about $20bn short even before the global financial crisis, and pledges to boost agricultural investment in poorer countries have so far raised just a fraction of the committed amount.