Many of us agree that the 21st century brings unique challenges and opportunities. As the cliché has it, the world has indeed become a global village, and therefore considerably more interdependent.
But the challenges we confront today – particularly in Western Africa – require a well thought through and collective response that forge sustainable solutions. They are too big to be addressed by any single stakeholder, whether it be governments, the private sector, the multilateral institutions or the non-profit sector.
For example, it is known that the total required spending on infrastructure in the developing world is estimated to be $3.3 tn, while current spending is only $2.5 tn. That leaves a gap of $800bn globally.
No one organisation or government can bridge this gap, but a combination of public and private institutions can do so by working together to focus funds around sustainable solutions to the world’s most pressing problems. For this reason, the Islamic Development Bank (IsDB) Group has established the Public Private Partnership (PPP) Infrastructure Advisory Facility that will provide support to our member countries for advisory work on enabling environment and project preparation.
I believe that public-private partnerships will help harness the financial as well as innovative strengths of the private sector, driving up project quality and efficiency. It will also help to reduce the burden on the state budget and divide the risks between the two sectors.
As such, more initiatives need to be established that bring together sovereign wealth funds, institutional investors both from the private and public domains and other stakeholders to network, identify co-investment opportunities, share transactions and collective experience across various regions and sectors.
On 9 May, I opened the fourth annual Sovereign Investment Forum in Libreville, Gabon, organised by the IsDB, following events in Jeddah, Rabat and Bali in previous years.
The two-day conference, attended by the president and prime minister of the Republic of Gabon, shone a light on the projects open to investment in Gabon and Western Africa, bringing together investors from government funds, corporations and financial institutions with policy and decision makers from Gabon’s investment and business community. During the forum I was especially keen to discuss infrastructure spending as a means to create more jobs, enhancing productivity and boosting growth.
We know the world is quickly urbanising, not least in large parts of Africa. The 21st century will see a world that lives more in cities than villages. Seventy percent of the global population is expected to be living in cities by 2030. Existing cities and metropolises are not necessarily prepared to accommodate a growing influx of population from the rural areas, placing extreme pressures on not just the physical infrastructure of the city such as sewage systems and hospitals but also on the softer social fabric of the city itself.
As the cities continue to sprawl and grow without any direction, the need for building better and smarter cities becomes inevitable. And that certainly calls for an urgent action plan towards building sustainable cities. Science and technology are offering more solutions than ever before, and by investing in these key areas, countries can give their people the tools to build a sustainable future.
The appetite for innovation and entrepreneurialism in Islamic countries has seen a substantial rise in recent years, and it is crucial that we are garnishing this growth and adding to the value chain of countries at their source.
The IsDB recently launched its $500m Transform Fund with the goal of accelerating science, technology and innovation-led solutions in the developing world, believing that economic growth is the best route out of poverty.
As part of the fund, an online platform, Engage, was also launched to offer an online ecosystem that connects scientists, innovators, and entrepreneurs from all over the world. The platform is the first of its kind for the developing world and was made available to ultimately improve the lives of millions of people. Engage offers three main services: match-making, technology transfer and calls for Innovation.
The world’s challenges require smart strategies, coordinated effort, and efficient utilisation of our time and resources; and our success would in fact depend on how efficiently we mobilise and deploy resources towards the fulfilment of the sustainable development goals (SDGs). Given the resource constraint, the public and private sector need to come together to address this challenge.
Forums such as the IsDB’s Sovereign Investment Forum create a platform for these partnerships to begin. As part of our concerted effort to tackle our common challenges, we are eager to work together with other multilateral and bilateral institutions, financial intuitions and other stakeholders in the private and public sectors to fuel economic growth. It can’t be done alone.