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Speeches & Transcripts

Speech by World Bank Africa Region Vice President Makhtar Diop to the Senegal Consultative Group

Makhtar Diop

Groupe Consultatif du Sénégal

Paris, France

February 24, 2014

As Prepared for Delivery

Media Contacts

Your Excellency, President of the Republic of Senegal, Madame Minister, representing the French Government, Honorable Ministers, Dear Colleagues, Ladies and Gentlemen, Mr. President,

First of all, I would like to express, on behalf of the President of the World Bank Group, our thanks for choosing our Paris offices for the Seventh Consultative Group, to which Senegal has invited its partners, both public and private. In his eyes, this highly symbolic choice attests to the excellent partnership between Senegal and the World Bank Group.

 

Mr. President,

Sustainable growth lies at the heart of the challenge. Many countries boast strong growth rates based on the exploitation of natural resources. Thus, it is all too easy to find a direct connection between a strong growth rate and exploitation of these resources.  But in so doing, there is a tendency to forget that an abundance of natural resources is in no sense a requisite condition for obtaining a sustainable growth rate; Singapore and South Korea show this to be true.

I mention this fact to emphasize the necessity for Senegal to pursue a path of sustained growth based on the absence of abundant natural resources, despite occasional announcements of discoveries of gold or zircon. Indeed, Senegal enjoys comparative advantages that, in other countries, have produced sustainable positive effects. High-quality human capital, political stability, strong institutions, selection capacity, good governance, an open relationship with the rest of the world, and a strong capacity to adapt and implement economic policies – these are the characteristics of countries that have successfully managed the transition toward emergence.

Human capital has long been Senegal’s most important resource. This human capital, Ladies and Gentlemen, must remain the foundation on which growth is built, along with efforts to strengthen institutions so they will remain viable and deep-rooted over the long term. In this regard, we must applaud the efforts that Senegal is making to improve the education sector.

For years, the World Bank and other partners have provided support to the Government of Senegal to strengthen its education sector. In addition, the World Bank Group has brought about a significant comeback in higher education; the record of performance in secondary and primary education does indeed hinge on high-quality higher education, and there’s no limit to what we can hope for. Let me cite one example to illustrate this optimism: the African Center for mathematics, computer science, and information and communication technologies at Gaston Berger University outside Saint-Louis, which aims to create the conditions for high-quality research in applied mathematics and ICTs. Let me also emphasize the reforms that you are preparing to launch in secondary education, aimed in particular at adapting school curricula to the realities of today’s world. These reforms in the education sphere should receive continued support because they represent the very foundation of a service-based economy.

 

Mr. President, Ladies and Gentlemen,

Building strong and sustainable institutions and facilitating the emergence of high-capacity human resources go hand in hand with a requirement of accountability and the reduction of inequalities. Marginalization of a segment of the population that does not benefit from a fair share of the country’s wealth is a threat that must not be ignored. As such, we applaud the Plan Sénégal Emergent, which appears to us to be a strategic instrument for reducing inequality.  We should recall that, prior to this plan, your partners unanimously applauded the expansion of social welfare through the distribution of family allowances, along with the development of universal health coverage, a pair of innovations that Senegal is implementing in the African context.

These salutary efforts are not, however, enough, as there is also a need for growth in job-creating sectors, including the informal sector.  “Jobs, jobs, jobs” may indeed be the credo of any policy oriented toward shared prosperity.

It is great to note that public policies are being reoriented toward development of the agricultural sector based on improvements in land management and irrigation. At least for now, agriculture is one of the greatest sources of job creation and poverty reduction.  Therefore, we will not let up on our efforts to support this sector, all the more so because it constitutes one of the pillars of the Plan Sénégal Emergent. We are also convinced that resources allocated to the agricultural sector should be further increased by a significant margin.  In particular, there is a need to improve the financing for agriculture by improving the regulatory framework, rehabilitating the sector’s financial institutions, and supporting the development of leading institutions that will have a leveraging effect.

In terms of the logic of job creation, I should also emphasize the need to revive the manufacturing sector. This is especially urgent as you firmly situate Senegal, Mr. President, within a regional dynamic of growth in this sector, notably with the new rail connections planned toward Mali and the Banda energy project with Mauritania.

Senegal’s favorable geographic location, especially with respect to Europe, is an advantage.  To fully benefit from it, the infrastructure must be upgraded and the procedures governing movements of goods and services simplified. Senegal has already implemented public-private partnerships that have indisputably had an impact on growth and, just this month, has set in place a new framework law, called the CET, to facilitate these operations; you can count on the support of the World Bank Group as you continue on this path.

However, all this potential will be for naught without a competitive business environment.  We hope that the indicators related to the business climate will improve substantially as a result of immediate implementation of the decisions reached by the 2012 Presidential Investment Council, with a new program of reforms concerning the business environment and competitiveness in the next two years.

To achieve the objectives of the Plan Sénégal Emergent, it is essential that the cost of inputs be in line with those in competing countries.  The World Bank will assist the government in implementing a well-planned energy policy, favoring production costs that are clearly on the decline. This strategy will require actively looking for regional solutions with the neighboring countries of Mauritania and Guinea. Here again, we are encouraged by the upcoming signing of the Banda project, which is an example of an innovative project that includes the private sector and countries of the sub-region, aimed at local processing of the continent’s natural resources. The World Bank will assist Guinea in its Keleta and Souapiti projects. Here’s an African solution to an African challenge!

The accelerated urbanization of the African continent and of Senegal itself offers accelerated opportunities for technology transfer and leads to the creation of new, more sophisticated markets with increasingly demanding consumers.  In this area, social housing is an important tool that combines direct support for underprivileged populations with job creation through construction programs. Here again, institutional and financial reinforcement of specialized institutions will be necessary for this sector to take off.

More generally, we will encourage labor-intensive solutions in infrastructure construction projects. To cite just one example, the paved road construction projects financed by the World Bank in Central America have clearly had a positive impact on employment.

 

Ladies and Gentlemen,

Senegal has already demonstrated strong innovation capacities which have enabled it to carry out successful policies in infrastructure sectors (e.g. toll road) and in the nutrition sector.  The challenge for the future is to strengthen these capacities.  Meeting this challenge will require:

  1. A very specific effort focusing on results and implementation;
  2. Constant adaptation to a rapidly changing external environment;
  3. The most efficient use possible of the resources that are mobilized, particularly in the context of this Consultative Group, because this is the only way to be sure, if you will excuse the expression, of getting your money’s worth – or what we call Value for Money – and this will reassure all your partners, both public and private, not to mention Senegalese civil society, which I applaud for a growing mobilization of strength to ensure effective implementation of public policies favoring the reduction of inequality.

On behalf of the World Bank Group, I would like to reiterate our commitment to continue our partnership through support to the public investment program, but also in the area of private sector mobilization.  Tomorrow, my colleague Jean-Philippe Prosper will no doubt indicate the main lines of action that will enable IFC to support more effectively the Senegalese private sector.

I can assure you that your intention to emphasize resolute implementation and monitoring, well on display in the Plan Sénégal Emergent and reflected in the creation of a Service Delivery Unit, is in keeping with the guidelines introduced by the President of the World Bank Group, Jim Yong Kim.

I hope this gathering meets with tremendous success, and I thank you for your kind attention.

Thank you.