More than three out of five Africans now have a mobile phone.
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Barely 20 years ago, only one person in 100 in Sub-Saharan Africa had a telephone at home. Today, more than 60 percent of Africans are connected to the world through digital phones. Opening the market to competition—and private investment—helped Africa join the digital revolution and reap its many social and economic benefits.
It took a combination of efforts to help Africa make that huge leap. Regulatory reforms opened the market to competition, and encouraging private investment brought in funding the government simply couldn’t have provided on its own.
That mix created both a market that changed lives in Africa, and a model for the development community. In a world where governments and aid agencies can’t meet the needs of the billions of people who still lack clean water, electricity, and other basic services, private investment is the clear path toward realizing the World Bank Group’s twin goals of ending poverty and boosting shared prosperity by 2030.
Creating Markets, Creating Opportunities: For IFC, that is the way forward.
The private sector generates nine out of every 10 jobs in the world; so we must create more opportunities for private investment in the places that need jobs the most. Learning from Africa’s example, we must encourage the reforms that will help us develop undeveloped markets, or support the overhaul of existing but underperforming markets.
Getting there will require the efforts of the entire World Bank Group. Working together, we can reduce political and investment risks, help governments build frameworks that open markets to private investment, and strengthen local capital markets to ensure the availability of local-currency loans.
We’ve done it before. Helping Colombia use private investment to fund a massive and badly needed roads project, encouraging privatization in the power sectors of Jordan and Côte d’Ivoire, and working to expand broadband throughout Africa, are just a few examples of the World Bank Group’s successful efforts to create markets.
The private sector is the answer to the world’s biggest development challenges. If we truly want to see an end to poverty, it is up to us to help private investment create opportunities for all.
During the Spring Meetings last week, a panel discussed how IFC-World Bank collaboration resulted in both new markets for investors and significant development impact in emerging economies. These were some of the projects highlighted:
Jordan, a country that once imported nearly all of its primary energy supplies from its oil-rich neighbors, has become one of the world’s leading renewable energy developers—and a regional champion of private sector participation.
Colombia went from a country in need of thousands of miles of new roads—and the money to build them—to an attractive market for pension-fund investment in an ambitious public-private infrastructure project.
Millions of people in East Africa got their first chance at broadband Internet access—with no high price tag or massive government spending.
Côte d’Ivoire’s power sector went from bankrupt public utility to a private-enterprise system that keeps prices down—and the lights on.
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Published in April 2017