Out-Law News | 29 Oct 2014 | 3:30 pm | 1 min. read
The initiative was announced on 27 October as World Bank Group president Jim Yong Kim and UN secretary-general Ban Ki-moon joined international institutional and commercial leaders on a visit to the region to promote increased business and commerce.
Countries set to benefit from the package of assistance include Djibouti, Eritrea, Ethiopia, Kenya, Somalia, South Sudan, Sudan and Uganda.
The World Bank said: “The Horn is diverse, with some of the fastest growing economies and huge untapped natural resources.”
“Greater regional links between countries with regional transport routes” will be a key focus of support under the aid package, which is in addition to existing development programmes for the eight countries, the World Bank said.
The World Bank said its funding commitments “include $600 million from the International Finance Corporation (IFC), the bank’s private sector arm, which will support economic development in the countries of the Horn”.
According to the World Bank: “IFC investments under the new Horn initiative will include a regional pipeline linking Uganda and Kenya, greater investment in agribusiness expansion in storage, processing and seeds, possible public private partnerships in pharmaceuticals, renewable energy and transport, and financial advice and support to government and companies to improve business confidence and investment, access to markets and access to private finance.”
An additional $200m is being provided in “guarantees against political risks” from the Multilateral Investment Guarantee Agency, the World Bank said.
The Islamic Development Bank, which is supporting the initiative, said its new financing for Djibouti, Somalia, Sudan and Uganda over 2015 to 2017 “would focus on critical infrastructure development, food security, human development and trade”.
The European Union is also supporting the Horn initiative with a total of $3.7bn until 2020, “of which about 10% would be for cross-border activities”. In addition, the African Development Bank has announced a pledge of $1.8bn over the next three years for a range of projects, the World Bank said.
Sub-Saharan Africa is “rapidly closing in” on the global penetration rate of mobile communications usage, according to a survey published earlier this year by Swedish company Ericsson. Total mobile subscriptions in sub-Saharan Africa stood at about 70% at the end of 2013, compared to about 92% globally, and digital technology is “fast becoming a part of everyday life” in the region, the survey said (8-page / 224 KB PDF).