In his keynote address at the 30th AGM of the African Export and Import Bank (Afreximbank), President Akufo-Addo said it is important for Africans to build their indigenous financial institutions in order to achieve economic growth through domestic resource mobilization and private sector development.

President Akufo-Addo explained the drawbacks of depending on foreign capital, citing financial leakages, high borrowing rates, and interest payments as key issues.

According to him, such reliance undermines the growth of domestic financial institutions and hampers the development of African economies.

He urged his fellow African leaders to prioritize the establishment of strong financial institutions to foster prosperity across the continent.

“Unless we have strong financial institutions we are not going to develop, we have learnt over the decades that relying on foreign capital is both risky and costly. It has resulted in huge financial leakages to a high cost of default-driven borrowing rates and interest payments and undermine the growth of our financial institution’s domestic resource mobilization and private sector development,” President Akufo-Addo said.

Mr Akufo-Addo outlined some interventions that African leaders should embrace to overcome the current economic challenges. He emphasized the importance of capitalization and effective coordination with the African Union.

“There is capital and effective coordination with the African Union. Despite constant efforts made by many African governments during an extremely economic global operating environment, our economic financing institutions remain highly under-capitalised,” the President noted.

Afreximbank, a key player in facilitating trade and economic development in Africa, has taken a significant step by providing $10 billion in funding for the establishment of an adjustment fund.

This fund aims to support countries under the African Continental Free Trade Area (AfCFTA), a landmark agreement aimed at boosting intra-African trade and economic integration.