Shrinking Global Aid Forces Africa to Rethink Economic Strategy, Says Finance Minister Edun
In a stark assessment of the global financial landscape, Nigeria’s Finance Minister, Wale Edun, has declared that an era of diminishing international aid necessitates a fundamental shift towards intra-African investment and trade to secure the continent’s economic future.
The End of an Aid-Driven Era
Speaking at the 5th B2B Agribusiness Matchmaking Event in Abuja, Minister Edun presented a sobering picture based on African Development Bank projections. He revealed that concessional financing and overseas development assistance to Africa are not just stagnating but are in active decline—falling by 9% in 2024 with an anticipated 17% drop in 2025.
“The multilateralism that defined the decades since the rise of the Bretton Woods institutions is rapidly fading,” Edun stated, highlighting a global retreat from cooperative financial support structures. This trend, coupled with high debt burdens consuming public funds across many African nations, creates a perfect storm that demands a new economic paradigm.
The Private Sector as the New Engine of Growth
With traditional aid flows turning negative, Edun emphasized that the private sector must become the primary driver of investment, both foreign and domestic. The solution, he argued, lies in looking inward: “We must increase trade with one another and grow our economies together by channeling our people’s savings into productive activities.”
This call for self-reliance represents a significant strategic pivot for a continent historically reliant on external financial support. The urgency of this shift was the central theme of the event, titled “Catalysing Arab Africa Trade: Unlocking New Frontiers in Food and Agribusiness Trade,” part of the broader Arab Africa Trade Bridges (AATB) Programme.
From Rhetoric to Reality: Concrete Trade Targets
Translating this vision into action, Bamidele Seun Awoola, Founder and CEO of Welcome 2 Africa International, announced ambitious targets to facilitate at least 10 major trade deals, each valued at a minimum of $100 million, between African and Arab markets.
Awoola stressed that the event was designed for tangible outcomes, not ceremony. Her organization conducted thorough market analysis to identify specific supply capabilities within Nigeria and other African nations that meet demand in the Arab world. “We invited only stakeholders capable of finalizing genuine investment and trade agreements,” she clarified.
Building an Industrial Base Through Strategic Partnerships
The strategy extends beyond simple trade. Awoola emphasized that a core objective is to drive industrialization through joint ventures that attract manufacturers and processors to Nigeria. She argued that Nigeria’s comparative advantage in raw agricultural production must be matched by enhanced processing capacity to generate employment, increase value addition, and spur sustainable economic growth.
This approach aims to move African economies up the value chain, ensuring that wealth created from trade and investment benefits local communities and establishes a durable industrial foundation.
A Formal Commitment to Regional Cooperation
The meetings in Abuja culminated in a significant institutional step forward with the signing of two Membership Agreements with Nigeria and Côte d’Ivoire, formally enrolling them in the AATB Programme. This commitment includes initiatives to promote trade, enhance export competitiveness, and focus on key sectors like agribusiness value chains and SMEs, while also supporting national capacities in logistics and industrial development.
As global aid contracts, the message from Abuja is clear: Africa’s economic resilience will increasingly depend on its ability to mobilize its own resources, deepen regional integration, and leverage private sector investment to build a self-sustaining future.
This report is based on information originally published by AllAfrica.