Laying the Groundwork for Jobs in Africa: Core Infrastructure & Business Environments

Transcript of the Keynote Address by Ajay Banga

"I want to start by thanking the Italian government because I think that we can all talk about jobs and we can talk about the desire to change them. We need governments that are going to make a difference with the actions they take. And I think what Prime Minister Meloni is doing and the Mattei Plan, and the government are doing, is showing that they’re putting their money where their mouth is, where their thinking is, and they’re adding their technology, Italian companies, into the mix. And I think that’s a great starting point.

And Fabio, I think you’re an outstanding host, but also a terrific governor for the World Bank. And I want to thank you as well for what you’re doing.

President Tharman is a friend, a mentor, but also, as you just heard, a very, very constructive leader in the world. He’s thoughtful, he’s deep, he’s realistic, but most importantly, he has hands-on experience through many years of public service, not just as being elected as a legislator, but through the government in many different roles. It shows by the way he speaks, and his willingness to be the guide and advisor for our jobs council is a huge asset for me personally, but also for the Bank.

And then my soul sister is here, and that’s Christine, and she and I think alike on many of these topics. I’m just delighted that she’s around and being with us. And we had a great lunch together as well and did talk a great deal about AI.

And for all of you else who are here — Sidi, Alvaro — I’m delighted you’re all here together with us.

Here’s the thing. A lot of people have given these numbers, but yes, over the next 10 to 15 years, 1.2 billion young people are going to come of age, meaning they will be 18 years of age and they will be looking for a job. Now, we call that a demographic dividend. And I think it gives them clean air, clean water, health care and education when they’re growing up. What you really need to do is to give them the hope, the dignity, the optimism of being able to earn money because of being a productive contributor to society. Whether that is by working for somebody or whether that is by starting your own business and being an entrepreneur does not matter. The point is it’s the dignity and the hope and the optimism that brings you out of your bed every morning, wanting to be something better for the world that day. That’s what we’re talking about.

Because right now, the same emerging markets where these 1.2 billion are growing — remember, we’re not discussing the developed world right now; that’s a whole other thing because the population dynamics there are quite the opposite. And in parts of the emerging world as well, the population dynamic is changing. But overall, 1.2 billion people in the emerging world will come of age. Those same countries are currently forecast to create around 400 million jobs. Those forecasts are made by — I’m in a room full of economists, so pardon me, I mean, I’m a recovering economist too — but the forecasts are made by economists. We do tend to make assumptions go beyond where they should.

So we may be wrong, and we may be wrong by 50%, even 100%. So fine, instead of 800 million, it’ll be 400 million people who will not have a job at the end of 15 years. It’s still too many zeros attached to those numbers. That’s the point I’m trying to make. Don’t get hung up on the number. Get hung up on the micro problem of these people growing up without hope. That’s the issue we’ve got.

And by 2050, more than 80% of the world’s population will live in today’s developing countries. And just to be clear, one in four people on the planet will be African.

Now, if these young people do not find work, then the current pressures we fear — of migration, of fragility, of political systems — I think they are not going to remain contained within borders. But on the other hand, if they do, then this demographic shift will probably fuel growth for the coming 30 to 40 years, the way Asia did over the last 20 to 30 years. And so this is not a zero-sum game.

When developing countries grow, advanced economies benefit. And Prime Minister Meloni, President Tharman — they know this very well. Rising incomes create new consumers, they create new markets, they create new partners. Supply chains will diversify. Stability will strengthen.

And at the World Bank Group, what we are trying to do is move our entire North Star towards jobs, move our concentration, our focus, around this idea of jobs, because jobs are the surest way out of poverty. If you want to put a nail in the coffin of poverty, give a person a job. That is the way to do it.

We have put particular emphasis and focus on entrepreneurs. We are very focused on small and medium-sized businesses. The reality is small and medium-sized businesses create 90% of employment globally, including in Italy and including in the United States and including in China. And so they don’t survive without big businesses. It’s a symbiotic relationship. But you’ve got to make it easier for them to set up business, and grow, and get capital, and do the things they need to do for the people they want to employ.

So our approach settles on three pillars, and Fabio talked about pillars. The first one is infrastructure — the physical and the human. And by physical and human, I mean, of course, energy, transport, water and digital connectivity and power like the M300 effort, but also, importantly, financial systems and payment systems. It’s very important — people forget that as part of the infrastructure. You should not. You’re sitting in a central bank; it is the most important thing we can do to facilitate commerce and business.

Second is the human side of this: healthcare, education, and most importantly, skilling. In a world where it’s unclear what dimensions of traditional education will contribute greater to your competitive benefit, skilling and matching the skills to the opportunities that are coming will certainly be a good way for you to have a productive outcome. And so that’s going to be important. That’s the first pillar.

The second pillar is business-friendly regulatory environments. In our private sector lab, which we’d set up, when we were asking, “What is it that will enable more private sector money to come to the party for the emerging markets?”, one, two and three was a predictable regulatory environment, a level playing field. It was, in the words they use, the rules, the predictability that investors require and seek.

The third pillar is to help the private sector scale using de-risking tools and guarantees and equity that moves investments at volume.

I think Italy’s Mattei Plan is our jobs-first strategy. We align across all three.

I’m going to give you a few specific examples. We’re expanding physical infrastructure — electrical connections in Mozambique and Côte d’Ivoire, in Tanzania, in the DRC; water and irrigation systems in Angola, in Tanzania — just a couple of examples.

Then in human infrastructure, we’re linking labor demand and opportunity across borders, connecting jobs in Europe with skilling and talent in North Africa, beginning in Tunisia, expanding to Egypt and Ethiopia.

We are also advancing regulatory reform, clearing the bottlenecks that jam the system, that hold back investment, that pair financing with practical policy change. And a good example is the work underway to strengthen energy connectivity between Tunisia and Italy, thereby creating a more predictable and clearer framework to link Africa and Europe.

And then finally, the third pillar: mobilizing private capital through concessional finance and guarantees, making public resources stretch further. We’ve already got a billion euros in co-financing moving alongside the World Bank Group. We’re talking to a number of institutions, including CDB, on what more we can do together.

This three-pillar approach, this partnership with governments like Italy, comes to life in five sectors which is very carefully chosen. They are large scale; local job creation can take root. They don’t rely on outsourcing Western jobs based on cost arbitrage. That model is challenged for all kinds of reasons, including the ones that the President of Singapore started speaking about.

Secondly, these are not as sort of headwind-facing from what AI may mean for jobs in the next five to ten years. A number of them — actually, small AI delivered at the edge, even on old phones using local compute power — could actually be a productivity enhancer in these five sectors. Not equally, but it could.

And the last point is that they build opportunity where people live.

What are these? The first is infrastructure itself — energy and other things, the construction, but then what it enables. The second is agribusiness. And you saw the video and you heard the President of Singapore speak very elegantly about the upstream and the downstream impacts of the multiplier effect of agriculture as a business, particularly by giving small farmers — which is the majority of our farming community — the access to scale that they deserve to remain competitive and productive.

Third is healthcare. A lot of us in the developed world take healthcare for granted. In the developing world, it is a very serious challenge. If you try and build healthcare only by building hospitals, you are facing a losing battle. You have to build out primary healthcare at the grassroots level to catch diseases and provide healthcare well before things get out of hand.

The diseases of prosperity — that is not a fair word — but the diseases of heart attacks, diabetes, blood pressure, strokes caused by new food habits and sedentary lifestyles, which connect a little bit unfortunately to prosperity, these are diseases that can be diagnosed earlier and caught and treated much cheaper than when you go to the hospital. The most expensive type of healthcare is hospital. And we have to figure out how to get ahead of this through primary healthcare, better delivered.

And then tourism. You’re in Italy, a mecca for tourism. And I was in Cairo yesterday — a real possibility on tourism, even beyond what they do. Tourism generates more jobs per dollar invested than any other sector that you can think of, both direct and indirect, for exactly the same kinds of reasons that the President of Singapore spoke about when he spoke about agriculture.

And then value‑added manufacturing, including the critical minerals that we all seek from the emerging markets who are blessed with them.

There’s a unique point in time now where these five sectors could come together — whether as a job or as an entrepreneur — differently impacted by small AI delivered at the edge as compared to big AI, but a real possibility.

I was in Egypt and Cairo for the last two or three days. I saw this in action across four of these five sectors. I visited a bus manufacturing facility — e‑buses. It’s supporting and financing, it’s expanding local production, it’s creating skilled industrial jobs and export opportunities. I visited a housing program, not only building resilient homes, but supporting construction, supply chains and employment. I visited with agritech entrepreneurs that are helping small farmers improve productivity, connect to export markets, create jobs along the value chain — from storage to logistics to processing.

And I toured the newly constructed Grand Egyptian Museum, which is amazing. That is responsible single‑handedly for driving up tourism numbers in the country of Egypt and is generating employment opportunities far beyond its exhibit halls.

For those of you who know Egypt, it is not just the country of pharaohs, which is what people are selling today. It has the White Desert, which is stunning, where even Egyptians have not been. It has the sea, and the beaches, and the life that a lot of us desire in holidays. It has unbelievable food, very warm, welcoming people and outstanding culture, and things that all of us would love to spend time with. It’s why we come to Italy on holiday. Egypt has that too.

But yet, Egypt gets a total of 15 million tourists in a year — New York City alone. So we’re talking about a pimple on a dimple on a man’s left cheek. This is what we should be thinking about when we think of tourism and the power of tourism. I think that’s my case on tourism that I made with the Egyptian president as well — exactly that way.

Now, in each of these cases, infrastructure mattered, but access to finance mattered even more. It also demonstrates something else. If you plan regulatory reforms, if you implement them fully, if you apply them fairly and consistently, you can increase private capital mobilization. Their journey on it’s not a journey they’ve completed. They still have state‑owned enterprises in their economy. It’s things they’re conscious of. But this is real work opportunity in Egypt.

So the focus of today’s summit is to make it easy to do business in one particular sector. It is critical. Jobs are created when entrepreneurs and firms of all sizes have the confidence to start to hire, to expand. That confidence is built on clarity, on rules that are transparent and reliable.

The evidence across time is clear. Countries with sustained growth and expanded employment have done so not through isolated projects, but through steady, measurable improvements in the business environment. Reforms are sequenced, they are implemented, they are maintained, and they are jealously guarded by the leadership of the country.

If you get this right — infrastructure, regulatory certainty, and access to scale and finance — we will create jobs where young people live. And that is why we are here today: because of young people.

Thank you very much."