Regional Integration Strategy and Trust Fund Moono Mupotola NEPAD, Regional Integration and Trade Department (ONRI) AfDB Partnership Forum March 2010

Outline 1.Regional Integration at the Core of AfDB’s Mandate 2.Regional Integration Strategy 3.Regional Integration Trust Fund: What, Why, Who and How

Regional Integration at the Core of AfDB’s Mandate Regional Integration has been part of the AfDB’s Charter since its establishment in 1964 The Strategic Plan, adopted in 2000, placed regional infrastructure development as a central pillar The High Level Panel (HLP) reaffirmed in 2007 that “economic integration should be a prime policy of the Bank and a distinguishing feature of its programs” Regional integration was also identified as an area of increased focus in the Bank’s Medium term Strategy (MTS) for The HLP and the MTS provide the framework for the Bank Group Regional Integration Strategy for

Regional Integration Strategy Outcomes and Objectives Attract foreign direct investment, deepen private sector involvement, and foster economies of scale Enhance African presence in the global marketplace and intra- regional trade Establish an effective African “voice” on development and regional integration Efficiently provide regional public goods Strategic OutcomesStrategic Objectives Establish an effective institutional framework to promote trade and integration Mobilize resources (financial, technical and knowledge) to ensure delivery of priority regional programs Facilitate enabling policy framework for investment

Regional Integration Strategy Pillars and Cross-Cutting Issues Regional Infrastructure Formulation and review of strategic frameworks Support to development corridors NEPAD-IPPF: Bring projects to “bankable stage” Investment Institutional Capacity Building Rationalization of Regional Economic Communities (RECs) Strengthening of regional and national institutions Trade Facilitation and Capacity Building Partnerships and Cross-Cutting Issues Aid for Trade Regional Financial Integration

Goal – The RITF aims to leverage resources to scale up implementation of priorities defined in the RIS, notably its soft components set out under Pillar 2 and Cross-Cutting Issues Components –Technical assistance (capacity building, policy formulation and harmonization) –Financial assistance (grant components of investment projects, upstream project preparation) –Knowledge Products (studies, reports, advisory papers) –Monitoring and Evaluation (AfT reviews, validation workshops) Regional Integration Trust Fund What

Complement investments in hard infrastructure –Hard infrastructure alone is not enough to foster regional integration and increase trade flows –It must, therefore, be complemented by investments in soft infrastructure that aim at removing constraints to trade and creating a larger economic space Implement activities identified in the RISPs Take advantage of AfDB’s comparative advantages –The AfDB is the sole organization with a clear mandate to work directly with RECs –The NEPAD, Regional Integration and Trade Department is now fully staffed and has the necessary expertise to manage regional integration and trade programs Regional Integration Trust Fund Why

Target Beneficiaries –Regional Economic Communities (RECs) –Regional Member States (RMCs) –Specialized Regional Institutions Objective –Improve beneficiaries’ capacity to design, implement and monitor policies and programs that foster regional integration and trade Regional Integration Trust Fund Who

Resource Requirements –Technical assistance: USD 1 million per year –Knowledge products: USD 3 million per year –Financial assistance and monitoring and evaluation: USD 2 million per year Governance and Administrative Structure –Management committee composed of AfDB, development partners and donors –Ensures that activities reflect RIS priorities –Ensures that activities evenly cover entire continent and all sub- regions –Meets initially twice a year Regional Integration Trust Fund How

Moono Mupotola Division Manager NEPAD, Regional Integration and Trade Department (ONRI) Focal Point