(AGENPARL) – Mon 03 November 2025 Africa Growth and Opportunity: Research in Action Conference
Opening remarks by Luigi Federico Signorini
Senior Deputy Governor of Banca d’Italia
Palermo, Palazzo dei Normanni, 3 November 2025
Ladies and gentlemen,
It is a pleasure to open this conference, organised jointly by the Bank of Italy, the Italian
Ministry of Economy and Finance and the World Bank Group, and devoted to discussing
Africa’s development and the role of international cooperation in fostering it.
By 2050, one person in four will be African.1 By 2030, half of all new entrants to the world’s
labour force will come from Sub-Saharan Africa.2 This demographic transformation is
both an immense opportunity and a major responsibility. It can become a powerful
engine of growth, if supported by education, infrastructure, and sound institutions.
International cooperation remains an important part of the strategy needed to achieve
this goal.
The effectiveness and impact of all available resources and investments should be
maximised. Increasing budget pressure on official development assistance around
the world makes this even more necessary. Action-oriented research, such as the
Conference title suggests, is therefore important. Let me mention here that the Bank of
Italy welcomed and supported the recent expansion of the World Bank Group’s Rome
Hub. Its enhanced mandate will cover research, capacity building and operations,
with a special focus on Africa. Its success hinges on close collaboration with African
authorities and cultural institutions. Today’s conference will present the first, valuable
results of this project, and discuss the way ahead.
In recent decades, several African countries have grown considerably, yet most
economies remain well below the global average in terms of GDP per capita.3 The
potential for innovation and entrepreneurship in the continent is supported by rapid
African Union (2023). Continental Report: African Agenda 2063 and the Global Context – Final. Addis
Ababa: African Union. Available at this link.
International Monetary Fund. Regional Economic Outlook: Sub-Saharan Africa – Jobs Note. Washington,
DC: IMF, October 2024, p. 1. Available at this link.
World Bank. 21st-Century Africa: Governance and Growth.
urbanisation, digital adoption, and a growing middle class;4 at the same time, structural
challenges persist. Challenges and opportunities need the interaction of farsighted
policy action at the global and at the local level.
Let me focus on four aspects.
First, infrastructure. Africa needs investment in physical infrastructure for energy and
transport, as well as in infrastructure supporting digital connectivity, human capital and
finance. Good infrastructure improves productivity, fosters innovation, and supports
trade, both within the continent and with other regions. Investing in people is also vital,
as technological progress offers great opportunities, but only a well-educated and
adaptable workforce can seize them.
Investment requires a flow of internal and external capital. Whatever their origin, capital
flows are enhanced by a stable macroeconomic environment and by strong, transparent
institutions that protect investors’ rights and foster an efficient use of resources. This is
necessary both for attracting international private capital and for mobilising domestic
resources. Developing local financial markets should be a policy goal, wherever feasible.
Domestic and international investment, if successful, will reinforce each other.
International cooperation, both bilateral and multilateral, remains critical for much
infrastructural investment. It provides resources for growth-oriented investment in
cases when private returns are too low or uncertain. It offers technical assistance where
required. Less obviously, but no less importantly, it can mitigate the uncertainties and
information asymmetries that often affect private investment in developing economies,
making it scarcer, more costly and more volatile than it could otherwise be. By leading
by example, disseminating information, promoting transparency and good governance,
and showing concrete results on the field, multilateral development banks – first and
foremost the World Bank Group – can make a difference. They also play a key role in
enhancing human capital: the Bank of Italy is proud to be contributing to this line of
action through our partnerships with the World Bank, the African Development Bank,
and European education and research institutions.
My second point concerns trade. For decades, trade has been one of the strongest
drivers of economic growth. It stimulates productivity and fosters innovation. Together
with improved infrastructure, trade can contribute to diversifying Africa’s economies
and increase their role in high value-added segments of the global value chains. WTO
Director-General Okonjo-Iweala will surely touch on these topics during the Mattei
Lecture she is due to deliver to this audience tomorrow.
Prospects for global trade are today, regrettably, more uncertain than they have been for
a long time. In the current context, marked by fragmentation and tensions, enhancing
trade ties within Africa and between Africa and other regions is a priority. The African
https://www.ifc.org/en/insights-reports/2024/digital-opportunities-in-african-businesses.
Continental Free Trade Area (AfCFTA) is a step toward continental integration. Italy and
Europe are open. The EU’s Global Gateway, as well as the G7 Partnership for global
infrastructure and investment, will contribute to Africa’s development strategies and to
the continent’s green and digital transformation.
Italy has devoted special attention to African countries, notably with the Mattei plan,
now in its implementation stage; Minister Giorgetti has just taken the opportunity to
explain the Italian government’s actions and priorities in this field.
My third point is about debt. Rising debt-to-GDP ratios and a shrinking fiscal space are
not just an African issue these days. In Africa, however several countries have reached
a crippling level of external debt.
Addressing external debt vulnerabilities is urgently needed. It is not a question of
who is to blame: whether investors’ recklessness, exogenous global financial-market
oscillations, or bad use of borrowed money. Whatever the reason, where debt is
unsustainable, it must be restructured; as a market-economy principle, this is true
of countries no less than of companies. For countries, however, an unbearable debt
burden not only constrains public investment and discourages private capital: it can
undermine people’s livelihoods and endanger social stability and peace.
The framework for sovereign debt restructuring, never straightforward, has become
even more complex, also in connection to changing patterns in the international
creditor community. Progress has recently been made, and most ongoing cases have
by now moved toward completion; but the process remains too slow and uncertain.
In extreme cases, debt forgiveness is a moral obligation. More generally, however, debt
restructuring is an unavoidable fact of economic life. The pain it inflicts on both debtors
and creditors can be mitigated by a predictable and fair approach to debt resolution.
Further improving debt restructuring processes, including under the G20 Common
Framework, is needed; achieving it requires, in turn, earnest multilateral cooperation.
An efficient arrangement should be crafted in a way that strives to prevent repeated
defaults – through well-designed contracts and institutional arrangements – so that
the resources released are used efficiently, and, looking ahead, capital can confidently
flow to where it is needed, at a moderate price.
My final point concerns payments. This issue is part of central banks’ own responsibilities,
and it is crucially important for millions of households and small companies.
Remittances are a special concern for developing countries, and Africa in particular.
Remittance flows to developing countries reached $700 billion in 2024, exceeding FDIs
and official aid combined.5 The flows of remittances from Africans working abroad are
World Bank, World Development Indicators; IMF, Balance of Payments Statistics.
a major source of external finance for the continent. They provide stability to families
and communities and support consumption and investment.
Remittances are also an important financial link between Italy and Africa: in 2024,
recorded flows from migrant workers in Italy to their African families amounted to
2 billion euro.6
People wishing to transfer money to and from developing countries often face high costs
and long execution times. This happens mainly because of fragmented infrastructure,
limited competition and lack of regulatory alignment. The cost of sending money to
Africa remains the highest in the world, averaging around nine percent for Sub-Saharan
Africa. It is particularly high for intra-African remittances, exceeding thirty percent for
some corridors.7
Improving cross-border payments, including through linking local fast payment
systems, can make transfers faster, cheaper, and safer. The experience of the Bank of
Italy-World Bank initiative in the Western Balkans, currently underway, is showing the
value of cooperation in this area. Similar approaches could be extended to African
partners. We stand ready to help.
Ladies and Gentlemen,
In the past few decades, globalisation and market-oriented reforms have lifted millions
out of poverty in many areas of the world. Strong and open institutions, robust
partnerships, as well as enhanced flows of trade, finance and ideas, can offer enormous
opportunities to improve the economic well-being of many more millions. Now it is
Africa’s turn. The continent’s immense human, natural and entrepreneurial resources
can and should be unlocked.
I have not discussed so far, but I feel compelled to mention before closing my remarks,
that, in several African countries, civil wars and internal strife are still causing enormous
human and social suffering. These conflicts remain a major source of economic
stagnation, institutional fragility, and stalled reform processes, with severe negative
spillovers on neighbouring countries. We can only hope – and work to ensure – that
these conflicts soon find a peaceful resolution, while sustained economic and social
progress may, in time, help make such tragedies less likely to occur again.
Despite all the difficulties, multilateral institutions remain a key factor. They need to
reform and become more targeted, focused and efficient. At the same time, as global
tensions, and – sadly – armed conflicts, have increased, well-designed international and
regional partnerships hold significant promise for creating further effective channels for
development. In developing countries, a stable macroeconomy, open and accountable
institutions and the prevalence of the rule of law can help mobilise resources,
Banca d’Italia, Foreign workers’ remittances statistical data.
World Bank, Remittance Prices Worldwide database (data as of 2025 Q1).
from private investors, donors and official sources alike. The fact that many developing
countries have weathered the latest financial storms much better than previous ones
has proved that reforms pay.
For international cooperation to happen, mutual understanding – across geographical
and cultural differences – is the starting point. Let me conclude by making a brief
reference to the building where our meeting is taking place. The Palazzo dei Normanni
was built more than a thousand years ago, over even older fortifications, as the residence
of the rulers of the island of Sicily; it is, to this day, the seat of the legislative assembly of
this autonomous region. In the first half of the 13th century, it was inhabited by Frederick
II, King of Sicily as well as King of Germany, King of Italy and Holy Roman Emperor. He
was known as stupor mundi, the wonder of the world, for his outstanding political and
cultural achievements. He spoke many languages and was curious about many fields
of knowledge. As King of Sicily, he took pride in being open to the many traditions
he found in this melting pot of an island (Sicilian and Italian, German, Norman, Greek,
Latin, Arab, Jewish). Largely thanks to his encouragement and openness, Sicily became
a cradle for the rebirth of European culture after the Dark Ages.
Frederick II showed that mutual understanding between cultures – across faiths,
languages and seas – is not a weakness but a strength. Eight centuries ago, he fostered
dialogue between the northern and southern shores of the Mediterranean Sea – that is,
between Europe and Africa –, proving that wisdom knows no borders.
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