Bob Geldof, Bono and other celebrity activists have done an admirable job of focusing world attention on the plight of poor people in Africa. But while more funding is essential, money is not enough. We cannot eradicate hunger and poverty unless we also foster the right conditions for sustainable, long-term economic growth.

The development community has been working hard to get aid right since the Gleneagles summit of 2005. One advance rarely mentioned in the popular press is the debt sustainability framework. This is a permanent change in the way we at IFAD, and other multilateral financial institutions, do business. Put simply, we have eliminated our very low interest loans and replaced them with grants for poor countries unable to sustain debt.

The debt sustainability framework signals a new approach to development. It allows aid to continue to go where it is needed most, while freeing poor countries from the burden of interest payments. This not only reduces the danger of a future debt crisis, it allows countries to take money previously earmarked for interest payments and use it for essential services, such as clean water, health and education.

The importance of addressing poverty, especially rural poverty, in Africa cannot be overstated. The number of undernourished people in Africa has grown to 206 million from 169 million in the early 1990s. More than 70 per cent of the continent’s poor people live in rural areas.

Climate change is about to make a bad situation worse. Experts expect rising temperatures in Africa will leave as many as 250 million people without enough water to meet basic human needs by 2020. Yields from rain-fed agriculture in some countries could be reduced by half. 

In Africa, if agriculture fails, no amount of investment in other sectors will compensate. We in the development community have a limited influence on climate change, disease, war and the myriad other factors that have made life so desperate for so many in Africa. But we can have an influence on whether aid to Africa is effective. No matter how poor people may be, they can overcome poverty if they are given the opportunity to cultivate land and have access to credit, technical assistance, water, roads and markets for their products.

These issues were among the many discussed by the international development community at the World Economic Forum on Africa in Cape Town. The meeting garners far less media attention than its sister forum in Davos, or the recent G8 summit, but it could have a more immediate and direct impact on shaping the fortunes of the continent.

IFAD is playing its part. Almost half of IFAD’s assistance goes to Africa to fight rural poverty. We have pledged US$1 billion over the next three years. This is a pledge we will keep.

At the World Economic Forum on Africa, details of a new Africa challenge fund were announced. This will be the first challenge fund to be based in and designed specifically for rural Africa. The fund will encourage the development of agricultural and financial markets. It is a truly international venture. It is supported by the African Development Bank, the Consultative Group to Assist the Poor, IFAD and the UK Government through the Department for International Development, and the Netherlands Ministry of Foreign Affairs.

This is just one of many initiatives being worked on behind the scenes. They may not make front page headlines, but they hold the promise of contributing to real and sustainable economic gains for some of the poorest people on Earth.