MFI/Radio France Internationale (Paris)
Jan Kristiansen
3 July 2002
analysis
Durban, South Africa — Organizing A Union For Africa - Durban 2002 (10 of 11)
The main international financial institutions, the International Monetary Fund and the World Bank, have thrown their full weight behind NEPAD. They see the plan as a real opportunity for sub-Saharan Africa, hard hit by the world economic slowdown, to create a basis for the kind of sustained, rapid growth needed to help the continent catch up with other regions and overcome abject poverty.
Leaders of the two institutions simply hope African leaders will waste no time in going ahead with the implementation of NEPAD and that they will mobilise the energies and the determination required to produce the kind of results that will encourage donor countries to boost their aid in line with the partnership concept adopted by the international community at the conference of rich and poor countries at Monterrey, Mexico earlier this year.
"Africa must get its act together" says one senior official. Africa's short- and medium-term prospects are not so bright, however. Speaking during the IMF-World Bank spring meetings in Washington at the end of April, Bank President James Wolfensohn bluntly described the situation in Africa as "alarming". He said the continent was still affected by the adverse economic consequences of the September 11 terrorist attacks in the Unites States, which briefly threatened to plunge the global economy into recession. "The deep decline of commodity prices, reduced tourism revenues and workers' remittances have opened new financing gaps" in Africa, he said, adding that faster and more evenly spread growth is urgently needed. Wolfensohn's remarks came as the Bank released a new report showing that many developing countries, most of them African, are not on track to reach the United Nations Millenium Development Goals (MDG), notably that of halving extreme poverty in the world by 2015. In fact, it says, the number of poor in sub-Saharan Africa may actually rise, from just over 300 million out of a total population of 659 million in 2000, to 345 million people by then.
"To halve poverty by 2015 African economies will need to grow at 7 percent a year on average (about 5 percent in per capita terms), or more than twice as fast as the 3.1 percent rate (recorded) in 2000" the report says. The region's GDP grew at an annual average of 1.6 percent in the 1980s (the "lost decade") and 2.5 percent in the 1990s.
Encouraging forecasts
The IMF, which released its latest economic forecasts in late April, nevertheless takes heart from the fact that the region achieved a relatively better performance than other regions during the global downturn, which is coming to an end with signs of recovery in the United States and Western Europe. Africa is set to benefit from this. Fund experts attribute the improved performance to the fact that a growing number of African countries pursue better economic policies. They also say the reduction of the number and intensity of conflicts in the continent and the resources freed by debt relief under the joint Fund-Bank initiative for Highly Indebted Poor Countries (HIPC) are contributing factors.
Excluding South Africa, IMF forecasters expect 4 percent growth in the region this year, up from 3.9 percent in 2001, followed by a pickup to 4.8 percent in 2003, despite a recession in the region's number 1 oil producing country Nigeria, where GDP is set to contract by 1.1 percent before a rebound to 3.5 percent in 2003. South Africa, the continent's economic giant, accounting for nearly 40 percent of the region's output, will also benefit from the recovery. Emerging from several years of lacklustre performance, the economy should grow by 2.3 percent this year and 3 percent next year as it overcomes the impact of delayed domestic reforms and such external factors as weak commodity prices and the political turmoil in neighbouring Zimbabwe. Sounding a note of Afro-optimism, IMF Managing Director Horst Koehler, speaking in Accra, Ghana, as he wound up a tour of five African countries in early May, said the most important feature of NEPAD was that "it is an African agenda, designed and carried out by African leaders and people". Echoing the final statements adopted by the top policy-making bodies of the Fund and the Bank in Washington at their April sessions, he promised "wholehearted" support for NEPAD from both. He also reaffirmed their support for increased official development assistance for Africa and strongly urged increased access for African exports. This would be "the best form of help for self-help", Koehler said. But Fund and Bank figures show that Africa's bid for faster development will start from very low levels.
Figures that speak for themselves
Africa today only represents 1.7 percent of international trade and receives less than one percent of world flows of private investment flows. In this continent, which counts the largest number of Least Developed Countries (LDC's), more than half the population lives on less than one dollar a day. Gross national income (GNI) per capita was $470 in 2000, the lowest in the world outside South Asia ($440). Only 41 percent of Africans over the age of 15 can read and write. Infant mortality is 91 per 1000 live births with HIV/AIDS as the main cause of deaths. Life expectancy has actually declined, from 50 to 47 years, since 1990. Only 55 percent of Africans has access to clean drinking water and sanitation facilities. Infrastructure is insufficient : only 12 percent of Africa's roads are paved, only 32 out of 1,000 Africans have access to telephones (fixed or mobile) and there are only nine personal computers per 1,000 people.
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