United States Department of State (Washington, DC)
Charles W. Corey
8 June 2006
Washington, DC — Even though Africa is moving toward greater economic growth and development, it must remain the first priority of the World Bank if it is to fully prosper long-term, said World Bank President Paul Wolfowitz.
In remarks at the African Growth and Opportunity Act (AGOA) Investment Summit June 7, Wolfowitz said Africa, despite some progress, lags far behind the rest of the developing world in reducing poverty.
"Twenty years ago we had 150 million people in extreme poverty. Today that number is doubled and it is roughly 50 percent of the population of sub-Saharan Africa. That has to be a concern not just of Africans. It has to be a concern of all human beings." Numbers like that, he said, do not point to a healthy world "when a major part of the world is falling behind."
Despite such statistics however, Wolfowitz said he agrees with Nigerian President Olusegun Obasanjo that "'Africa is a continent on the move.'"
Wolfowitz cautioned, however, that the economic progress now taking place across Africa is not uniform. "You can still find many pockets of misery," he said, adding that there is not enough attention being paid to African success stories like Rwanda.
"Rwanda is amazing," he told his audience. "Nine hundred and fifty thousand people were slaughtered in the genocide a little over 10 years ago. In the intervening period," he said, that country's economy has been enjoying a very good 10 percent growth rate.
In addition to Rwanda, Wolfowitz said, improved performance is also apparent in the governance of other parts of Africa, including Nigeria "where a former chief of police is in jail for corruption." He also cited a case in South Africa, where "the country's deputy president was dismissed not because he took a bribe but because he was held accountable for one of his aides taking a bribe."
Those who watch Africa on a regular basis, he said, are "seeing a difference" in performance levels. "You are seeing it in 15 African countries that have had median growth rates over the past 10 years of better than 5 percent -- from Ghana at 4 percent to Mozambique at 8 percent and Rwanda at 10 percent."
Clearly the key to economic success is creating jobs, he said, adding that job creation should be one of the Millennium Development Goals along with health, education and poverty reduction. He also credited Africa's economic progress in part to the increased number of Africans successful in business.
OBSTACLES TO DEVELOPMENT REMAIN
Wolfowitz told his audience that Africans still face an enormous set of obstacles with regard to development -- "some of them avoidable ... some of them totally unnecessary and many of them ... manmade such as the regulations" inherited from years back that govern businesses.
"Somebody thought 30 or 40 years ago that it made sense to have to have 55 different licenses to start a business in any number of African countries," he lamented.
As a direct result, he said, Africa does poorly when ranked with other regions in terms of which countries have the most nurturing business climates. Of 155 countries ranked worldwide, seven of the bottom 10 (those with the most inhospitable business climates) are African countries, he said.
"That is bad news on one hand, and on the other hand ... it is good news. It says that there's a lot that African countries could do fairly quickly, fairly easily like clearing away some of that regulatory underbrush."
Other things that are harder to fix such as infrastructure, he said, will take longer. The World Bank is now "coming back in a very determined way" to help Africa tackle after some years of ramping down infrastructure projects.
Burkina Faso, he said, is one of the 15 countries that are performing well, despite the fact it costs 1.5 times the average per-capita annual income just to open a business. That figure is more than it costs to start a business in the United States, Wolfowitz said.
The World Bank president also cited as evidence of Africa' progress a drastic drop in the number of active African wars, from 16 in 2002 to six currently.
"Six is still too many and every one of those conflicts is ... a tragedy in itself and a huge obstacle to development." But he quickly added, the fact that number has gone down so much in the past five years is a "very hopeful sign."
Wolfowitz also acknowledged that Africa's past colonial legacy left terrible scars on the continent, but he told his audience "You won't make progress dwelling on it!"
(The Washington File is a product of the Bureau of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)
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