4 June 2014

Africa: Panel Director Warns Against Economic Inequality

interview

The Africa Progress Panel, an advocacy group which lobbies for equitable and sustainable development for Africa, was represented at the recent Africa Rising meeting in Mozambique by its executive director, Caroline Kende-Robb. AllAfrica's Melissa Britz interviewed her in Maputo.

What have been the highlights for you at the Africa Rising conference?

There are many highlights actually; it's a very inspirational conference. It talks about Africa Rising. We see that across Africa, we see many countries rising, fantastic growth rates, resilient economies, so at one level this is a celebration but also we see some really critical issues that are being raised at the same time.

So we have two stories and it's balancing the narrative that's very important. And of course Africa has 54 countries and its very diverse but many of the countries that have got good growth rates also have increasing inequality. What the IMF has said recently, which for many years previously was debated, is that rising inequality is a drag on growth. So it doesn't help a country economically, certainly it does not help socially. These are very powerful messages.

The Africa Progress Panel has put a strong emphasis on agriculture and development in that sector. Here at the conference there seems to be considerable debate about the ability of the agriculture sector to create jobs and to boost development and growth. What are your comments?

I think the report we just wrote on Grain, Fish and Money, and financing Africa's green and blue revolutions actually makes a very powerful case for agriculture. Two-thirds of Africans depend on the agriculture and fisheries sectors for their livelihoods and fisheries is a hugely neglected sector. Now if you are in countries where many of your people are dependent on agriculture and you're neglecting that sector, you're neglecting a lot of people.

Let me take Nigeria for example, at this moment in time a very prosperous country. Film is expanding and fashion and arts, and agriculture is not doing as much. So it's trying to enable that energy to be pumped into agriculture.

Now the story is changing because the minister of agriculture is very dynamic and what he says is don't look at agriculture as a charity case, make the business case and that's the way to frame agriculture, because a woman working in a field, pulling out her tomatoes, taking them to market, she's a businesswoman.

So I think if you frame it differently and then you look at issues of value addition you have a whole new framing of the agriculture and fisheries sector.

Much has been said in recent times - most notably by former South African president Thabo Mbeki - on illicit capital flows from Africa, that if we address that issue Africa wouldn't need development aid.

We very much appreciate the panel of Mr. Mbeki. They've done some fantastic work and in reality is that there's at least U.S. $50 billion in illicit financial flows flowing from Africa every year. This is a huge amount of money and he's absolutely right and that's what we've put in our report as well.

Actually $38 billion of that $50 billion is on one technique called trade mispricing which takes place more often than not in the oil, gas and mining sector. So the oil, gas and mining sector, and I gave a panel on this yesterday and it was touched upon, this is a complicated, complex sector.

People are thankfully talking about more transparency - including the CEOs, including governments - so that's a good thing but it's a complex, messy sector and highly political. So these kinds of issues need global solutions so it's a problem for the G8, G20 and it's a problem for Africa.

The Extractive Industries Transparency Initiative (EITI) promotes transparency in this sector. How successful in your opinion has that process been?

When you look at five years ago and what the EITI did, and they're very pioneering, Claire Short is here who heads the EITI.

Incredible work that they've done, it's about putting these issues on the agenda and hoping that others will pick them up and that's happening.

EITI was at one level initially voluntary. So countries could choose to join the EITI but once they've chosen they have to sign onto binding regulations to be more transparent. It's good to see the United States has just joined and Australia too so it's becoming a very big global phenomenon.

Ultimately we need to depend on the Dodd-Frank Act in the U.S. and similar European Union legislation that has to be implemented. We need the data and civil society then needs to be able to check whether these funds are flowing in the right direction.

A number of the speakers have touched on women's development and the role that women have to play but are African governments actually progressing in that regard?

I actually think this is a global challenge. Even women in countries that are so called progressive as far as gender issues are concerned, there's a lot of hidden discrimination, a lot of domestic violence, a lot of discrimination in the workplace so these are issues that I think should be tackled globally.

Some countries are making good strides. If you go to Rwanda you are dialoguing with many women ministers and that certainly is a fantastic role model. So this is one big step forward, but another big step is looking at the agriculture sector, women are the farmers across Africa and they are fantastic businesspeople.

So the really interesting initiative is helping entrepreneurs. How can we help entrepreneurs? Many successful African businesspeople are now trying to mentor other people to become more business aware and there's a really fantastic organization called Mara Foundation they're doing really good work and they're African-based, an African organization, working with Africans to see how we can help entrepreneurs. It does need mentoring, so there's many different ways and one of the key links to the mentoring is how do you get access to finance.

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