Washington, DC — Africa's numbers remain awful but that's come to be almost routine at the annual Spring Meetings of the World Bank and International Monetary Fund.
The documents produced for this spring's sessions place Sub-Saharan Africa at the bottom of the list for every development indicator, making Africa's situation, as World Bank President James D. Wolfensohn put it to the IMF International Monetary and Financial Committee on Sunday, "alarming".
The Millennium Development Goals set by the United Nations in September 2000 aim to halve global poverty by the year 2015. By that time, in Africa, the number of poor people - defined as those living on less than one dollar a day - will have increased from 300 million in 1999 to 345m. Using two dollars a day as the standard during this same time period, poverty in Sub-Saharan Africa will grow from 484m to 597m.
For bank officials and others almost numbed by these figures, and all the other negative development indicators, the only question when it comes to Africa - a continent into which billions of "assistance" dollars have been poured - is why does so little seem to work?
Some answers stand out in sharp relief. For example, the cold war as fought on African terrain, led to projects being commissioned for the wrong reasons, to corrupt leadership and wasted billions. For decades, "aid to Africa was for geopolitical reasons not development reasons," acknowledged Shanta Devarajan, Chief Economist for the Bank's Human Development Network.
While African ministers here in Washington this weekend were hardly calling for an end to official development assistance (ODA), complaints that its effects sometimes ran counter to its intentions were not hard to find. Tanzania, in what the World Bank itself calls a "stark example" of the burdens of foreign assistance, was producing 2,400 quarterly reports annually for its donors, who were sending missions to Tanzania at the rate of 1,000 a year.
"I think that we are now in a situation where everybody recognizes that to have countries burdened with innumerable visits from good-hearted people like us and all the bilateral donors, and innumerable reports that they have to complete quarterly and little coordination in terms of some of the mechanics of the implementation, that there is a large pick-up to be had in just coordinating and better implementing what the development community are doing already," World Bank President James D. Wolfensohn said Friday, acknowledging that "aid effectiveness" - an important theme of this year's spring meetings - had to do with more than money.
And everywhere over the weekend, talk underscored a major shift in the thinking of African leadership that has occurred during the past few years. In discussions about what Africa needs the words "trade" and "investment" are heard more often than "assistance." African economies "are very open now," declares Cote d'Ivoire Finance Minister, Paul Bouabre. "A lot of controls that existed in the 'seventies and 'eighties are no longer there. And also we have privatized. We have moved to a market orientation."
Says Ghana's Minister of Finance and Economy, Yaw Osafo-Maafo: "It is becoming very clear that what Africa needs at the moment is fair trade, and aid should come in as supplementary."
And, adds Zambian Minister of Finance, Emmanuel Kasonde, "it is important that we do change the strategy and concentrate on trade and open the grounds of the world trading areas to African products."
But in this arena "fair" becomes another key word surrounded by uncertainty. Ghana can sell cocoa beans to Europe without any duty being imposed, notes Osafo-Maafo: "But when we sell the butter and chocolate, we have tariffs on them." The higher cost of African products because of these tariffs loses them market share. "Tariffs in the United States are two to three times higher on the products of poor countries than they are on average," says World Bank Chief Economist Nicholas Stern.
And then there are non-tariff barriers. The north-west African nation of Mauritania, says Stern, was achieving international success with cheese products made from camel's milk, even winning some prizes at a German cheese fair. Camel's milk is supplied by nomads, 70 percent of whom live on less than one U.S. dollar a day. Their cheese attracted one of the highest tariff levels, impeding its entry into the EU.
But, says Stern, that wasn't ultimately what killed this promising export line for Mauritania. Although foot and mouth disease is not known to come from camels, the EU decided it was a risk. "They said these camels had to be milked mechanically - a bit of a challenge for a nomad in Mauritania. Essentially what was a very promising export line in a very poor country was stopped on that kind of technicality. That," says Stern, "is a non-tariff barrier."
Protective agricultural subsidies in rich nations also handicap Africa trade efforts, says Trevor Manuel "The US$300bn of agricultural subsidies granted in the year 2000 is six times the total sum of ODA granted. So we face a huge contradiction."
In a television interview, International Monetary Fund head, Horst Köhler, seemed to agree. "The big issue is indeed the subsidies for agriculture, for cotton, for sugar, for citrus fruits and so on.... I am deeply convinced, if there is leadership, and we need leadership to tackle these subsidies, we will create a better world."
Better leadership on debt relief would also help greatly, say African ministers. "We carry a very heavy burden, the burden of our debt," says the Governor of the Central Bank of the Democratic Republic of the Congo, Jean Claude Massangu Mulongo.
Ethiopia expects a 47 percent reduction in debt under the World Bank-initiated "Heavily Indebted Poor Countries" (HIPC) program. Even so, its debt service over the next 20 years will be about US$72m per annum, - about the same as it spends annually on health, according to The Jubilee Debt Campaign which has been campaigning for debt relief for three years. That equation looks even more troubling when you consider that Ethiopia would need to spend $2.5bn per year to meet its health needs.
The Jubilee campaigners call the HIPC initiative a failure. Part of a document they were circulating over the weekend, stated that, "only four countries had passed through all the hoops of the HIPC initiative. Out of the 42 countries included in the process, almost half of these had not even reached a 'decision point' after which they receive some interim relief on their debt service payments."
The bank acknowledged this month that the world economic slowdown, combined with falling commodity prices, has slowed the implementation of the HIPC initiative, but insists this is still the best policy tool for address the debt problem.
World Bank President Wolfensohn says "the HIPC initiative is the one to back. I think it is going well." He acknowledges the heavy debt burden, however. "I think we are responding to it. We are really moving very much forward. I can't do much about - some of the accumulated debts - but we are working away at it."
Perhaps most encouraging, as the Spring Meetings end, is that the old frame of reference for discussion seems to have changed, as African - and other - voices seek a new starting point for engagement with the rich, industrialised Western world.
Old relationships built around foreign aid welfare and donor-driven goals are finally being challenged and re-evaluated.
The new Chairman of the Development Committee, South African Finance Minister Trevor Manuel, says his Committee's work this weekend was part of the momentum of the recently held Monterrey Conference on Financing and Development: "[The Monterrey] consensus is about establishing partnerships, and it is about enhancing the situation where developing countries take ownership of events in their own countries and use that for going forward."
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Nepad, the New Partnership for Africa's Development,"[is] a model for the kind of partnership we talk of going forward," Manuel told reporters, Sunday.
The essence of Nepad, he says, "is a partnership where the reciprocity is constructed between what we can deliver as African countries - largely matters relating to governance, better planning, and better measurement of outputs - and on the other side of it, clearly, a relationship with donors to be able to assist in the enablement of African countries to deliver against those issues."
There are still thorny, difficult issues for developing nations - especially African nations. A key aspect of "governance", the current political watchword, centers on deregulation, according to Cote d'Ivoire's Paul Bouabre: African economies suffer from strong rigidities that are attributable to the regulatory framework for the business environment and economic activity environment. So we must start strong structural reforms."
One of those reforms involves privatizing inefficient public companies. The idea is to open up what were public monopolies to competition. However, notes Bouabre, very often this isn't what happens. "We end up supporting the inefficiencies of private monopolies when we used to support those inefficiencies under public monopolies."
And there is a host of other pitfalls for the African nation that wishes to move beyond the slough of underdevelopment in which so many nations have been mired for so long. But depressing as African development indicators might seem, says Ghana's Yaw Osafo-Maafo, a lot of work has already been done, even though it may not show on the surface.
The development of African countries is uneven, he says, making more headway in some places than in others. "It is possible that some of us will get there faster," he adds and some African nations will have to "become the role models for the others."
