African Finance Ministers Discuss Debt, Infrastructure and other Regional Challenges
African Finance Ministers began a two-day Consultative Meeting in Tunis on Tuesday, to discuss domestic and regional development challenges in the light of major global initiatives in support of Africa.
The ad-hoc ministerial conference, hosted by the African Development Bank (ADB) in close collaboration with the UN Economic Commission for Africa and the African Union, was presided over by the chair of the ADB Board of Governors, Mr. Seydou Bouda of Burkina Faso.
The discussions today focused on the debt cancellation initiative and challenges in financing the Millennium Development Goals, infrastructure needs, especially regional projects, the impact and policy implications of oil price increases in Africa, and the World Trade Organisation Doha Round trade talks in Hong Kong next month.
In a welcome speech, the President of the ADB, Mr. Donald Kaberuka said that the past 12 months have been momentous for Africa and for the Bank. He noted in particular increased initiatives on Africa such as the Gleneagles announcement of the cancellation of debt owed to the World Bank, the ADB and the IMF by countries that had reached completion point in the HIPC initiative which has reinforced economic growth and good governance.
"We must deepen those gains everywhere in Africa by the pursuit of sound and prudent economic policies, and further sustain the substance of our economic reforms. The ultimate objective is to bring about faster economic growth and effective integration in world trade and investment," he said.
Developments of the African scene continue to offer good reasons for optimism, Mr. Kaberuka said, pointing to rising growth rates, improving overall governance and waning political conflicts in the region. In this regard, he welcomed the recent election by the people of Liberia of Mrs. Ellen Johnson-Sirleaf, Africa’s first woman Head of State.
The ADB President pointed out that this is not the first time there had been a surge of optimism and international support for Africa. He noted however, that "there is today, a big window of opportunity which requires a converted response. We are challenged as Finance Ministers, custodians of our national budget plans and mobilizers of resources."
He said institutions such as the ADB can take the lead to translate promises into practical programmes through careful planning and coordination as well as synergy among institutions.
The Executive Secretary of the ECA, Mr. Abdoulie Janneh on his part, said the Bank, the African Union and his institution, were looking at ways of optimizing the partnership with countries with a view to accompanying the efforts of governments to meet the challenges of the continent. This, he said, could be done "by revitalizing the joint secretariat as well as harmonizing and rationalizing our respective statutory and consultative meetings".
Mr. Janneh noted that the meeting was taking place at a critical juncture in Africa’s renewed efforts at accelerated development and poverty reduction.
The major challenge facing Africa, he pointed out, "is increasing the pace of shared growth in order to meet the MDGs, enhancing the continent’s share in international trade and capital flows, addressing the debt problem, improving the quality of governance… as well as reducing the heavy disease burden particularly HIV/AIDS and malaria."
In reference to one of the issues on the agenda, he spoke of the need to rapidly reverse the decline in Africa’s share of global trade which dropped from 5% two decades ago to less than 2% currently. Each percentage share lost by Africa in global trade, he pointed out, represents 44 billion dollars in foregone earnings.
The conference chairperson, Mr. Seydou Bouda, spoke of the strategic interest of the Tunis meeting which should allow ministers to reflect deeply on the conditions for eligibility for debt reduction.
He underlined the importance to Africa of global trade, noting that the losses suffered by Africa’s cotton producers as a result of the unfair subsidies by rich countries largely offset the benefits of debt cancellation.
Also addressing the debt issue, Tunisian Finance Minister, Mr. Mohamed Rachid Kechiche, said external debt had a negative impact on the outcome of policies and strategies by countries to create and sustain a virtuous cycle of growth and development.
In a press conference on the first day of deliberations, South African Finance Minister, Trevor Manuel and his Nigerian counterpart, Mrs. Ngozi Okonjo-Iweala, applauded the ADB for organizing the meeting and said institutions ought to play a greater role not only in mobilizing support for Africa but also in projecting a strong African voice on international issues.
Attending the Meeting are representatives of the World Bank, the Africa-America Institute, the IMF, NEPAD Secretariat and other regional organizations.