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Africa News afrol News
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Africa News afrol News
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afrol News, 8 May - Africa made impressive economic progress in the 1990s. Despite nearly a decade of reforms in many African countries, economic growth however remains fragile, and there has been little progress in reducing absolute poverty. Therefore, the continent needs a new development plan to consolidate recent gains, concludes a new UN report. Africa is experiencing "impressive" economic growth, but recovery is fragile and poverty on the rise, according to a report released yesterday by the UN Economic Commission for Africa (ECA). The report, Transforming Africa's Economies, states that Africa has averaged growth rates of 4 per cent annually in recent years, compared with only 0.5 per cent in the early part of the last decade. For the first time in many years, several countries sustained double-digit growth. Exports nearly doubled over the decade as the demand for African manufactured goods increased in Europe and the United States. Despite nearly a decade of reforms in many African countries, economic growth remains fragile, and there has been little progress in reducing absolute poverty. That is the starting point for the ECA report, which stresses that on current trends Africa will not achieve the target of reducing poverty by half by 2015. The ECA report says that the good news masks several disturbing trends. The number of people living on less than US$ 1 a day increased from 217 million in 1987 to 310 million in 1999. At the same time, natural disasters like the floods in Mozambique, external shocks such as the recent increase in oil prices, and cross-border spillovers of civil conflicts as evidenced in Sierra Leone, have undermined the recent recovery. The report is based on an innovative set of indices developed by ECA, including the Economic Sustainability Index. Based on that Index, the report concludes that most African economies have not yet developed the capacity to produce outcomes that are consistent with long-term structural change. Of the 47 countries ranked, 24 scored below what is regarded as sustainable. Against this backdrop, ECA is proposing a new "pro-poor" development agenda, based on the need for a structural transformation of Africa's economies. The agenda entails a renewed emphasis on modern agriculture as a basis for resource-based industrialization. It also calls for investments in education, as well as efforts to harness the benefits of information and communication technologies and narrow the digital divide. In addition, the agenda requires measures to tackle diseases that deepen poverty, including HIV/AIDS, tuberculosis and malaria. In his foreword to the report, ECA's Executive Secretary K.Y. Amoako however also places good governance at the centre of Africa's efforts to reduce poverty. Amoako argues that "high-quality governments are better able to design and implement effective policies. They are more transparent. They manage national finances soundly. And they provide citizens with peace, security, and the economic freedoms for markets to flourish." The ECA report therefore is well in line with World Bank and IMF recommandations. The report further concludes that interventions should be chosen "if they benefit all segments of a society’s growth, employment, and poverty reduction. There should also be an appropriate mix of government and private interventions in areas where, due to market imperfections and failures, the state needs to intervene," the report concludes, acknowdledging th role of state intervention. National goals and objectives for a new development plan are identified. The include poverty reduction; increasing incomes and reduce income inequalities; substantially increasing investment in human and physical capital; diversifying the structure of African economies and; creating an environment for growth and development by strengthening governance, economic management, and conflict resolution. - Progress is predicated on African countries undertaking the necessary political and economic reforms to ensure their economic take-off, Amoako concludes. "But rich countries have to support these reforms through long-term partnerships for more aid, for more effective aid, for deeper debt relief, and for greater access to their markets." Transforming Africa's Economies was released on the eve of the Ninth Session of the Joint Conference of African Ministers of Finance and Ministers of Planning and Economic Development, which opens today and runs through 10 May. The event, organized by ECA, is being held in Algiers.
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