DEVELOPMENT: NGOs Urge U.S. Treasury Chief to Revise Africa Stance

By Emad Mekay Reprint | | Print |

Emad Mekay

WASHINGTON, May 17 2002 (IPS) - Anti-debt campaigners are pressing U.S. Treasury Secretary Paul O’Neill to adjust U.S. policies towards African development as he embarks on a 10-day visit to some of the most impoverished nations in the sub-Saharan region.

But on the eve of his May 20-31 trip, O’Neill appeared determined to stick to the U.S. line of tying aid to economic policy changes designed to attract and reward private sector investment, an approach opposed by many civil society groups both in the South and here.

Advocacy groups here, including Africa Action and Trans Africa Forum, have urged a new U.S. policy towards the continent, one based on eliminating what the groups regard as Africa’s illegitimate external debt, and increasing U.S. public investment in social development.

The groups say the world’s richest country, and the backbone of several international financial institutions (IFIs), should also pay greater attention to the continent’s ravaging health crises, including the HIV/AIDS epidemic.

Anti-debt campaigners Jubilee USA Network, said in a statement it hoped O’Neill would see first hand the failings of the Heavily Indebted Poor Countries Initiative, better known as HIPC.

“In looking for alternatives to the failed HIPC programme, we hope Secretary O’Neill will engage the rich policy alternatives originating from African civil society on debt and development,” said Marie Clarke, national coordinator of Jubilee USA. “After all, genuine solutions for Africa can only come from her people.”

Other groups, like Action Aid USA and the Fifty Years is Enough network,campaigners against poverty and debt in many parts of the world, said they hoped O’Neill would notice the damage that IFIs do to Africa.

The groups want O’Neill to use his clout within the U.S. government, the World Bank and the International Monetary Fund (IMF) to call for a new approach to the development challenges of Africa.

But the treasury secretary, who will visit Uganda, Ethiopia Ghana and South Africa, has said in the past that trillions of dollars in aid have been wasted, and he could prove a hard target to convince.

The former businessman will spend the bulk of his trip meeting government officials and business executives rather than non-governmental organisations, activists or poor Africans.

At a press conference, O’Neill stressed that his aim would be ensuring that African nations create the right atmosphere, a financially rewarding one, for foreign capital investments.

“I often say capital is a coward, because it’s true,” O’Neill said. “Foreign investors don’t want to risk their savings in a place where corruption is rampant and contracts aren’t enforced.”

“And private citizens are scared off by the same uncertainty, choosing to keep their savings buried under their houses rather than put up a building or buy a machine that they fear could be taken away from them at any time.”

O’Neill also repeated that economic results must be tangible.

“Compassion requires that we be hard-minded and insist that we measure the impact our assistance is having, so that we can constantly improve our effectiveness and participate in the development of human potential in Africa,” he told reporters.

The recent U.S. announcement that it will beef up foreign aid by 10 billion dollars over three years, has not won over campaigners who protest that the aid is too little, too late and is likely to come with many strings attached.

They also criticise the New Partnership for African Development (NEPAD), a pan-African programme introduced by the presidents of Algeria, South Africa, Nigeria and Senegal. The programme proposes rewarding good governance with aid, trade access, private sector engagement in the fight against poverty and, possibly, more debt cancellation.

Western officials say they plan to support NEPAD with 64 billion dollars a year. But civil society groups say that support should not be tied to more hard-to-meet conditionalities.

They say the approach now in favour with the World Bank and IMF, which stresses free trade and the private sector as engines of economic growth, is essentially flawed, disregarding many more pressing development instruments, like health care, education, democracy, and transparency among others.

O’Neill’s visit is the latest in a series of high-profile trips by officials from Western and rich countries to address problems in Africa. In a visit earlier this month, IMF Managing Director Horst Koehler promised to help build economic institutions.

British Prime Minister Tony Blair, who toured Africa last year, and French President Jacques Chirac, who also recently visited nations there, vowed to support NEPAD.

President George W. Bush plans to visit the continent next year.