Africa, Development & Aid, Europe, Headlines, Human Rights, Poverty & SDGs

AFRICA: Cautious Optimism Surfaces

Ramesh Jaura

BERLIN, May 25 2006 (IPS) - Africa has come to be associated with conflicts, political unrest, famine and disease. A new report says that there is reason to be optimistic about the world’s second largest continent.

But the upbeat message is escorted by words of caution from two development economists of repute: Louka Katseli, director of the OECD Development Centre in Paris and Donald Kaberuka, president of the African Development Bank in Tunis.

A cautiously upbeat message comes also on the human rights front, accompanied by plenty of warnings on both rights and development.

“While prospects for much of Africa are more favourable than they have been in the recent past, human security continues to be severely affected by weak governance structures, conflicts and the vulnerability that accompanies extreme poverty,” Katseli and Kaberuka write in the preface to the latest African Economic Outlook (AEO).

This is the fifth in a series of annual Outlooks by the Development Centre of the OECD (Organisation for Economic Cooperation and Development). The Development Centre is an interface between OECD member countries and the emerging and developing economies.

The survey offers a comparative panorama of the economic, political and social evolution of 30 African economies from 2005 to 2007, covering 87 percent of the population and 90 percent of the continent’s revenue. It was released May 16 in Paris.

The lack of freedom from want and opportunities to satisfy basic human needs lead Katseli and Kaberuka to conclude: “For most African countries the prospects of attaining the Millennium Development Goals remain a challenge.”

The Millennium Development Goals (MDGs) agreed at the United Nations summit of world leaders in 2000 oblige the international community to eradicate extreme poverty and hunger, achieve universal primary education as well as promote gender equality and empower women.

The aim is also to reduce child mortality, improve maternal health, combat HIV/AIDS, malaria and other diseases, ensure environmental sustainability, and develop a global partnership for development.

There is a growing sense that barring great effort, the MDGs will simply not be reached by 2015. “Progress means tackling the basics, like hunger, which affected some 28 percent of the population in 2000-2002, and combating diseases like AIDS, tuberculosis and malaria,” says another development economist Rory J. Clarke in an article for the ‘OCED Observer’, a magazine and online service.

At the same time, conflicts and natural disasters in countries such as Sudan, Zimbabwe, Ethiopia and Nigeria continue to dampen economic growth besides creating humanitarian disasters.

Despite such conflicts, the Commonwealth Human Rights Initiative sees at least partial improvement in the human rights situation.

“While it is unfortunate that the human rights situation in much of Africa is worsening – daily reports from Zimbabwe provide particularly sobering reading – a picture of exclusive doom and gloom would provide an unfair picture,” Aditi Dutta from the Commonwealth Human Rights Initiative told IPS in London.

“The strength and activism of so much of civil society, for instance, can only be seen as inspiring. That so many people – whether unionists, faith-leaders, NGO workers, journalists or ordinary mums and dads – are willing to risk so much in their pursuit of better governance, access to justice and human rights reflects the passion, commitment and power of people across the continent.”

It is not just at that local activism level that there are positive changes, but also at some national levels, Dutta said. “This includes the countries that are slowly recognising the importance of open governance, as seen by increasing interest in right to information laws.”

Dutta acknowledged that this is also accompanied by further moves towards secrecy in other countries. “But that a country like Uganda has recently passed a right to information law and others have Bills, is a positive development.”

The situation of people and of governance is being underpinned by the economic improvement.

Several African countries improved their economic performance in 2005 recording an overall growth of 5 percent, with average per capita up by 3 percent and inflation steady at lower than 10 percent – not least because of a notable increase in official development assistance (ODA) and debt forgiveness.

The OECD report points out that Africa is the largest recipient of ODA. In 2003 (for which the Development Assistance Committee of the 30-member donor club has reliable figures) Africa received 26.3 billion dollars – the largest amount going to a single region – from the 77.45 billion dollar global pot.

Mobilisation for reforms, growing support of the international community that achieved a thrust by the Commission of Africa set up by the British government, and last year’s Gleneagles G8 Summit have also played a part in the rise in optimism.

There are other reasons too. The CFA countries (Communauté Financière Africaine), a dozen or so Francophone countries from Chad to Gabon whose franc is pegged to the Euro, profited from low inflation worldwide and a cushion against higher dollar- denominated commodity prices.

Those with floating exchange rates also managed well, reaping the benefits of generally prudent monetary policies and the weaker dollar. Even in southern Africa, where inflation stayed in double figures, price rises still slowed to around 11 percent from 16 percent a year earlier, though Zimbabwe and Angola remained above 20 percent.

Against this backdrop, a ‘policy insight’ paper posted on the web by the OECD Development Centre goes as far as to conclude: “Africa’s economic progress now seems on a firm footing.” In the next breath however some ‘ifs’ and ‘buts’ are tagged on to this affirmative statement.

The paper cautions: “If the good weather of 2005 holds up, along with world commodity prices, the improvement could continue into 2006 and 2007. But if oil prices stay high, the threat to the continent’s oil-importing countries should not be underestimated.”

This is because while price controls and subsidies have shielded consumers from the full effects of the oil price increases, higher oil prices have still been painful for net oil- importing countries.

The AEO puts their average trade deficit at more than 5.6 percent of Gross Domestic Product (GDP). “Continuing high oil prices – which seem increasingly likely – are a major medium-term risk for the continent’s oil importers and seriously endanger their macroeconomic stability efforts through the key problem of the funding and sustainability of trade deficits,” warn the authors of the policy insight ‘A Two Speed Continent?’

It also makes poverty-reduction even harder by reducing the government’s financial room for manoeuvre and threatening a spread of poverty, they say.