EDITOR’S NOTE

Developing Africa through Partnership Initiative

The New Partnership for Africa’s Development (NEPAD) was inaugurated in 2001 by five initiating countries namely Algeria, Egypt, Nigeria, Senegal, South Africa, to address the current challenges facing the African continent, such as the escalating poverty levels, underdevelopment and the continued marginalisation of Africa in international economics and politics. The Highly Indebted Poor Countries (HIPC) Debt initiative was proposed by the World Bank and IMF (Indian Monetary Fund) and agreed by governments around the world, and after being significantly enhanced in 1999, it has helped over 25 HIPC countries to reduce total debt stock by nearly 50 percent, cut the ratio of debt-to-GDP from under 60 percent to under 30 percent and boost social spending. The Poverty Reduction Strategy Papers (PRSPs) of the World Bank have also contributed to developing a structured approach to target poverty. The African Growth and Opportunity Act (AGOA) Preferential Trade Agreement introduced by the US and the Cotonou Preferential Trade Agreement by the EU are providing preferential access to the African products. The AGOA had led to a 30 percent increase in non-fuel, non-mineral exports to the United States from 2000 to 2003. British Prime Minister Tony Blair launched the newest Initiative on  February 26, 2004, in the form of the Commission for Africa, to generate action for a strong and prosperous Africa.

But, are these initiatives really transferring resources to the poor, or just generating employment for the development sector? Unless projects do not transfer cash or create encashable opportunities for the poor, they render little service. Probably just using helicopters to drop coins across Africa may help. The rich will not run in the fields and roads to pick them up, while the poor will be scuttling to get their hands on them. Is there any better way of income distribution?

ACTIVITY REPORT

Economic Development Priorities: What Next After HIPC Completion Point and PRSP

Consumer Unity & Trust Society-Africa Resource Centre (CUTS-ARC) in partnership with Southern Africa Regional Poverty Network (SARPN) organised a half-day stakeholders' roundtable on this theme at Lusaka on  December 15, 2004. 

Jack Zulu of the Jesuit Centre for Theological Reflection (JCTR) felt that the HIPC initiative which was designed in 1996 to bring the mounting debt of 42 developing nations to sustainable levels is eight years along and failing at a record of only 7 out of 42 countries in something close to debt sustainability.

Professor Venkatesh Seshamani of the University of Zambia reiterated that HIPC is not a panacea to debt sustainability because it will make very little difference on the release of new development financial resources for development.

Professor Oliver Saasa of Premier Consult said the HIPC initiative was designed to ensure that no poor country faces a debt burden that it cannot manage. He however, pointed out structural flaws of the programme, including the appropriateness to many poor countries of the HIPC debt sustainability criteria of the ‘rule of thumb’ threshold of 150 percent debt repayment-export ratio which is a cut and paste from Latin America where socio-economic characteristics are significantly different from what is obtained in many African HIPC countries.

(For more details, please write to: cutsarc@zamnet.zm)

The United Kingdom Commission for Africa Consultation

CFA National Meeting

CUTS-ARC was invited to make a formal submission during the UK Commission for Africa (CFA)-Zambia meeting, which took place on  November 30, and  December 1, 2004. The meeting was organised by the Ministry of Commerce, Trade and Industry (MCTI). Making the submission to the commission on: “Improving the International Trading System: A Zambian Perspective,” CUTS-ARC made a brief assessment as well as suggestions from the vantage point of Civil Society in Zambia vis-à-vis the improvement of the domestic economic environment as well as international trading system through well rehearsed negotiation skills backed by empirical information of the vital aspects of the economy. It proposed a few changes in the international trading system and the development policy outlook, which could make an impact on the ground.

CFA Regional Meeting

The CFA National Meeting was soon followed by the CFA regional meeting organised by the Southern African Regional Poverty Network (SARPN) and the Economic Association of Zambia on 13-14 December 2004, the occasion on which the Centre was again given an opportunity to make a submission on the topic ‘Creating Enabling Environment in the Regional and International Trading System: A Southern African Perspective’. Among the pertinent suggestions that this paper put forward included strengthening policy coherence in the various trade agreements existing in the region, improving the social safety nets in the face of massive privatisation, demanding increased corporate social responsibility from multinational companies, debt cancellation as well as a call for fairness during the negotiations of economic partnership agreements and at the multilateral level.

CFA National Workshop for Drafting the final Document

CUTS-ARC was also invited to the final workshop to draft the final document for submission to the commission. The two day meeting held on 20-21 December 2004, among other recommendations, included a call for fair treatment in the international trading system, support in increasing foreign direct investment, debt write off, support for capacity building and private sector development.

(For more details, please write to: cutsarc@zamnet.zm
lusaka@cuts.org)

Can Africa Trade her Way out of Poverty?

This regional seminar organised by CUTS, Nairobi in partnership with Friedrich Ebert Stiftung on 25-26 October 2004 at Naivasha, Kenya, attracted participants from eight sub-Saharan countries and also from India and Vietnam.

With cautious optimism, Ambassador Peter Robleh of the United Nations Economic Commission for Africa felt that the answer to poverty in Africa lay in fair trade and not aid, saying ‘so far the trade arrangement between the EU and Africa have not resulted in considerable economic and social change in Africa.’

One issue on which there was unanimity was that trade liberalisation alone will not reduce poverty. The seminar proposed suggestions through which African countries could rationalise and develop coherence among different trade arrangements.

The seminar concluded that poverty reduction is not only linked to trade but also to good governance and other appropriate measures.

NEWS BRIEFS

Africa Requires US$100bn Annual Investment

The African Union (AU) Commission has disclosed that a minimum of US$100bn annual investment is required to change the current poor development status of Africa. According to Professor Alpha Oumar Konare, Chairperson of AU Commission, political commitment is crucial to raise these resources and undertake the required investment to the continent and fight poverty.  

(Source: http://www.allafrica.com, 17.12.04)

ADB Budgets US$5.4bn for Poor African Countries

The African Development Bank (ADB) has announced the conclusion of negotiations under the 10th replenishment in which Deputies agreed a level of approximately US$5.4bn to cover funding of development projects in the poorest African countries. The latest replenishment which covers a period of three years, 2005-2007, represents an increase of 43 percent over the actual resources mobilised under the African Development Fund (ADF)-1X.

(Source: http//: www.thisdayonline.com, 23.12.04)

Launching the Development Corridor Linking Four Countries

A development initiative dubbed the Mtwara Development Corridor initiative linking four southern African countries has been launched to promote economic development and integrate transport networks over an 850km stretch linking Zambia, Malawi, Mozambique and Tanzania. This corridor is aimed at exploiting existing investment opportunities through the development of roads, electricity, postal services, telecommunications, agriculture, mining, fishery and tourism.

(Source: http://www.irinnews.org, 21.12.04)

Africa’s ‘Disappointing’ Big Plan

The New Partnership for Africa’s Development (NEPAD) is facing pointed arrows of fresh criticism and this time from one of the architects of the Africa's home-grown plan for economic development, which has been big on plans and small in actual achievements. Senegal's President Abdoulaye Wade said a lot of time and money had been spent on conferences, with few results, and that he was at pains to explain what has been achieved when people at home and elsewhere ask that question, adding that NEPAD had become "confused and a little unfocused.

(Source: http://www.bbc.com, 22.10.04)

COMESA Celebrates 10th Anniversary

The Common Market for Eastern and Southern Africa (COMESA) celebrated its 10th anniversary on  December 9, 2004 in Lusaka, Zambia with the Chairman of the COMESA Authority, Ugandan President Yoweri Museveni imploring member countries to broaden their spectrum of activities and involve more people living in the trading bloc. He urged COMESA member countries to move away from the narrow window of trade and agriculture, saying authorities in the regional trading bloc should desist from the trend of thinking that agriculture was the only solution to joblessness. Zambian President Levy Mwanawasa described the high transport costs in the region as compared to other regions as a "great setback".  Earlier, COMESA Secretary General, Erastus Mwencha, said the regional bloc has made several achievements over the past decade, and hoped for more positive changes in Africa as the global environment expects more changes ahead of 2015.

(Source: http://www.comesa.int, 10.12.04)

PUBLICATIONS/POLICY BRIEFS

Investment Policy: Performance and Perceptions – Cases of Tanzania and Zambia

This paper compares the investment framework in two LDCs, Tanzania and Zambia, their performance in attracting FDI, and the civil society’s views on FDI. Please read about the role FDI has come to play in the economy of the two countries that are similar in many ways but differ fundamentally in their approach to similar external influence. The paper is based on findings of the country research studies carried out under a project entitled Investment for Development (IFD).

(For more details, please write to: cutsarc@zamnet.zm
lusaka@cuts.org)

EU-ACP Economic Partnership Agreement Negotiations: Cotonou Undermined

The trade arm of the Cotonou Agreement (CA), the Economic Partnership Agreements (EPAs), negotiations have so far paid limited attention to the fundamental values and objectives originally set out in the CA and are set to threaten and undermine its vision. To understand what is happening as the EU ‘shaves too little too thin’ in these important negotiations by giving too little and demanding more, read this policy brief.

(For more details, please write to: cutsarc@zamnet.zm
lusaka@cuts.org)

Contact Us:

Africa Resource Centre
Suite 4.11, Main Post Office Building,
Cairo Road, P.O. Box 37113, Lusaka, Zambia
Ph: (00) 260-1-224992
Email: cutsarc@zamnet.zm
lusaka@cuts.org

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