Do what we did, Africans tell Europe

2011-09-28 11:55

kalahari.com

Washington - As the world's finance czars clamoured this week for decisive action to clean up Europe's debt crisis, ministers from the planet's poorest region Africa were quietly saying "been there, done that".

A weekend briefing by African finance ministers at IMF/World Bank meetings in Washington attracted modest media attention, but there was quiet pride in the way representatives from tiny states like Cape Verde and Gambia were able to claim concrete achievements in managing debt and public finances.

Developing countries from across the world, including Africa, are portraying themselves as "innocent bystanders" of the economic storm boiling out of Europe and the United States, and have joined the chorus calling on the European nations in crisis to bite the bullet of painful economic reforms.

"It is not easy, it is painful, and we went through the pain, and the Europeans must be prepared to go through the pain," African Development Bank President Donald Kaberuka told Reuters in an interview.

He said the reforms needed in the ailing southern European states involved the kind of overhauls of public finances and labour markets and other structural reforms that African nations - with firm urging from the IMF and World Bank - had tackled over the last two decades and now had results to show for it.

Fund and Bank experts say sound macroeconomic reforms and better budget management are some factors that have helped propel robust growth in sub-Saharan Africa since 2000.

This has given the region one of the brightest outlooks of any region amid the prevailing gloom.

Re-profiling of Africa's risk

"The outside world still sees Africa of yesterday. We believe that this is Africa's time," Kaberuka said.

While acknowledging major challenges on the continent - huge infrastructure and energy deficits, shortages of skilled labour and the risk of political flare-ups - he said the moment had come for what he called "a re-profiling of Africa's risk".

The continent's risk profile had been grossly overestimated for too long, Kaberuka said.

"There are risks, the buffers built before 2008 are weakened, inflation is raising its ugly head in some countries because of pressure of food prices, we have residual political issues in a few countries," he said.

And the continent had good reason to worry about the threat of aid, finance, investment and trade flows falling if conditions in the advanced economies worsened.

"But are we more risky than some of these peripheral countries in Europe, which have 150% of GDP in debt, 30% fiscal deficit?" Kaberuka asked.

"All hands on deck"

Arguing the change underway in Africa was comparable to that experienced by India 20 years ago, Kaberuka said aggregate economic fundamentals on the continent - its wide internal variations notwithstanding - were something to be proud of.

"An average African country would now be growing at about 6%, we'd be having a fiscal deficit of no more than 3%, debt no more than 15% of GDP," he said.

His biggest worry was not what was happening in Africa, but what was not happening in the developed world, "the inability or unwillingness of the rich countries to take the decisions needed to return the global economy to growth momentum".

But he said emerging markets and low-income countries, the Africans included, had a role to play in trying to re-launch a new global growth momentum. "We have to get the ship moving, that requires all hands on deck," Kaberuka said.

Investment in infrastructure in Africa could help to rekindle aggregate demand for equipment and products from advanced economies, which in turn would put idle manufacturing capacity back into use, he said. This would make Africa's infrastructure agenda part of the global recovery efforts.

Upgrading power and infrastructure was critical to sustaining Africa's continuing rise and, while connectivity in broadband Internet services remained a problem, the telecoms sector on the continent was "exploding", Kaberuka said.

"There's room here for the private sector, returns are very high, cost of entry, very low, risks, very low," he added.

Energy sector reforms needed creation of sound regulatory systems and financially sound utility companies, he said.

But Kaberuka warned the continent's governments that if they wanted to avoid the kind of political upheavals seen in North Africa and the Middle East, they needed to ensure that growth was truly inclusive, and work to tackle inequalities.

"Beyond the jargon, all persons in the country must be seen to benefit, all sectors, all communities," he said.




 

Read more on:    eu  |  us  |  africa
NEXT ON NEWS24X

Read News24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
20 comments
Add your comment
Comment 0 characters remaining
 

Inside News24

 
 

'Zuma's legacy will be judged by Nkandla'

The legacy of President Jacob Zuma is contingent on how he deals with the issue of upgrades to his Nkandla homestead, says Cape Town Archbishop Thabo Makgoba.

 
 

Latest elections multimedia

Why Jack Parow wants you to vote on 7 May
The ad the SABC doesn't want to air
Elections 2014 in one cartoon
This year's election posters
 
Traffic
Lottery
 
  • Thursday Sir Lowry's Pass - 05:35 AM
    Road name: Old Sir Lowrys Pass Road
    TRAFFIC LIGHTS not working at Bezweni Road
  • Thursday Cape Town - 05:35 AM
    Road name: Buitengracht Street
    TRAFFIC LIGHTS not working at Waterkant Street
 
More traffic reports...
 

Jobs in Cape Town [change area]

Property [change area]

Travel - Look, Book, Go!

Escape winter, head to Mauritius

Escape winter by spending 7 nights in Mauritius' tropical bliss from R13 215 per person sharing. Includes return flights, airport transfers and accommodation. Book now!

Kalahari.com - shop online today

Get many eggs in one basket!

Gaming bundles: 2 Super Hits games for R99, 3 Disney games for R99 and more + exclusive accessory bundles only available on kalahari.com. While stocks last. Shop now!

25% off bestselling books!

The Real Meal Revolution by Tim Noakes, Jeffrey Archer’s Be Careful What You Wish for, Man’s Search for Meaning by Victor E. Frank and many more titles. Shop now!

Up to 25% off electronics

Buy top electronics and save up to 25%. Such as kalahari.com’s 1# selling product the gobii eReader, Patriot X Porter flash drive, Asus Nexus 7” 3G tablet, Samsung Galaxy SIII, Lenovo G580 Notebook and many more. Shop now!

DStv HD PVR Decoder now R949

The DStv HD PVR Decoder has further revolutionised the television experience with lifelike viewing, sharper images, more vibrant colours and precision picture quality. Now R949, save R550. Offer valid while stocks last. Shop now!

Up to 30% off appliances & homeware

Save up to 30% on appliances and homeware this Easter! Offer valid while stocks last. Shop now.

OLX Free Classifieds [change area]

Samsung Galaxy s4

Mobile, Cell Phones in South Africa, Western Cape, Cape Town. Date October 24

Best bargain in big bay

Real Estate, Houses - Apartments for Sale in South Africa, Western Cape, Cape Town. Date October 25

VW Golf 6, 1.6 Trendline (Excellent condition)

Vehicles, Cars in South Africa, Western Cape, Cape Town. Date October 25

Apple iPad 2 White 16GB 9.7" Tablet With WiFi & 3G

Two cameras for FaceTime and HD video recording. The dual-core...

From R5727.00

I'm shopping for:

Horoscopes
Aquarius
Aquarius

Self-indulgence may be strong today. You may want to enjoy yourself to the fullest and share it with those that make you feel...read more

There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.








Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.