bulletin of the AFRICA PROGRESS PANELVolume 5, Issue 16 — 27 September 2012
Africa Progress Panel
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Africa to foreign investors: We’re open for business
Squeezing the poor for the sake of corporate profit? Or providing vital jobs and incomes? Whatever your view of foreign investors, analysts believe that business will be essential to African development.
With Africa’s population likely to double in the first quarter of this century, the private sector may be the only sector able to match this growth with precious jobs. In Africa, one job goes a long way towards protecting a family or community, as Africa Progress Panel member and former Nigerian President Olusegun Obasanjo told a recent conference of investors ahead of this week’s UN General Assembly meeting.
Besides, many issues confronting the African continent can only be resolved with private sector involvement. Only the private sector, for example, has the know-how to build power plants that will reduce Africa’s enormous energy shortages. Fortunately, foreign investors are increasingly keen to invest in Africa, because, as stated in our policy paper, “Africa – Investment Ready”, this is a great time to get involved.
Africa is home to seven of the world’s ten fastest growing economies, business regulation is getting better all the time, and the outlook for continued growth is good, according to both the World Bank and IMF.
Foreign investors say foreign investment would be higher if African countries had more stable public policies, more liquid stock exchanges, or even lower risk. They cite solutions that range from venture capital to use of donor funds.
But foreign investment does not have all the answers to African development. And in some cases, especially in the oil and mining industries, the social and environmental impacts on local communities have been disastrous.
But slowly Africa’s development paradigm is shifting away from aid dependency towards wealth creation as a model for the future. And business will be central.
At the Africa Progress Panel, we have several policy recommendations for African governments that will help increase both the quantity and quality of foreign investment.
Governments should strengthen regional economic integration, which makes Africa a more attractive proposition by creating larger consumer markets.
They should keep commitments to regional and international initiatives on corruption and transparency, such as the Open Government Partnership or the New Partnership for Africa’s Development (NEPAD). Lower corruption levels help attract foreign investment.
And governments should demand that foreign investment supports local companies, employs Africans, and transfers technology and skills. They should make job creation an explicit objective of economic policy, because job creation means sustainable and equitable growth.
Africa’s workforce is young and growing fast. Leaders across the continent and their partners must find new and effective ways to harness this energy and creativity. And business must play a central role.
- While U.N. members appear deeply divided over the crisis in Mali, with some neighbors backing possible military intervention, and the United States stating that the West African nation must first have an elected government; Malian leaders call for the United Nations Security Council to approve an "immediate" mandate for an international force to help defeat rebels who control the northern parts of the country.
- Faced with the threat of U.N. sanctions and economic collapse, Sudan and South Sudan have reached agreements on a demilitarised border zone and oil production that will allow exports from South Sudan through Sudan to resume. However, limited progress has been made in other contested areas. South Sudanese are urged to be patient, as this should for now prevent any resumption of the kind of fighting that broke out along the border in April - the worst violence since South Sudan seceded in July 2011.
- Ethiopia's new Prime Minister Hailemariam Desalegn was sworn in last Friday and immediately promised to stick to his predecessor Meles Zenawi's development agenda. In comparison to challenges facing Somalia’s new president, analysts say PM Desalegn takes over a country with a “little more going for it.” A major challenge for him, amongst others, would be to “dissociate politics of state from politics of religion.”
- Angolans have sworn in an elected president for the first time in its history, with long-serving leader Jose Eduardo dos Santos taking the oath for a fresh five-year mandate on top of his 33 years at the helm of Africa's no. 2 oil producer. While Dos Santos pledges social improvements, his critics say his party has excessive control over public administration and uses it mainly to retain power.
- Army officers have been appointed to take over two powerful militias in the eastern Libyan city of Benghazi, after the president ordered that all militias join the armed forces or disband. The move reflects increasing pressure on the government to control or disband the country's militias, many of which it had relied upon for securing Libya in the turmoil following last year's ousting of Muammar Gaddafi.
- At the end of the fourteenth regular session of the African Ministerial Conference on the Environment (AMCEN), the first meeting post Rio+20, Environment ministers and government representatives from over forty African countries have agreed to adopt a common voice on climate change negotiations and remain fully engaged in the implementation of the Rio+20 outcome document.
In the blogs...
- The Guardian’s Poverty Matters blog: Ban Ki-moon’s new education initiative must emphasise teaching and targets, 27 September 2012 – David Archer argues that if the UN’s Education First scheme is to succeed, it must prioritise quality teaching and define clear goals.
- Impatient Optimists: From farms to family planning: Investing in Women on World Contraception Day, 26 September 2012 – Melinda Gates discusses why World Contraception Day is important to her and for millions of women in developing countries around the world.
- African Arguments: Economic growth in South Africa: Has the ANC got it wrong? 25 September 2012 - Moeletsi Mbeki and Refiloe Morwe argue that although South Africa has great potential for both economic and social development, it will not reach its full potential unless the challenges that its society faces are addressed.
- CNN’s Global Public Square blog: How to boost U.S.-African trade, 19 September 2012 – On behalf of the Africa Progress Panel, Linah Mohohlo writes about what she thinks should be done to increase U.S.-African trade.
- AfDB approves US $348 million in funding for Kenya-Ethiopia electricity highway
- AfDB, FAO and Senegalese Finance Minister sign agreement to provide $1 million in emergency humanitarian assistance to rural areas in the country (in French)
- African Union official says Mali's interim leaders can manage crisis
- African Union proposal over Abyei accepted with mixed reactions
- EAC African Kiswahili Commission opens in Zanzibar
- Tanzania allows export of grain to EAC, having previously placed repeated and regular bans on maize exports to its neighbours
- Mali, ECOWAS reach agreement on liberation of northern Mali
- Nigeria approves $6 million to construct ECOWAS Parliament office
- UN chief unveils $1.5 billion initiative to achieve universal education
- African policy makers seek to reduce pollution for clean air benefits and climate protection
- Experts warn of water bankruptcy for many regions after reviewing 200 major global projects
- WFP partners with MasterCard to improve "digital food" delivery
- At UN, African leaders voice range of concerns, from development issues to Council reform
- IMF and WB write off Guinea’s $2.1bn debt, the cancellation will reduce the west African country’s annual borrowing servicing cost by $121m, to $49m for the next nine years
- World Bank’s Climate Innovation Centre opens in Kenya
- Ghana signs $210m World Bank funded projects to sustain middle-income status
- World Bank approves $1.5 billion interest free loan to Ethiopia
- Morocco secures $300m World Bank loan to fight unemployment
What is becoming increasingly evident is that Africa is on its way to becoming a preferred investment destination, a potential pole of global growth, and a place of immense innovation and creativity.
- Kofi Annan, APP Chair
- allAfrica.com: Disparate partners find promise in Africa’s agriculture, 27 September 2012 Lauren Everill discusses the African Green Revolution Forum and participants’ hopes that it will enable various parties to join forces to tackle global food insecurity through Africa’s smallholder farmers.
- allAfrica.com: Faces change at DfiD, but does aid to Africa really matter anymore? 24 September 2012 – Richard Dowden questions what is happening to the UK government’s aid ministry and its impact on Africa, particularly as the deadline for the MDGs draws nearer.
- Pambazuka News: 50 years on, is Uganda truly independent, 20 September 2012 - The author argues that there is ample evidence to show that national independence does not mean much for most citizens of Uganda and that the upcoming anniversary should be a day to reflect about where Ugandans want to take their country in the next 50 years.
- CNN: Why we should grade countries on their elections, 20 September 2012 – Kofi Annan argues that for democracy to fulfill its potential, we must have fair and credible elections. He calls for a new transnational organisation to be created that could grade countries on their elections and sound the alarm about electoral malpractice.
- African Arguments: Africa’s fabulous mineral wealth that isn’t all there, 18 September 2012 Bright Simons argues that there is a lack of perspective that usually attends the evaluation of Africa’s natural resource endowment in a global context.
- China loans South Sudan $2.5 billion for universities
- China offers support to Mali military in fight against Islamists
- France’s Hollande calls for Mali intervention
- French Total may look to North Sea, Africa for $20 billion in sales
- DFID announces thirteen new programmes that will focus on innovative ways to improve health for people living in poor countries as part of a UK aid funded scheme
- The UK's contribution to a global polio vaccination programme will be stepped up to reach a further 29 million children around the world
- U.S. Secretary of State Hillary Clinton presses the presidents of Rwanda and the DRC to resolve a conflict over rebels in eastern Congo
- The United States is joining forces with 12 international partners to launch a new effort aimed at expanding women's political and economic participation around the world
- U.S. Secretary of State affirms ongoing support for West Africa's Sahel Region as it faces political turmoil, rising extremism and a severe food crisis affecting an estimated 18 million people
- President Obama vows to intensify fight against human trafficking, inside the United States and around the world
- Currently, 20.5 per cent of households in developing countries have access to the internet, which a report by the ITU says puts them on target to achieve the 40 per cent target by 2015.
- The 2012 State of the Future report states that, “The world is improving better than most pessimists know, but future dangers are worse than most optimists indicate.” After 16 years of global futures research, we have “found more agreement about how to build a better future than is evident in the media”, according to Jerome C. Glenn, CEO of The Millennium Project.
- According to a new initiative, “Better than Cash Alliance,” which is aimed at improving efficiency and helping the world's poor better manage resources, a shift to digital payments can improve the global effort to fight poverty and improve conditions for those trapped in a cycle dependent on cash.
|1 Oct||Publish What You Fund 2012 Aid Transparency Index: Washington D.C, U.S.|
|2 Oct||OECD-DAC Committee meeting: Paris, France|
|4 Oct||12th International Economic Forum on Africa (IEFA) organized by AfDB/OECD/UNECA and the French Government: Paris, France|
|8-9 Oct||Global Green Growth Forum: Copenhagen, Denmark|
|9-11 Oct||13th World Knowledge Forum: Seoul, Korea|
|12-14 Oct||World Bank/International Monetary Fund Annual meetings: Tokyo, Japan|
|12-14 Oct||XIVème Sommet de la Francophonie : Kinshasa, DRC|
|15 Oct||Launch of 2012 Ibrahim Index of African Governance and announcement of 2012 Ibrahim Prize for Achievement in African Leadership: London, United Kingdom|
|16 Oct||World Food Day|
|16-19 Oct||4th World Forum on Measuring Progress in Societies, New Delhi, India|