Conference of African Ministers of Finance, Planning and Economic Development Statement by Dr. Maxwell M. Mkwezalamba, Commissioner For Economic Affairs, African Union Commission Addis Ababa, Ethiopia
Your Excellency Mr. Meles Zenawi, Prime Minister of the Federal Democratic Republic of Ethiopia Your Excellency Mr. Benjamin Mkapa, Former President of the Republic of Tanzania Honourable Dr. Taher Al-Hadi Jehaimi, Secretary of the General People's Committee for Planning Mr. Abdoulie Janneh, United Nations Under-Secretary General and the Executive Secretary for ECA Honorable Ministers of Finance, Planning and Economic Development Prof. Firmino Mucavele, Chief Executive of the NEPAD Secretariat Your Excellencies Ambassadors and Members of the Diplomatic Corps Distinguished Representatives of International, Regional and Sub-Regional Organizations Distinguish Ladies and Gentlemen It is a great honour and privilege for me this morning to deliver a statement, on behalf of the Chairperson of the African Union Commission (AUC), His Excellency Professor Alpha Oumar Konare, at t his Fortieth Session of the ECA Conference of African Ministers of Finance, Planning and Economic Development. Professor Konare could not join you at this auspicious occasion owing to other pressing commitments. He, nonetheless, sends warm and fraternal greetings to you all and wishes the Fortieth Session of the Commission great success. This Conference constitutes one important forum of exchange of ideas on and analysis of the questions concerning aspects of economic and social development of our continent. Your participation at this Conference is, therefore, a manifestation of your commitment and that of your countries to improving the well being of men and women of our continent, and particularly, in seeking solutions to ensure that Africa attains the Millennium Development Goals (MDGs) by the target date of 2015. I wish to reiterate the keen interest of the African Union in your deliberations. The theme of the Conference, “Accelerating Africa's growth and development to meet the MDGs: Emerging challenges and the way forward”, is appropriate and timely. This is particularly because we are quickly approaching the target date of 2015. Also, the African Union Summit of July 2005 held in Sirte, Libya, mandated the AUC in collaboration with the ECA, the United Nations Development Programme (UNDP), the New Partnership for Africa's Development (NEPAD) Secretariat and the African Development Bank (AfDB), to monitor the attainment of MDGs in Africa and to report to subsequent Summits. The choice of the theme of the Conference testifies the urgent need for re-examining progress towards the attainment of the MDGs in Africa and for adjusting our policies and strategies in the fight against poverty. In this regard, I wish to underline the commitment of the AUC to closely working with you, Honourable Ministers, the ECA and other partners in the development and implementation of policies and strategies intended to address the emerging challenges and enable Africa attain the MDGs. The participation of the AUC at this Conference underscores the excellent collaboration that exists between the AUC and the ECA. You may be aware that the AUC is here not only as a participant but also as part of the Conference Secretariat. The AUC has been involved throughout the preparations for this Conference. This is not the first time that the ECA and the AUC have jointly worked together. In March 2006, for instance, the ECA and the AUC jointly organized the “African Plenary on National Strategies for Poverty Reduction and the Millennium Development Goals” in Cairo, Egypt. In addition, the ECA and the AUC have collaborated on the preparation of joint documents, including “Assessing Regional Integration in Africa II”, “An African Common Position on the Review of the Millennium Declaration and the Millennium Development Goals”, and the “Africa Economic Report 2007” to be launched during this Conference. In this respect, please allow me to salute and congratulate the ECA, and more particularly, Mr. Abdoulie Janneh, for this very positive gesture that recognizes and takes into account the fact that our two sister institutions are complementary. Your Excellencies Distinguished Ladies and Gentlemen We need to ask ourselves why there is recurrence of discussions on the MDGs in Africa. The fact that these discussions are being held frequently is testimony to the their importance in the quest to reduce poverty and promote sustainable socio-economic development in Africa. But, it could also be argued that this is the case because there is little progress that is being made in Africa on the attainment of the MDGs. Available empirical evidence suggests that indeed, with the exception of North African countries, several African countries are unlikely to meet the MDGs by 2015. Africa scores low in all the MDGs indicators. Almost half of the population continues to live in extreme poverty and hunger, Africa is at the bottom of the health related human development indicators, and the continent continues to be ravaged by HIV and AIDS. This is in spite of Africa's improved economic growth performance in recent times, which has been in excess of 5 percent per annum since 2004. Given that other countries in Africa are likely to meet the MDGs, it is critical that we learn from the experiences of such countries. What is it that they have done that needs to be emulated by the other countries that are unlikely to meet the MDGs. In Cairo, Egypt, in March 2006, there were reflections on this and I believe this Conference will need to carry on with these reflections. It is evident that in order to attain the MDGs, adequate financial resources, both domestic and foreign, will need to be mobilized. On the other hand, our will and commitment to mobilize domestic financial resources is not always apparent given our countries' continued dependence on external assistance. There is a lot that our countries can do to mobilize domestic financial resources, including promoting and sustaining macroeconomic stability; improving revenue collection and public expenditure management; continuing to implement reforms within the financial sector, including promoting and strengthening informal financial institutions; and enhancing peace, security and good economic and political governance. The Millennium Declaration called on the international community to support the development efforts of African countries through, among others, increased flows of Overseas Development Assistance (ODA) and Foreign Direct Investment (FDI), fairer trading system, and debt cancellation. Further, both the Monterrey Conference on Financing for Development (March 2002) and the World Summit on Sustainable Development (September 2002) urged developed countries that had not yet done so to make concrete efforts to achieve the target set since the 1970s of 0.7 percent of gross national product (GNP) as ODA. Further commitments have been made in recent times, including during the G8 Gleneagles Summit of 2005. The concretization of the commitments made by Partners has, however, at best been dismal. Africa needs to work with the Partners to ensure the delivery of the commitments made to support the attainment of the MDGs and the implementation of the NEPAD agenda. In this regard, Africa and her Partners will need to take stock of all the commitments made and develop a mechanism to monitor their realization. Increased aid should come with improvement in its quality. This should be through ensuring a stronger linkage between aid and the MDGs, the NEPAD programme, and national Poverty Reduction Strategies (PRSs). Further, there is need for greater predictability of ODA flows, strengthened ownership of aid by African countries, and a greater policy space in the utilization of aid. In this regard, the operationalization of the Paris Declaration on Aid Quality and Effectiveness needs to be pursued vigorously by all. At the same time, Africa will need to reduce its dependence on aid. In this regard, it is highly recommended that Africa develops “aid exit” strategies, including increasing reliance on the mobilization of financial resources from Africans living in the Diaspora. The relationship between debt cancellation and the achievement of the MDGs needs not to be overemphasized. African countries are spending significant amounts of their budgetary resources in repaying debts at the expense of economic growth and support for the social sectors of health and education. The decision by the G8 Gleneagles Summit to cancel 100 percent of debt owed by 18 countries, including 14 from Africa, to the World Bank, the International Monetary Fund and the African Development Fund was highly commendable. However, the African Union continues to insist that that consideration should also be given to the remaining African countries. At the same time, there is need to develop comprehensive national debt management policies that will, among other things, guide future borrowings. In addition, a number of our countries have huge domestic debt problems that need to be addressed. Your Excellencies Distinguished Ladies and Gentlemen Employment creation is key to reducing poverty and attaining the MDGs, as earlier highlighted by Mr. Janneh. The African Union Heads of State and Government underscored this during their Extraordinary Summit on Employment and Poverty Alleviation in Africa in Ouagadougou, Burkina Faso, in September 2004. The Summit came up with a Declaration on Employment and Poverty Alleviation in Africa, a Plan of Action for Promotion of Employment and Poverty Alleviation and a Follow-Up Mechanism for Implementation, Monitoring and Evaluation. The African Ministers of Finance, Planning and Economic Development need to work on ensuring the implementation of the Declaration and Plan of Action. As ECA African Ministers of Finance, Planning and Economic Development, you were seized with this matter in Ouagadougou, Burkina Faso, in May 2006. The question is: What have you done since Ouagadougou to support the implementation of the Declaration and Plan of Action. Have you “walked the talk”? Attainment of the MDGs in Africa also requires the acceleration of regional integration through the enhancement of the competitiveness of African economies by establishing large regional markets, the promotion of intra-African trade, harmonizing and coordinating national policies, and the provision of regional infrastructure and regional public goods. The promotion of regional integration in Africa is, however, faced with a number of challenges, including the multiplicity of the Regional Economic Communities (RECs), with similar mandates; weak physical infrastructure; and production of similar products, mainly primary agricultural products. In order to accelerate regional integration, the AUC, in collaboration with the ECA, as mandated by the July 2006 Banjul African Union Summit, is currently undertaking studies entailing the review of the Abuja Treaty establishing the African Economic Community and the establishment of a minimum integration programme, and the quantification of costs and benefits of African Union Member States belonging to more than one REC. In addition, the AUC has prepared a draft strategy for accelerating the establishment of Africa's three financial institutions, namely, the African Central Bank, the African Investment Bank and the African Monetary Fund, as per Act 19 of the Constitutive Act of the African Union. The Draft Strategy, which was presented to the Second Conference of African Union Ministers of Economy and Finance (CAMEF II) in Yaounde, Cameroon, in November 2006, has been discussed with a number of key stakeholders, including the Association of African Central Banks (AACB), la Banque des Etats d'Afrique Centrale (BEAC), la Banque Centrale des Etats d'Afrique de l'Ouest (BCEAO), the African Development Bank, and some of the RECs. The African Investment Bank, once established, will help fill the financing gap that currently exists in the financing of regional infrastructure projects as well as private sector activities that cut across national boundaries. Furthermore, only in last month (March 21), in Algiers, Algeria, the NEPAD Heads of State and Government Implementation Committee (HSGIC) took bold and far-reaching decisions on the integration of NEPAD into the African Union structures and processes. The decisions included the creation of a Coordinating Unit at the African Union Commission to oversee the integration process and the creation of a NEPAD Planning and Coordinating Authority. In their discussions, the Heads of State and Government underlined the fact that NEPAD is not an institution but a philosophical vision, mission and framework of the African union. The African Union Summit to be held in Accra, Ghana, in July this year is expected to endorse these decisions. Implementation of the decisions, once endorsed, will go a long way in enhancing and strengthening the implementation of the NEPAD agenda. This will positively contribute to the promotion of continental and regional integration and foster sustainable social and economic development in Africa and hence the attainment of the MDGs. Clearly, my exposition has not been exhaustive. It has only been intended to highlight some of the important policy and strategic questions and issues we need to address if Africa is to attain the MDGs by the target date of 2015. Although Africa is currently off- track in achieving the MDGs, there is room to meet them. Some progress has definitely been made. With additional efforts, including ensuring the implementation of the various policies and strategies, and availability of resources, Africa can meet the MDGs. On its part, the African Union will continue to play its role in ensuring that Africa meets the MDGs by focusing on such critical issues as the promotion of peace, security and good governance; the promotion of employment and poverty alleviation; the promotion of quality education for Africa's sustainable development; the promotion of gender equality and empowerment of women; and the promotion of good natural resource management and environmental sustainability.
Your Excellencies Distinguished Ladies and Gentlemen
Let me conclude by joining Mr. Janneh, the UN Under-Secretary General and ECA Executive Secretary, to call for the need for the AUC and the ECA to jointly organize the Conference of African Ministers of Finance, Planning and Economic Development. Currently, the Conference of African Union Ministers of Economy and Finance (CAMEF) and the ECA Conference of African Ministers of Finance, Planning and Economic Development are organized separately, involving more or less the same Ministers and discussing more or less similar issues. Jointly organizing the Conference of African Ministers of Finance, Planning and Economic Development will help reduce duplication, enhance the existing synergy and partnership between the AUC and ECA, achieve cost effectiveness in organization of and participation at the meetings, and ensure increased level of participation. This issue was raised in Dakar, Senegal, and Abuja, Nigeria, in May 2005 during CAMEF I and the ECA Conference of Ministers of Finance, Planning and Economic Development, respectively. CAMEF II held in Yaounde, Cameroon, in November 2006 decided that the ECA and the AUC jointly organize the Conference. The African Union Summit held in Addis Ababa in January 2007 endorsed this Decision. The AUC, therefore, looks forward to organizing jointly with the ECA the Conference of African Ministers of Finance, Planning and Economic Development beginning in 2008. With these remarks, I wish you successful deliberations and thank you sincerely for your kind attention. I thank you!
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