Pan-African bank to aid revolt-hit statesBy KITSEPILE NYATHI in Addis Ababa | Monday, March 28 2011 at 20:05
The African Development Bank (AfDB) will provide $1.2 billion to Tunisia and is negotiating another rescue package for Egypt to help the North African countries recover from the uprisings that toppled their long time rulers.
AfDB president Donald Kaberuka made the announcement at the official opening of the fourth joint conference of African ministers of Finance, Planning and Economic Development in Addis Ababa on Monday.
Details of the packages could not be immediately obtained.
But the Pan-African bank’s boss emphasised that the revolutions in North Africa must serve as a warning to governments on the continent to have their development priorities right.
Long serving Tunisian president Zine el-Abidine Ben Ali resigned in January after weeks of protests by citizens angry over high levels of poverty in a country which had recorded years of positive economic growth.
He was followed by President Hosni Mubarak of Egypt, who fell after sustained protests.
Dr Kaberuka blamed the duo’s downfall on “excessive dependence on hydrocarbons” and “dynastic governments”.
“It’s quite important that ministers put at the centre of their agenda the issue of inclusive growth,” he said.
“We all know very well that growth which is not inclusive, that leaves some behind, as we can see from North Africa, is neither economically nor politically sustainable and will only lead to frustrations and social explosion.”
He said the bank was involved in a new strategic rethink of the economic challenges in North Africa and the type of support it should provide.
AfDB had commitments of over $7 billion in North Africa and many bilateral and multilateral partners were already active in the region, he said.
Before the uprisings, most of the North African countries were on course to achieve between four and eight per cent Gross Domestic Product (GDP) growth rates. They were also on track to meet the UN Millennium Development Goals and had good infrastructure.
However, most of them were too reliant on oil and had uneven growth rates and huge levels of unemployment that created the need for unsustainable subsidies.
“I know many will agree with me that it was the predatory, dynastic nature of the state, which not only delayed the resolution of those issues, but which led to large parts of the population feeling disenfranchised, with opportunities closed off. This sparked the revolution in southern Tunisia,” Dr Kaberuka said.
Meanwhile, the African Union Commission chairman, Dr Jean Ping, said the North African uprisings will deal a severe blow to the continental body’s finances in the long run as Egypt and Libya were among its top five funders.
Libyan leader Muammar Gaddafi is also battling armed rebels following countrywide protests against his rule.
“Five countries - Egypt, Libya, Algeria, Nigeria and South Africa - fund 75 per cent of our African Union’s budget and the rest comes from our partners,” Dr Ping told the same event.
“The developments could hamper and prejudice our operations.
“We may not be able to meet some of the targets you (ministers) have set us.”
The African ministers of Finance and Economic Planning are meeting to consider a new development strategy under the theme: ‘Governing development in Africa- the role of the State in economic transformation.’
The two-day conference was opened by Ethiopian Prime Minister Meles Zenawi, who observed that while African economies had been growing much faster than usual, the quality of the expansion still left a lot to be desired.
“The improved growth in our economies has not resulted in transformation of our economies, nor has it been inclusive enough,” he said
Mr Meles said the limitations in the quality of the growth of African economies were related to prevailing development paradigm in the continent, which needed urgent review.
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