African economies, which were on the verge of turning the corner following more than a decade of faster and steadier economic growth, now desperately need new funding to mitigate the negative effects from the global financial crisis, the World Bank (WB) has said.
In a statement from the bank's office in Nairobi received on Wednesday, Vice-President for the Africa Region Obiageli Ezekwesili said it is crucial for wealthier nations not to focus on "insular" domestic responses to the crisis.
"We call on rich countries to keep Africa in mind as they design programs to help their economies weather the financial crisis," she said.
Ezekwesili reiterated a call made earlier by World Bank President Robert Zoellick for donor countries to devote 0.7 percent of the amount of their stimulus packages to a Vulnerability Fund for Africa.
She explained that the fund would direct spending to projects that are urgently needed to avert the growing unemployment across Africa as a result of the closure of mining operations, the suspension or cancellation of projects in sectors hardest-hit by a reversal of private capital flows, and tighter public budgets, the fall in commodity prices, and the shrinking of revenue from tourism and remittances.
The fund would also finance safety net programs, attend to the basic needs of the poorest of the poor in health, education, school feeding projects, basic inputs for farmers, among others.
It will also help sustain the flow of credit to small and medium-sized enterprises, which are the engines of growth, job and wealth creation.
The fund, which the World Bank is asking the G20 summit scheduled to be held in London on April 2 to help set up and support investments in infrastructure projects that can build a foundation for future productivity and growth in Africa and other poor countries.
To sustain support for aid and the kind of fresh funding proposed under the Vulnerability Fund, Ezekwesili urged African governments to stay the course of public sector reforms; help to build more capable states, train and retain competent civil servants who demonstrate integrity and tackle inefficiencies in state bureaucracies.
The World Bank official also called on African governments to improve the efficiency of public expenditures, pointing to the need to scrap subsidies that benefit those Africans who do not need them.
She urged resource-rich countries to improve adherence to transparency and accountability mechanisms, to ensure that revenue from natural resources are invested in sustainable poverty alleviation programs, to promote pro-poor growth and to diversify their economies beyond non-renewable sources of wealth.
"Countries like Zambia and other mineral-rich African nations must articulate a development strategy and make policy choices that would guarantee prosperity for 'a Zambia without copper'," the World Bank Vice President said.
"The citizens of Africa are the continent's most valuable asset, " Ezekwesili said, stressing the importance of tertiary education in building Africa's skills to compete in a truly globalized economy.
She said education, innovation and the technological leap- frogging offered by ICT (information and communications technology) would help those African economies that invest in them to build the knowledge economy of the future.
"Those who can pay should pay but the governments should provide scholarships and other forms of assistance to ensure that poor students who deserve to can attend university," Ezekwesili said in response to a question on tertiary education in Tanzania.
"Governments cannot abandon their regulatory role, especially when it comes to ensure that their financial sectors work efficiently," Ezekwesili said.
Some analysts have blamed ineffective regulatory mechanisms for the current global financial crisis.
The worldwide economic meltdown is widely seen here to pose a real threat of rolling back gains in poverty alleviation by African countries that have been fuelled by healthy growth rates ranging from 5.9 percent to 8.1 percent for about 65 percent of Africa's population during 1997-2007.
(Xinhua News Agency February 11, 2009)