African Leaders want More Say in the Management of Current Global Financial Crisis
ECA Press Release No. 04/2009
Addis Ababa, 03 February 2009 (ECA) – African leaders today expressed the need for the continent to be given a greater say in how the international community plans to deal with the current global financial crisis.
Meeting in a session devoted to the unfolding global economic and financial crises, leaders present in Addis Ababa Ethiopia for the 12 th Ordinary Summit of the African Union adopted an unusually strongly worded Declaration on what they perceive as Africa being marginalized from meetings on how to deal with the crisis.
In the Declaration, called “the Addis Ababa Declaration on the International Financial Crisis”, African leaders said that a real voice should be “given Africa in the forum of international financial institutions aimed at better management of economic shocks”.
In this regard, they expressed “gratitude to the Republic of South Africa for having clearly expressed Africa's opinion during the G20 process”, and insisted on the need for “an in-depth reform of the global financial system, based on an inclusive approach which fully integrates, in all legitimacy, the voice of Africa”.
“Convinced of Africa's role in the resolution of the crisis, (we) deplore the fact that Africa was totally marginalized from deliberations which led to the establishment of the current international financial system, giving rise to the situation that encouraged the present financial crisis”, the Declaration argues.
The session was also attended by heads of leading development partner agencies, such as United Nations Under-Secretary General and Economic Commission on Africa (ECA) Executive Secretary Mr. Abdoulie Janneh; the President of the African Development Bank (AfDB), Mr. Donald Kaberuka; the Deputy Managing Director of the International Monetary Fund, Mr. John Lipsky; the UK Minister of State, Foreign Affairs and Commonwealth Office, Lord Malloch Brown; the vice president of the World Bank, Africa, Ms. Obiageli Ezekwesili; and the African Union Commissioner for Economic Affairs, Mr. Maxwell Mkwezalamba, who made the introductory remarks.
Taking the floor, in what was a very lively and frank exchange on Africa's current financial woes, the Executive Secretary Mr.
Abdoulie Janneh, said that although “this global crisis is not of African making”, its impact will be greatly felt by the continent.
“This crisis will erode much of the gains that Africa has made in recent past in both economic and social sectors. However, it is essential to ensure in this regard that short-term considerations do not impair Africa's long-term development prospects. These times call for bold and innovative policies and we should explore avenues for using resources raised to invest for the future”, the ECA Executive Secretary advised.
He pointed out how the ECA had used its expertise to work with the African Development Bank (AfDB) and the AU to assist in assessing the impact of the current crisis and to fashion a common African position.
Dr. Donald Kaberuka, AfDB President, explained how in response to the crisis the bank has set up an emergency fund equal to
$1.5 billion, to help funding emergencies.
“Things could have been worse for Africa. Many countries on the continent weren't exposed to the “ toxic debt” that plagues many western banks because of its limited integration into world financial systems as well as prudent financial management, which “strengthened our capacity to withstand external shocks”, he said.
Another positive note came from the Prime Minister of Ethiopia, Mr. Meles Zenawi who cautioned that the financial crisis should not be seen just in terms of losses, but also as an opportunity for action. Mr. Meles Zenawi called on his peers to use their influence and voice to get rich countries to bailout Africa, just as they are doing for their own countries.
“If rich countries can find the vast sums of money to bail out businesses and institutions they deem globally vital, the same could and should be done for Africa. A bank in these (rich) countries is deemed too important to fail is getting more assistance than the whole continent of Africa,” the Ethiopian Prime Minister said.
“We have to insist that Africa is at least as important to the global economy as the individual banks in the developed countries”, he continued.
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Speakers representing global financial institutions at the session also made presentations. Mr. John Lipsky Deputy Managing Director for the International Monetary Fund stated that global economic growth levels would be their lowest for more than 50 years and that Africa's growth would be just 3.4 percent; that is, 2 percent lower than last year.
Lord Malloch Brown, United Kingdom's Minister of State, Foreign Affairs and Commonwealth Office, stated his government's agreement that African countries needed a voice at the G20. He said his government would work with the AU to come up with a way to ensure that the continent was more fully represented.
As to what Africa could do to ensure that economic growth that became the reason for a lot of Afro-optimism in the last few years does not wane, Ms. Obiageli Ezekwesili, vice president of the World Bank, Africa offered one piece of advice: seize the opportunity presented by this era of sobriety.
“This season of sobriety in the economic life of the nations is also the season when leaders are going to have to communicate the importance of economic reforms that are very deep,” she said, warning that the reforms may initially be painful, but that they would ultimately pay off.
The AU had been scheduled to end on Tuesday 3 February 2009, but was extended till the following day.
Issued by the ECA Information and Communication Service P.O. Box 3001
Addis Ababa Ethiopia
Tel: 251 11 5445098 Fax: +251-11-551 03 65 E-mail: ecainfo@uneca.org Web: www.uneca.org
