President Joaquim Chissano of Mozambique and Mrs. Joyce Banda, founder and executive director of the National Association of Business Women (NABW) in Malawi, have been awarded the 1997 Africa Prize for Leadership for the Sustainable End of Hunger by the Hunger Project, a New York-based non-governmental organization.
Photo: Fred Sher / The Hunger Project
President Chissano was recognized for his role in ending one of Africa's longest and most devastating wars and for his government's efforts to promote economic recovery, particularly in agriculture and trade. Mrs. Banda was cited for helping many thousands of mostly rural women to become economically self-reliant through the NABW, which enables women to enter business by providing them with access to credit, information, markets and appropriate technology.
Mozambique is rebuilding its social and economic infrastructure to help its people eradicate hunger, said President Chissano at a 20 October press conference at the UN in New York. But progress in agriculture has been slowed by the continuing problem of land-mines in roads and fields, he observed.
The removal of long-term government subsidies and a year of heavy rains has damaged Malawi's maize crop and increased foreign aid dependency, said Mrs. Banda. She commended Mozambique for having eased border restrictions, enabling Mozambican maize to get to Malawian markets.
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Japan's official development assistance (ODA) recovered this year after a sharp fall in 1996, but it is set to drop by 10 per cent in fiscal year 1998, with further cuts until 2001. The fall of the yen against the dollar could mean a 25 per cent cut in real terms. "I'm afraid Africa will become a major victim of our aid cuts," Mr. Morihisa Aoki, Japan's new ambassador for African conflicts, told the London Financial Times. Sub-Saharan Africa got 11.6 per cent of Japan's ODA last year. Aid will also "have to be much more selective," Mr. Aoki added.
The planned cuts follow an ODApolicy review by a committee appointed by Prime Minister Ryutaro Hashimoto. UN agencies may also be hit if the cuts are approved in December when Japan's Diet votes on the national budget.
Japan's attitude to humanitarian issues may be "questioned internationally," and other countries could also be "lured" into cutting their own contributions, warned Mrs. Sadako Ogata, UN High Commissioner for Refugees, in a letter she wrote in July to Mr. Hashimoto. "We keep hoping that the threatened cuts will not be carried out," added Mr. Manzoor Ahmed, head of the Tokyo office of UNICEF,which faces a cut of nearly 40 per cent in Japanese funding, Inter Press Service reports.
Japan is the world's biggest donor country in volume, but it is second to last among major donors in terms of ODA as a proportion of gross national product (GNP). Its ratio of ODA to GNP fell from 0.28 per cent in 1995 to 0.20 in 1996, the biggest decline among major donors. But this was still ahead of the US, which stayed in last place with a ratio of 0.12 per cent, up from 0.10 per cent in 1995.
In US dollar terms, Japanese ODA fell some 35 per cent in 1996 to $9.6 bn, but is projected to rise to about $13 bn this year. Reasons for the decrease last year include large repayments on ODA loans, cuts in multilateral aid and depreciation of the yen, says The Reality of Aid, 1997-1998, a major review of ODA by non-governmental organizations (NGOs). But with the biggest budget deficit among major donor countries, Japan has been reviewing all spending, including foreign aid. Defenders of foreign aid, including NGOs, are lobbying against the cuts, and the government itself says that aid, investment and trade are a "trinity" in accelerating progress in developing countries.
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At a time when the surge in private capital flows to emerging markets has strengthened the voice of critics of foreign aid, World Bank President James Wolfensohn has said that aid "pulls in private investment," spurs economic growth and reduces poverty. But poor countries must have "sound economic policies," he added at a mid-September symposium in Tokyo on "A new vision of development cooperation for the 21st century," jointly organized by Japan's Overseas Economic Cooperation Fund (OECF) and the Bank.
Foreign aid is even more important than in the past for most developing countries, said Mr. Joseph Stiglitz, the Bank's Senior Vice President and Chief Economist. Of the $244 bn in private investment flows to developing countries in 1996, World Bank research presented to the symposium shows that just 26 countries took in 95 per cent, while another 140 developing countries shared the remaining 5 per cent. Japanese and World Bank speakers pointed out that even in the main recipients of large capital flows, relatively little went to the key health and education sectors which underpin the economy.
Much of the massive aid that Japan received after World War II funded major infrastructure projects that were the "cornerstone of Japan's dazzling economic growth" in the 1960s, said OECF President Akira Nishigaki. While private sector-led infrastructure development has been important in many countries, Mr. Nishigaki said that "there are still many areas that call for development using public funds, with governments displaying initiative and leadership."
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The European Commission postponed a $90 mn loan to Kenya in September, pending guarantees that the money -- earmarked for road repairs -- would be used "properly." The postponement came just over six weeks after the International Monetary Fund (IMF) suspended a three-year $220 mn enhanced structural adjustment facility (ESAF) loan, accusing Kenya of failing to tackle corruption.
Commission spokesman João Vale de Almeida complained of Nairobi's poor record with human rights and democracy, as well as a general "lack of transparency." He said the funds will be released when the required assurances are received.
Kenya had already come under pressure in August when the World Bank warned that unless President Daniel arap Moi's government tackled corruption, it would substantially reduce its aid. Kenya had been relying on Bank funding to renovate its dilapidated road network and modernize the energy sector, which is struggling to meet demand.
The government responded to the IMF-World Bank criticism by committing itself to "expeditiously" address their concerns. It promised to take action on energy sector management, including legislation to provide for the reform of the sector and the establishment of an autonomous regulatory board. It also pledged to establish accountability in financial management and create an autonomous anti-corruption authority.
Since then Kenya, scheduled to hold presidential and legislative elections by the end of the year, has experienced unrest and violence. This has deepened the sense of political and economic crisis, resulting in high interest rates and instability of the Kenyan shilling, as well as a decline in the tourism industry. The country's highest single foreign exchange earner, tourism brings in about $400 mn dollars a year and employs some 150,000 people. After a two-year slump, the industry was expected to recover in 1997, but the recent political unrest has dashed these expectations.
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Several recent oil discoveries indicate that the deep waters off West Africa's coast will be a major new source of oil in the next decade. With more discoveries in the offing, analysts say West Africa's deep-water oil reserves will climb to 20 bn barrels, with potential production of up to 1 mn barrels per day by 2005.
In August, the French company Elf Aquitaine announced a big discovery off the coast of Angola. Officials were optimistic that the "Dalia" field's potential would surpass that of the nearby "Girossol" field discovered last year. Girossol's proven reserves have been estimated at 500-700 mn barrels of relatively light crude oil, but this could rise to 1.5 bn barrels. The discovery of fields with 1 bn barrels or more is a rare occurrence.
Exploration has proved particularly fruitful off the Angolan coast, where over one-third of the regional total of exploratory "wildcat" wells have so far been drilled. The US company Chevron has confirmed a find of up to 1 bn barrels in the deep-water "Kuito" field, north of the Dalia field. Several large discoveries have also been made off the coast of Nigeria.
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With Norway's recent contribution of $935,000 to the Trust Fund for least developed countries (LDCs), managed by the UN Conference on Trade and Development (UNCTAD), total pledges and commitments have reached $2.8 mn of the initial $5 mn target. Of the world's 48 LDCs, 33 are African.
The Trust Fund was set up in May 1996, and became operational last February. It aims to help LDCs integrate into the world economy through technical cooperation to strengthen export capacity.
Programmes may include support for trade policy changes and trade diversification, and for policy changes in the financial and fiscal sectors. Norway's contribution will help finance various UNCTAD programmes for LDCs, including debt management.
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There may be more than 20,000 tons of obsolete pesticides in Africa, says the UN Food and Agriculture Organization (FAO). And stocks are growing because the continent has no environmentally sound disposal facilities. FAO adds that donor countries, aid agencies, agrochemical companies and African governments are all responsible for the steady accumulation.
"Obsolete pesticide stocks pose a serious threat to public health and the environment," said FAO Agricultural Officer Alemayehu Wodageneh. "In many countries, pesticide containers are kept in the open, containers deteriorate and leak their contents... contaminating soil, water and groundwater. Most stores are in urban areas. Many of these chemicals are so toxic that a few grams could poison thousands of people."
In July FAO said it had disposed of some 370 tons of unused toxic pesticides from Zambia and the Seychelles, as part of a programme to help developing countries clean up this environmental hazard. Storage sites were cleaned and highly dangerous chemicals were shipped to Europe for incineration. Most were unused stocks donated through foreign aid programmes.
The removal cost $1.3 mn, and FAO got financial help from the Dutch government and the German Technical Cooperation Agency. FAO says it will need over $100 mn to dispose of all the obsolete pesticide stocks in Africa. It is currently seeking funding from agrochemical companies to remove 20 tons of dangerous chemicals from the Gambia, 300 tons from Senegal, and 200 tons from Botswana.
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In the last week of June, a group of African experts on financial management systems took part in the first UN "meeting" ever conducted on the Internet. For two hours a day over five days, eight experts in five African countries -- Ghana, Ethiopia, Kenya, Swaziland and Uganda -- sat at their computers and talked directly to each other on-line, in real time. They discussed ways to improve accountability and transparency in African financial management, reading background documents and other participants' contributions, and then typing in their own comments. It was "an historic and fabulous experience," said Mr. Singh Gurubacham, the Ugandan government's Audit Director.
Ms. Cheryl Larsen, at the UN Department for Economic and Social Affairs, organized and moderated the session from UN headquarters in New York. Not only did the session help advance the introduction of modern technology into UN practice, she notes, it also demonstrated the cost-savings possible from such technologies, largely by eliminating the need for travel. A meeting of this sort normally requires at least $60,000, but the on-line session cost just $8,000, an 85 per cent saving. Ms. Larsen, as well as the on-line participants, strongly recommended such sessions to other UN departments and agencies. The ease and low-cost of Internet meetings, she points out, "encourages South-South dialogue."
