Global Policy Forum

While official development assistance (ODA) was important, the way forward for the development of Africa was not through aid, but through foreign direct investment and the acquisition of skills and technologies, the representative of Malaysia told the General Assembly this afternoon.

As the Assembly continued its debate on the implementation of the United Nations New Agenda for the Development of Africa in the 1990s, the Malaysian representative said it was of critical importance that the Organization's system paid particular attention to action that would lead to the creation of an enabling environment for foreign direct investment flows, both in terms of infrastructure development and institutional capacity- building.

The representative of South Africa said that to secure an effective outcome of the New Agenda, it was crucial for the Assembly to monitor and evaluate the programme again before its final review. "Our deep concern is with the problems encountered from the external environment which often frustrate delivery and undermine constructive efforts in the implementation of the New Agenda", he said. The fact that globalization had not helped to foster a climate for internal economic industrial integration -- a crucial starting point for the attainment of the New Agenda's goals -- was an additional constraint.

The representative of Algeria said it was important to recall that the New Agenda had been presented as a genuine contract of partnership between the United Nations and Africa. African countries had demonstrated their devotion to that partnership by embarking on the course of reforms. Their partners, however, had produced meagre results, particularly in the areas of foreign debt relief and assistance for development. Today's discussion should remind the international community about its responsibilities towards Africa.

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The representative of Burkina Faso said that on the one hand, the mid- term review of the New Agenda had highlighted the painful sacrifices made by African countries. On the other, the slow pace of response by the international community to shoulder its responsibilities had been clearly seen. African countries were the first and main architects of their own destiny. While aware of that reality, they had always paid the price for pursuing the most difficult initiatives and reforms to produce a forward and sound economic climate.

The representative of India said that increased financial flows were critical for the implementation of the New Agenda for the Development of Africa. While a devastated Europe had received a generous and sustained infusion of capital under the Marshall Plan, resurgent Africa had seen its prospects for development and growth denied by a paucity of financial resources. That challenge needed to be addressed comprehensively, effectively and urgently.

Statements were also made by the representatives of Tunisia, Senegal, Republic of Korea, China, Pakistan, Libya, Singapore, Guyana (for the Caribbean Community -- CARICOM), Cameroon and United States.

The Assembly will meet again tomorrow at 10 a.m. to consider the second report of the General Committee and cooperation between the United Nations and the Inter-Parliamentary Union.

Assembly Work Programme

The Assembly met this afternoon to continue its consideration of the implementation of the United Nations New Agenda for the Development of Africa in the 1990s. It had before it the reports of the Secretary-General (document A/53/390 and Add.1), which present progress made in the implementation of the New Agenda since the mid-term review in 1996. (For further details, see Press Release GA/9487 issued this morning.)

Statements

Ali Hachani (Tunisia) said despite a less than favourable international situation, the African continent was steadfastly engaged in pursuing economic recovery. The periodic review of the New Agenda allowed the international community to see if goals were being achieved. If not, the review allowed for adjustments when appropriate. For the first time in two decades, the per capita income throughout the continent had risen in 1995, 1996 and to a lesser extent in 1997. There was also a noticeable decrease in inflation and budget deficits. There were better monetary and macroeconomic policies; and restructuring of the banking and financial systems progressed. The programmes for reforms and structural adjustment had been combined with internal economic and commercial liberalization, contributing to the modernization, efficiency and transparency of fiscal systems.

He said the recent economic measures undertaken by African nations and the trade liberalization policies were being put in place, with civil society at the forefront. There had been intensification of the process of democratization, with democratic restructuring of society aimed at creating a more attractive environment to attract more capital flows. African countries were still, however, not attracting foreign investors. It was clear that the magnitude of the problems required considerably greater resolve and greater resources to guarantee Africa sustained and lasting growth and development. The drawbacks were clear: decreasing aid for development; limited investment revenue; and the debt burden. The marginalization of direct foreign investment in Africa was comparable to the continent's marginalization in global trade. It was, therefore, the duty of the international community to enhance the recovery of the African economy.

Ibra Deguene Ka (Senegal) said that, while recognizing responsibility for African development rested with Africans, the New Agenda for the Development of Africa called for a partnership between nations of the continent and the international community. On the one hand, African countries were asked to undertake political and economic reforms to reinforce democracy, mobilize internal resources for economic growth, integrate the concern for the environment into the politics of development and pursue regional and subregional cooperation. The international community, on the other hand, would support those efforts by taking concrete measures to resolve the debt

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problem, mobilize additional resources for public development assistance, diversify African economies, bolster regional economic integration, eliminate tariff obstacles and non-tariff barriers affecting African exports.

For the majority of African countries, the primary task was to deepen political liberalization and to simplify administrative and fiscal reforms, he said. His country noted certain aspects of what had come to be called an "African renaissance", such as: sensible reductions of budget deficits; the maintenance of annual economic growth rates averaging 4 to 5 per cent; increasing budget allocations to social sectors; and a reduction in military expenses. Furthermore, the pursuit of regional integration was evidenced by the establishment of the African Economic Community, as well as the promotion of peace and stability, aided by the creation of a conflict prevention and settlement mechanism set up by the Organization of African Unity (OAU).

Africa's economy, however, remained fragile in light of what remained to be done, he continued. Not only did Africa have to fight poverty, mobilize domestic savings, provide basic social services -- such as health and education -- and control populations; African growth had been further compounded by its marginalization in the world economy. At present, Africa's participation in the global economy was only 2 per cent. Three crucial areas needed to be addressed by the international community to assist African development: the debt problem; the mobilization of resources; and market access.

In order to repay the totality of its debt, African countries would have to pay 60 per cent of the value of its exports, he continued. Only a global approach could accomplish a satisfactory solution to the debt problem. Resource mobilization was an obstacle to effectively implementing the Agenda, while unequal foreign trade, far from increasing African income and employment, had caused them to shrink. The international community needed the political will to pursue the initiatives for Africa. The time had come for action and partnership, because African growth would also benefit their partners in terms of investment opportunities and market shares.

Abdallah Baali (Algeria) said that Africa was courageously dealing with a wide-range of problems. The interest of the United Nations in that continent had been demonstrated by numerous initiatives on Africa. It was important to recall that the New Agenda for Africa had been presented as a genuine contract of partnership between the United Nations and Africa. The African countries had unquestionably demonstrated their devotion to that partnership by embarking on the course of reforms. Africa's partners, however, had produced meagre results, particularly in the areas of foreign debt relief and assistance for the purposes of development. Today's discussion should remind the international community about its responsibilities towards Africa.

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There was a need for new support for Africa to promote its development, he continued. The considerable assistance provided so far could not be denied, but it had clearly been insufficient. The dwindling flow of assistance and limited direct foreign investments, increased vulnerability of African countries and lack of access to world markets created handicaps hindering the development process. International interest in Africa must maintain its momentum, as frenzied globalization made Africa even more vulnerable. A major effort was needed to coordinate the existing initiatives to avoid squandering of necessary resources. While awaiting the final assessment of the New Agenda in 2002, it was important not to limit activities to declarations of intent.

Michel Kafando (Burkina Faso) said the challenges of globalization and economic liberalization were even harder for African nations to meet. On the one hand, the mid-term review of the New Agenda had highlighted the painful sacrifices made by African countries. On the other, the slow pace of response by the international community to shoulder its responsibilities had been clearly seen.

African countries were the first and main architects of their own destiny. While aware of that reality, they had always paid the price, pursuing the most difficult initiatives and reforms to produce a forward and sound economic climate. Export diversification and strengthening the efficiency and transparency of fiscal regimes were all measures which had been pursued. Regional and subregional cooperation were also even more visible than before.

Despite all of those achievements, he continued, the basic problems remained. Three hundred million Africans lived below the poverty level. One quarter of all children had no schooling. Lack of clean water and health systems were maladies that persisted. African States were, however, still committed to putting Africa on the path to true endogenous development. It had been established today that Africa was the place where the effects of globalization were more severe. The debt burden could also block all efforts towards economic recovery. The only viable solution that remained was the simple cancellation of that debt.

He said another obstacle to African economic recovery was the recession that was taking place in the resources allocated for development. Current sources were well below the level required to support satisfactory growth. All the current negative realities by themselves should have brought about a reaction by the international community. A summit to be held in 1999 in Burkina Faso would demonstrate, however, the resolve of African countries to address their real concerns.

Kamalesh Sharma (India) said that increased financial flows were critical for the implementation of the New Agenda for the Development of Africa. The best intentions and goodwill must be matched by adequate resources, that were not only sufficient for implementing the New Agenda, but

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which would lead to a per capita annual growth rate in gross domestic product (GDP) of more than 8.6 per cent. That was the level judged to be the minimum required to effectively fight poverty on the continent. That was the crux of the problem. While a devastated Europe had received a generous and sustained infusion of capital under the Marshall Plan, resurgent Africa had seen its prospects for development and growth denied by a paucity of financial resources. That challenge needed to be addressed comprehensively, effectively and urgently.

Noting the continuous decline in Africa's gross domestic savings rate, he asked whether the poor savings rates and steady fall did not reflect the structural constraints of those economies. After all, there could hardly be any savings at subsistence levels. Policy options available to those countries for increasing domestic resource mobilization were also limited. His Government believed that reform programmes aimed at macro-economic stabilization, financial discipline, reduction of fiscal deficits and transparent and predictable tax regimes, would usher in an economic environment where private agents could better plan their futures and contribute to increased savings. India called for more social sector investments, especially in education, and capacity-building projects on the continent. At the sale time,physical infrastructure was essential to a viable economic environment to inspire investment and growth.

Clearly, deteriorating social spending in Africa was largely due to rising interest payments on public debt, he added. As the former President of the United Republic of Tanzania Juluis Nyerere, so poignantly asked, "must we starve our children to pay our debt?" Since most of the increase in private capital flows had by-passed Africa, by no stretch of the imagination could the potential investment savings gap in Africa be filled. Despite the constraints, India had established a revolving fund for Africa to promote trade, investment and technology sharing, as well to revitalize its bilateral trade and investments with Africa. Acknowledging that access to markets was in some ways a basic competitiveness issue, he called on the international community to act in concert to ensure market access for African products and manufacturers as an integrated element of the development process.

Suh Dae-Won (Republic of Korea) said a comprehensive and holistic approach was required to address the critical issues contained in the New Agenda for Development of Africa. Africa's development activities must focus on capacity-building. Peace and stability were a prerequisite for sustainable development. The Republic of Korea was providing economic and development assistance to Africa, while participating in peacekeeping operations in sub- Saharan Africa. The Republic of Korea was concerned that New Agenda's implementation was lagging. In particular, mechanisms to monitor and evaluate field-level implementation had to be established. The fulfilment of the Agenda depended on the efficiency of field-level coordination and clear identification of implementation criteria.

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The New Agenda should strengthen compatibility among the currently existing development initiatives, he said. Bilateral donors and development agencies would improve the overall efficiency of their development assistance by focusing on the United Nations system-wide Special Initiative on Africa. The Republic of Korea was planning to host a forum on Asia-Africa cooperation in export promotion in Seoul in December. Ways would be sought to maximize the mutual benefits of trade between Asia and Africa. The discussions on trade promotion, foreign direct investment, and market access were crucial for the African region to overcome marginalization and to participate in the global economy. He believed the Seoul forum would contribute to the implementation of the Agenda.

Shen Guofang (China) said the gap between the level of development in Africa and that of other regions was widening. Even if the current growth rate was maintained, it would still take more than 10 years for Africa's per capita GDP to recover to its 1980 level. African countries had emphasized that what they needed was not preaching or new programmes of action, but real action.

The international community had to increase ODA to Africa and loosen the conditions placed on such assistance, so African countries could use the resources more effectively according to their own economic and social needs and priorities, he said. The Heavily Indebted Poor Countries (HIPC) Debt Initiative must be better implemented and Africa's debt burden must be relieved in real terms. The international community had to remove trade barriers targeted at developing countries to ensure greater market access for African products.

The United Nations role in promoting development in Africa and in the effective implementation of the New Agenda was pivotal, he said. The devotion of sufficient resources and the formulation of practical assistance programmes to suit specific characteristics of African countries would support economic development on the continent.

Hasmy Agam (Malaysia) said despite upward trends, African development had to be looked at against the backdrop of decades of economic stagnation and decline which must now be reversed on a sustained basis for the continent to reach a take-off point towards sustainable development. It also had to be borne in mind, that a minimum growth rate of at least six per cent per annum was required if Africa was to avoid marginalization.

He said the new found optimism on Africa had to be looked at against the backdrop of some of the underlying weaknesses in the continent's economies, such as inadequate savings, dependence on a narrow base of export commodities and a heavy debt burden. From the perspective of Africa being the continent with the highest debt-to-export ratio, the recent positive economic performances would therefore appear to be rather tenuous and called for

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greater efforts by both African countries themselves and other international partners.

He said the New Agenda had an inherent weakness in that it had no targets and goals. The United Nations System-wide Special Initiative on Africa had overcome that by focusing on seven major areas. To evaluate the success achieved in those specific areas, targets, goals and performance indicators should be explicitly spelled out. The financial resources that were to be mobilized for each programme should also be indicated. More countries should also be covered under the Initiative.

He said while ODA was important, the way forward for the development of Africa was not through aid, but through foreign direct investment and the acquisition of skills and technologies. It was, therefore, of critical importance that the United Nations system, in efforts to carry forward the aims of the New Agenda, paid particular attention to action that would lead to the creation of an enabling environment for foreign direct investment flows, both in terms of infrastructure development and institutional capacity building.

Khiphusizi J. Jele (South Africa) said that in securing an effective outcome of the New Agenda, it would be crucial for the General Assembly to monitor and evaluate the programme again before its final review. South Africa was concerned about the economic condition of Africa, particularly its continued lack of economic development in spite of efforts by the international community. Poverty eradication was also a prime concern of many African governments, and they continued to develop strategies that were broad- based and cross-cutting. Those initiatives straddled economic reform, environment and sustainable human resource development. Such efforts, however, needed to be underpinned by international support to ensure that objectives of the New Agenda were realized.

He said "our deep concern is with the problems encountered from the external environment which often frustrate delivery and undermine constructive efforts in the implementation of the New Agenda". A particular constraint in that context was the negative impact of globalization on the fragile economies of Africa and the progressively declining financial resource flows to the continent.

He said the New Agenda was seeking to lay a strong foundation for Africa's economic development and industrialization in particular. However, globalization had not helped the process much, particularly in fostering a climate for internal economic industrial integration, which was a crucial starting point for the attainment of the Agenda's goals. Given the dynamics of the international economic system, African countries were under constant pressure to liberalize. The down-side was that they continued to be

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marginalized and remained vulnerable to increased competition from established and more advanced economies.

Ahmad Kamal (Pakistan) said the international community had to find a decisive solution to the unsustainable debt burden of Africa. Clearing the entire debt stock of the poorest African countries would release a considerable amount of resources, which could be spent on human resource development. Enhanced access to the developed countries' markets and improved regional cooperation were needed. The OAU's institutional capacity to support the African economic community should be enhanced. Africa's overall industrial performance should be improved. Those nations must be provided with the required technologies and resources to transform from raw material producers to processors.

Increased investment in human resources would have to be made, he said. Human resource development held the key to overcoming the challenges faced by Africa. To give impetus to such efforts, major investments in education, health, population and in basic social programmes were required. Financial resources had to be mobilized. The decline in ODA was inconsistent with the initiatives and policy pronouncements on Africa. The continent's recent recovery was fragile and could unravel. Clearly defined goals and a clearly defined time-frame were necessary to ensure the implementation of various initiatives launched by the international community.

Abdussalam A. Sergiwa (Libya) said he appreciated the efforts towards the implementation of the Agenda. While the report of the Secretary-General made clear much had been achieved, it also focused attention on the dangerous economic situation in Africa. Despite the great potential of Africa, the continent remained exposed to poverty, conflicts, disease and starvation. The problem of external debt was staggering, and the export commodity crisis was hindering progress.

Since colonialism had contributed to Africa's problems, the countries that had colonized Africa now had to rectify the situation by providing resources and assistance in implementing the new agenda. If developed countries had a sincere political will to help Africa, they had to settle the question of external debt and refrain from creating new obstacles for African States, including the use of coercive economic measures. The United Nations had to mobilize the necessary financial resources for the development of Africa, taking into consideration the fact that South-South cooperation was one of the main pillars of development of that continent. The Bretton Woods institutions should not impose new conditions, which could prevent African countries from implementing their aims.

Kishore Mahbubani (Singapore) said through a cooperation programme, over 1,100 officials from sub-Saharan African countries had attended courses in Singapore. Areas of study included: aeronautical information services;

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productivity management; customs application; public service reform; and telecommunication. To generate better awareness and enhance the quality of programmes, Singapore had established partnerships in technical assistance with other States and international organizations.

He said Singapore also worked jointly with the United Nations Development Programme (UNDP) to extend technical assistance to developing countries in Africa. Singapore had worked with 27 African countries and wished to include other countries in future technical cooperation programmes.

He said the private sector in his country had also launched assistance programmes for African countries. In 1996, an African scholarship scheme was formerly introduced in Nairobi. The scheme offers scholarships at both undergraduate and graduate levels, and short-term management courses to African nationals to study in Singapore. A total of 28 awards had been made available during the first three years.

Samuel R. Insanally (Guyana), on behalf of the Caribbean Community (CARICOM), said it remained a matter of concern that African growth rates had fallen well short of the levels required to reduce poverty. Since the present growth rates could not be sustained, additional resources were needed if the 6 per cent growth rate targeted under the New Agenda was to be realized.

He said current trends in resource flows to Africa were hardly encouraging. Africa had managed to attract only paltry sums of private capital flows, which were concentrated in only a handful of countries. While some progress had been made since the adoption of the New Agenda, the vicious cycle of underdevelopment in Africa had not been broken. More than half of Africa's population continued to live in conditions of dismal poverty, with little hope of real improvement.

He said the signals of economic recovery remained weak and could disappear if not strengthened by international support. The international community could not be complacent. The CARICOM urged increased support for Africa and had, itself, taken a series of initiatives to further cooperation with the continent. Last September, the Ministers for Foreign Affairs and representatives of CARICOM and the Southern African Development Community (SADC), defined the following areas of cooperation between the two regions: technical cooperation on the rules of origin and common external tariff; exchange of technical expertise between the two secretariats; and involvement of the CARICOM and SADC private sectors to explore trade and investment opportunities.

Jean Simplice Ndjemba Endezoumou (Cameroon) said areas of priority to Africa which were flagging included resource mobilization; strengthening civil society; and enhancing good governance. Other areas needing address were restructuring measures to reduce African debt, diversification of African

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economies, food security and human development. Cameroon was sensitive to the valuable contribution that international partners were making to African recovery efforts.

The Secretary-General's report contained an urgent appeal to Member States to help enable Africa to meet its goals, including in the area of industrialization, he said. Better follow-up to United Nations conferences was needed in the field, including meetings at regular intervals. The report also addressed the need to mobilize financial resources for Africa. He noted that erratic capital flows could block the harmonization of financial regulations.

The poverty threshold was the most widely shared factor of African States, he said. Addressing the human factor, therefore, was crucial to correcting the poverty problem. The improvements of various social initiatives would be a decisive factor in the development of Africa, noting that Africans must be the driving force in that process. Fighting poverty was the priority for his Government.

Regina Montoya (United States) said although some African countries had made substantial progress in economic recovery, those gains were threatened by the international financial crisis and weather disruptions. As the Secretary- General's report highlighted, more work needed to be done on the promotion of private sector activity, foreign direct investment, democratization, strengthening of civil society and debt relief. The debt burden of many African countries, and the drag it created on development, had been amplified by the overall slowdown in global economic activity. It was an area that had to be addressed in coordination with the World Bank and the International Monetary Fund.

National ownership and global partnership were the keys to the New Agenda and the Special Initiative on Africa, she said. The Agenda provided the policy framework to accomplish the mission, while the Special Initiative placed that framework in an operational context. It was important to base development programmes for national development on priorities set at the country and regional levels, and in keeping with the international community's consensus agreement on how United Nations resources should be directed. Coordination among national officials, Africa's own development experts, specialists in the development community and United Nations personnel at the field level was essential to developing pragmatic, reality-based initiatives.

In many strife-afflicted countries, a key challenge was to convert emergency assistance into sustainable development programmes, she said. The response of the United States, in its bilateral and multilateral development efforts, was to work with the "stakeholders" and increase the focus on African ownership of the development process. Good governance, accountability, transparency, restraint, the rule of law and an active civil society were elements of a successful strategy. Dialogue between all stakeholders, including non-governmental organizations, was also a key to progress.

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