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UK/Africa: Commissioning Development?

AfricaFocus Bulletin
Mar 18, 2005 (050318)
(Reposted from sources cited below)

Editor's Note

UK Prime Minister Tony Blair's Commission for Africa report, released earlier this month and intended to galvanize common action by rich countries on African development, has received mixed reviews. The report is largely a composite of frequently repeated but not yet implemented proposals on issues such as increasing aid, reducing rich-country trade subsidies, canceling debt, and improving governance. It did, however, also feature new stress on how rich countries themselves fuel corruption in Africa through failure to stop money-laundering and bribery by their own institutions.

Although 9 of the 17 Commissioners were African, and consultations were held around the continent in preparing the report, some commentators focused on the implicit tone of paternalistic charity and advice-giving. Others stressed that the key test would be implementation. "When G8 leaders meet in July," said Commonwealth Secretary-General Don McKinnon, "they must go beyond promises and expressions of goodwill. They must, quite simply, convert this report into action."

The already low odds that rich countries would find common ground on strategies to fight global poverty were further reduced by the March 16 shock announcement that the Bush administration had chosen Deputy Secretary of Defense Paul Wolfowitz, architect of the Iraq war and "development" strategy, to head the World Bank. The move, which still has to be ratified by the board of the World Bank, was an unequivocal signal that the U.S. administration had no intention of providing support for the more consultative European approach to African development, much less giving any heed to African viewpoints. (See http://www.worldbankpresident.org for commentary and updates.)

One of the more detailed reactions to the Blair Commission report, released in advance by the development NGO ActionAid, called on the UK government first to ensure that its own policies "do no harm." This AfricaFocus Bulletin contains excerpts from ActionAid's "African Commission for Britain," outlining ten immediate steps that the UK can take without waiting for other rich countries to act.

Press releases, summaries, and the full text of the Blair Commission for Africa report are available on the Commission's website at http://www.commissionforafrica.org

For a short summary of reactions, see
http://allafrica.com/stories/200503120001.html

For two critical articles, by Tajudeen Abdul-Raheem and Issa Shivji, and a roundup of other reactions, see the March 17, 2005 issue of Pambazuka News at
http://www.pambazuka.org/index.php?issue=198#5

++++++++++++++++++++++end editor's note+++++++++++++++++++++++

The African Commission for Britain.

Ten actions Britain must take to support Africa's development.

ActionAid International

Johannesburg South Africa
Telephone. +27 (0) 880 0008 Fax. +27 (0) 11 880 8082 Email. mail.jhb@actionaid.org Website. http://www.actionaid.org

February 23, 2005

[excerpts only. For full text visit http://www.actionaid.org/media]

... The African Commission for Britain, an all-African panel of ActionAid International staff, has developed its own set of recommendations. We believe that for Britain, the first step in supporting African development must be to do no harm. The UK has yet to take this step. Dumped exports from British farmers still depress farm prices in Africa, putting poor farmers out of business. UK carbon emissions contribute to climate change, causing natural disasters across the region. UK companies continue to violate basic rights and the environment, while arms exports from British companies still fuel widespread conflict.

As Africans working with poor people across the continent, we know that change in Africa is urgently needed. Governments must become more accountable and less corrupt. Conflicts must end. Education, health and other basic services must improve, and be made more widely available.

While we know that real change in Africa must be led by Africans, we also know that some of the greatest obstacles to change lie outside the region. Africa has been the supposed beneficiary of no fewer than 10 ambitious development plans in the past three decades, many of them written outside the continent. But grand plans and grand statements rarely work. Too many of the 'African initiatives' have started from the assumption that the 'West knows best.' Donors apply conditions to force African governments into following 'sound' policies. Trade negotiations lock African countries into a free trade model that rich countries didn't follow themselves. ...

The UK government is right to stress that the rich world must take action for Africa in 2005. It is right to show leadership in ensuring that African issues are top of the political agenda. But just as charity begins at home, so does justice. This report sets out 10 things that we believe that the UK must do in order to support, rather than undermine, Africa's development. All 10 are achievable; all 10 could be delivered in 2005. ...

Taaka Awori
Country Director, ActionAid Ghana,
On behalf of the African Commission for Britain.

... we therefore call upon the UK to:

  1. Stop forcing African countries to open up their markets.
  2. Stop export dumping.
  3. Reach the 0.7% aid target by 2010.
  4. Stop tying economic policy conditions to aid.
  5. Cancel unpayable debts.
  6. Allow all people with HIV access to lifesaving treatments.
  7. Stop UK corporations from undermining basic human rights.
  8. Cut carbon emissions.
  9. Work to resolve and prevent armed conflict.
  10. Stop supporting bribery and corruption in Africa.


01. Stop forcing African countries to open their markets.

... African countries are under considerable pressure to allow competition from foreign imports in their own markets. The UK is at the forefront of pushing this trade liberalisation on Africa, and remains one of the most ardent proponents of the 'free trade' model. ...

The European Union is negotiating a new set of trade agreements, so-called 'Economic Partnership Agreements' (EPAs), which will force poor African farmers and emerging industries into unfair competition with British and other European exporters. The UK government is also using conditionality attached to aid, both directly and via other donors such as the World Bank and International Monetary Fund (IMF), to further push trade liberalisation onto poor African countries.

The UK remains wedded to its free trade model despite the fact that no country has ever developed by following such policies. In Western Europe and North America, industrialisation was accompanied by the protection of infant industries. Moreover, trade liberalisation actively hurts poor and vulnerable groups, including small farmers. For example, Ghana's tomato canning industry has been decimated and producers are struggling against cheap imported tomato paste from the EU following tariff cuts. ...

The African Commission for Britain therefore calls upon the UK to:

  • Work to radically change Economic Partnership Agreements and provide pro-development alternatives.
  • Stop forcing African countries into negotiations on service liberalisation.
  • Accept that poor African countries have the right to protect domestic industrial and agricultural sectors that are important for poverty reduction and food security.

02. Stop export dumping.

... Export dumping - the sale of products at less than the cost of production - is an integral part of UK and EU agriculture. Dumping has three main negative effects - it depresses world prices, displaces developing country exports in third country markets, and undermines domestic production in developing countries, as local producers are unable to compete with cheap imports.

The UK is a major agricultural exporter. At present, UK wheat exports are being sold at 30% less than the cost of production, while white sugar is being sold at 40% below production costs. Across the EU as a whole, skimmed milk powder is also sold below the cost of production. ... In each case, dumping is only made possible by agricultural subsidies from the taxpayer, which developing countries are prevented from providing to their own producers. ...

Swaziland, for example, produces sugar at less than half the cost of the EU, yet is unable to compete with EU confectionary products (which contain subsidised EU sugar). Southern African outlets have switched to cheaper, dumped EU confectionary leading to the loss of some 16,000 jobs in the Swazi sugar industry directly and 20,000 related jobs, such as packaging and transport.

The African Commission for Britain therefore calls upon the UK to:

  • Prohibit the dumping of all goods.
  • Call publicly for the right of all countries to protect their economies against dumped products, without having first to prove injury to farmers, industry or other groups.
  • Support measures to those developing countries dependent on cheap food imports so that they are able to meet their food security needs.
  • Ensure that the EU agrees to an early end date for direct export subsidies.
  • Push the EU to bring forward further reform of the Common Agricultural Policy (CAP), to ensure that domestic support is re-oriented to deliver sustainable farming, environmental protection, support to smallscale farmers, and the development of local food economies.

03. Reach the 0.7% aid target by 2010.

... In 1970, the UK government pledged to give 0.7 per cent of its national income in overseas aid. It has never reached that target. In 2003, 33 years later, UK aid was at only 0.34% of national income, ranking the UK only 11 out of 22 donor countries. Moreover, UK aid figures include debt relief, often on loans that were taken out for purposes unrelated to poverty reduction. ...

If the UK reached 0.7% during 2005, an additional œ4 billion would be made available to fund basic services in Africa. According to the WHO, this sum would save two million lives a year in sub-Saharan Africa if spent on basic healthcare. The UK has proposed an alternative to direct increases in aid - the International Financing Facility (IFF) - which will bring forward future aid flows to fund development now. While we welcome aspects of this proposal, it should not be used as an excuse to delay increases in aid. ...

The African Commission for Britain therefore calls upon the UK to:

  • Make a firm commitment to reach the 0.7% target by 2010.
  • Ensure that the aid budget does not include funding for debt relief. Debt relief must be additional to aid spending.

04. Stop tying economic policy conditions to aid.

In return for aid, African countries are required to meet conditions to deregulate and open up their economies. Aid conditions have a dismal track record in terms of their impact on poverty, and are also widely criticised for undermining national 'ownership' and democratic accountability. Yet they continue to be justified by donors as a way of improving the policy environment and thereby fostering 'aid effectiveness'. Most conditionality is devised and applied by the International Monetary Fund and the World Bank, that together operate as the linchpin of the aid system.

The UK is the fourth largest shareholder in both the International Monetary Fund and the World Bank, and has a history of strong board support for economic policy conditions in the Bank and Fund's programmes. A growing share of UK aid is aligned with World Bank structural adjustment programmes. ...

For example in Ghana, when the World Bank recently withheld $100 million of aid because of failure to privatise municipal water, the UK followed suit and froze œ7 million, leaving two million urban Ghanaians waiting for safe drinking water. In Uganda, privatisation of the energy and water sectors has been a key benchmark for releasing further World Bank and DFID funds. ...

The African Commission for Britain therefore calls upon the UK to:

  • End economic policy conditions in DFID programmes, and confine conditionality to what's necessary to ensure aid is spent accountably, on poverty reduction.
  • De-link UK aid from IMF 'trigger conditions' and macroeconomic performance indicators.
  • Put pressure on the IMF and World Bank to reduce and reform their own use of conditions.
  • Introduce full disclosure of all remaining conditions.

05. Cancel un-payable debts.

... Despite recent debt relief initiatives, sub-Saharan Africa still owes almost $220 billion to its western creditors, more than 50% of its combined income. Much of this debt is 'un-payable' it cannot be repaid without undermining the ability of African governments to perform their most basic functions. ...

The UK government has already cancelled, or promised to cancel, the bilateral debt owed to it by African HIPCs. It has agreed to pay its 10% share of the debt service paid by selected lowincome countries to the World Bank and African Development Bank, based on the UK's shareholdings of those institutions. It is also pushing for the sale or revaluation of IMF gold to fund relief on IMF debts.

Welcome as the UK's proposal is, it does not go far enough. Firstly, in Africa the offer has only been extended to HIPCs. This excludes similarly indebted countries that are not on the HIPC list. The UK has only promised to cancel debt service as it falls due, rather than writing off debt stocks outright. ... Secondly, the UK proposal uses money from existing aid budgets, rather than providing genuinely new money to fund debt relief. ...

Most importantly, the UK proposal continues to require poor countries to implement risky and unproven economic policy conditions, such as privatisation, trade liberalisation and fiscal austerity in order to access debt relief. ...

The African Commission for Britain therefore calls upon the UK to:

  • Cancel its share of all un-payable debts from African countries.
  • Fund debt relief using new money, rather than that taken from existing aid budgets.
  • Stop requiring poor countries to implement economic policies, such as privatisation and liberalisation, as a condition for granting debt relief.

06. Ensure access to free and comprehensive treatment for all people living with HIV and AIDS.

... In sub-Saharan Africa 6,300 people die every day as a result of HIV and AIDS. This is a human rights scandal that has long-term negative economic impact. British government policies on access to treatment are fine on paper but, in reality, the UK is not doing enough to reduce the level of illness and death.

The UK Government has announced that it will contribute œ500m a year to for the fight against HIV and AIDS from 2005-2008, making it one of the highest ranking donor countries. It is, at last, increasing its annual contribution to the Global Fund to Fight AIDS, TB and Malaria. However, the UK will contribute less this year to the Fund than either France, Germany or Italy. ...

The African Commission for Britain therefore calls upon the UK to:

  • Commit additional funding to the Global Fund to Fight AIDS, TB and Malaria and take leadership to ensure stable resources so that the Fund is better able to support developing country AIDS programmes.
  • Provide urgent financial support to secure the achievement of '3 by 5' and urge the G8 to set a timetable for universal access to antiretrovirals.
  • Actively oppose EU and US 'TRIPs plus' agreements, which place greater restrictions on developing countries' use of intellectual property regulations than the WTO. The UK should use their presidency of the EU to speed up this process, pushing for approval of the regulation and its quick implementation at national level for member states.
  • Invest in human resources in the health sector to include sufficient salaries and working conditions for healthcare workers to reduce their migration to work in the UK.

07. Stop UK corporations from undermining basic rights.

... Tony Blair has called for a huge increase in private sector investment in Africa. Properly regulated, private enterprise can help to reduce poverty, realise people's rights, increase employment opportunities and generate economic growth. Yet the actual track record of overseas companies in Africa tells a very different story.

Britain accounts for 40% of Africa's inward investment in extractive sectors such as minerals, timber, precious metals, oil and gas. ... Where complaints have been brought against British companies under the OECD Guidelines, such as in the case of companies fuelling conflict in the Congo, the UK government has thus far failed to investigate, let alone sanction, the companies involved.

At the same time, multinational agribusiness firms are undermining the fight against poverty by using their considerable power within domestic markets to force down the prices of agricultural commodities, upon which millions of Africans depend for their livelihoods.

For example, in C“te D'Ivoire, three companies control 95% of cocoa processing, while just one company manages virtually all of Ghana's palm oil processing industry. Such high levels of market concentration enable companies to dictate the terms of trade with smallholder producers and contract growers. Meanwhile, prices paid to farmers for cocoa have fallen by 6.9% a year, and palm oil prices by 3.4% a year over the past two decades. ...

The African Commission for Britain therefore calls upon the UK to:

  • Make company directors legally accountable for the social and environmental impacts of their businesses' activities overseas.
  • Support the UN Human Rights Norms for Business.
  • Take action to prevent the abuse of market power by UK agrifood companies in Africa.

08. Cut carbon emissions.

... Climate change poses massive development challenges to Africa, which stands to be one of the worst affected regions from changes in rainfall and temperature. Industrialised countries such as Britain, which accounts for less than 1% of the world's population but 3% of global emissions, are chiefly responsible for the problem. The average Briton accounts for 47,000 Kwh of energy a year, 168 times what the average Ethiopian consumes. Despite the UK promise of a 20% cut in carbon emissions by 2010 (on 1990 levels), between 2002 and 2003 the UK's emissions of carbon dioxide from energy rose by approximately 3%. UK companies create carbon emissions not only in Britain, but also within Africa, for example through oil flaring. ...

So far, climate change has not been properly integrated into development policy and planning, and the response from rich countries has been grossly inadequate. Rich countries spend œ50 billion a year subsidising fossil fuel industries only, but around œ300,000 a year helping poor countries manage their emissions and adapt to climate change.

The African Commission for Britain therefore calls upon the UK to:

  • Urgently scale up its support to the Global Environment Facility and to other programmes designed to help Africa mitigate the impact of climate change.
  • Cut its own carbon emissions and intensify efforts to get other major industrialised nations to follow suit.
  • Actively support African efforts to manufacture energy generation systems that do not depend upon oil, including micro- and meso-hydro, solar power and wind generation.

09. Work to prevent and resolve armed conflict.

... Africa remains one of the most conflict-affected regions of the world, and since the end of the Cold War is estimated to have accounted for 90 per cent of all conflict-related deaths. In 2003, 15 African countries were affected by armed conflict in five cases these were major conflicts claiming more than 100,000 casualties. In the Democratic Republic of Congo alone, the estimated death toll runs to almost four million people. ...

The UK plays a direct role in many of Africa's conflicts, both through its colonial legacy and through its more recent commercial and political activities in the region. In particular, the UK is the world's second biggest arms exporter, with $4 billion of annual sales, or 20% of the global market, while UK arms sales to Africa totalled œ200 million in 2003. In ten of the current conflicts in Africa, the countries concerned have made recent military purchases from the UK. ...

The African Commission for Britain therefore calls upon the UK to:

  • Support an International Arms Trade Treaty.
  • Support the African Union's peacekeeping and peace building capacity. ...

10. Stop supporting bribery and corruption in Africa.

... The UK government requires African countries to take measures against corruption in order to qualify for financial aid. Yet UK government agencies use taxpayers' money to support British companies that continue to bribe their way into winning contracts from African governments. Of the 37 allegations of overseas corruption currently registered against UK companies, 14 have come from Africa by far the largest number for any region. ...

Corruption in Africa has been facilitated by policies and money laundering in rich countries that enable capital flight. A recent study estimated that total capital flight from Africa stood at $285 billion in the mid-1990s, and Britain, together with its overseas territories and dependencies, has been cited as a 'magnet' for stolen wealth. For example, around $1.3 billion of the money looted from Nigeria by the Abacha family found its way into London banks. Only $30 million of the Abachas' money has ever been frozen in UK bank accounts, and the UK government has consistently failed to respond to requests for help from the Nigerian government for financial documents and for the return of the money....

The African Commission for Britain therefore calls upon the UK to:

  • Establish a special unit to investigate and prosecute cases of bribery and other serious economic crimes overseas.

    ...

  • Debar companies convicted of corruption from obtaining export credit support for three years.
  • Introduce mandatory requirements on due diligence for banks handling money from government officials abroad.

...


AfricaFocus Bulletin is an independent electronic publication providing reposted commentary and analysis on African issues, with a particular focus on U.S. and international policies. AfricaFocus Bulletin is edited by William Minter.

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