African LDCs contemplate financial crisis and potential for growth

6 Jul 2009

Though the global financial crisis is yielding disastrous results for sub-Saharan African Least Developed Countries (LDCs), some say the slowdown could allow nations to unite and consider innovative approaches for prolonged economic and social development.

"The crisis has exposed a lot of the weaknesses that underlie African economies," said Alexander Aboagye, senior economic adviser for the United Nations Development Programme's Regional Bureau for Africa. "This is an opportunity to redefine our development policies…to come out stronger, economically, and to be able to become globally more and more competitive."

Aboagye told MediaGlobal that "natural resources will place LDCs in a better position" to mitigate the effects of the global crisis. Ghana, for instance, experienced "a bit of high performance in terms of the export of gold and cocoa," while petroleum producing countries like Angola "have managed to weather the crisis a bit better than the others."

He also cautioned the international community against automatically grouping LDCs and their needs. "There is a dangerous generalisation of the countries that we are talking about, and we can't have one policy that will definitely work for all of them," Aboagye said. "But conferences like this, where these nations can spark dialogue and see how we can mobilise, together—this can help."

Aboagye was just one of the officials who advocated a comprehensive international action plan for African LDCs at the United Nations' World Financial and Economic Crisis Conference on 25 Jue 2009. It was a chance for nations and financial organisations to move away from the "theoretical," Aboagye said, and concretely outline a plan to reboot the continent's economies, re-establishing them on a steady path for sustained growth.

Reflecting on the crisis facing the least developed countries, Dr. Dipu Moni, Minister for Foreign Affairs of the People's Republic of Bangladesh, the keynote speaker of the conference, said, "They [LDCs] do not have the resilience to face this crisis. This is not merely an economic crisis, but one that threatens to have far-reaching ramifications in their social and human domains."

"This crisis has pushed billions of people below the poverty line and into hunger," Moni added. Echoing the lack of commitment to the LDCs by the international community, Cheick Sidi Diarra, under-secretary general and special adviser on Africa and High Representative for the LDCs, said, "Though average GDP growth of African LDCs was 7 percent from 2003 to 2008, it declined to 6.4 percent in 2008. Growth is expected to continue to slow into 2009, reaching an estimated 5.3 percent, bringing impressive growth performances to a complete halt."

ActionAid International, the South-Africa based anti-poverty agency, estimates that the rate of infant deaths in LDCs is expected to rise by 200,000 to 400,000 in the coming year, while resource gaps continue to widen in education, health, and sanitation, further compounding issues of poverty. Though world leaders at the G-20 summit in April reaffirmed their commitment to administer an additional US$50 billion to LDCs, International Monetary Fund members have not yet finalised these plans, and from the perspective of LDCs, it offers little in terms of additional resources.

Article published courtesy of MediaGlobal