Before the start today of the Forum on Africa in Taormina (Sicily, Italy), we interviewed Pierre Ewenczyk of the IMF.
Later this afternoon Ewenczyk is scheduled to talk about the ‘global economic outlook’ beside Caleb Fundanga of the Bank of Zambia and Dominick Salvatore of Fordham University and advisor of South Africans reserve bank.
I would like to ask if you share the fears of growing China’s involvement in the development and in the business of many African countries. Is this a western fear or is it a reasonable concern?
The Fund welcomes China’s provision of financial support and debt relief to African countries. China is fast emerging as a significant business and development partner for sub-Saharan Africa. Its trade, investment, and aid ties with the region have grown remarkably in the recent past. African countries, on their part, need to ensure that any borrowing is consistent with the debt sustainability considerations and that the resources are put to effective use consistent with the PRSP priorities of the country.
Even though Italy has made a questionnable agreement with Libya for stopping immigration (with direct expulsion to Libya) Italy and Europe are trying to defend their influence in Africa. Is this the end of western influence in Africa or is it the beginning of a new world era?
This really is outside the expertise of the IMF. What seems clear though is that the migration from African countries to Europe and beyond is in large part due to the widespread poverty in the region. Better economic outcomes in Africa should serve to lessen the pressure to emigrate over time.
How Sicily, Italy and Europe can help develop Africa economically? What are they doing for Africa now?
European countries can help support these efforts through more foreign investment, trade openness, and indeed aid.
Imf role in Africa is said by some economists and journalists to be the source of some problems because of the adoption of Friedman economics thought. What the IMF is doing to change its politics for Africa?
The IMF certainly advises countries to reduce their macroeconomic imbalances. This is central for fostering high economic growth, which is the means by which poverty can be reduced on a sustainable basis. And if you look at the evidence, economic growth in Africa until the onset of the current global economic crisis was actually quite good. Since the turn of the Century, the region has been enjoying its highest rates of growth since at least the 1970s. One important reasons for this is the improvement in macroeconomic environment. And of course the high growth rates have contributed to the reduction of poverty rates.
The big threat to African countries is the global economic slowdown. The IMF has responded quickly and comprehensively to address the fallout from the global financial crisis. During the first eight months of 2009 the Fund committed new concessional lending to sub-Saharan African countries of about US$3.0 billion, compared to some US$1.1 billion for the whole of 2008 and US$0.2 billion in 2007. The Fund has helped countries to mitigate the impact of the crisis in vulnerable groups, with the fiscal targets in 75 percent of its programs in Africa being relaxed.
Can technology and ICT help develop Africa? And what kind of development would it be?
Improvements in technology can contribute to gains in productivity, which in turn can be an important source of growth for Africa. Higher productivity, together with investments in human and physical capital are crucial elements in achieving and sustaining the high growth rates needed to increase per capita incomes and reduce poverty in the region.
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