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Wednesday, 10 April, 2002, 17:32 GMT 18:32 UK
Africa aid flows dwindle
Malian child
A child in Mali, one of the poorest nations in the world
Shrinking aid and investment flows means that African nations are facing increasingly dire prospects, the World Bank has warned.

And the decline of funds, together with the rapid spread of HIV/Aids and weak commodity prices, risks reversing the hard-fought progress made in recent years.


Africa urgently needs rich nations to deliver on their promises of more generous aid

World Bank
The World Bank has called for urgent action by rich nations to try and remedy the situation.

Rich countries pledged to boost the flow of foreign aid to developing countries with "sound" social and economic policies at the international conference on poverty in Monterrey last month.

And the World Bank says that the Western nations must start honouring these commitments.

"Many African governments are already putting in place policies that will boost growth, strengthen governance, and more effectively deliver social services."

"They are keeping their side of the global bargain... they now need rich countries to deliver speedily on theirs," said Callisto Madavo, World Bank vice president for the Africa region.

Falling aid

The World Bank has also called on rich nations to implement wider trade agreements.

"Without greater access to the world's wealthiest consumer markets, many African countries will fail to secure any sustainable advantage for their people," the Bank said in its report , African Development Indicators 2002.

Sub-Sahara Africa - key facts, end 1999
24.4m people with aids/HIV
infant mortality - 9%
78% enrolment in primary school
life expectancy - 47
source: World Bank
The report reveals that aid to Sub-Saharan African countries fell to $12.3bn in 1999 from $17.2bn in 1990.

And the Bank notes that, while countries at war have suffered the biggest slide, assistance to governments with sound policies has also dwindled.

Mozambique, for example, one of Africa's poorest countries with a strong track record of policy reform, saw aid fall to $804m in 1999 from $1bn in 1990.

In addition to the decline in aid, the global economic slowdown has meant that the flow of outward investment into Africa is also suffering, regardless of African economic conditions in the near term.

Level playing field

Sub Saharan Africa's greatest social challenge is the HIV/Aids virus.

The scope of this problem reinforces the need for African countries to be given the means to build their economies and increase their exports, the report says.

And the Bank again calls on the cooperation of rich nations in order to ensure that exports are indeed allowed to grow.

The report claims that the revenues of cotton exporters in West and Central Africa would increase by $250m a year if the US stopped subsidising the industry.

African countries are already struggling to overcome a steep deterioration in trade revenues, as non-oil commodity prices are down around 35% on average since December 1997.

Efficiency drive

Economic growth across Africa varies substantially.

While 12 countries posted growth exceeding 5% in 2000, other countries are struggling to keep the pace of their economic growth in line with population growth.


Dealing with multiple donors has absorbed half of the time of scarce management expertise of some African governments

Alan Gelb
World Bank economist
The World Bank also stressed the need for donor countries to work towards reducing the administration burden on poor countries.

"Donors must also help African countries make more efficient use of aid," said Alan Gelb, the World Bank's chief economist for the Africa region.

"Dealing with multiple donors has absorbed half of the time of scarce management expertise of some African governments. This must end."

See also:

29 Mar 02 | Europe
EU faces East-West poverty gap
22 Mar 02 | Americas
Head-to-head: Fighting poverty
22 Mar 02 | World
Poverty 'fuelling terrorism'
19 Mar 02 | Business
Fight against world poverty
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