The Summit should produce a set of commitments that together build a new strategic partnership between all development partners, based on enhanced mutual accountability, that will link their efforts together into a cohesive strategy through to 2015. Previous global compacts on development have had the right intentions, but in practice have been too easily reduced to simplistic quantitative measures around targeted interventions to respond to crises and prevent suffering. Efforts to promote the conditions that will support a long-term path out of poverty towards prosperity, including a focus on promoting good governance, increased private capital and investments in building local capacity to fight poverty, have lagged behind what is needed.
Moreover, a real partnership for the future must more effectively incorporate all critical sources of finance for development. Development assistance from external sources will continue to be crucial, but domestic resources and private capital must also be considered. In 2009 ODA for sub-Saharan Africa was $38 billion, but domestic resources raised in the region totalled more than $200 billion in 2007. At $66 billion in 2008, FDI also exceeded ODA to the region. Going forward, all these sources of finance can and should be better harnessed to the goal of beating extreme poverty in Africa.
An effective new strategy will require a stepped-up focus on three broad policy areas. Firstly, the strategy requires a renewed emphasis on governance and accountability; secondly, it requires a renewed emphasis on equitable and sustainable economic growth, the kind which actually helps citizens lift themselves out of poverty; and thirdly, it requires increasing aid investments into mechanisms and programmes which have to date been delivering real and measurable results for African citizens.
GOVERNANCE AND ACCOUNTABILITY
The G7 have made a number of commitments to promote peace and security, strengthen governance and accountability and fight corruption. This area of policy focus must now be more of a priority and must be more clearly monitored for delivery. The direct benefit of this is that it will allow African citizens to hold their leaders accountable; the indirect benefit is that it should stop the leakage of scarce resources out of African economies due to corruption and incompetence. Specific measures in this area should include the following.
STRENGTHENING CHECKS, BALANCES AND FEEDBACK MECHANISMS IN AFRICAN NATIONS
Some development assistance flows can go towards building up governance and accountability systems; the rest can be made partially conditional upon these nations building up governance and accountability systems with their own resources. The systems which need increased investment include improved quality and public availability of statistics; open access to government decision-making and budgetary processes; public expenditure management systems; independent evaluations of development policy; strengthening of legislative branches and the judiciary; independent electoral commissions; securing freedom of the media; and strengthening think tanks and civil society groups.
FIGHTING CORRUPTING INFLUENCES FROM THE INTERNATIONAL COMMUNITY
International financial and corporate reform is required to ensure that Western companies do not undermine African efforts to promote good governance. For example, the Stolen Asset Recovery Initiative (StAR) aims to help African nations recover assets stolen from them and stashed in Western banks by corrupt officials. However, this effort requires more support – financial, technical and political – from the G7 and the wider G20. Furthermore, the Extractive Industries Transparency Initiative (EITI) should be fully ratified and implemented, and the Natural Resource Charter should be adopted as the norm by the G20 to ensure that the vast natural resource wealth of regions like Africa can be better harnessed for their own development. Ratification and implementation of the UN Convention Against Corruption (UNCAC) by all G20 nations – as well as by African nations – would drive an overall improvement in governance across the international community.
MAKING G7 AND OTHER INTERNATIONAL DEVELOPMENT PROMISES MORE ACCOUNTABLE
One particular lesson of the past five years is how hard it is to monitor the grand promises emanating from the G7. To this end, ONE has worked with others to develop a set of principles, called the 'TRACK' principles, to help ensure that development promises are of a high quality and can be more easily monitored and met.
SUPPORTING AFRICAN PEACEKEEPING AND CONFLICT RESOLUTION EFFORTS
In 2005 promises were made to support African peacekeeping efforts, and in particular to provide training and logistics support for African standby forces. Some training has been delivered, but whenever logistical support has been required, Western donors have failed to deliver.
EQUITABLE AND SUSTAINABLE ECONOMIC GROWTH
Although economic growth rates have been decent for a decade, poverty reduction rates have been sluggish, and indeed may have reversed since the global financial crisis. Too often it seems that economic growth has benefited elites in urban areas but has failed to reach and lift the large majority of people out of poverty. The following policy changes would help alter this trend.
FOCUS ON AGRICULTURAL PRODUCTIVITY
This boosts economic growth in rural areas and directly lifts large, remote populations out of poverty. Investements in women and smallholder farmers are particularly important.
FINANCIAL EMPOWERMENT OF THE POOR THROUGH ACCESS TO FINANCIAL SERVICES
Recent emphasis in the financial services sector has been directed to micro-credit, but access to savings accounts and access to credit for small and medium-sized businesses can be even more transformative. Mobile banking services, as piloted by Safricom’s Mpesa and Zain’s ZAP, have the potential to revolutionise the industry.
Currently, African nations trade the least with each other of any region in the world – regional trade accounts for a mere 10% of total trade. The AU, the ADB and the UN Economic Commission for Africa (UNECA) have developed ambitious regional integration plans that could be supported further. A strategy to coordinate support from the BRICs economies for regional infrastructure projects would be particularly helpful to the African integration project.
TACKLING ENERGY POVERTY THROUGH HARNESSING THE REGION’S RENEWABLE ENERGY POTENTIAL
Africa has tremendous renewable energy potential, and even a comparative advantage over other regions in some sectors. Investments in solar, geothermal, hydro, biomass, wind and wave technologies to harness its full potential are considerable, but renewable energy can provide the continent with clean, cheap energy permanently into the future.
PROMOTION OF INVESTMENT IN AFRICA
Frontier investors have for some time enjoyed excellent returns on their African positions, and the potential of African investments could be more widely promoted to attract capital from financial centres.
REDUCTION OF WESTERN SUBSIDIES AND OPENING OF MARKETS, FREE OF TARIFFS AND DUTY, TO AFRICAN PRODUCTS
Initial efforts such as the African Growth and Opportunity Act (AGOA) in the US and the Everything But Arms (EBA) initiative in the EU have been helpful, but both should go much further to encourage dynamic economic growth in Africa. Further, progress in eliminating trade-distorting agricultural subsidies is long overdue.
ACCELERATE INVESTMENTS IN PROGRAMMES DELIVERING PROGRESS TOWARDS THE MDGs
The great success of the past five years has been the mobilisation of additional resources for certain effective programmes, which have produced strong results. One clear lesson is that these proven mechanisms should not want for sufficient finance.
Mechanisms such as the Global Fund and the Global Alliance for Vaccines and Immunisation (GAVI), which both go through replenishment cycles this year, must be fully financed. A new strategy must be devised to drive down maternal mortality, which is closely linked to the quality of overall health systems and infrastructure.
Reform and refinancing of the Education For All – Fast Track Initiative can build on the increased enrolment rates of the past five years, while also improving completion rates and overall quality.
Clear plans for implementing the L’Aquila Food Security Initiative must be agreed by all partners, with clear timetables and parameters established around financing commitments. These efforts must be extended beyond the current 2011/12 end point.
ON WATER AND SANITATION
The water and sanitation commitments of the G7 were perhaps the weakest of those monitored in the DATA Report. A much sharper action plan must be established in order to make progress in these neglected sectors