This weekend, the Development Committee of the World Bank and the International Monetary and Financial Committee of the International Monetary Fund, or IMF, are holding a joint meeting. During the bi-annual meetings, which are scheduled every spring and fall, participants talk about the progress – and problems – of the programs of the two financial institutions. Among the issues likely to come up this weekend are debt relief, boosting aid, and progress cutting poverty.
Brett Schaefer is a Jay Kingham research fellow in International Regulatory Affairs at the Heritage Foundation in Washington, DC. He told English to Africa reporter William Eagle that he hopes the two institutions will discuss ways to improve the delivery of multilateral development assistance, because he says the World Bank has not been effective in spurring development in the region.
This week, the International Monetary Fund said Sub-Saharan Africa registered an average eight-year high of 5% last year while inflation fell to its lowest rate in 25 years. However, Mr. Schaefer said such spurts of growth are common, and there is often a return to the mean. He attributes part of recent improvement to more African countries adopting economic policies conducive to the growth of the private sector and private investment.
On the other hand, a recent World Bank report says there has not been enough growth for Africa to reach the organization's proposed Millennium Goals like cutting poverty in half over the next 10 years. As part of its solution, it suggests the doubling of foreign aid. But Mr. Schaefer of the Heritage Foundation says nearly 70 billion dollars has been sent to Sub-Saharan Africa since 1980 and of the countries that have received the aid, about half have registered declines in per capita income.
He says the United States should be more active in promoting better policies, reducing corruption and investing in health and education. Among the initiatives that attempt to do just that are the Bush administration’s Millennium Challenge Accounts, which grants aid to countries that have a proven record of competent economic and political management. Mr. Shaefer says under the MCA, countries are encouraged to take the lead in creating their own aid programs, which are funded by the US once the plans are proved to be conducive to economic growth and development. In contrast, he says the World Bank is more likely to plan and direct the projects it proposes to African countries. The result, he says, is that many governments lack the motivation to fulfill the terms of the projects.