World Bank President Paul just back from Sierra Leone and Liberia, says he is optimistic about the economic prospects for Africa. Wolfowitz spoke Monday at Washington's Heritage Foundation.
Since becoming World Bank president 14 months ago, Wolfowitz has made fighting corruption and boosting development in Africa his priorities. In the 1990s Sub-Saharan Africa fell behind economically as the number of Africans living in absolute poverty, earning $1 per day or less, doubled to 300 million. Africa also suffers from having 60 percent of the world's cases of HIV/AIDS.
But Wolfowitz also pointed to more positive trends. These include the rich nations promise to write off 37 billion dollars of African debt and a commitment to double the inflow of assistance to $50 billion a year by 2010. Fifteen Sub-Saharan countries have registered five percent annual growth rates for 10 consecutive years. And the fastest growing economies, Rwanda and Mozambique, have achieved eight percent annual growth.
Wolfowitz also sees African progress in fighting corruption. Leaders, he says, are committed to combating corruption because there are tangible benefits from doing so. "A country that improves the quality of its governance can almost triple the income per capita of its population over the long term; can reduce infant mortality and illiteracy by two-thirds. And that's what some people call the triple dividend of good governance," he said.
Africa, says Wolfowitz, can register progress against corruption by reducing the red tape that discourages business activity. "On average it takes 64 days to launch a company in Africa compared to two in the fastest country, Australia. A new African entrepreneur needs twice the per capita income to start a new business just to pay the licenses and fees, compared to Denmark where it is zero," he said.
Wolfowitz praised the newly democratic governments in both Sierra Leone and Liberia and said they deserve increased financial support.