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A New Program to Boost Trade and Investment in Africa

It was announced at the World Economic Forum in New York Saturday that the rich industrial nations, the Group of Eight, are creating a new $500 million aid program for African countries committed to reform.

The aid and trade program was announced by Canadian Prime Minister Jean Chretien, who promised that Africa will be a central focus of the economic summit he will host in June. The Canadian leader said the aid promise is a tangible response to the New Partnership for Africa's Development (NEPAD) recently launched by African leaders. The aid will go to African governments that create specific development programs that will boost trade and investment.

U.S. Treasury Secretary Paul O'Neill told the forum that the Bush administration will boost its development assistance budget and shift away from loans to outright grants. But Mr. O'Neill said it is up to third world leaders to prove that aid is being effectively used.

Rock singer and Aid advocate Bono said that Mr. O'Neill is right to put aid effectiveness first. But he added it is essential that western aid budgets be substantially increased to deal with the health emergency in Africa. "There is a will and the way now just has to be agreed," he said. "The level of aid has to increase despite peoples concerns about it. And I think this area of debt [forgiveness] and trade is interesting to politicians because it doesn't cost them as much."

Bono said results are impressive in Uganda where, since aid repayments were reduced last year school enrollments have increased by three hundred percent.

Bill Gates, the Microsoft founder who is the world's richest man, says his charitable foundation is spending $50 million on HIV/AIDS prevention in Africa. But for Mr. Gates says private philanthropy is not enough. "If governments are pulling back [on aid budgets] on this stuff, then the AIDS epidemic will absolutely not be stopped," he said. "And the whole view of the rich world and how they behave in the world at large will be sort of irredeemable."

African leaders are applauding the increased focus on African problems. The Senegal president and the Mozambique prime minister say Africans recognize that they themselves must undertake far-reaching economic reforms. South African President Thabo Mbeki, under pressure because of his controversial views on AIDS, stoutly defended his government's health policies. He said, "As far as South Africa is concerned, we have, as I was saying, a comprehensive [AIDS] program that the United Nations says is the best they've seen in terms of the actual expenditure of cash."

Mr. Mbeki says the African continent requires comprehensive economic reform, increased aid from the West, and greater access to markets in industrial nations.