Financial crisis shouldn't impact Africa aid, leaders warn

Business Materials 22 September 2008 23:17 (UTC +04:00)

African leaders warned Monday that a financial crisis enveloping advanced economies was no reason to slash foreign aid commitments to the African continent, which is in danger of falling far short of a series of UN goals on reducing poverty, reported dpa.

UN Secretary General Ban Ki-moon, opening a one-day conference on Africa in New York, warned that not a single country in Africa is currently on track to meet the United Nations' poverty goals by 2015.

Ban issued a plea for 72 billion dollars per year in foreign aid if Africa was to have any hope of reaching the Millenium Development Goals (MDGs), a series of poverty-reduction targets first set up eight years ago.

"This price tag may look daunting. But it is affordable and falls within existing aid commitments," Ban said, urging the developed world to meet a 2005 pledge to double aid to the continent.

African leaders promised to take the initiative in tackling the continent's many ongoing problems, but warned that they would not be able to get on track without help from the outside.

"We want developed countries to deliver" on their promises of more aid, said Jakaya Kikwete, Tanzania's president and chair of the African Union, at a press conference in New York.

Kikwete warned that the financial crisis could have "serious implications" on foreign aid commitments, but added that he expected the turmoil in the US banking sector to calm down over the coming months.

Last week witnessed a series of bankruptcies and massive government bailouts of financial institutions in the United States, which led global stock markets on a wild ride and sparked concerns that the credit crisis could have far-reaching effects for the global economy.

"We need to prevent our development efforts from being swept away by the tide of financial markets," said Heidemarie Wieczorek-Zeul, Germany's minister for economic cooperation and development.

Ban said more money was crucial to helping Africa meet a series of complex challenges, including the food crisis - the result of surging prices over the last year - as well as curbing the effects of global warming and pulling millions of Africans out of extreme poverty.

"No one is more alarmed at the current trends," Ban said. "But I am convinced that through concerted action ... the MDGs remain achievable in Africa."

More than 40 world leaders attended the New York conference, designed to take stock of Africa's improvements over the past few years and map out a plan to tackle the many remaining challenges.

Donald Kaberuka, president of the African Development Bank, said the ongoing financial turmoil showed just how interconnected the world had become. He quipped that New York's losses last week showed Africa may be a better place to do business than many investors think.

"Many more people have lost money in this city than in Africa over the past couple of weeks," Kaberuka said.

French President Nicolas Sarkozy said Africa had "found it's way back to growth" over the last decade, but that the European Union heeded the UN's warnings and was committed to boosting its own aid pledges.

"The globalized world needs a developed Africa," Sarkozy said, adding that Europe was "deluding" itself if it believed its own security and stability was possible without bolstering the economies of its African neighbours.

Ban warned that climate change was already having a serious impact on the continent, sparking greater droughts in some regions and flooding in others, and leading to a scarcity of resources.

He linked the effort to boost Africa's economies to the battle for peace across the globe, warning that local conflicts over dwindling natural resources "could spin out of control" if left unchecked.

"The recent spate of conflicts over food and natural resources show that our security depends on building prosperity in the developed world," Ban said.

The World Food Programme Monday issued an appeal for nearly half a billion dollars to assist 9.6 million Ethiopians affected by drought and high food prices.

The conference on Africa comes at the half-way point of the UN's 2015 target date for meeting the Millenium Development Goals. A broader conference on MDG progress around the world will be held Thursday.