African finance ministers have resolved to step up infrastructure financing to prepare for greater growth prospects after the current global economic crisis, noting that Africa should not lose sight of its aspirations to industrialise.
The finance and economic planning ministers, who wound up a two-day meeting in the Egyptian capital, Cairo, on Sunday, said African countries must increase spending in key infrastructure projects, even if this increased the budget deficits in most states.
The ministers noted “a good crisis should not go unexploited, and Africa should exploit the current crisis to reshape its dealings with the outside world, reshape African policies towards its poor, and reshape the continent’s potential for future growth”.
Egyptian Finance Minister Yousef Boutros-Ghali, who chaired the meeting attended by 40 ministers, sought increased spending in Africa as a key step towards fighting the effects of the global financial crunch, which has ignited an economic slowdown.
The Egyptian minister said he would use his chairmanship of the International Monetary and Financial Committee to make sure Africa’s voice was heard on the international stage.
He urged fellow ministers of finance to increase spending, particularly on infrastructure development, even though it would increase budget deficits, as to do otherwise would increase poverty.
“This increased spending will mean Africa would be in a better position to increase growth after the current recession,” he said.
Also speaking at the opening of the meeting, the African Union Commission Chairman, Jean Ping, said efforts to cushion African states from the effects of the global crisis were underway and measures were being taken by key institutions to deal with the crisis.
Africa’s leading institutions, including the AU, the UN Economic Commission for Africa and the African Development Bank have all been proactive in supporting African states to respond to the financial and economic crisis.
African ministers of finance and governors of central banks met in Tunis, Tunisia, in 2008 to discuss the crisis, leading to efforts such as the creation of the Committee of Ten (C10) as part of efforts coordinated by the UNECA and AU.
There has also been Africa’s participation in the London G20 summit as an entity which spoke with one voice and presented one common position for Africa.
Ping hailed the decision of the G20 summit to increase resources available to the International Monetary Fund (IMF) noting that poor countries could benefit from an additional US$50 billion availed to the institution for further lending.
He called on other international institutions to honour their pledges to increase resources to Africa.
Africa is united in seeking a strong voice in the drafting of new rules for global economic governance and reform of the institutions that regulate the global economy.
UNECA Executive Secretary of Abdoulie Janneh said although the global financial and economic crisis was not of Africa’s making, its impacts were being felt on the continent.
The ECA chief outlined four key areas that ministers should consider at the meeting as protecting Africa’s recent development gains.
Among these are identifying the major domestic policy options African countries can adopt in responding to the crisis; ensuring that promises made to Africa, particularly aid and trade, are honoured; and making sure Africa’s concerns on reform of the international financial architecture are adopted.
He stated that the active participation of ministers in consensus building meetings would send the right signals on Africa’s common purpose to the international community.