The global credit crisis has wiped out the relief due to Africa from the 5% gross domestic growth registered in the past year, according to the UN Under Secretary-General and Executive Secretary of the Economic Commission for Africa (ECA), Mr Abdoulie Janneh.
Addressing the 14th session of the Executive Council of the African Union, which got underway here on Thursday, Janneh therefore called for renewed and diversified efforts to grow African economies to meet the Millennium Development Goals (MDGs) by the target year of 2015.
The eight broad goals revolve around heath, good governance, environment, education, gender parity, food, water, child mortality and reproductive health care.
“The present financial crisis is unprecedented in scale and scope and will impact on growth and trade as well as investment, trade credits, remittances ad tourism. Moreover, several African countries have already experienced volatility in their stock market and exchange rates since the onset of the crisis,” he said.
He said that the hemorrhage in major global financial markets and economies had further exposed Africa’s soft underbelly, which he said should be cushioned against similar shocks through diversification.
“We need to increase agricultural production and diversify into manufacturing and services in order to provide jobs for out teeming number o unemployed youth. Diversification will also give most economies the resilience to deal with future economic shocks to which they are now vulnerable,” Mr. Janneh said
This year’s AU summit focuses on three key themes: infrastructure development, transport and energy.
However, it is taking place against the backdrop of a global economic downturn that has adversely affected demand in traditional markets for the continent’s exports.
Capital inflows to the continents have also been affected, resulting in subdued remittances, tourism, credit facilities and private sector investments.
Equally, political instability in Zimbabwe, Somalia, DR Congo, Burundi, Sudan, to name but a few, has been cited as major impediments to the implementation of projects that would scale up inter-state and inter-regional trade and movement of goods and services.
“Africa’s ability to meet its challenges head on depends on the consolidation of peace and security and the cessation of violent conflicts and civil wars,” the UN official said.