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African Finance Ministers Press Briefing|
September 28, 2002
Mr. Martin Ziguele, Prime Minister in charge on Finance of the Central African Republic
Mr. Ali Badjo Gamatie, Minister of Finance of Niger
Mr. Rigobert Andeley, Minister of Finance of the Republic of the Congo
Mr. Julio Marceline V. Bessa, Minister of Finance of Angola
Mr. Thimothy T. Thahane, Minister of Finance and Development Planning of Lesotho
Mrs. Luis Dias Diogo, Minister of Finance of Mozambique
MS. FOUDA: Ladies and gentlemen, good morning. I'm Lucie Mboto Fouda of the External Relations Department of the IMF, and I would like to welcome all of you to this press conference of the Ministers of Finance from Africa.
As you may know, this press conference is a unique opportunity for African Governors to express their views on issues of interest to them with regards to their relations with the IMF and the World Bank. This is also, indeed, an opportunity for the reporters to get first-hand information from some of the people who struggle on a daily basis with the debt burden, poverty and pandemics.
Now let me introduce our guests. Starting from my immediate left is Minister Rigobert Andely, Minister of Finance of the Republic of Congo. To his left is Minister Timothy Thahane, who is the Minister of Finance from Lesotho. Close to him is Mr. Martin Ziguele, who is the Prime Minister from the Central African Republic. He is also in charge of Finance. To the immediate left of the Prime Minister is Minister Ali Badjo Gamatie, Minister of Finance from Niger.
I will ask the Prime Minister of the Central African Republic to offer a few opening remarks, then we will take questions in the room.
MR. ZIGUELE: First of all, I wish to thank the International Monetary Fund and the organizers for having offered this opportunity and for dedicating time for holding this press conference, which will allow officials from a number of African countries representing the continent in its geographical diversity to be able to inform broadly the international community on what is taking place in extremely difficult circumstances within the framework of our economic and financial reforms in our countries.
In Africa, we have very different situations. There are many countries which devote many efforts and make many sacrifices and undertake reforms in the fight against poverty and for growth. We in other countries, unfortunately, have critical situations of extreme crisis, and we are sure of one thing, and that is that we have all lived through very difficult situations in all African countries, and we are convinced that the only way to find solutions is to have sustained growth and to have sustainable development to create pleasant climates for living and for resolving local problems.
QUESTION: Good morning. Eric Ture Muhammad, The Final Call Newspaper.
The question I have is twofold: one, how serious is the issue in the Middle East, the instability among the Palestinian territories, the conflict there with the Israelis, how seriously does that weigh in on the support that you feel that the African countries are deserving of? Secondly, how fair is it of African nations to look beyond Africa in and of itself to richer countries who got rich off the exploitation of Africa? Should we expect them to give in the way that Africa needs to give? And being that the focus of the IMF and the World Bank has really been towards those efforts to secure European and Western economic standards, how will this translate into something constructive for the African continent.
MS. FOUDA: Mr. Andely, you can take that question, and if any other minister would like to add a few words, he will be given the floor as well.
MR. ANDELEY: I think that you have asked two questions. I'm going to answer the first one in English and, if you want, it is fair, the second one in French.
I must say I didn't want this press conference to start with, let's say, war and troubles issues. I would think that you were going to raise problems on economic and social fronts. It's obvious that the present crisis in the Middle East has an impact on Africa, through the oil prices as it can result in an increase in oil prices, and most of the African countries are importers.
My own country is an exporter. We will be happy to have more of an increase in price, but the bulk of African countries are net importers. So it is going to be, if you want, bad news for Africa. And in Africa, we like peace basically. We really do like peace, because we think that without peace, we cannot develop our countries. So for the Middle East, we always wished peace for them also. We want peace between Israel, and the Palestinian Authority, and we really think finally that it is always good for the world, not only for the Middle East, not only for Africa, to have peace.
So let's talk more about peace and development than about crisis.
The second question is a very important one. How will Africa organize in order to raise the standard of living of its people? How can the countries which, according to you, exploit Africa, how can we expect those countries to help Africa? And I can say the following: Africans have gone beyond the stage of waiting. Africans have gone beyond the stage of putting out their hand. And we have a very specific program for that purpose, NEPAD, which is a program that entails our taking our fate in our own hands. And therefore, even though we have to be in a framework of cooperation with Western countries, we do not expect any gifts, and we are not asking for gifts.
The new spirit in Africa is based on trade as partnership. If our partners benefit, we benefit. And I think that instead of being in confrontation with those countries which you think exploit us in Africa, we would prefer to have a peaceful approach, one of negotiation, of cooperation, to ensure that the West as well as the Africans find common interests.
MR. ZIGUELE: I would like to add a few brief comments. Africans have always been blamed for speaking too much and to change adversaries every day. Yesterday, we were against imperialism then neocolonialism; today, something else.
I think that for once, there are many chiefs of state in Africa who have thought about this and have said that we have to unite around a community of interest. And this is what has happened with the NEPAD. And we think that in the framework of NEPAD, there are subregional initiatives which go to the center of things to make concrete proposals and to discuss with the G-8 to see to what extent we can design something which can make progress and which can solve the true problem of Africa, which is the fight against poverty. And this is all done under the political structure of the African Union. We have to leave aside ideological debates, because we have real problems. They have been identified, and our heads of state are working toward their solution.
Mr. THAHANE: Just to add one or two words to what has been said by the Prime Minister and my colleague from the Congo, first, the Africans have chosen a framework for cooperation with the rest of the world in the form of NEPAD. A key element of it is that the Africans are going to be in the driver's seat in defining their development goals. A key one among them is the poverty reduction on the continent. And it is through that framework that a home-grown development process, program, will be the basis of cooperation with the Bretton Woods institutions and also with the donors. That is a very important change in what has happened in the past.
A second part, I think, is a recognition by the African countries that peace and political stability are important preconditions for sustained growth, for private sector investment both domestic as well as foreign. African leaders have committed themselves to creating such conditions. But as has been said by the previous speakers, peace is not only essential for African development but is important for global development as well. We cannot expect to have Africa alone developing on the basis of a constrained peace and stability, but it has to be set against a global context of peace and stability. And that is where the problem in the Middle East is of concern to the Africans.
Now, a very important problem that I think in the cooperation between Africa and the international community is one of debt. And there are many initiatives for debt relief. the Bretton Woods institutions have been working on HIPC, but a key concern for the African countries is that the debt has to be sustainable. The conditions for sustainability are such as, a), the projections, the forecasts, that are made have to be realistic; b), the commodities on which the African countries depend for the sustainability of the debt and their exports have been declining, and the international community has to deal with that.
The third element is the access of markets in the developed countries are critical for the products of the African countries. If access is improved, and we have put our houses in order, and there is increased productivity and output, then, there will be less need for assistance in the long-term.
QUESTION: Mr. Minister, you referred to the representation of Africans in international financial institutions, in the IMF and in the Bank, where Africans should have larger voting rights. Also, we have a conflict in Cote d'Ivoire at the moment. What are you proposing in that respect?
MR. GAMATIE: On the Middle East, I would note that twelve years ago, there was the fall of the Berlin Wall. Now, you're talking about the Middle East. I don't see the issue that way. Really, the question today is what is different today that we can feel that we stand more chances to succeed in terms of development than yesterday? That's the real issue. And for me, the answer is that today, the conditions are there for us to be serious about ownership. That's a key point. And then, it falls down into three points: the debt issue, the policies and good government.
The second one is the policy, the so-called Washington Consensus. When you look at the three items of the Washington Consensus, per se, there is no problem with them. The problem is that we haven't factored enough the time dimension, the capacity and fairness with Africa. I have in mind access to markets, which you just mentioned; the time dimension, and the human capacity to carry out these things.
These are the three ingredients that were missing in the Washington Consensus. That is why I think, from my point of view, we are facing problems with the policy.
And then, the third point is good governance. Good governance has been presented as if we're doing it in Africa to get money coming from outside. But really, for me, the issue is we are doing it for our own good so that everybody would work in the same direction. Otherwise, you would have intellectuals in the capital city discussing programs and then people in the rural areas not knowing what's going on. That's the whole issue of the PRSP process.
And then, if you put NEPAD on top of that, that would be a sort of regional or African PRSP. Now, coming back to the questions of representativeness, you've stated that there was a new director of the African Department in the person of Mr. Bio Tchane, who started this year, a former Minister of Finance and Economy in the Republic of Benin, who is working in an entirely satisfactory way. There has also been a lot of recruitment at the IMF this year. I think 17 Africans, if I remember correctly, have been recruited. That represents about 10 percent of the people who were recruited at the IMF. It's not a lot, but it's the first time that we have had that level of recruitment.
Something is certainly going on. The question of quotas comes up in two different ways: in terms of volume, because we think that the increase in quotas in the Fund's overall resources would give a very strong signal to markets as to the Fund's ability to act, but it's also a question which must be asked in relative terms, and the Fund's Director General has already made a commitment to put that question concerning quotas and therefore of representativeness. That, obviously, gives rise to a serious difficulty for countries in the group that I belong to. If you look at what we represent today in quota terms, it's really very marginal indeed.
Very rapidly on Cote d'Ivoire, you'll understand that it's quite difficult to talk about it. It's a country that I'm very close to. After France, it's our second-biggest trading partner. Forty percent of the GDP.... A big meeting will take place tomorrow. Everyone has confirmed their participation in that meeting: We think that some type of African interposition force will be put together. You know better than I do that France gave its agreement this morning for logistic support for such a force. All of that will be set up, but I think that negotiations and dialogue will be key, both in Cote d'Ivoire's interest but in the whole African subregion's interest.
MS. FOUDA: We'll come back to the panel, the time for me to welcome Mrs. Dias Diogo, who joins us now. Mrs. Diogo is the Minister of Finance of Mozambique.
MR. ZIGUELE: On Cote d'Ivoire, I should like to draw everyone's attention to the fact that this problem is part of a post-conflict situation for many African countries. When you look at the history of our part of Africa, you see that when there is democratic change, armies usually fall behind. The armies do not manage to keep up with the democratic process of change, and the army is instrumentalized by certain people who use the army against new democratic orders. And that's exactly what's happened in Cote d'Ivoire.
When African leaders plead for reforming the armed forces, normally, they don't get much answer. When you take the case of my own country, the Central African Republic, we've had three military mutinies in 1996 and 1997. We held a meeting in New York in May 2000 under the aegis of the United Nations where proposals were made to restructure the armed forces, and except for France, who I would like to pay tribute to here, who actually followed up on its promises and helped us to restructure our army, no country answered our appeal, in spite of the promises that were made.
And then in May 2001, exactly what we expected happened. There was a bloody, attempted coup d'etat with disastrous consequences that were caused by exactly the same people who had manipulated the army in 1996 and in 1997, and that's why it's so important to know that we cannot have economic reform, and I don't need to tell you about that, nor even financial reform, with social consequences that are very difficult for our societies, when the overall context has not been made secure.
Because if you have a situation where there are social, technical, and logistical consequences that require help from outside, you will not have a complete, general framework that will be other than fragile, and any adventurer at that point can simply come along and manipulate or disturb that framework.
I remind you that, and I'm not speaking in the name of the Cote D'Ivoire authorities, but I'm speaking as an African> If you remember, the first reason that was set forth by the people in the mutiny in the Cote D'Ivoire, they said they were protesting against the dismissal of 750 army people, and you saw that less than one week afterward, you are not hearing about the 750 military people's claims. This leads us to ask ourselves what really the basic problem is.
You have to help governments who accept to undertake reforms. You have to help them to restructure armies, and defense, and security forces, and to give them all of the support necessary to make the overall framework of their countries stable and secure, otherwise you can have all of the agreements you like with the IMF and the World Bank, and five or six months afterward, if you haven't had the necessary stabilization of the framework, the entire overall context will be cast into question anew.
I think, and I'm very sad to say, that my colleague, the Prime Minister of Cote D'Ivoire, and the Minister of Finance, who several times shuttled back and forth between Abidjan and Washington to arrive at some form of agreement and three or five months afterward you see exactly what happened.
You must not hide or turn your eyes away from the problems of defense, and security, and restructuring of armed forces in our country. That's where you need to begin, in fact, and you can only build on a solid base if you proceed in that way.
MR. ANDELEY: There's one point I'd like to add concerning African representativeness in the two Bretton Woods institutions, I think that my colleague from Niger talked about the volume of quotas, and there is an aspect we need to add to this, which is quite important for Africans, and that is the increase in the number of people in the hierarchy of the two institutions.
Here, again, this is not a gift that we are requesting because in the past we had, for instance, at the IMF, an African. I won't mention his name, but we know who we're talking about and who may find himself in a very difficult case in Cote D'Ivoire, and we don't want this something to be interfered with because this is a very important African value, and we don't want anything bad to happen to him. And he had been, in fact, at as high a level as number two in the IMF, and he did work that was appreciated by the whole world.
At the World Bank, we have Mr. Madavo, who has had his entire career in the World Bank and who is also doing fabulous work. Young Africans who have gone to French universities and major American universities are capable of doing the same level of work as everyone else, neither more, nor less.
Because whether dealing with Madavo or Ouattars, these are people who were given a chance and who did not disappoint us. This is very important for us in Africa. We will always emphasize that aspect, and we need to go on taking account of numbers, but also of African career development in our hierarchies.
QUESTION: Sama Famkinwa is my name. This Day the newspaper in Nigeria.
My concern has always been the issue of corruption in Africa. Before NEPAD, there has been about 35 initiatives to help encourage growth and development in Africa, but we all know that at the end of the day, nothing has happened so far.
I would like to ask, we are asking for debt relief, we are asking for, in honor of the HIPC Initiative, we are asking for so many things. How do you expect the developed economies to take us seriously , considering the fact that most probably some of the people who are asking for this relief are part of those who are involved in corruption in Africa?
MS. FOUDA: Thank you. I would like to ask Mrs. Diogo to take this question, then Mr. Thahane will follow.
MS. DIOGO: On the issue that has been raised about NEPAD, what's different from the other initiatives that Africans had before?
First, the ownership, because they measure the problem that the other initiatives had before, all the problem furnishing to the higher level, political higher level. So we have this higher ownership from the African leaders about NEPAD.
The second issue is the commitment among all of those countries that are working on the process of organizing all the issue related to NEPAD. So the commitment is higher in the region, and we feel that it is the moment for implementing an initiative like this.
The third issue is related to peer review. That's the new issue that appears in an initiative like this, and there is a real engagement from the leaders in Africa to pursue peer review.
The major discussion is how this peer review should be developed, and I think that the Africans should be themselves, to organize themselves to do peer review, because this is a very sensitive issue that takes into consideration the conditions of the way how the Africans work, but they are the general principles and the general codes of conduct that should be followed.
So the Africans themselves do decide to organize NEPAD, basing on the major principles of good governance and avoiding conflicts, solve the conflict, and pursue a peer review. The main objectives of NEPAD we know are the poverty reduction, by following all of the priorities that have been submitted in these programs.
On the HIPC Initiative and reduction of debt versus corruption, I think we are not demanding for something that's not inassertable for the international community. The reduction of debt is an issue, and it is a need for Africa to develop it.
For example, Mozambique had a high level of debt, and after the HIPC Initiative, we reduced the service of debt from US$171 million per year to around US$56 million per year, and we had room to develop our strategic plans in education, and health, roads, order supplies and so on.
So the only way for the African countries that are highly indebted is to have a room in their projects and budgets by reducing the debt and having this room for implementing programs aiming at reducing poverty.
MS. FOUDA: Mr. Thahane, on the corruption issue?
MR. THAHANE: Yes, I think we need to separate the issue of debt relief and corruption. Debt relief is justified, whether or not you have corruption, it is justified from a long-term development standpoint. And I think as Minister Diogo has indicated, that's the way it should be looked at.
Now corruption, let me use the example of my own country because it illustrates a few interesting things on the commitment of the African countries.
I think, as many of you are aware, we have had a very large internationally supported project, water transfer scheme, costing about US$1.2 billion, and there were many international companies, construction and engineering companies, that bid, tendered for the work both on the tunnels, as well as on the dams, and many of them had their lobbies or their representatives there, and they managed to bribe the Chief Executive of the Lesotho Highlands Authority.
When this came to light, the Government decided to pursue the issue against the Chief Executive, and he did manage to get some good legal representation, but due process was followed, and he was convicted, and he's in jail.
The second aspect was what do you do with the corruptors? The government launched a case against some of the companies that had participated in this. I regret to say that their legal representation, of course, was far more than a poor country like Lesotho could have thought, but because of the principle, we went for them, and we are paying, and we will pay. And the first of these cases resulted in a conviction of one of the companies, which then also made statements threatening the withdrawal from the rest of Africa or whatever if this conviction was upheld on appeal.
But we also, then, are looking to the international community. The World Bank and others have said that such companies will be blacklisted, and we are now waiting. However, let me qualify, since the company has filed an appeal, one would have to perhaps wait until the appeal takes place, but the principles it illustrates are, A, the Africans are serious, and Lesotho, a small, poor countries has taken on the giants. And it has dealt with the problem of corruption, and there will be many more that will be dealt with if, and when, they are discovered.
The second is what do you do with the international co-corruptors or co-conspirators? That is where we expect the world, also, to do its part. Africa, alone, cannot do it. We are committed to eliminating corruption because it's in our development interests, but we need cooperation because it takes two to tango, and we can deal with one partner, but somebody has to deal with the other one.
MR. ZIGUELE: I should like to take the floor on the subject of corruption, and I am happy this question was asked by a journalist from Nigeria. I should like to say that things need to be clear.
A famous indivifual stated that in corruption, there are two different people who act; the one who corrupts and the one who is corrupted. And when we talk about corruption in Africa, we should not simply talk about African leaders. Often, very often, initiatives, proposals for corruption, come from elsewhere, and I don't want to go on about that at any greater length, but you understand me.
What you need to know is that African leaders are not all corrupt. We have all been educated, and the difficulty of behavior, when facing corruption, is very often a question of upbringing and personal reactions. On the basis of my own experience when I was appointed, I wrote to many institutions to ask them to help us concretely, not theoretically, but concretely, to set up measures to fight against corruption, and I can tell you that I'm still waiting for answers.
From many institutions, who often preach lessons about fighting against corruption, it is not an easy subject. It's a very attractive subject, but when you scratch the surface a bit, and you want to be pragmatic, you don't get a lot of answers from the people on the other side.
But to lighten up this dark picture a bit, I can tell you that we have had an answer from the United Nations Agency for Development, and we are working out a program to fight corruption, which is not a theoretical one, which is a very practical one.
I am among the Finance Ministers present here, so I'm rather sad to say that my own Finance Minister is in prison for corruption-related matters. That's been the case for four or five months. So, for us, it is not a theoretical problem, it is a practical problem. We have seen that corruption is a form of gangrene, which is linked to poverty, low salaries, irregularities, lots of phenomena of that nature.
We think that we can fight corruption not as the Niger Finance Minister said, to please our partners, but rather to bring things to their proper level because corruption is a sort of tax which does not say its name and which is reflected in the price and sale of goods and services which are proposed to our populations. So it's a form of tax which doesn't go into the state's coffers; it's a tax which has to be eliminated. We need to strenghten out our own countries' economies. We don't necessarily need to make anyone else happy; it's something we're doing for ourselves.
The fight against corruption in our different countries is not the least-effective form of action we can carry out. That's what I wanted to add.
MR. GAMATIE: I think that the question of corruption is very important. In my view, sometimes it's not raised correctly when dealing with Africa. When you look at figures, Africa is not the most corrupted continent, but one speaks only of corruption in Africa.
Corruption, don't get me wrong, is something very bad. As His Excellency, the Prime Minister has said, it is something very serious, and it changes relative prices of thing, and it affects the outflow of resources.
But what bothers me is and s what I find important today is what do we have on the table which means that we may succeed? The fight against corruption is good for us, and the danger it entails is that everything I'm saying means what it means, in operational terms, that we must strike a balance between what is public and what is private, in managing an economy, and we must strike a balance between the demand-driven, country-driven, ownership, driver's seat. That is a question of privatization in Africa, and we have to strike a balance between conditionality and ownership.
Now the question of corruption, we may then be said you're not ready, but that would delay those two fundamental issues, which are what balance must we find in Africa between the public and the private. We know that all public doesn't succeed and all private doesn't either, but the question of corruption is used to conceal that very important debate. So one has to raise the question of corruption. In Africa, it may be more visible than elswhere, but it's not the only place.
I don't wish to shock you, I, as a Minister of Finance and Economy, I could sit next to the Finance Minister of any developed country, and in terms of capacity or integrity, I have no problem, but one cannot generalize. The problem in Africa is that the bad examples spillover, have that kind of effect, and I'm very glad that you asked the question about corruption.
We must undertake efforts, we must do it in our homes, we must do it with our partners, and the companies of the North can assist us in that, but it should not be used as an argument to prevent fundamental issues of balance between public and private, and between conditionality and ownership by countries or not addressed.
MS. FOUDA: Corruption is obviously an interesting issue on which we will continue the discussion later. Ahead of that, let me welcome Minister Julio Marcelino Bessa. He is the Minister of Finance of Angola.
Minister Bessa is a member of the International Monetary and Financial Committee, and he has been attending a meeting. I would like to apologize on his behalf.
Now, Mr. Andeley, you wanted to elaborate on corruption....
MR. ANDELEY: First, I will apologize because I mentioned the deserving Africans in the IMF and the World Bank, and I forgot that my neighbor here to my left has been one of the most powerful Africans in the World Bank (Thimothy Thahane) so I congratulate you on that.
Having said this, I want to raise two issues. Our colleague from Niger has just referred to this. The bodies which fight against corruption, one finds them everywhere. The fight against corruption, it's not, that is not an African body, and I can tell you that one of my best readings -- I don't read it every morning, but every week -- that is the classification of countries of Transparency International based on corruption. And as the previous has said, I'm always impressed to see the position of countries in that classification.
I think that we Africans, when we speak of corruption, we should not be defensive. Why do we always sound defensive when we speak about corruption? I speak about this very comfortably. It is an international phenomenon. What is important, however, it is the legal framework of the struggle against corruption because we are law-and-order states, and we cannot suspect whether our citizens for corruption. We must have laws, we must have rules, and that is beginning in Africa.
In our CEMAC area, the Central African Economic Community, we are going to have a law against money laundering, and that must be a regional law because, at the regional level, there is better implementation. Our colleague and my sister, the Minister of Mozambique, was referring to peer review in the framework of NEPAD.
In the regional context, we will have legal implementation to fight against corruption and to fight money laundering. In the case, and still speaking about the legal framework of the fight against corruption, there have to be national anti-corruption laws with very simple rules. And a rule which I appreciate very much is what is the level of wealth at the start, and your level of worth at the end of your duties, and in so doing, Africa makes progress in the fight against corruption.
I refer, again, to Transparency International. If we see the measures that countries take against corruption, Africa is in a very good position.
QUESTION: Anna Willard from Reuters. The HIPC trust fund is about to run out of money, and I believe that the Congo is one of the countries coming up that won't receive any full debt relief unless the rich countries come together and give some more money to the Fund. So what would your message be to the rich countries as they sit around and try to decide whether or how to replenish the trust fund?
And the second question is, you complain about the trade subsidies and trade tariffs, do you think African countries are strong enough to compete against the rest of the world if all of the tariffs and subsidies, including in Africa were lifted?
MS. FOUDA: Could I ask Minister Bessa to take that question please?
MR. BESSA: I think that it is a relevant question. African countries are prepared to face international competition, and this has been the case since their tariff barriers were lowered.
We start out from the principle that a major part of the countries lost their productive potential, and the international trade of developed countries was not sufficient.
What we're saying is that there is a capacity in African countries, as a minimum, to produce raw materials, basic commodities. So it seems to me that African countries are in a position to succeed, to a certain extent, in establishing democracies and reforming structural systems, but also strengthening productive capacity.
This will place us in a position in which we can conquer and obtain new markets, and we can continue to be major exporters of products to Western countries.
MS. FOUDA: Minister Gamatie, would you like to take the floor on this question?
MR. GAMATIE: Very quickly. She's right, I think there is US$1 billion needed a year, and I know that the Bank is working on it. That was one of the issues you mentioned. The rich countries, they know -- I mean, it's been clearly demonstrated that if the debt is not sustainable, whatever we are doing, you can forget it.
Then one has to remember that the HIPC Initiative, it's a two pillars approach. I mean, you don't just take your plan, come to Washington and say, I'm a poor country, I'm entitled to HIPC. I mean, there is some, let's say conditionalities. We've done our share. Now we expect them to do their share. It's a bargain. We've done our part but the ball is in their side.
So we expect that this US$1 billion would be there and they know that the World Bank is working on it.
Now the issue of subsidy, what we're saying, just be fair to us. It's not an issue of capacity here. You take cotton in West Africa. If there were not the subsidy, a country like Benin, Burkina Faso, and Malawi will have roughly US$250 million US more this year, which they're going to be missing.
The point is, we have to be realistic. There is an emotional dimension to agricultural product in the US and in Europe. As long as they can afford to subsidize their farmer, they do it. They can afford it. That's the key point.
Now there's two ways to do it. Either you do it from the revenue side or you do it through price. What hurt us is the price. Leave price alone. It's against market economy. If you want to provide revenue to your farmers, go ahead, you can afford it. It's your budget. Do it.
That's the difference between the European Union and the US In the European Union, up to 60 to 65 percent of the support is in terms of revenue with no impact on the price, which is different in the US
QUESTION: Charlie Cobb with AllAfrica.com. Two questions. Mr. Wolfensohn and Mr. Koehler and other Bank and Fund officials have been emphasizing that this meeting is a meeting to implement various promises that have been made, particularly in the last year at Monterrey, or at Doha, or at Johannesburg, or G-8. What do you expect in the way concretely, in the way of implementation? Particularly, what are you expecting that's new?
I have a second question related to HIPC. Any number of countries from Africa were expected to reach the decision point and didn't, this year. Not only is the trust fund some US$800 million or US$900 million in the hole, but there are also lots of other questions surrounding HIPC. Would you call HIPC a failure at this point?
MS. FOUDA: Minister Thahane, would take thelast question please?
MR. THAHANE: Thank you very much. Let's start with the implementation. I think if you look back there have been many resolutions taken. You can go to '91 and the Rio Conference and all that, many commitments. But all of them never had a timetable for implementation and commitments to deliver certain things at a certain point in time.
So what the Africans, as well as the international -- the Bretton Woods institutions are saying is, what is the point of always saying, we agree, we will support, we will increase our aid, but not putting a specific figure and a specific time? How much are you going to increase the aid?
And equally on our part, when we say we are going to reform our legal and administrative systems, then the key question is, over what time period? I think there are questions that are being asked and we have been discussing with Mr. Wolfensohn the issue of Education for All. We need to get specific agreements of what the Bank is going to do, what the African countries are going to do.
Equally, we have been discussing, and the world has been discussing HIV/AIDS issue, which is a major one for our countries. What we are now looking for is concrete actions, agreements, obligations on our part and on the Bretton Woods institutions, so that we can look back five years from now and say, this is where we started. That's where we are. I think that is the process is beginning at these annual meetings and that's why the heads of the institutions are emphasizing that.
MRS. DIOGO: Thank you very much. It's not a failure, as you said, Minister Thahane. We should divide the HIPC countries in two groups. One is the group of the countries that are in decision point and they are looking for the completion point. And there, there are some measures to be taken in order to strengthen the HIPC Initiative.
So the problem with the HIPC Initiative is a problem of being strengthened, being improved in order to work better for the beneficiary countries, in order to achieve the objectives of growth and investment in the different priority sectors.
The second group is related to the group of countries that have benefited from HIPC, and there there are also measures.
From the first group, I think that some of the measures should be to accelerate the process of the completion point. The internal measures should be taken without delaying the process of the completion point. There I think assistance is very important during this period of time, instead of making some interruptions and so on, and create additional problems to the country. The other issue for these countries is the flexibility. It's necessary to have flexibility for those countries to be eligible in terms of completion point. We should not use all the conditionalities and delay those countries for the completion point.
The other issues that relate to the post-conflict countries. There are some countries that are eligible for HIPC but they are post-conflict, and the type of conditionalities should be different from those that are not post-conflict countries. So they are added challenges, additional challenges that those countries have to face.
On the second group, it's just that, I would say maybe to complement, to top up the measures that have been taken. Some of the measures are related to the issue of the classification of the products of export of some of the countries that have completion point.
Some of the countries that benefited from the HIPC, they are facing problems of sustainability now in terms of debt analysis.
So additional measures, additional funds should be available to accommodate those situations while the country is implementing measures in order to diversify their products, because it's not an easy exercise to make a diversification of products in terms of export.
The second measure is related to non-Paris Club members. The non-OECD countries are not so willing to have the same terms as the Paris Club members. So the Bretton Woods institutions, I think they have a role because those countries are members of the Bretton Woods institutions.
So there should be discussion with IMF and World Bank in order to try to help those countries that are HIPC countries in order to have additional relief from those countries. Because they don't just have the same terms as the Paris Club. So it's necessary to discuss this issue. Sometimes it's not easy from ourselves to have direct discussion without the involvement of IMF and World Bank.
And finally, the trust fund, it's always necessary, this trust fund to be filled up, because for the other countries, after those four countries that have been at the completion point, in Africa we need other countries to be eligible, to have the DRC issue and other countries. So it's necessary to have a trust fund in order to accommodate new countries for HIPC Initiative.
MR. THAHANE Just one word I think to the comprehensive presentation.
There is also the problem of what has been called the vulture funds, and these are funds that have purchased the debt that was from the secondary markets, and now they are coming back to the HIPC countries suing for payments. I think this problem has to be looked at and dealt with, and there's a role from the Bretton Woods institutions, as well as all of the donors that have participated in the whole HIPC Initiative.
QUESTION: In early September, when President Bush was at the U.N., he met with the African leaders from oil-producing countries, particularly in Central Africa. There is some concern, though, that the United States is looking for altnerate source of oil, other than the Middle East, and that some of the African countries that do not have oil will be marginalized in the so-called development process.
I would like your reaction to President Bush meeting some of these African leaders, especially to those countries that are not producing oil.
I would also like to ask a question about the Ivory Coast. The Minister mentioned that when there is democracy change, that means usually fall behind. Isn't that a question of leadership, though, that democracy is not only going to the polls and being elected, but that once a leader is elected, to pull the country through.
Because what is happening in Ivory Coast right now is that the opposition leaders or the people in the opposition have been virtually eliminated . But there is another particular situation also brewing between Senegal, Gambia, and Guinea-Bissau, and oftentimes, people, the African leadership do not pay attention to these problems until they blow up in the face of the leaders. I'd like to hear some comments on that, too, please.
MR. ANDELEY: I think I'm going to take the first part of your question about the new American interests from the so-called Guinean Gulf; I mean, Nigeria, Cameroon, Congo, Angola, and so on, and Cote D'Ivoire, of course. Cote D'Ivoire is really at the middle of the area I'm talking about.
I think that one will always have some surprise with the press people. You always take what is good for you. Because, in New York, you are talking about that meeting with the African heads of state in New York. My head of state was there, and he was what we call aspokesperson for the other heads of state.
So they discussed about oil, of course. I don't know what is in the mind of the American people or the American leaders, but they did discuss that one of the biggest sustainable development projects in Africa, which is the preservation of the so-called Congo Basin Forest, which is the second lung of the world after the Amazonia. So they talked about oil, of course, but they talked also during that meeting in New York about the sustainable development.
We are producing oil. If you can have some people to come there and develop that oil, we'll get revenue, and that is good for development. But I know also that -- and this is really something very important to say -- the Americans are really backing in a very hard way -- and we should note this new attitude of the American leaders to protect nature throughout the world.
I think that even in the World Bank, the American EDs are pushing on that. And I'm from Congo Brazzaville. I'm very happy with them. We have oil. But we have also a forest, and they are working with me to preserve that forest so we can breathe fresh air.
MR. BESSA: I would only say that we have seen a major change. There has been a major change in the policies of Western countries. There is an increasing attempt to try and understand African problems. They don't look at Africa as a single country. This is something that we had to go beyond, to leave behind. Africa is made up of many different countries, and each country has its own reality.
One of the aspects which we thought was interesting to hear from the Director of the IMF is that there have been these international changes of attitude toward African countries. These institutions usually go to Africa, and they forget the African reality. They forget Africans themselves. This was the case in the past years.
The aspect of democracy: it also seems to us that we had to pay more attention to African specificities. We're all in favor of democracy, but I think that our countries should not necessarily be forced to work so quickly and to face conflicts of interest, or some Western powers are stimulating or inciting one group against another, and that is not necessarily good.
The NEPAD Initiative, we think, could contribute to the solution of some of those problems. There is an enormous outpouring of good political will on the part of African countries, and it seems to me that if it found the necessary support among the Western powers, Africa will be able to enter into a period of greater stability.
I would also like to refer to post-conflict countries. At the meeting we held, we drew attention to the fact that those countries should be viewed differently, because those countries have gone through ferocious wars, wars which were fanned by Western powers. Those countries are facing serious economic structural problems -- the case of my country, Angola, we had 25 years of war which practically destroyed the entire country and which left behind many displaced peoples.
We have a problem with troop demobilization, troops which have been trained to do practically everything, so there will have to be a rethinking on the part of the IMF and others when they force governments of countries to quick change, and they result in greater turmoil, more wars, more conflict, and in the end, the expected results are not reached.
We want to draw attention to this, that we should not consider those countries as a single country. All African countries have their own specific characteristics and also to pay attention to structural forms. I wanted to draw your attention to some aspects which could lead our countries to serious conflicts. We have to make adjustments. We have had to make adjustments in prices, privatization. We have had to face a number of things that Western countries did a long time ago, and we, at times, are forced to do all of these things in a period of six months.
That creates difficult situations -- in the case of Angola, 4 million displaced persons, almost 40 or 50 percent of our population. We have to grapple with soldiers coming back from war who need subsistence, and we are forced to these violent adjustments which at times endanger our social stability.
Many countries in the International Monetary Fund do not view such situations with due respect. These matters require a great deal of attention. It seems to me that European countries after the Second World War were not any better than African countries which have gone through conflict. So we all know the economic history of those countries. In 1945, European countries were facing a difficult situation, and it was thanks to the Marshall Plan that those countries were able to recover, and it was in the early seventies that some European countries were able to have the capacity that they have today.
Now, to expect African countries after very violent wars where very sophisticated weapons were used, where infrastructure was destroyed, where there was social upheaval, to expect those countries to recover in six months or in two years is ridiculous in our viewpoint. We must help those countries to strengthen their capacities technically and in terms of initiative. We should not use the rhetoric of transparency and of corruption, because in the end, those matters create difficult internal political situations. We are pressured to be transparent in two days, when how many European countries, how many countries like the United States have mentioned that a lot more time is required?
So transparency cannot be a goal in itself. It has to be a goal to be reached at some point, and that goal can be achieved through dialogue and by paying attention to the idiosyncracies of those countries.
MR. ZIGUELE: I wanted to respond to the question by the journalist who asked for our reaction to the meeting between President Bush and the heads of state of central African countries. I will recall that it is not the first time that the head of a Western state meets with a number of African heads of state. There is the traditional Franco-African conference. The first one was between President Valery Giscard d'Estaing and several French-speaking African heads. There is also a Commonwealth conference which brings together a representative of the Queen of England and several heads of state of English-speaking Africa.
Perhaps what is of interest in this one is that it's the first time that an American head of state meets the presidents of a subregion of Africa. Among the countries represented, there were nine represented, and among them, there were non-oil producing countries. So in my view, that was not a meeting which was focused on oil questions, but the main purpose of the meeting was to bring about peace in central Africa. As you know, central Africa is one of the richest regions of Africa. Unfortunately, it is a region which has suffered from many crises. There was a war between Congo and its neighbors. I need not recall that.
That is a situation which has effects for all of the central African countries. My country had two serious oil crises which brought problems between it and the IMF. The flows, traffic on the Congo River was blocked. So efforts in the central African region must be supported.
The question of knowing whether something has changed because there are new sources of oil, I think that would be legitimate to believe that. But our interest is to ensure that there are direct contacts between our leaders and the maximum possible number of Western leaders to clarify the basis for our relations and, above all, to avoid misunderstandings and quid pro quos, because in Africa, we have the impression that we are blamed for all of the sins of Israel for good reason or not, and only direct contact will allow us to allay doubts and to know each other better.
In the case of Cote d'Ivoire, I will also say that democracy does not only mean organizing elections, as you have said. Democracy also means organizing elections, however, because it is through competition among various political forces that one can determine who is to lead the country. And these are elementary rules which our brothers and sisters in Africa sometimes do not respect.
When someone wins an election, and that person is not my candidate, I have to organize an opposition. I have to educate my people, strengthen my political base in order to be able to succeed at the next elections. That is where work has to be done. But what do we see? We see that whenever there are elections in Africa, those are very difficult and dangerous times, because no one accepts the results. Whoever wins the elections becomes the target of all of the political forces in a country which resort to all means -- and I repeat all means -- to destabilize.
That is a reality which we must address. We speak of Cote d'Ivoire. Unfortunately, since 1999, that country has been suffering, and every time, there are hundreds of human lives lost. Now, these are situations which other countries have also experienced. My country, for example, and others have suffered in this way, and I think that we must all ensure that African elites, that African leaders accept the theory based on respect for the results of elections and that for everyone to wait for their turn, in my view, the elections must be credible and transparent so that everyone has a chance.
But to have transparent elections, we must also allow those who win the elections to govern. If they exercise their functions, that is a factor in the next elections. But one cannot say that one is for democracy and then incite the armed forces, defense forces or other political forces to overthrow an existing government which will not only bear the responsibility for upholding democracy but also has the responsibility to feed the population every day, because they are -- they will be held accountable for the economic results and situations in their country.
I think that we should not compartmentalize. I think on the one hand, we have bloody and corrupt regimes in Africa. We also have virtuous opposition to all of this. But that is not exactly what the situation in Africa is. The situation in Africa is such that on a daily basis, those who believe in democracy, those who believe in the power of people by people through elections, they meet the periphery, those who believe that there can be shortcuts to power. If you encourage, through remarks of that sort, those who are always questioning the results of the ballot box, then, what is the purpose of all of the good efforts of the IMF and the World Bank, et cetera? Everything which will come to our country will be to no avail, because circumstances will constantly be changing. And I think we only need look at Cote d'Ivoire. In one or two weeks, the efforts of many, many people will be crushed.
I will conclude by saying that the problem referred to by the Minister of Angola with respect to the treatment of post-conflict countries should call for the attention of all those who think about measures to be implemented in post-conflict countries by the international financing community. Not all countries who have had conflicts are in the post-conflict group. There is a question of eligibility to be a post-conflict country. We are told, well, after how many debts is one a post-conflict country? What are the conditions, and how are they set?
Once those problems are solved, then, we need to address problems of equitability. All countries should have the same opportunities and implementation of the same terms. I'm not saying that there is no fairness in the process, but we must strive for more fairness in dealing with these questions, because one cannot ask someone who hasn't been eating properly to all of a sudden be like the well-fed athletes in the United States. It's not possible. So we have to pay attention to that.
QUESTION: Yesterday at the G-24 meeting and at this meeting last year, I asked a question about Zimbabwe, not because I've got a bee in my bonnet but because I'm not getting the correct answer. I described the behavior of the Zimbabwe Government yesterday as barbaric, and I also referred to the fact that the agricultural sector has been virtually destroyed and that nearly 2 million people have been pushed below the poverty line.
Now, the answer that one always gets is that there is a special historical reason for this, the implication being, of course, that the activity of the Zimbabwe Government is, in some way, acceptable. Could I please have a definitive statement from the podium that the model in Zimbabwe is totally unacceptable for Africa? And may I also, please, have a condemnation of that activity and some indication of what you're going to do to try to restrain this behavior? I'm not speaking for the white farmers. I'm speaking for everybody and for common sense.
MS. FOUDA: On this very political issue, I would like Mr. Prime Minister to give a unique answer.
MR. ZIGUELE: Two weeks ago, I went on a working visit to London just at the same time as the Sustainable Development Summit was being held in South Africa, and there were a certain number of now-famous speeches that were made. The question was asked of me, a bit in the same terms you have just now; I was asked to say what I thought of that situation.
I should like to say first of all that we are in a press conference here, the idea of which is to let people present better to understand Africa's concerns. I don't think it is my place here to say that I condemn the Zimbabwean Government, because that goes well beyond my capacities as a prime minister. But what I can tell you about is my opinion on what is going on there.
I think that we must cast our minds back over history, even if you don't seem to want to do that. We have to remember the history that we have had. There was the Lancaster House Conference and the agreements there in 1980, which said very clearly that the Zimbabwean Government should receive support from Western countries, including the UK and the US, so as to allow a consensus-based transfer of farmland from white farmers who were going into retirement toward black farmers on a voluntary basis with indemnification. And that was supposed to happen over a 10-year period between 1980 and 1990.
During that period, the Minister of Agriculture was supposed to remain a white person, and President Mugabe respected those conditions, I think, because the Minister of Agriculture was white until 1990 and a bit beyond that. On the other hand, the movement of land transfer did not take place. There were some different amounts of money, US$30 million or US$43 million -- it's been estimated differently by different sources -- were transferred. Nonetheless, the Zimbabwean Government considered that was not enough money for property transfer to take place between two groups which respectively controlled more than 90 and less than 10 percent of the land concerned.
I don't want to say who is right and who is wrong, but I do want to remind you that we learned our law in Western schools, and all contracts contain obligations on both contractual parties. If, at any given point in time, we see that there are weak points, things are not happening properly, the thing to do is to reopen a file, to rediscuss it and to update agreements, because we can all see that we are moving toward a path of accusations and anathema, which only leads to situations getting still further bogged down.
What we can do is not to have condemnations pronounced by us as prime ministers against Zimbabwe. That would change nothing. That might give people psychological satisfaction, but it won't change anything in terms of the real problem. The way to solve the real problem is for all friends of Zimbabwe, all friends of white farmers and of black farmers to bring the protagonists to defuse the passionate nature of this debate and to open up the file as created by the Lancaster House agreements to see who did and who did not do what.
There are jurisdictions that exist. There are ways to go forward. But there are also mechanisms for consensus which can be set up so as to deal with the crux of this problem, and I think that the UK and Zimbabwe have common friends who can lead them to sit down around this file on the basis of less passionate discussion than we are having today, and that would be in the interests not only of Zimbabwean farmers who are white, but who have been Zimbabweans for four or five centuries and blacks who have been born on that ground as well since the beginning of time.
Everyone has rights to put forward, and people have to be helped to be brought to a common understanding.
The Central African Republic wants to contribute to the resolution of the Zimbabwean problem in its own way, because, as I have said during my mission, we are ready to receive Zimbabwean farmers and to let them live in our country to develop our farmland, because we have 620,000 square kilometers, but we are only a few hundred thousand inhabitants. So we have less than one inhabitant per square kilometer. We have a lot of land, rich land, and we are a country where there is not one single square kilometer of desert. All of our land is green. We are part of the Congo Basin that the Congo Finance Minister told us about, and there is enough room for everyone.
We would like to have contact with organizations for Zimbabwean farmers so that we can concretely see what might be done. I don't know if that is a satisfactory response for you, but I think that that is the way out of our trouble. Otherwise, we are all going to take an ever more rigid position, and the people who will ultimately be the losers are the people who are meant to be farming that land.
MS. FOUDA: It is with the Prime Minister of the Central African Republic's positive statement that we will end this press conference today.
On your behalf, I would like to thank the Prime Minister from the Central African Republic, the Minister of Finance from Mozambique, the Minister of Finance from Angola, from the Republic of the Congo, from Lesotho and Niger.
IMF EXTERNAL RELATIONS DEPARTMENT