Transcript of a Press Conference of African Finance MinistersWith Mr. Baledzi Gaolathe, Minister of Finance and Development for Botswana; Mr. Abdoulaye Diop, Miniter of State, Minister of Ecomony and Finance of Senegal, and Mr. Ali M. Lamine Zeine, Minister of Finance, Planning and Economy of Niger April 12, 2008
|Webcast of the press briefing|
MS. MBOTO FOUDA: Ladies and gentlemen, good morning and welcome to this press conference of African Finance Ministers. Each of the Ministers will have about five minutes of opening remarks, and will then take your questions. But before we get to that, let me introduce you to the panel we have here today.
To my immediate right is Mr. Baledzi Gaolathe, Minister of Finance and Development Planning for Botswana; to his immediate right is Minister Abdoulaye Diop, Minister of State, Minister of Economy and Finance for Senegal and last, but certainly not the least, we have Mr. Ali Lamine Zeine, Minister of Finance, Planning and Economy for Niger.
MR. GAOLATHE: Thank you very much, Madame, members of the press, ladies and gentlemen.
I am Baledzi Gaolathe from Botswana. As you will have heard, we have witnessed another smooth transition from President Festus Mogae to President Khama.
Our former President, Mogae, retired at the end of March, and our new president took over on April first. We will be facing a general election next year, towards the end of next year, 2009.
As you know, Botswana is a developing country. It is one of the so-called middle-income countries. Like many developing countries, we have our own challenges, but I can say that when we became independent just over 40 years ago, we were classified as one of the 25 poorest countries in the world. Since that time, we have given priority to the country, and we have made some progress, because we are now one of the upper middle-income countries.
Right from the beginning, our form of government was a democratic one, with elections every five years, and these elections have taken place without fail up to this very day.
We are members of SADC. We are also members of the Southern African Customs Union.
We have always worked on the basis of national development plans. The current plan will end in March 2009. So, we have already started working on the tenth plan. This tenth plan, unlike previous plans, which were for six years, will be for seven years, the reason being that we have a long-term vision for Botswana, which is prosperity for all. This vision was a 20-year vision, starting from 1996. It will terminate in 2016. So, this planning is the last one which we will use to try to achieve all our vision goals.
It so happens that 2016 is also very close to 2015, which is the target date for the Millennium Development Goals. And many of the Millennium Development Goals are the same as those in our vision.
Of critical importance over the coming years is of course to ensure that the economy continues to grow, not only growing but also to diversify. We have hitherto been dependent on minerals, which account for about 40 percent of GDP at the moment. For the rest of the economy, about 60 percent, we would like to see a greater diversification, not only as an assurance but also to make sure that we create jobs. And we make sure also that our people make a living out of their efforts.
We, like many countries, we have unemployment, which is a problem. Our unemployment rate at the moment is 17.6 percent. Some people may say, by developing country standards, it is low, no? But we are not happy with that. We would like to see everybody having opportunity to be employed. So, that is one of the reasons why we must diversify the economy, why the economy must grow fast. By 2016, we are saying, among other things, that no citizen should be living below the poverty line. We believe that less than 30 percent of our population now live below the poverty line. And we don't see any reason, if we all work very hard, why, by 2016, everybody cannot live above the 2016.
We are cooperating, of course, with the entire community, including the IMF. And with regard to the IMF, right from the beginning, we have never borrowed from the IMF, but they have cooperated with us in the sense that their missions do come to Botswana and come and look at our economy and give us a second opinion. And some good ideas that they bring, we do adopt. They have also given us technical assistance as a member country, and we have valued that. And so, this collaboration will continue.
But ever so often, of course, we are a member of the developing world and members of our constituency. As such, the problems that the constituency have got are our own problems, and we work together with the rest of the developing countries. So, it has been our desire that our voice as Africa should be heard in these important institutions among other things, given that, in terms of extending resources, developing countries are the major beneficiaries. It is very important that they be represented where major decisions are made.
We are very pleased that we should be here. As you know, we cooperated with the IMF, with the World Bank, with the African Development Bank. And I have already indicated to you that, at the regional level, we are one of those countries that support integration, deepening of integration. For this is, in our region, the SADC region our heads of state will be signing an agreement of free trade in August,. So, from August next year, SADC will be a free trade area. And by 2010, the ambition is that we should reach a customs union status, and by 2015, a common market.
MR. DIOP: I would like to describe the economic and financial situation in Senegal, which goes back to 2000 after we had a new government in power and new economic and financial program.
We've had a period, since 2000, of about 5 percent of growth per year, with a good control of inflation and the other fundamentals of the economy.
But in 2002-2006, we did have some drop in performance due to a deficit, but the economy resurged thanks to the telecommunications and trade sector, in spite of the high rise in oil prices that we've seen since 2006.
The inflation, per annum, in Senegal is about 2 percent. So, it is in line with the performance criteria established by the West African Economic Monetary Union, to which we belong, together with Niger. We are also members of the West African Custom Union that works very well with good performance in Senegal.
The budget, which is under the surveillance of the Economic and Monetary Union, has been noted to have a good level of revenue. We have a rate in growth of revenue of 9 percent on average as compared to last year, where the budgetary revenue was 12.5 percent, with a good control of expenditures, it has remained below that level.
This has evolved consistent with the PRSP Program, and we have focused mainly on the social sectors, education and health, which in our view are investments, not operational costs, and we have also given priority to the productive sectors.
Education and health absorb 50 percent of the government's operational cost, in spite of the budgetary rigor, we have a public deficit of about 2 percent, and there was an increase in 2007 because of the increase in subsidies linked to oil prices and because of the increase in food prices that have increased. So, this has been an increase of 7 percent, and we've tried to keep it down to 3.5 percent.
Before this, the average was 6 percent, so we are within the proper limits, and between 2006 and 2007, with the increase in the cost of goods and the crisis in one of our largest national corporations, we had a budget crisis deficit of 9 percent, but those problems are about to be resolved because the corporation is now being able to reach agreement with its main creditors.
The foreign debt has led to reducing the budget in Senegal, which was 80 percent of GDP. So, this good economic and financial health to the country has been sanctioned by the fact that the IMF has signed an economic and financial program without disbursement under the Policy Support Instrument for Senegal's macroeconomic stability. It is aimed at stabilizing the macroeconomic levels.
But all of these outcomes are significant. They are the result of reforms undertaken in 2000, beginning with the reform of the code of investment, which focused on taxes. So, it was 25 percent and it was decreased from 35 to 25 percent for tax on corporations, and this has not affected our budget.
Senegal's ambition is to consolidate our long-term growth. That's why we have adopted an accelerated growth strategy, and we've implemented that strategy based on our sectors that have strong growth potential. These include agribusiness, where we have a significant share of the world's market, also, the cultural industries. Senegal is a tourism destination. Also, telecommunication and teleservices, construction, fisheries, and the other industries for cooperation with the private sector.
We have worked together with the private sector that has helped coordinate all these efforts. And in 2008, we will be implementing this strategy, this plan, which will lead us to a rate of growth of about 7 to 8 percent per year.
MR. LAMINE ZEINE: Madame moderator, ladies and gentlemen of the press, it is an honor to be able to describe to you the status of Niger, one of the eight countries of the West African Monetary Union.
But before I describe the economic situation, I would like to briefly remind of the real situation in the 90s in our country, that was a period during which we were learning and applying the basic principals of democracy.
Before 2000, there was a total lack of cooperation with the donor community in Niger. It was a decade where we incurred debt and were in arrears at both the external and domestic level. Public servants' salaries were in arrears by 12 to 13 months. That was also the period where we recorded three coups d'etat.
But beginning in 2000 with the election of President Tandja Mamadou, the principles of democracy were brought back to the country. The international community came back to work with Niger, and the programs that we had with the Bretton Woods Institutions were resumed.
So, today, we can say that, at the macroeconomic level, beginning with 2000, and I also endorse what the Minister of State of Senegal said about the rate of growth, we've had a rate of growth of about 5.3 percent per year in real terms, and inflation is close to zero, which is quite unusual in West Africa.
We have in our budget, a significant decrease in our total deficit, basic deficit. And with regard to our foreign trade, the profile of our balance of payments is positive.
As you've heard, we export Uranium, and our monetary situation has led to a significant increase in economic credit.
So, from 2000 to 2007, our country has had two programs with the Bretton Woods Institutions, and that has led us to bring about this balance in our economy. And it has attracted resources. We've been able to mobilize funds to attain our objectives and have a good policy for public expenditure. Most of this has targeted those sectors that will bring about growth, but also those sectors that will affect the society, education, and health.
In terms of cooperation with the IMF, I would say that one significant aspect is the ownership of the program. The programs that we've had with the IMF are now programs that have been drafted by national groups and submitted for approval. So, we have had a significant decrease in expenditures, a decrease in the arrears we had on our foreign debt. In terms of foreign debt, Niger has benefited from the HIPC Initiative. But even domestically, I would say that, as a result of restructuring our financial system and our focusing on microfinance, we have a more specific schedule for preparing the budget with the involvement of everyone. Niger is one of the countries that have attained the fixed goal of having a law on regulations.
And in terms of what our prospects are, we, of course, export significant raw materials: uranium, coal, and we are talking about looking for oil in our country. We need to focus on maintaining a stable economic picture and to be able to stick to this strategy of accelerated development, a strategy that was financed last year by the donor community.
But our second major goal is to try to bring about wealth by allowing the private sector to serve as the driving engine in our country. The rural sector represents about 40 percent of our wealth through new dams that have been built and the production of energy, and the new Uranium mines. So, this will help us increase our exports.
We have just signed an agreement with the United States on the protection of our environment, and having a good business environment in order to attract investors for this purpose.
I would now like to talk about the rise in prices that is affecting our country. We are working hard to find a solution to this problem at the regional level. As you know, we are an oil importer country. And in terms of food costs, we've adopted some measures in order to prevent a crisis. Learned from neighboring countries, we've suspended the tax of VAT and the custom tax on a product that is consumed a lot in our country, rice. And this is a timely but limited measure, of course, so we need to work with others, with our partners here, to see what we can do together to find a solution to the rise in rice price.
So, the two basic points I wanted to share with you are the upcoming program that we will be signing with the IMF that will insist on borrowing to correct the image of our country that existed for the past ten years, and will give us greater access to more financing. So, that's what we're talking about with the IMF.
But the second element is perhaps the most important, that we will have greater access to the IMF's funds.
This is what I wanted to share with you, and I'm ready to answer any questions you may have.
MS. MBOTO FOUDA: We're now going to take questions. Could I just kindly demand you to be as succinct as possible so that we can take as many questions as possible.
QUESTIONER: What is your position on the current food crisis in Africa?
Mr. GAOLATHE: As you know, the formal meetings are starting only just now. The Committee has just started, and we are still expecting to hear a bit more and to have all of these issues discussed. But of course, all of us are trying to work on this in different ways.
First of all, to the extent that some of these price increases affect food supplies, as you have heard from my colleagues, in some countries, they have had to assist, for instance, by reducing tax. But on the long-term, what it means is a challenge to Africa to produce more, to produce more food than we are producing now.
I believe that the continent has considerable potential if we can only work harder to adopt more modern methods of production. Part of the increase in price, of course, arises from the increase in price of oil. That has a ripple effect in all activities, and I expect that during the consultations here, we will be discussing not just with consumers like ourselves what measures we can take; discussions will also be directed or involve the producers of oil. For instance, the fact that prices have gone up means that supply has reduced, and we believe there is considerable potential to produce more, and obviously, those who are producing would like to maximize the price they fetch for their commodity, but to the extent that a commodity like petroleum has a ripple effect in the world, we believe there will be give and take.
MR. DIOP: It is true that we have heard a great deal recently about the food crisis in addition to the increase in oil prices which affects Africa, especially those that don't produce oil. But we haven't waited; we will not wait for official positions to be taken here in this meeting to implement policies that will allow us to slow or even stop this crisis.
In our own countries, almost all of us have suspended taxes provisionally. These suspensions of course are not going to last forever, but as far as Senegal is concerned, we have implemented medium- and long-term policies reflected in our accelerated growth strategy. Since last year, we have implemented a plan of rice self-sufficiency to get rid of the difficulties that we have been having in this regard, because we eat a great deal of rice in Senegal. We import it from Asia, and we give ourselves five years to produce at least half of the rice we are now importing, and in ten years, we want to be able to produce all the rice we need.
We have 240,000 hectares of irrigateable land which we are now working with other partners to prepare the irrigation for these areas. This is mainly in the northern part of Senegal. We are using all the rivers in this part of Senegal. We do have rivers throughout Senegal, but we are using all of these policies with our partners like India and other Asian countries as well. We are also in the energy sector implementing alternative energy policies, promoting renewable energy. We have had some spectacular success. We have been successful in saving energy, so our oil bill has gone down considerably in the expectation that research programs which are very promising will allow us to become self-sufficient in energy, too.
So globally, these meetings are very useful to exchange experiences with other countries, but each country in accordance with its own circumstances is setting up its own policies, allowing it to confront the general increases in food and energy prices.
MR. LAMINE ZEINE: I would just add one word, saying that Niger did not wait for this increase to take measures. In 2005 and 2006, we had food problems already, and those experiences taught us to emphasize in our anti-poverty strategy the dam projects.
There are problems. We don't have enough energy, and we don't have enough food. So this dam is going to at least partially settle three problems, including the energy crisis. For one thing, a country like Niger that imports 95 percent of its energy from a neighboring country, with this dam will become self-sufficient in energy and will even be able to export the surplus. That is why we have to accelerate the building of this dam.
In the field of agriculture, it has been shown that the land irrigated following the building of this dam is going to allow us to get agriculture production such that food self-sufficiency will be a reality. Also, we are emphasizing modernization of our national industry, rice production, which was mentioned by my colleague from Senegal. We have been working with India and China. They have invested a great deal in modernizing rice production.
So I would say that we need our partners in the IMF and the World Bank because these measures over the last three months are only limited in nature, but our opinion, is to talk about subsidies which would allow us to reach the poorest populations. And we will use the expertise of our partners for doing this.
So, to answer your question, we are going to take the necessary measures to face the food crisis.
QUESTIONER: A question for Mr. Gaolathe, and forgive me if you have addressed this already, but I'm afraid I wasn't able to be here for the whole of your earlier remarks. To what extent are you concerned about the possibility of the international financial crisis reverberating through your own economies? Clearly, the damage is not that extensive so far, but just how concerned are you about a crisis made somewhere else having a negative impact?
QUESTIONER: Mr. Minister from Senegal, aren't you going to have to change what you eat in Senegal? People eat more and more beans in other countries. Aren't you going to have to leave the Asian rice and concentrate on other commodities that can be grown in Africa?
MR. GAOLATHE: Thank you very much to the gentleman from the BBC.
Indeed we are very much with what happens in the rest of the world. As you know, the most important commodity that we sell to the rest of the world is diamonds, and the biggest market for diamonds is in the United States. So if the economic situation in the United States does not improve or if there is a lull or a recession, it means that people have less disposable income, and because diamonds are a luxury commodity, people tend to buy fewer luxuries when there is a recession. So we would be affected in the sense that we would probably sell less diamonds, or if we need to sell them at all, we will not get good prices. Already to the extent that the dollar has been losing ground in terms of exchange rates, it means that what we are earning is reduced.
But globally, as you are aware, we are also affected, but as you know, as Botswana, we have never had a balance of payments problem since independence. In fact, we do have positive exchange reserves, and these exchange reserves can assist to cushion us for a period of time, because any financial crisis, if it arises, the international community will start to tackle it, and problems arise in the interim before the graft is pushed upward. So in short, we would be affected, especially from the point of view of the sale of commodities, because we are very much a trading nation, especially for diamonds. Notwithstanding that, we have gone a step further by promoting the cutting and polishing within Botswana. In the past two years, we have licensed 16 diamond cutters and polishers, which means that whereas if the price of rough were to reduce quickly, maybe the prices of polished would not necessary follow as soon.
But at the end of the day, we are one world, and we are going to be affected in various degrees. This is the reason why I pointed out that a major challenge of our new plan is to diversify the economy so that we are dependent on many other things, and even from the point of view of agricultural production, we are as self-sufficient as we can be.
MR. DIOP: In terms of consumption, it is very difficult to change habits. You can't have directed policy in t his field, but people adapt very quickly with the increase in prices. Of course, people are really obliged to change their habits, and in Senegal, we have set up special programs on rice and manioc which have allowed us to quintuple our production in these two crops.
Besides that, the implementation of special programs allowing us to increase by five and even by ten times the production of certain commodities, in our research institutions, we have set up some special programs that allow us to have exactly the same dish that used to use rice, using corn. We are disseminating this, and with the price increase and with the special programs that have allowed us to increase corn by five times, I think we will make some headway in this.
I would like to say that the initiatives to increase production are very important in Niger. We have the special President's program which is part of our poverty reduction program, and there is one component which has to do with building mini dams where there is enough water, wherever we can collect surface water, groundwater, rain water, and the results have really been possible, demonstrating that we can really increase production.
Now, on rice, the intentions and goals that we have are to import less and to emphasize national production via our National Research agronomic Institute. We have strengthened it in terms of investment quite recently, and we are also working to increase groundwater and the use of river water. So, if you set aside the imports of rice, in the very near future, these efforts will allow us to meet national demand.
Now, regarding beans, the niabe [ph.] had record production in the last couple of years, and there is a program with the World Bank right now to see how we can use this economic potential which is enormous for Niger in order to protect the producer. We have been thinking about this. Of course, it is difficult to limit the preferences of the consumer, but we have high hopes for this program.
QUESTIONER: In the G-24 Communiqué yesterday, there was a reference to the hope of setting up a facility to mitigate for developing countries the impact of the developed economies and what is happening with them. You haven't referred to that. Is this something that the African Ministers have talked about? Do you see this initiative taking off or doing something?
MR. DIOP: I personally am not aware of this initiative. I know that there is an initiative against exogenous shocks which is not well-used at the moment, and they are asking for a reimbursement from the developed countries. The African countries are concerned by this, but we are not aware of this other issue.
QUESTIONER: Messrs. Ministers, you have just given us a green picture for Africa; things are looking good. I wonder if you are going to be able to reach the MDGs by 2015 in your countries. I would like to ask a question specifically to the Minister of Senegal, Mr. Diop. There is a contrast that I can't understand. You have a very stable macroeconomic situation, the macroeconomic situation is doing well, but how do you explain this with the fact that the population is affected, and they find that life is very, very expensive? How do you explain this?
I also have a question for the Minister of Niger on the liberalization of your strategic product, that is, uranium. There were some problems with selling this on the international market. Can you sell it now on the international market? To whom do you sell it, and under what conditions?
MR. DIOP: What you have said is true, that the macroeconomic picture is a good one, a healthy and sound one, in Senegal. This is the second question; I'll come back to the first later. So we do have a good, stable macroeconomic situation.
The short, medium, and long-term policies that have been implemented to deal with the general increase in food prices have been set up, but Senegal has also responded quickly to the situation. First was the decrease in the VAT tax that I mentioned, because we thought we had to find an immediate solution. For instance, Senegal was the first country to suspend all VAT taxes and fees on food products such as rice, flour, and milk. We were criticized for our partners for having done that, for having eliminated all taxes on food products, but we felt that this was an immediate solution that we had to take to deal with the rise in food prices. And as you see, other countries have now done that.
So that was a short-term, immediate solution. Now, as to medium- and long-term solutions, we have implemented policies for food self-sufficiency. Since, in the Constitution of Senegal, people have the right to march and to demonstrate, there was a demonstration, and yes, it was a peaceful demonstration like there are in other countries, but yes, there were some political elements in that demonstration that led to some violence, and the Government did have to take steps to make sure that the consumers were protected in that demonstration and not hurt by the politicians, but those who were demonstrating were not hurt; they were able to leave and finish.
Constitutionally, they can demonstrate to express their views on a specific situation, but Senegal has always responded in a satisfactory manner and a manner which the rest of the population has accepted. So we are not first in this area to have to deal with demonstrations.
Now, on the MDGs, Senegal is the eighth country in the Region that will be attaining the MDGs by 2015. There are some problems with some of the indicators in health, infant mortality and the level of maternal mortality. The President of the Republic of Senegal together with the World Bank convened a meeting together with all of the other development partners. I was not there, because it was this week. But all of the development partners were there, including the World Bank, to inform them about this and see how, together with our partners, we could take corrective measures to resolve that problem.
But other than that problem, on all of the other MDGs, we are at the right point, and we will be attaining them by 2015. In fact, some have been achieved in the area of education. Forty percent of our budget is for education, so we consider that an investment, and by putting a lot of money into education, we feel that this will allow educated individuals to help address and correct the problems for the other MDGs to help us attain them by that time.
So that is our policy. We believe that education is investment. It is not a function or an operation. The President has reclassified the expenditures for education and has put them under the "investment" column and not under the "operations" column. We are part of the eight countries, therefore, that will be achieving our MDGs.
MR. LAMINE ZEINE: On the MDGs, Niger has three basic tools to help us speed up development and attain those MDGs. Again, this accelerated development strategy includes several initiatives in the area of production, with a particular emphasis on the private sector health and education.
Therefore, there is this social economic aspects, but then an emphasis on growth, with specific goals, very ambitious goals, that will allow us to attain these MDGs.
In the area of the MCA, I think there is education, health, and business are the areas that will allow us to attain these objectives, together with the proper financing. The third element is working with the UNDP. We have a new initiative where our countries, one of four that will be receiving financial support from UNDP, again, to help us attain the MDGs. And we are committed to working in that direction.
As to the question on whether there will be demonstrations on food or not, we haven't had them yet in Niger, but there were some events that took place in 2005 and 2006, and to resolve this we have given priority to social dialogue, political dialogue on a regular basis. The President of the Republic meets with head of the opposition to talk about what is going on, to hear what are the issues to the country. They work hard to anticipate any possible crises that might arise in a country.
These initiatives that have been taken will allow us to perhaps anticipate and prevent the crisis from taking place, and resolving those problems.
As to the last very specific question about Niger, with your permission, I'd like to say that Niger does not set the price for Uranium. We don't set the level of production. It is a very specialized type of work, but what Niger has done is to open ourselves up to other partners.
We will continue to work so that Niger can continue to benefit from this commodity, which is a wealth for our country and will help our people, but we will do it together with our partners including some of the older partners with whom we've had a relationship. We are speaking to them right now, very directly, very honestly, and we want to make sure that the interest of both parties are met. That's what I would like to say on this very sensitive issue.
MR. GAOLATHE: On MDGs, if you look at the African continent as a whole, it is unlikely that all countries will meet the MDGs, especially the poorer ones, the reason being that one important element in the UN declaration was that the donor community, the international donor community, should make more resources available. As I speak now, I think only half of the expected resources have been made available, and the years are moving very fast.
So, I think that is one element. And I can say that most countries on our continent have gone a long way in introducing reforms, macroeconomic reforms, and they were hoping that, with the improvement in their economies, the international community will compliment that. You are aware, for instance, that some of the promises made by the G8 have not yet materialized, and that aspect is lagging behind.
Coming to Botswana, I think that I cannot guarantee that we will meet all of them by that time, but we believe that we will be able to achieve most of them. As I pointed out at the beginning, our vision 2016 more or less coincides with the Millennium Development Goals.
If you look at education, at the moment, we guarantee access to the first ten years of schooling, everybody goes there, and the literacy rate is more than 90 percent. And by 2010, we will be guaranteeing universal access to a minimum of what we call "Cambridge-level" education, that is senior secondary level education for all of our people.
This is not just a question of providing facilities for formal education. We have the non-formal education and we have the regular education, and then we've also gone ahead--for the size of our population, I think we are ahead in terms of facilitating access to university and tertiary education level. So, in that area, we are making progress.
And as you know, there is an element of the girl-child, the extent to which women are actually participating and benefiting from that educational development. At the primary and the secondary level, it is almost 50-50. Actually, at the primary level, there are more girls than boys now in our schools.
So, I believe that, in Botswana, we have made considerable progress, and we will meet that--actually we are almost there.
Now, when it comes to health, we would be there by now had we not encountered this problem of HIV/AIDS, which has had the affect of reversing some of the strides that we had made, some of the--what we have achieved.
But nonetheless, you are aware that we are the first country in the African continent to provide the universal access to anthro retroviral therapy. And we have an ambitious program of fighting HIV/AIDS. In fact, we are expecting that, by 2016, we shall have stopped the spread of the virus. If anything, we will be nursing those who already will have contracted. So, we believe that in the area of health, we could be far--it is that HIV/AIDS which has reversed--but nonetheless, we will get there.
Let me not take more time, but I should mention the environmental aspect, which is critical, but our development also should be a long-term sustainable and the environment should be protected.
There is no country that I am aware of in the world which has got as many elephants as we do. The numbers go up to 120,000 elephants. It is an example, but there are many more wildlife species that we've protected.
But of course, the environment is not just keeping a pristine environment. We are also using patrolling, and we will be promoting that, but of equal importance, we've introduced other laws for reducing pollution of the atmosphere, and then also laws protecting our aquifers and also in urban areas. Sanitation is taken very seriously. In fact, all major projects are preceded by an environmental assessment. So, that goal--we believe we are there already. It is a question of maintaining that momentum. But we don't have time to go deeper into that, but for the continent as a whole, we still have a challenge. The international community ought to meet their side of the bargain. Thank you very much.
QUESTIONER: I'm just curious to know, as leaders in Africa, the impact of Zimbabwe's problems on your own economies, and what are you prepared to do as African leaders to perhaps address the problems and if there's an opening somewhere to go in and help, I guess, akin to keeping Africa's house in order by African measures, and perhaps what impact on your individual countries, if any, there is from their problems.
MS. MBOTO FOUDA: I would suggest that Minister Gaolathe take this question, given the geographic situation of his country...
MR. GAOLATHE: As you know, we have a long border with Zimbabwe, a very, very long one. And obviously, what happens in Zimbabwe has got immediate impact on Botswana. The major impact so far has been the influx of Zimbabweans into Botswana, because they feel that--under the perception that the economy in Botswana is doing a bit better, and therefore, when you go into Botswana, perhaps you can find some jobs, even if it means part-time jobs.
This influx has been so significant that I think it has not been possible even on the Zimbabwean side for them to issue passports to everybody once they come to Botswana. So, many of these people who have come without their travel documents, and this means that this has caused quite a strain in our facilities, and every so often, our immigration officers take them back. And then, after leaving the border, sometimes by the time they arrived, some had already crossed the other side. So, we've been having that immediate problem, because it means if they need health facilities in Botswana, they must get it and many other things, but the situation as you aware is changing.
At a summit held last year in Lusaka, the economic situation in Zimbabwe, which has been deteriorating, was discussed by SADC. And the ministers of finance were asked to perhaps collaborate a bit more with their Zimbabwe counterparts to see what can be done, and this is an outstanding matter.
But nevertheless, you are aware that the situation can only improve if the people of Zimbabwe themselves sit down and try to solve, and they call up on the rest of the international community, including neighbors like ourselves to assist. They are the ones to solve.
You are aware that they have had a very peaceful election which has just ended, and there is an impasse which we hope that will not last any longer.
The impasse is simply that the results of the presidential election have not yet been announced. There seems to be some technical problems, technical or otherwise, by the Commission, because it really is the Commission that ought to announce, but they are failing to announce. The international community is waiting, including the Zimbabweans themselves.
But I am one of the optimists. I think that Zimbabweans are getting close to solving their problems, and hopefully this coming week will bring miracles, and the announcement will come and they will work with them on that.
So, the impact has been there, it is not good for SADC to have a major economy such as the Zimbabwean one going down instead of going up, and I'm sure that SADC will deal with that.
On the elections, perhaps I should just mention we are aware of the fact that this summit of SADC is meeting, as well. They are meeting in Lusaka to assess the situation in Zimbabwe and see what help, if any, they can give to the resolution of what may now be pervading there.
But we are optimistic that the outcome of these consultations will lead to a better Zimbabwe of tomorrow.
QUESTIONER: My first question, for the developing countries, there is budgetary hardening, and this is making investment much more difficult. I would like to know what you think about these IMF recommendations.
Also, for Mr. Diop, Senegal is going to get into biofuels. In the present context, do you think this is justifiable vis-à-vis your people?
And my last question to Mr. Zeine has to do with our RFI correspondent in Niger. As a member of government, I would like to know what is his situation and can we expect that he will soon be released?
QUESTIONER: Farmers today face a serious problem, and the threat comes directly from the European countries, and that is the question of subsidies. It is very difficult for African farmers to compete favorably with their European counterparts. Recently, the President of Senegal, Abdoulaye Wade, has called for a rejection of the European Partnership Agreement, even though the United States of America has offered an olive branch through its African Growth Opportunity Act; but yet it is still very difficult.
I think we should start looking at these issues also, so my question when you start talking about grant, aid, loan, are the African Ministers concerned about the question of subsidy and how African farmers are disadvantaged?
MR. GAOLATHE: Indeed we are concerned that the IMF should be wanting to tighten its budget, which means that perhaps the assistance that it has been giving to developing countries will reduce, and there is also going to be, from the looks of things, a new policy whereby they will be asking beneficiaries to make a contribution. So we are a bit worried about that, and the discussion will continue. And mind you, if they have to effectively use the resources at their disposal, we cannot stop them from doing that. We hope that they will prioritize and give more assistance to those countries which really need assistance, and many in Africa do need that; they have programs.
I have mentioned that in the case of Botswana, of course, we don't benefit from IMF financial resources because we don't have a balance of payment problem and have never had one. But we have been enjoying technical assistance.
But one good thing is that AFRITAC would like to set up one or more AFRITAC centers, meaning that their technical assistance will be closer to us in Africa. That also will be positive. So, know we are together, and we will be discussing with them and trying to make sure that they don't prematurely reduce their assistance which has been very, very useful in many countries, especially those who encounter balance of payment problems, and those of our countries which have a capacity constraint.
On grant aid, I think you are aware that under NEPAD, the African continent has determined that the economic development in the continent is going to primarily be their responsibility; in other words, our countries are going to be largely responsible for our economic development. We will then be calling upon the international community to supplement or complement our own efforts, so most of the resources which will go into agriculture or other sectors will have to come from us, with the help of the international community whom we are asking to supplement.
On the subsidies that the European Union has been giving to the agriculture sector, this is very much an issue that we hope will be taken care of during the ongoing negotiations. Only the interim agreement has been signed with the ACP states. Most countries belong to that group. And we believe that this whole question of access to agricultural commodities, the whole question of removing nontariff barriers to our agricultural exports will be very much central in that.
MR. DIOP: On your question on IMF policies, I don't have any problem in particular with regard to Senegal because in the budgetary policy, after having served the key sectors for reducing poverty, we serve productive sectors to try to improve our national production in agriculture, as I said before. Then, there are subsidies which need to be introduced with caution. They cannot be forbidden entirely, but I certainly hope they will be limited.
Senegal is going to invest 40 percent of its budgetary resources in investment. Right now, we put more than our creditors do into investment. Sixty percent is invested by Senegal, and 40 percent comes from our development partners. So if there is a tightening, that doesn't affect us.
Now, as far as biofuels are concerned, and can we justify that, I think we can. We are confronting an increase in energy prices across the board. We have land which is available. We need alternative energy policies. I think that we need to do this. I think this is an area that can bear fruit and help our rural population, so I do think it is justified. But the main thing is that we cannot abandon other products, food products and export products, within the framework of our accelerated development strategy.
Now, as far as subsidy threats from Europe, of course, we all condemn these. Our different heads of state have together denounced the subsidy policy because this affects the competitiveness of all of our products, and in doing so, I think the Western countries are not helping us at all. We have all known the very bitter negotiations in the WTO.
The survival of our farmers in Chad and in Mali is really at stake. I think our rural population is really being threatened. The measures that President Wade has taken are going to involve losses of budgetary revenues, that is true. We will lose two or three points in terms of GDP with this, but European products will then be cheaper and will compete unfairly with our national products. This is not fair, so we are going to implement policies with our European partners even, as contradictory as this may sound, but we are not going to close down our national industries.
There are crises everywhere because of subsidies, because of other aspects, so we are taking common measures, so pay a fair price so that our raw materials get a fair price and are treated fairly and provide value-added in Africa. Some of these industries that are now in Africa and Asia can go to Africa. There should be a transfer of technology so that we can implement our own local products in Africa and process them before they are exported. This is much fairer and much more viable.
MR. LAMINE ZEINE: Speaking of budgetary rigor, it is understood that priority for our country is to have the means to finance our financing means. We know what the key sectors are. Agriculture, we already have programs. We are trying to recover land, increase arable land in three years. We have seen and learned that it is possible to recover two million hectares already. This requires money. A recent census of our livestock has shown that we have 34 million head of livestock. Now, we need slaughterhouses so that we can export meat. These are the needs.
And we need resources. We need to ask less from the outside. We need to develop our national strategy to do more, mobilize more resources at home. We have the mining sector, too. The whole debate is always about that. We need to have our own means to finance our development in that sector, too, and our aim, our long-term wish is to do without assistance. We have potential that we want to exploit with the expertise from outside, of course, and see to it that in the near future, Africans can use and take advantage of their whole potential.
And we in Niger are determined to work in this direction so that uranium can serve our country. Niger doesn't fix the price, but we want to come close to the international price, and to do this, we are talking to our partners to reach this goal.
Now, about what is going to happen to Moussa Kaka, I am in charge of the economy, and I think this question should have gone to the Justice Minister. I heard our Justice Minister who refused to comment on RFI, Radio France International. Something very clear was said, Niger needs development, justice, and we need to be independent. This case which is being dealt with at the highest legal level, no one dares to comment on it or even ask the court to rule. Musakaka has the best lawyers defending him, so I know that the commitment of this lawyer is great, and I know that the Niger judges are very independent and impartial. And please, I don't think we are doing Musakaka any favors if everybody starts commenting on how many days he has been in prison, et cetera. I think we do him much more service by trusting in our impartial justice system. And since he is subject to national laws, I think the courts will decide, and then people can comment as they deem appropriate; but for now, I think that's all we can say. I believe deeply in our courts, I believe in this choice that we have made to respect democracy, and I believe deeply in the need to come to a situation where we will recover our serenity and peace.
MS. MBOTO FOUDA: I would like to thank Minister Zeine, Minister Diop, and Minister Gaolathe for their time, and thank you all for being here with us today.
IMF EXTERNAL RELATIONS DEPARTMENT
|Public Affairs||Media Relations|