Managing Director of the International Monetary Fund
My final destination in this week’s visit to Africa was Zambia, where I sought the views not just of the government but also of the people—in a town hall with civil society, students, and the media. Zambia has one of the highest economic growth rates in sub-Saharan Africa: 6.3 percent in 2009 and the outlook for 2010 appears positive.
While recognizing that Zambia, just like Kenya and South Africa, has its own unique characteristics, I have pulled together some common threads from what I have been hearing in Africa over the past several days.
Three main themes come through:
First, Africa is a
different place from how it is often portrayed in the popular media. Thanks to
sound economic policies in many countries over the past decade or so, Africa has been able to withstand this crisis much better than has been the case in the past. The fact that the crisis hit Africa anyway does not mean that the policies were wrong. On the contrary, those policies helped to buffer Africa from the worst of the crisis, and they should now be strengthened. All three national leaders with whom I met—President Kibaki of Kenya, President Zuma of South Africa, and President Banda of Zambia—conveyed to me their strong sense of the
policy agenda ahead.
Second, the issue of governance emerged loudly, clearly, and frankly in my discussions in all three countries. In fact, I get the impression that it would be almost impossible to have a public discussion in Africa without this issue coming up. That’s a good thing and, again, very different from the past. At the same time, talking about governance and doing something about it are two different things. One encouraging point is clear to me: civil society in Africa has found its voice—and it calls for accountability. It calls for transparency. It calls out against corruption. If governments are wise—and I think most will be—they will listen to that voice more and more. Not only can that help give them further moral and political standing in the eyes of their people, it will help them to govern more effectively.
Third, the question of Africa’s relationship with the world takes on an even greater importance in the 21st century global world than it did in the 20th century colonial world. I have said often now that Africa was an “innocent victim” of the crisis. And so it was. But nevertheless it was affected. Because global financial linkages with Africa are weak, the continent was hardly touched at first; but then the crisis deepened and Africa was hit hard in areas of investment, trade, and even aid (as crisis-hit donor countries sought ways to cut back on commitments). The lesson: no country is immune from global shocks.
In my discussions in Africa, people often raised the issues of global financial regulation, global imbalances, and the global economic shift that is taking place—from the West to the East. The role of China in Africa, for example, is a topic that came up in all three countries I visited. Zambia’s special relationship with China, of course, goes back to the 1970s and the building of the famous TAZARA railroad. Economic relations between the two countries have intensified since then, primarily in the mining and construction sectors. Chinese investment in Zambia, and in Africa, is to be welcomed. At the same time, it is important that all foreign investment in Africa should make economic sense from the African perspective—and be fair.
Finally, one other dimension of my discussions fell much closer to home:
the role and reputation of the IMF. I found that the stereotype of the Fund as “the bad guy” persists in some quarters. I also found that there was not enough understanding—beyond official circles—of the
major changes that the IMF has undertaken over the last couple of years: the tripling of our lending to sub-Saharan Africa, at zero interest rates, to help them weather the crisis; the streamlining of conditionality; the emphasis on countercyclical policy and the preservation of public spending, particularly for the social sectors. And more. This suggests to me the need for two things going forward:
- the IMF needs to strengthen even further its policy advice in Africa, and
- it must communicate and engage even more to counter the outdated image of the Fund, and to build a better understanding of who we really are today—and that the IMF is Africa’s institution.
I leave Africa recognizing that the IMF has a way to go in strengthening its partnership with the continent. But at the same time—and building on the meeting that I had with the African countries in Tanzania last year—I leave encouraged that the journey is well under way.
See also my earlier posts on this trip: Something New Out of Africa: A Global Player, Africa Is Back and IMF—Delivering on Promises to Africa
