Re: African Economies in Reverse from the BBC
Dear Beran,
I thank you once again for your timely posting which came at the heels of
the successful conclusion of the Extraordinary Meeting of the Boards of
Governors of the African Development Bank.  Apart from re-electing Omar
Kabbaj to a second five-year term, the stock holders approved the 1999
accounts which registered a 12 percent increase in income from the previous
year [net income of $169.35 million, more than double the figure in 1994];
not bad for a Bank which nearly folded in 1993/94 due to bad governance
including corruption, nepotism in recruitment and all the currently malaise
plaguing the African continent.  I am proud to say that the African
Development Bank is now a better run and a more harmonious institution for
which Africans should be proud of as well.

During his recent news conference, the newly-re-elected Kabbaj said “…all
the (financial) ratios, especially those watched by rating agencies
(Standard & Poors etc), have continued to improve.  They are very close to
all those other institutions, including the World Bank, sometimes better.”
According to ADB projections, African economies are expected to grow as
high as 4.8 percent in 2000.  Even this figure is currently being viewed
with scepticism by some, including the Bank president himself and with some
justification.  However, it must be borne in mind that, unlike most other
international bodies, the ADB include north African countries [with bigger
and stronger economies than the rest of the Bank membership (excluding
South Africa)] in its forecasts.  If excluded, the growth rate would be in
the region of between 4.0 and 4.5 percent.

A resurgence of social conflicts and civil wars are responsible, in part,
for the reduction in GDP growth in Africa.  Rapid rate of growth of our
population, in some cases outstripping growth rates, is another factor
impeding economic progress. Bad governance practices adopted by member
countries of the Bank coupled with corruption, exclusionary and
inappropriate economic policies all work against the positive growth rates
registered.

Over recent years, the Bank has made some strides in facing up to the
challenges posed by these problems and will continue to do so in the
future.  The task ahead for the premier African finance institution is not
an easy one; and it will be more difficult if the political will and
resolve of its regional member countries is lacking.

On the issue of broadening the role and function of the African Development
Bank within the context of the Meltzer Report, I will be advocating a
cautionary approach.  The Meltzer Report is a political document
commissioned by the United States Congress. The Commission that prepared
the report is acting in an advisory capacity.  It should be viewed as such,
at least for now.

 In his private comments to me, Basil correctly observed that the
International Financial Institution Advisory Commission, [official name of
the body that produced the Meltzer Report], never invited officials of the
Bank to any of its public hearings to present the African bank’s views
[although George Ayittey was invited to present his personal view during
the public hearings].

To correct this serious omission, a commission staffer was despatched to
Abidjan to present the Report and to invite comments from Management,
which, in my view, is less than satisfactory, given the far-reaching
recommendations and its ramifications on the future operational activities
of the Bank.  All the same, I will be submitting my personal comments to
the US Treasury Department in the next few days.

 Basil and Hamjatta, your comments on the Meltzer Report were most useful
and, with your permission, I would like to extract relevant portions for
this purpose. I thank you all.

Sidi Sanneh

----------------------------------------------------------------------------

To unsubscribe/subscribe or view archives of postings, go to the Gambia-L
Web interface at: http://maelstrom.stjohns.edu/archives/gambia-l.html

----------------------------------------------------------------------------