G8 pledge for Africa
IN a monumental decision, the G8 have finally acted to salvage Africa from poverty. The breakthrough at the summit at Gleneagles, Scotland, came on Friday after Japan and Germany announced a decision to increase their contributions, Tokyo alone chipping in with $10 billion. Together, the G8 pledged $48 billion in aid for development worldwide over a period of five years, the lion’s share — an increase by $25 billion — going to Africa. Whether the aid will actually lead to poverty alleviation in the world’s poorest continent is a big question. Africa’s economic travails are massive and widespread. While poverty worldwide has gone down, in the case of Africa it rose from 45 to 46 per cent during 2003. It is higher than in South Asia by 17 per cent. There are two main reasons for the lack of success in the poverty alleviation programmes. First, the effects of growth do not seep down to the masses, and very few countries in Africa have a growth rate higher than seven per cent. Second, most growth in Africa is based on capital- not labour-intensive projects. This means employment generation is not keeping pace with population growth and the number of new entrants in the job market. Another question is whether the African countries receiving aid will be able to utilize it, given the corruption and incompetence that mark governance in many of them.
Aid activists have expressed disappointment at the summit’s decision. They say the aid pledged by the G8 summit — “by around $50 billion” — will mean less than $130 billion over the next five years, which is less than the $180 billion visualized by the Millennium Development Goals. But it is the five-year period that has disappointed many Africa watchers. They want the $25 billion to flow into Africa immediately if urgent action is to be taken in some vital sectors, including the fight against AIDS. The summit promised to end aid subsidies on farm exports to Africa — which hurt African agriculture — without giving a date.
Some other aspects of the summit decisions have also come under criticism, especially those concerning the environment. The reference to climatic changes “as a serious and long-term challenge” is tepid and seems designed to avoid a specific programme for cutting energy emissions in stages, probably because President George Bush blocked action by the other seven. But the summit could claim success when the American president signed the declaration, which attributes climatic changes to human activity, especially the effect of greenhouse gas emissions damaging the ozone layer. To critics, no clear-cut strategy was outlined for bringing America into the Kyoto protocol. But the US agreed to be part of the G8 dialogue with emerging countries on greenhouse effects in November.
Africa has welcomed the decision, but many nations have expressed fear that the commitments may not be honoured. There are at least two examples where aid pledges by international conferences have not been honoured. The Tokyo summit, held in 2002, had pledged $4.5 billion to Afghanistan, but only a trickle was received by Kabul. Similarly, the money promised to the Palestinian Authority after the signing of the Oslo accords never arrived. Aid donors blamed the violence in Afghanistan and Palestine for the aid freeze. Africa is no less unstable, plagued as it is by what Nigerian President Olusegun Obasanjo called “war, disease and dire poverty”. Nevertheless, the summit’s decision constitutes the biggest-ever financial help for Africa.

