Context of Contemporary African Political Economy Political Africa

Context of Contemporary African Political Economy

Political Africa

THE AFRICA WE SEE! MILITARIZATION HIV/AIDS FAMINE LEFT IMPUNITY WAR WE ARE PRIVATIZATION WITH AN OCEAN MINIMAL STATE HUMAN RIGHTS ABUSE OF POVERTY AND LIBERALISATION INJUSTICE CORPORATE CONTROL WOMENS RIGHTS CORRUPTION ABUSES CONDITIONALITY DEBT PATRONAGE ETHNICITY

Education for the Poor

ICTS

Capital Flight from Developing Countries n n n UNCTAD: $13 bn p. a. have flown from Africa between 1991 -2004 (approx. 7. 6% of the annual GDP of the entire region) AU: $150 bn p. a. flies out of Africa & 80% lands in offshore financial centres. i. e. about 30 % of SSA’s annual GDP has been nested in tax havens WB: Illicit money in circulation is estimated at $1000 -1, 600 bn and 50% of this comes from southern countries

Africa Capital Flight Cont’d n n Real capital flight from 40 African Countries between 1970 and 2004 amounted to $420 bn. Including imputed interest earnings, the accumulated stock of capital flight was about $607 bn as at end of 2004 Some 17 SSA countries are estimated to have lost in excess of 100% GDP since 1970(Boyce & Ndikumana) Conservative estimates suggest that developing countries can loose between 510% GDP annually in capital flight (Sony Kapoor, et al. )

n n n In general, equity flows (FDI and portfolio investment flows) to Africa remain low. Africa’s share in world FDI remains at around 3 per cent, with a peak at 4 per cent in the mid-1980 s. This share has followed the same trend as Africa’s economic weight, as measured by its share in world GDP (figure 2. 5).

Capital Flight & MDGs There is a hidden financing gap 1. Official estimates show a big financial deficit on plans to achieve the MDGs 2. Africa pays more in debt servicing than they receive by way of ODA 3. Africa pays even more in capital flight than they do on debt servicing 4. In 2005 UN estimated that $348 bn would be needed to cover MDGs up to 2010 & $529 bn up to 2015

Capital Flight & MDGs cont’d n n n Global ODA averaged $90 bn/yr between 2003 -2006. This amounts to $24. 6 m/day Global debt cancellation under HIPC & MDRI initiatives amounted as of end of 2007, to $67. 7 & $47. 9 bn, respectively HIPC countries are still servicing more than $2. 4 bn per year. Low income countries pay every year $35 bn in debt service, and debt service paid annually by all developing countries amounts to $540 bn. CSOs estimate that between $424 & $589 bn of debt should be cancelled to meet

Climate change and challenge of Environment n n n Climate change is emerging as one of the most important challenges of the 21 st century. Eleven of the last twelve years (1995 -2006) rank among the 12 warmest years of global surface temperature since 1850. Climate change is a major threat to sustainable growth and development in Africa, and the achievement of the Millennium Development Goals Although Africa is the continent least responsible for climate change, it is particularly vulnerable to the effects, including reduced agricultural production, worsening food security, the increased incidence of both flooding and drought, spreading disease and an increased risk of conflict over scarce land water resources.

Climate Challenge n n n Africa is highly vulnerable to climate change with the areas of particular concern being water resources, agriculture, health, ecosystems and biodiversity, forestry and coastal zones. The longer-term Agriculture and food security at stake. Over 95% of Africa’s agriculture is rain-fed. Agricultural production, including access to food, in many African countries and sub-regions is projected to be severely compromised by climate variability and change.

Climate Challenge cont’d n n n Half of Africa will face water stress. Three-quarters of African countries are in zones where small reductions in rainfall could cause large declines in river water. Climate models show that 600, 000 square kilometres classified as moderately water constrained will experience severe water limitations. By 2020, between 75 and 250 million people are projected to be exposed to an increase of water stress due to climate change. Risk to coastal areas could force major population movements. Sea level rise resulting from global climate change threatens coasts, lagoons and mangrove forests of both eastern and western Africa. More than a quarter of Africa’s population live within 100 kilometres of the coast, and projections suggest that the number of people at risk from coastal flooding will increase from 1 million in 1990 to 70 million in 2080 The direct and indirect effects of climate change could further undermine peace and stability in the continent.

Adaptation or Mitigation n There is a ranging debate on what should be done: Adaptation or mitigation and who bears the cost.