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Africa: Weathering the Storm Charting Recovery

Jun 10, 2009, 6:30 AM

Press Release

The global recession has reignited two perennial crises. The first is the crisis of faith in global integration. With falling demand for and prices of commodities, and with falling private capital, remittance and aid flows, do the risks of globalisation for Africa now outweigh the benefits?

The second is the perennial crisis of faith, or direction, in African development. Should it be trade not aid for the developing world? Has aid failed and should it be replaced by private investment even as private capital flows fall?

In truth, as many have sensibly argued, these are not the choices they are posed as. Aid, trade and investment are all needed and are facilitated by deeper global integration. They are all mutually dependent, and none must drive out the other.

But as Africa seeks a way out of the vulnerability of global recession, I would pose a different challenge. African countries should use the opportunity of the recession to speed up the process of regional integration. They should do so economically and politically through regional markets, infrastructure and institutions. Regional integration is the best insurance against the ups and downs of the global economy as it is the best protection against local political instability.

It is through regional trade and infrastructure development that African countries will build the economies of scale necessary to make swift gains on growth and poverty reduction. Strong regions will stimulate domestic private sectors and attract investment from outside Africa. There is vast untapped potential; just five percent of African countries' trade is with other African countries, compared to more than fifty percent of the trade of European or East Asian counterparts.

This means opening up regional markets, as the Southern African Development Community (SADC) have begun to do through the launch of their Free Trade Area, and as the Economic Community of West African States (ECOWAS) will seek to do by introducing a single currency.

Strong regional economies will also depend on regional cooperation on infrastructure; the roads, railways and ports that literally keep the wheels of trade turning. This is why the North-South Corridor conference this year, which the UK's Department for International Development supported, was so important. It will remove bottlenecks at borders through One Stop Border posts and lead to the upgrading of large stretches of road and railway, which will benefit the 500 million people who make up the combined regional markets of 26 different countries.

And it is the regions that are best equipped to tackle climate change, which risks increasing Africa's ability to achieve growth and poverty reduction across national

borders. Regional initiatives such as the Nile Basin agreement and the Congo Basin Forest Fund will be crucial.

Some of the most important moves towards deepening democracy and accountability in

Africa are also taking place at the regional level. The African Charter on Democracy,

Elections and Governance clearly sets out where African countries would like to be. The

African Peer Review Mechanism and SADC's peer-to-peer democratic review processes

are two fine examples of where progress is already underway.

ECOWAS has played a critical role in trying to reverse recent unconstitutional changes of government as has SADC. The African Union, under Jean Ping, has consistently stuck to the principle agreed to by its members that it will not undemocratically choose new leaders - thereby creating a powerful source of peer pressure.

Regional justice mechanisms will also be an important part of developing a culture of accountability across Africa, be it through the African Court of Justice, the

African Court
on People's and Human Rights or the sub-regional courts.

The growing importance and strength of Africa's regions means that aid, trade and investment is necessary but it's not sufficient. Aid, trade and investment must come hand in hand with a policy of 'Africa, first'.

The international community will benefit from the stronger global engagement that a more integrated Africa will bring: African growth will be an important part of the world's recovery from recession. With it should come representation, which the UK fought hard for at the G20 London Summit. I hope that this will be the first of many global discussions, including ultimately in the UN Security Council, where not just the Asian tigers but the emerging African lions have a seat at the table.

But it's in the great gains that stronger regionalism brings at home that African countries and their people will first notice the difference.