Tag: IMF

  • IMF pledges to stop competitive devaluation

    Nigeria might get some respite from international pressure to devalue her currency. The International Monetary Fund (IMF) in its Communiqué after the Thirty-Fourth Meeting of the IMFC released in Washington DC on Saturday, promised to refrain from competitive devaluations and not “to target exchange rates for competitive purposes.”

    The IMF lamented that “the economic outlook is increasingly threatened by inward-looking policies, including protectionism, and stalled reforms.”

    ” We commit to design and implement policies to address the concerns of those who have been left behind and to ensure that everyone has the opportunity to benefit from globalization and technological change.”

    Going forward, the IMF demanded that “all countries should use fiscal policy flexibly and make tax policy and public expenditure more growth-friendly, including by prioritising high-quality investment, while enhancing resilience and ensuring public debt as a share of GDP is on a sustainable path.”

    The Fund noted that “appropriate and credible fiscal policies along these lines will support growth, job creation, and confidence. Well-designed tax structures, as well as income policies where appropriate, can promote stronger growth, protect the vulnerable, and reduce inequality.”

    With regards to monetary policy, the Fund urged monetary authorities to “remain accommodative, consistent with central banks’ mandates, mindful of financial stability risks, and underpinned by credible policy frameworks. Monetary policy by itself cannot achieve sustainable and balanced growth, and hence must be accompanied by other supportive policies.”

    To help ensure that the financial sector is robust enough to support growth and development, IMF pledged to “intensify efforts to address remaining crisis legacy issues in some advanced economies and vulnerabilities in some emerging market economies, while monitoring potential financial stability risks associated with prolonged low or negative interest rates, systemic market liquidity risks, and nonbank intermediation.”

    It cautioned that “timely, full, and consistent implementation of the agreed financial sector reform agenda remains an important priority, as well as finalizing remaining elements of the regulatory framework as soon as possible.”

    The Fund agreed to redouble its “commitment to maintain economic openness and reinvigorate global trade as a critical means to boost global growth.”

    To help maintain the current lending capacity of the Fund, it was agreed that they will welcome the pledges of US$360 billion received from 26 members to ensure the IMF’s continued access to bilateral borrowing under the strengthened governance framework approved by the Executive Board; support the need for continued access to multilateral borrowing agreements; and call for broad participation of the IMF membership including through new agreements.”

    Looking ahead, the Fund reaffirmed its “commitment to a strong, quota-based, and adequately resourced IMF to preserve its role at the center of the global financial safety net.”

  • IMF offers zero interest loans to members facing challenges

    IMF offers zero interest loans to members facing challenges

    The Managing Director, International Monetary Fund (IMF), Christine Lagarde has said the fund is offering zero interest loans to all its members facing economic challenges.

    Nigeria has insisted on not taking an IMF loan, but funding its huge fiscal deficit from within, employing creative solutions to overcome national challenges.

    Speaking at a press briefing in Washington yesterday, she said economic growth has been too low for too long, and IMF was stepping up with zero interest loan for those in need of loans.

    She said: “Prospects for low-income economies may be more challenging with varied outlook. We see growth as too low, too long and benefiting few.

    “We believe that there are more to policies than meets the eyes. By exploiting synergies in policies we can overcome these challenges. We also believe that each country has something to offer.

    “My hope is that at the end of these meetings, each finance minister, each governor of central bank will go back home thinking of what to fuel growth. For example, when monetary policy has been overstretched, fiscal policy can step up.

    “This will also put in place the structural reforms that are much needed, which have been sorted out in some countries, but which are still lacking in other places.”

    The IMF chief said  the zero interest rate loans would be available for as long as it is needed around the world.

    “So, what does it mean for the IMF? It means that if we want to improve the inequality issue, we must have a strong international safety net.

    “In this context, I am pleased to reveal that our board recently approved the extension of zero interest rate on all concessional facilities from 2016 to 2018, and thereafter, if there is need for extension.

    “That is really important for low-income countries to be able to actually absorb the shocks without necessarily going to the international markets or relying on bilateral lending capacity of close to a trillion dollars by extending access to bilateral borrowing agreements.

    “The new agreements that are being signed this week will run at least through the end of 2019, and will continue to serve as a third line of defence.

    “As you know the first line of defence is quota, second line is New arrangements to borrow, and the third line of defence will be those bilateral loans,” she said.

    According to her, member countries had so far given $344 billion in pledges, while the fund looks forward to others joining the effort.

  • Raise revenue through tax, IMF urges Fed Govt

    Raise revenue through tax, IMF urges Fed Govt

    The International Monetary Fund (IMF) has advised the Federal Government to build up revenue mobilisation through tax capacity building for the country to get out of rcession and meet the Sustainable Development Goals (SDGs) of the United Nations.

    Its Director, Fiscal Affairs Department, Vitor Gaspar, who spoke at a press briefing on the IMF Fiscal Monitor report in Washington yesterday, said the debt rise in the country is characteristic of oil-producing economies.

    He said: “Message number one is that if you look at the global debt and deficit landscape, you’ll see that the countries that have the highest public sector deficit are oil exporters,” he said.

    “Nigeria is in debt group as a country that was very much hit by very low oil prices. That is a general message because it applies to oil exporters in general; the group of oil exporters have shared some characteristics.

    “The most important point in my view of general relevance is that for countries in sub-Saharan Africa to deliver on SDGs, for most of them, the key challenge is the building up of revenue mobilisation capacity through tax capacity building; that’s a key priority.

    “These countries must improve their capacities to raise revenue, and why is that so? Because there is such need in term of public infrastructure, there is such need in terms of public education, there is such need in terms of health.

    “For these groups of countries, public finance, fiscal policy is part of the overall development strategy, and in that, tax capacity is a fundamental cornerstone.

    The global lender warned that the economic situation in the country was creating economic difficulty for its neighbours, being a very important of economy in the West African sub-region.

    Its Head, Fiscal Policy and Surveillance Division, IMF Fiscal Affairs Department, Catherine Pattillo, said Nigeria’s challenges were hurting its neighbours.

    Pattillo said: “The slump in oil production and slow growth has created challenges for the country (Nigeria), but one statistic that is quite striking to me is that the debt profile is weakening and interest payment account for more than 45 per cent of Federal Government revenue.

    “On fiscal side, the important priority should be in safeguarding fiscal sustainability — which means, importantly, to increase non-oil revenues — and implementing an independent price-setting mechanism that minimises fuel subsidy.

    “So, these are two priorities, while also, of course, improving public service delivery so that citizens can see the benefits of good governance and services financed by the government.

    “As you know, Nigeria is a very important economy in the region and its success has positive spill over for the region, particularly in West Africa and its challenges then creates difficulties for its neighbours.”

  • Power: Adeosun accuses World Bank,  IMF of denying Nigeria coal use

    Power: Adeosun accuses World Bank, IMF of denying Nigeria coal use

    The Federal Government yesterday accused developed countries and multilateral development institutions of frustrating its efforts at addressing the electricity supply deficit facing the country through the use of coal.

    Speaking during a panel discussion at the on-going International Monetary Fund (IMF)/ World Bank meeting in Washington DC, Finance Minister, Mrs Kemi Adeosun described the multilateral institutions and their western backers as hypocrites for denying Nigeria and other African countries opportunity to use coal to generate electricity.

    She said: “I am going to point fingers at multilateral institutions and the West (of double standard). A good example is the coal fired power plants. In Nigeria, we have coal but we have power problem, yet we’ve been blocked because it is not green, there is hypocrisy because we have the entire western industrialisation built on coal energy; that is the competitive advantage that they have been using. Now Africa wants to use coal and suddenly they are saying oh! You have to use solar and wind (renewable energy) which are the most expensive, after polluting the environment for hundreds of years. Now that Africa wants to use coal they deny us.”

    While she agreed that Africa needed to make investment in infrastructure,  she said there must be a level playing field for all. “We need policy consistency to attract bankable projects, we also need macro-economic stability, but if you want to phase out coal,  no problem but those who started it should lead, those who want us to stop using dirty fuel should stop it first before telling us not to use it. By telling us not to use coal, they are pushing us into the destructive cycle of underdevelopment, while you have competitive advantage, you tie our hands behind us,” she said.

  • Growth rate may beat IMF prediction, says Fed Govt

    Growth rate may beat IMF prediction, says Fed Govt

    As emphasis on capital expenditure by the Federal Government begins to yield positive results with investment/Cross Domestic Product (GDP) ratio increasing, the GDP growth rate of the economy is likely to beat the International Monetary Fund (IMF) prediction of -1.8 per cent for this year, the Ministry of Budget and National Planning said yesterday.

    Although the data from the National Bureau of Statistics (NBS) shows that the GDP declined by -2.06 per cent in second quarter, the ministry noted that the emerging signal points to the fact that the agriculture and solid minerals – the two sectors given priority by the Federal Government – are beginning to respond to policy initiatives.

    In a statement by Budget & National Planning minister’s media adviser Akpandem James, the ministry descibed as cheery news that the month-on-month increase rate   has fallen continuously over the past three months even in the face of high inflation rate.

    For the high unemployment rate, the statement said that unemployment was a structural nature and  usually so whenever growth slowdowns.

    “It is expected that the social safety net initiative will slow down the unemployment rate before the end of the year”, the statement said.

    According to the ministry, past vulnerabilities of the economy combined with the short-term effect of the structural changes complicates the trajectory of growth and inflation, pointing out that this formed the basis for negative growth in Q1 and Q2.

    It, however, noted that the rest of the Q2 data is beginning to tell a different story.

    The statement reads: “There was growth in the agricultural and solid minerals sectors which are the areas in which the Federal Government has placed priority. Agriculture grew by 4.53 per cent in the second quarter as compared with 3.09 per cent  in the first quarter.

    “The metal ores sector showed similar performance with coal mining, quarrying and other minerals also showing positive growth of over 2.5 per cent.

    “Notably also, the share of investment in GDP increased to its highest level since 2010, growing to about 17 per cent of the GDP.”

    It indicated that the manufacturing sector, though not completely out of the woods yet, was beginning to show signs of recovery. “The service sector similarly bears watching as available data already shows a reduction in imports and an increase in locally produced goods and services,” it said.

    The ministry expressed optimistic that the trend will be maintained, although it will start off slowly at the initial stages before picking up later.

    Explaining the GDP decline in the second quarter, the ministry said a close look at the data has shown  that the outcome was mostly due to a sharp contraction in the oil sector due to huge losses of crude oil production as a result of vandalism and sabotage.

    It added that the commitments to stop attacks on oil installations in the Niger Delta will reverse the trend and improve government earnings.

    The statement said: “This would however be a temporary solution in the sense that it still promotes the weak economic structure of the past which it said manifested in two ways – the over-reliance on crude oil and the country’s economy being mainly consumption driven with a high import propensity.

    “With crude oil contributing 8-12 per cent of the GDP and up to 50-53 per cent  of the non-oil sector dependent on the oil sector, it is clear that the fortunes of up to 60 per cent of the economy rested on a volatile sector.  This shaky foundation was masked in the past by high oil prices and reasonably high foreign reserves.

    “Again with the availability of foreign exchange it was possible to drive growth in national income through consumption without feeling the fallout of such structural weaknesses.”

  • Presidency: GDP figures better than IMF estimates

    Presidency: GDP figures better than IMF estimates

    The Presidency on Wednesday said that the just released Gross Domestic Products (GDP) figures for the 2016 second quarter by the National Bureau of Statistics (NBS) despite showing temporary decline is a hopeful expectation in the country’s economic trajectory.

    The Special Adviser to the President on Economic Matters, Dr. Adeyemi Dipeolu made the remarks while speaking on the latest NBS report in a statement issued by the Senior Special Assistant on Media and Publicity, Laolu Akande.

    Apart from the growth recorded in the agriculture and solid mineral sectors, he said that the Nigerian economy in response to the policies of the Buhari presidency is also doing better than what the IMF had estimated with clear indications that the second half of the year would be even much better.

    According to him, the Buhari presidency will continue to work diligently on the economy and engage with all stakeholders  to ensure that beneficial policy initiatives are actively pursued and the dividends delivered to the Nigerian people.

    He said: “The just recently released data from the National Bureau of Statistics showed that Gross Domestic Product declined by -2.06% in the second quarter of 2016 on a year-on-year basis.

    “A close look at the data shows that this outcome was mostly due to a sharp contraction in the oil sector due to huge losses of crude oil production as a result of vandalisation and sabotage.

    “However, the rest of the Q2 data is beginning to tell a different story.  There was growth in the agricultural and solid minerals sectors which are the areas in which the Federal Government has placed particular priority.

    “Agriculture grew by 4.53% in the second quarter of 2016 as compared with 3.09% in the first quarter.  The metal ores sector showed similar performance with coal mining, quarrying and other minerals also showing positive growth of over 2.5%.  Notably also, the share of investments in GDP increased to its highest levels since 2010, growing to about 17% of Gross Domestic Product,” he said

    Despite the manufacturing sector not yet out of the woods,  he said that it is beginning to show signs of recovery.

    He said: “Nevertheless, the data already shows a reduction in imports and an increase in local produced goods and services and this process will be maintained although it will start off slowly in these initial stages before picking up later.

    “The inflation rate remains high but the good news is that the month-on-month rate of increase has fallen continuously over the past three months.
    “Unemployment remains stubbornly high which is usually the case during growth slowdowns and for reasons of a structural nature.

    “The picture that emerges, barring unforeseen shocks, is that the areas given priority by the Federal Government are beginning to respond with understandable time lags to policy initiatives.  Indeed, as the emphasis on capital expenditure begins to yield results and the investment/GDP numbers increase, the growth rate of the Nigerian economy is likely to improve further.

    “As these trends continue, the outlook for the rest of the year is that the Nigerian economy will beat the IMF prediction of -1.8% for the full year 2016.

    “The IMF had forecasted a growth of -1.8% for 2016, however the economy is performing better than the IMF estimates so far. For the half year it stands at -1.23% compared to an average of -1.80% expected on average by the IMF.

    “What is more, it is likely the second half will be better than the first half of 2016. This is because many of the challenges faced in the first half either no longer exist or have eased,” he said.

  • IMF:  Economy may contract by 1. 8%

    IMF: Economy may contract by 1. 8%

    Nigeria’s economy is likely to contract by 1.8 per cent this year, the International Monetary Fund (IMF) said yesterday, as the country grapples with the impact of low oil prices.

    The sharp fall in global prices since 2014 has led to a prolonged economic crisis since the crude sales make up around 70 per cent of government revenue.

    The IMF’s projection for this year, contained in its World Economic Outlook update, is down from the 2.3 per cent growth it foresaw in its April forecast. It now forecasts 1.1 per cent growth for 2017, down from 3.5 per cent in the April forecast.

    Gross domestic product (GDP) contracted by 0.36 per cent in the first quarter of the year.

    “In Nigeria, economic activity is now projected to contract in 2016, as the economy adjusts to foreign currency shortages as a result of lower oil receipts, low power generation, and weak investor confidence,” the IMF said.

    The Central Bank of Nigeria (CBN) currency restrictions imposed last year in an attempt to protect dwindling foreign reserves prompted investors to flee and led to dollar shortages, pushing down the naira currency’s value on the country’s burgeoning black market.

  • Buhari advised to recover looted funds, shun IMF loan

    Buhari advised to recover looted funds, shun IMF loan

    President Muhammadu Buhari has been advised to redouble his efforts at recovering looted public funds so that such funds could be ploughed back into the economy instead of seeking loans from the International Monetary Fund (IMF).

    An agro-allied economist and aviation expert, Captain John Okakpu, who spoke with reporters in Lagos at the weekend, said the president should ignore calls to seek foreign credit line to put the economy back in shape.

    Okakpu, who is the Managing Director and Chief Executive Officer of ABX World, condemned the stringent conditions Switzerland and other foreign financial institutions have handed down to the Federal Government before repatriating the looted funds in their custody. “That is completely wrong; Nigeria has the right to decide on whatever it wants to do with the funds,” he said.

    He urged the National Assembly to pass laws that will prescribe stiff penalties for fund looters to make stealing unattractive.

    According to Okakpu, the repatriated stolen funds could be given to Small Medium Enterprises (SMEs) at a single digit interest rate to create more impact on the economy.

    “We have to start taking care of ourselves. Over the years, IMF has been giving us loans, knowing that we are corrupt,” he said.

    He said amnesty should be granted to fund looters, arguing that the gesture would encourage them to repatriate their loot.

    He  said: “The amnesty means whatever anybody has starched abroad, let’s grant them official pardon and deposit it with Nigerian banks; the fund could be given as loan at single digit interest rate for indigenous investors to develop other sectors of the  economy as we move away from oil and gas.

    “If you look at other nations, they have systems to control this kind of amnesty; they use their money to develop their countries, whereas, we feed them with our funds. Amnesty is a way out.

    “Fighting people to get these funds may take time and lead  to nowhere. Between the last 30 and 40 years, so much funds have been stolen and taken away from Nigeria. If amnesty is extended in place, the Nigerian banks will become so big even as to extend facilities to the IMF. Fighting to get the money from them may cost more than what they will remit at the end of the day; even if you recover $10billion from them, it is just a fraction.”

    He said if the Federal Government embraces the amnesty option and give it legal backing, in the next six months, over $100billion could be repatriated to the system.

    Okakpu said for an ailing economy like Nigeria’s, there is need to inject funds that will energise the system and put money into the hands of the citizens.

    According to him, the promotion of agric produce has become imperative in the face of slump in the prices of crude oil in the international market, adding that current global realities have made it important for government to be more creative in exploring other sources of revenues  than depending on crude oil.

    H said: “In Africa today, Kenya is leading in a network called Global GAP; which involves all the supermarkets in Europe and North America. Unfortunately, neither the Federal Government, state, local nor community in Nigeria has Global Gap certification, which is one of the reasons we can’t even sell our agro-allied produce direct to Shoprite.

    “How do we put our products to the world? Kenya leading the African Continent has 1,879, certifications; South Africa has 1,797; Egypt has 671, Ghana has over 200 certifications, and others, while Nigeria is zero.

    “Agriculture is private sector driven. What is expected of the government is policy direction and structures in place to empower subsistence farmers, not commercial farmers only.“

  • IMF forecasts low growth for  Nigeria, others in Sub-Sahara

    IMF forecasts low growth for Nigeria, others in Sub-Sahara

    The International Monetary Fund (IMF) in a report released on Monday stated that the growth forecast for this year, represents the lowest for the region in the past 15 years.

    It attributed the development to severe shocks, including weak commodity prices, tight external financing and drought, stressing that there is urgent need to reset policies to secure growth.

    “ After a prolonged period of strong economic growth, sub-Saharan Africa is set to experience a second difficult year, as the region is hit by multiple shocks,” the IMF said in its latest Regional Economic Outlook for Sub-Saharan Africa,” pointing out that the steep decline in commodity prices and tighter financing conditions have put many large economies under severe strain. The report called for a stronger policy response to counter the effect of these shocks and secure the region’s growth potential.

    The report said growth fell to 3½ per cent in 2015, stating that in the current year, growth is expected to slow further to three per cent, well below the six percent average over the last decade, and barely above population growth.

    Hit by several shocks, the commodity price slump has hit many of the largest sub-Saharan African economies hard, the report said, adding that while oil prices have recovered somewhat compared to the beginning of the year, they are still more than 60 per cent below 2013 peak levels.  As a result, oil exporters such as Nigeria, Angola, and five of the six countries within the Central African Economic and Monetary Community continue to face particularly difficult economic conditions, stating that the decline in commodity prices has also hurt non-energy commodity exporters, as well. The report however indicated that the impact of these shocks varies significantly across the region as many countries continue to register robust growth, including in per capita terms

    While the immediate outlook for many sub-Saharan African countries remains difficult, the region’s medium-term growth prospects are still favorable. The underlying domestic drivers of growth at play over the last decade generally continue to be in place. In particular, the region’s much improved business environment and favorable demographics should help bolster growth in the medium term, said the report

     

     

  • IMF and World Bank as patrons of poverty? (2)

    As we noted in the first instalment of this piece, Dr  Sylvester OdionAkhaine , in his book, ‘Patrons of Poverty: IMF/World Bank and Africa’s Problems’, traces the root causes of contemporary disorientation, disarticulation, disillusion and mal-development in Africa to the historical forces of slavery, colonialism and now neo-colonial imperialism. He cites the concrete examples of Senegal and British-Gambia to demonstrate that his thesis is no mere ‘leisure of the theory class’.  Those two countries were forced by the colonial administration to engage in overproduction of groundnuts for export to the detriment of the production of rice, which was their staple food crop. The consequence was that they became heavily dependent on rice importation from French Indo-China and India respectively.

    All across Africa, the emphasis of colonial economic policy was on production of cash crops for export leading to the persistent food crisis due to overdependence on food imports. As Dr Akhaine puts it, “Rodney saw in it what he called ‘irrational contradictions’ due to non-industrialization. Africans grew cotton and imported finished cotton goods, grew cocoa but imported chocolate beverages in a process of product round tripping…colonial production never allowed Africans to produce what they consumed and consequently became outward oriented economically”.

    Perhaps the two most important chapters in the book are the fourth and fifth, which interrogate the Western and African solutions, respectively, to the continent’s crisis of dependency and underdevelopment. The western policies propounded for Africa through the IFIs and mostly adopted by intellectually slavish and timid African policy elite include modernisation theory, Import Substitution Industrialisation, Washington Consensus/Structural Adjustment Programmes (SAP) and Highly Indebted Poor Countries (HIPC) initiative. None of these policy initiatives helped to ameliorate the plight of African countries – indeed they only sank deeper into the morass of underdevelopment.

    Modernisation theory, for instance, Dr Akhaineexplicates, posited that African countries were backward and traditional societies that had to tread the trajectory of highly industrialised western countries to achieve modernisation and development. The rich industrialised countries of Europe and North America were put up as the developmental role models that African countries must seek to replicate. They did not realize, or perhaps did not bother, that this kind of development model by imitation engendered a feeling of inferiority and psychological inadequacy on the part of Africans that only made it more difficult for the latter to find a way out of the dark labyrinths of poverty, misery and despair.

    This dilemma was perhaps best captured by Professor Claude Ake, who lamented that “The colonisers convinced themselves and tried to convince us that our level of civilisation was sub-human…Now, two decades after political independence, the cult of inferiority continues to be nurtured by the ideology of development which Europe has foisted on us; this ideology represents Western society as the ideal state of being and African society as thoroughly bad and needing drastic change. It is no wonder that we the African elite suffer from an inferiority complex”.

    Modernisation theorists who drew up the immediate post-independence development plans for many African countries such as Nigeria, Ghana, Uganda among others emphasised external capital inflow in the form of loans and grants as well as increased agricultural production for exports to the detriment of domestic food sufficiency. The rich bauxite deposits of Ghana, Akhaine notes, could easily have supported a viable aluminium industry for the country. But there was a snag. Western experts deemed Ghana’s bauxite inferior and needing further enrichment from the West to enhance its suitability for industrial purposes.

    Thus, Akhaine describes these policy options as being “in the main, mechanisms for reproducing the unequal economic relations of the colonial epoch in a post-colonial setting, which many have referred to asneo-colonialism, the continuation of colonialism by means of economic dependence”. The author agrees with Professor OkwudibaNnoli that what was achieved was at best the ‘acquisition of artifacts’ such as bridges, trunk roads, stadia, ports etc which were not products of the indigenous productive or technological capacities of African countries.

    In a similar vein, the Import Substitution Industrialization strategies suggested to African countries by the IFIs only increased further import dependency, encouraged massive foreign exchange (capital) outflow and high budget deficits. This is because the strategy was based on large scale importation of equipment, machinery and high level technical skills to produce locally consumer and intermediate goods that were once imported.

    And despite the emphasis on Agriculture, rural development and employment, particularly by the United Nations (UN) development agencies, the 1980s was regarded as a lost decade for Africa with severe food shortages across the continent, drought in some areas, increased malnutrition, marked slump in manufacturing, manipulation of commodity prices by Western multinationals to the detriment of African countries and monstrous corruption by African countries all combining to drive the continent deeper into debt.

    As from the mid- 1980s, the IFIs began to urge the adoption of stringent Structural Adjustment Programmes (SAP) by desperate, fiscally distressed African countries as a condition for external financial support. The same set of policies –exchange rate devaluation, market liberalisation, deregulation of controls, privatisation of public enterprises, removal of subsidies to the most vulnerable, downsizing of the public sector etc – were forced on practically all African countries irrespective of their peculiarities. At the end of the day, the SAPs practically wiped out the middle class in most African countries, destroyed social services, increased both poverty and inequality, compounded the debt problem and generally worsened the plight of these countries.

    The Western solutions to Africa’s crisis of development are juxtaposed by Dr Akhaine in chapter five with proposed home grown African solutions. Two major solutions to Africa’s problems originating from Africa are examined by the author. The first is the far reaching organisation of African Unity (OAU) 1980 Lagos Plan of Action (LPA), which, unlike the Western solutions focussed on concrete problems confronting the continent with the objective of achieving collective self-reliance for accelerated, non-dependent development. Areas covered by the LPA include food and resources, human resources development and utilization, science and technology, transport and communication, trade and finance, economic and technical cooperation, environment and development, energy, women and development, as well as development planning, statistics and population.

    The second major home grown development agenda by Africans for Africans is the African Alternative Framework to Structural Adjustment Programmes (AAA-SAPs) articulated by the UN Economic Commission for Africa. Summarising the thrust of AAA-SAP, Dr Akhaine writes that “Whereas SAP compels adjustments to the crisis in the global financial architecture in its domestic and external dimension, the alternative framework proffers for African economies structural transformation from its ‘structural disarticulation’, diversification and increased productivity in order to improve the lot of the African people and bridge the gap in the standard of living between them and the rest of the world”.

    It is a measure of the stranglehold that the IFIs have on the policy process in Africa and a confirmation of Dr Akhaine’s central thesis that these alternative home grown solutions were shot down by the IFIs and African leaders abandoned them for the IMF/World Bank-inspired African Priority Programme for Economic Recovery (APPER) – 1986-1990. The economies of African countries have unfortunately degenerated even further since then. Poverty has risen astronomically, the debt burden worsened and meaningful development more of a mirage than ever.

    To launch Africa on the path of true development, Dr Akhaine stresses the need for the requisite political will on the part of African leaders as well as the replacement of the current rent-seeking, neo-colonial African elite with new patriotic afro-centric elite. But then one wonders how this can be achieved without a far reaching revolution, which seems a remote prospect given the constellation of class forces in today’s world.

     However, it is difficult to fault the author’s endorsement of the position of the Tony Blair-inspired Commission of Africa that “Africa’s development must be shaped by Africans. History has shown us that development cannot and does not work if policies are shaped and forced by outsiders. It is Africa’s actions and leadership that will be the most progressive in generating resurgence in Africa, advancing living standards and taking forward the fight against poverty”.