Last decade has completely transformed the African continent as an economic hub for investments. Africa’s abundance in natural resources including oil and gas, precious metals, etc. have attracted investments from China, Russia, India and the European Union.
But in the annual report of the UN’s Economic Commission for Africa, has held developed countries responsible for not living up to the expectations and promises of increased aid to the continent. The United Nations’ economists pointed out, strong economic growth rates in Africa have miserably failed to convert the developmental process to enhance job opportunities, and to alleviate poverty.
Richard Kozul-Wright, an economist with the UN’s Department of Economic and Social Affairs (DESA) said that he was dismayed to find, the aid to Africa in recent years was in the form of debt relief rather than productive investment. He further opined that there were no programs for additional new resources to infuse the African economy, and the general consensus was that the quality and quantity of aid remained inadequate.
The report claimed that the African nations have already paid back more than that they had borrowed and yet owed $250 billion. The economists were unhappy with the way international development aid is managed and called for writing of the debts to usher palpable developments in the region.
The report said economic growth in the continent reached 5.8 percent and was set to rise to 6.2 percent in 2008. Africa was highly dependent on continuing robust demand and high prices for its commodity exports said Pingfan Hong, another DESA economist. The report also blamed the African states themselves for their plight and poor performance in human development.
It found “weak financial infrastructure, weak governance and rampant corruption as some of the major factors contributed for ineffective mobilization of domestic resources.” Notwithstanding, African countries should provide political stability and an environment, which allows the investor to be confident of achieving targets on a long term basis, to prevent the predatory attitude.