Source:Ghanaweb/ Stephen Yeboah in Geneva
Mr. Kofi Annan, former UN Secretary General and Chair of the Africa Progress Panel, has challenged governments in Africa to wisely manage revenues that come from the continent’s natural resources. In managing these resource rents, he urged African “leaders to invest more upfront to relieve the pressing human needs that constrain Africa’s development.”
Mr. Annan was speaking at the Graduate Institute of International and Development Studies (IHEID) on September 26, 2013 to mark the opening of the 2013-2014 academic year in Geneva. The lecture was as well to celebrate the move of the Graduate Institute to its new campus, ‘Maison de la Paix’.
Speaking on the theme “Is Africa’s mining boom helping or harming its people?” Kofi Annan bemoaned the increasing paradox that has taken over the continent’s extractive sector. He stressed that though natural resource wealth rightly belongs to the continent’s citizens, the “citizens are being robbed of its benefits by revenue diversion, corruption, jobless growth, and rising inequality.”
Africa is endowed with vast natural resource deposits like gold, diamond, cobalt, oil and gas, and bauxite. However, there is evidence of the ‘resource curse’ syndrome where natural resource wealth has been found to be negatively correlated with living standards. Countries like Nigeria, Democratic Republic of Congo, Equatorial Guinea, Gabon, Liberia, and Sierra Leone have often been cited to have suffered from the resource curse.
Mr. Annan called for a transformation of the extractive sector. “Africa and its partners will miss the opportunity to transform the lives of future as well as present generations if they carry on with business as usual”.
Africa has recorded impressive economic growth over the decade driven by natural resource wealth but this growth has not translated into improved standard of living of the people. Though GDP per capita in Equatorial Guinea is higher than in Poland, “yet three-quarters of the population still live in poverty, and child death rates are among the highest in the world”, Mr. Annan said.
He put forward strategies that could help governments harness the potentials of their natural resource wealth. He indicated that “African governments should adopt national strategies that set the terms on which their natural resources will be developed, and link these strategies to plans for poverty reduction and inclusive growth”. He again urged governments to build on the Africa Mining Vision by adopting “legislation that requires companies bidding for concessions and licences to disclose fully their beneficial ownership”, adding that “tender and concession granting processes must be open and transparent”.
Mr. Annan challenged leaders to make transparency and accountability a high priority in the natural resource sector. “African governments must put transparency and accountability at the heart of their natural resource policies. They must manage their citizens’ natural resources efficiently and share the revenues fairly”.
The Africa Progress Panel, chaired Mr. Kofi Annan, released a report “Equity in Extractives: stewarding Africa’s natural resources for all” this year revealing the plunder in Africa’s extractive sector through practices like tax evasion and transfer mispricing by multinational companies. The report has, inter alia, called for improvement in taxation system and the need for transparency reforms in all deals in Africa.