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Monthly Archives: March 2013

BRICS wrangle over new development bank, Source: Al Jazeera And Agencies, Last Modified: 26 March 2013 11:04


BRICS emerging powers sought a deal on setting up a development bank that would rival Western-backed institutions, trying to iron out significant differences ahead of a leaders’ summit in Durban.

The grouping of Brazil, Russia, India, China and hosts South Africa are racing to elaborate on proposals for an infrastructure-focused lender that would challenge seven decades of dominance by the World Bank.

Just hours before leaders kick off the summit at 17:30 GMT on Tuesday, finance ministers were still working to agree key elements of the plan.

Disputes remain over what the bank will do, with each side trying to mould the institution to their foreign or domestic policy goals and with each looking for assurances of an equitable return on their initial investment of about $10bn.

Failure to secure a deal would be a major embarrassment for many of the participants and would play into the hands of those who argue that the BRICS have little to bind them together.

‘Positive headway’

Xi Jinping, who has underscored the growing importance of the group by making Durban his first summit as China’s president, earlier expressed hopes for “positive headway” in establishing the bank.

In a keynote speech in Tanzania on Monday Xi pledged Beijing’s “sincere friendship” with the continent, and a relationship that respects Africa’s “dignity and independence”.

Meanwhile, host President Jacob Zuma has lauded the summit as a means of addressing his country’s chronic economic problems including high unemployment.

“BRICS provides an opportunity for South Africa to promote its competitiveness” Zuma said in a speech on the eve of the summit.

“It is an opportunity to move further in our drive to promote economic growth and confront the challenge of poverty, inequality and unemployment that afflicts our country.”

A failure to take concrete steps would raise questions about whether the BRICS grouping can survive.

“Ironically it may be the cleavages within the BRICS grouping that more accurately hint at the future of the global order: tensions between China and Brazil on trade, India on security, and Russia on status highlight the difficulty Beijing will have in staking its claim to global leadership,” said Daniel Twining of the German Marshall Fund.

But if the leaders succeed it would be the first time since the inaugural BRICS summit four years ago that the group matches rhetorical demands for a more equitable global order with concrete steps.

That would send a loud message to the US and European nations that the current global balance of power is unworkable.

Together the BRICS account for 25 percent of global GDP and 40 percent of the world’s population.

But members say institutions such as the World Bank, the International Monetary Fund and the United Nations Security Council are not changing fast enough to reflect their new-found clout.

Diplomats say it could start with $10bn seed money from each country, but the exact role of the bank is up for debate.

BRICS FACTS

Economic data shows that the grouping of Brazil, China, India, Russia and South Africa now account for 25 percent of global GDP and 40 percent of the world’s population.

China has become the informal leader of the group. With a GDP of $8.25 trillion in 2012, the IMF
estimates that the Chinese economy will climb by a whopping 8.2 percent in 2013.It remains the globe’s most-populated country, with 1.34 billion inhabitants.

Brazil: With a GDP of $2.425 trillion in 2012, Brazil is the world’s seventh largest economy. It holds only a modest place in world trade activity, however, and experienced sluggish growth of one percent last year.

Russia: Ranking ninth on the list of the world’s biggest economies, Russia accumulated a GDP of $1.953 billion in 2012, boosted mainly by its gas exports, making it the world’s eighth largest exporter.

India: Despite its population of 1.24 billion, India remains a smaller player among the world’s economies, falling into a 10th place with a GDP worth 1.946 trillion.

South Africa: Smallest of the BRICS economies is South Africa. Placing 41st world exporters, the country has a GDP of $390 billion and a population of 50.5 million.

 
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Posted by on March 26, 2013 in Africa Development

 

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The 2013 edition of the India-Africa business forum and thereafter, by Chofor Che, 20 March 2013


The 2013 edition of the India-Africa business forum took place in New Delhi, India from the 17 to the 19 Mach 2013. The 2013 Confederation of Indian Industry (CII)-EXIM Bank Conclave on India Africa Project Partnership was pivoted on the premise that India and Africa have a common goal to furnish the developing world with an opportunity to improve on their trade, oil and gas, mining, agricultural, tourism as well as the environment sectors. Anad Sharma, India’s Minister of Commerce, Industry and Textiles, opened this very important forum.

So far there have been eight (08) Conclaves. In the past, these Conclaves have been attended by the Vice President of Burundi (2007), the Vice President of Tanzania (2008), the Vice Prime Minister of Mauritius (2009), the Vice President of Ghana (2010), the Prime Minister of Togo (2010 & 2011), the Prime Minister of Mozambique (2011), the Vice President of Zimbabwe (2012) and the Prime Minister of Central African Republic (2012). A host of government Ministers from Africa have also participated at the Conclaves.

From the last eight Conclaves from 2007 to 2012, 1510 projects worth USD 104 billion have been deliberated. Cameroon was the “Guest Country” and Ethiopia was the “Focus Country” for this 9th Conclave.

According to an article in Cameroon Tribune dated the 19 of March 2013, Cameroon’s Prime Minister, Head of government, Philemon Yang told Indian investors at the opening of the 2013 edition of the India-Africa Conclave that Cameroon is blessed with untapped investment opportunities. He added that project partnership is germane in bringing to fruition these untapped areas of interest. For instance, just 1.8 billion cubic meters of the state’s estimated 695 billion cubic metres of gas has been exploited. The state also plans to construct a gas liquidation plant in Kribi. Cameroon equally possesses vast forests which are sources of timber and other forest products. “These forests also create climate conditions that favour the production of diversified agricultural products such as cocoa, banana, rubber, palm oil and a host of other tropical fruits,” added the Prime Minister of Cameroon.

Cameroon’s Prime minister, Philemon Yang thus used the opening ceremony at the Taj Palace to present Cameroon’s investment potentials in the mining, agricultural, petroleum, gas, transport and power supply sectors. Philemon Yang projected Cameroon’s image as one of the favourable destinations for investors in Africa. He made reference to a couple of laws the state of Cameroon has enacted to improve investment incentives, curb tariff barriers, furnish an environment for free enterprise, and ease trade and capital flows.

Concurring with the report of Cameroon Tribune dated the 19 of March 2013, the 2013 edition of India-Africa Conclave, comes shortly after Cameroon’s diplomatic representation in New Delhi was created. The Prime Minister considered a will to facilitate economic exchanges to prevail between India and Cameroon. At the end of the Conclave, the delegation from Cameroonian and Indian investors signed Memorandums of Understanding in the agriculture, mining and tourism sectors.

It is always a great idea for partnership to be cemented between states when it comes to investment and economic exchanges. All the same such partnership remains meaningless if there still exists tariff barriers, a harsh environment for free enterprise, and bottle necks that hinder trade and capital flows. Although Cameroon has put in place several laws to curb these impediments, state practice shows that the state of Cameroon still has a long way to go. Ensuring that Cameroon as well as other African states benefit from the 2013 edition of the India-Africa business forum entails more than empty promises. There is need for the state of Cameroon as well as other African states to ensure that state practice reflects institutional provisions that promote free markets and trade. It does not suffice to have laws in place which are not respected by state authorities.

Additionally, the private sector in African states especially in Cameroon needs to be invigorated. Indian investors would definitely need to cement business deals with private operators in African states reason why there is need for central governments in Africa to make the business environment conducive for all and sundry by also ensuring that the taxation laws are not stringent.

 
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Posted by on March 20, 2013 in Africa Development

 

Eradicating turbulent armed conflict and insecurity in Africa for sustainable economic growth, by Chofor Che, 14 March 2013


Africa is still plagued by on-going conflicts in Mali and parts of the Democratic Republic of Congo (DRC). There are security concerns in parts of Cameroon especially with the recent kidnapping of French tourists. Such security concerns are even magnified with assassinations of foreign investors in parts of Nigeria and Tunisia. There remains a serious concern on how sustainable Africa’s economic growth can last in the midst of insecurity and armed conflict. Despite these worries, the international community has begun to look at Africa differently.

According to a report by Ivor Ichikowitz, executive chairman of the African defence engineering company, Paramount Group, in the Business Day Live, posted in early January 2013, the boss of the International Monetary Fund (IMF), Christine Lagarde was in Abidjan, the political capital of Cote d’Ivoire, and considered armed conflict as the worst enemy of Africa’s economic growth. The IMF boss concurred that “Security is too fragile … if there is no peace, the people simply won’t have the confidence or courage to invest in their own future and neither will (foreign investors).” All the same, the IMF boss did not stop at security being important simply because it distorted economic development in Africa. Lagarde said security was fundamental for the financial stability of the whole world.
Lagarde alluded that “It’s clear that emerging countries are the motor of world economic growth.” In her assertion, the IMF boss was supporting the IMF’s projections that sub-Saharan Africa will grow 5.25% in 2013, second only to Asian growing economies and well above the world average of 3.6%.

The IMF boss is not the only one to recognise the important role Africa’s economic growth and security record has to play in the world today. During the visit of President Barack Obama of the United States of America (USA) to Ghana in 2009, he acknowledged that Africa’s economic growth and security can benefit that of the USA. According to Obama, it was necessary for all and sundry, including African leaders to play their own role in making Africa a safe haven for global economic competition. Good governance is thus a necessary recipe for security, added the President of the USA.
To get such hope from leading figures in the international arena that security is germane for Africa’s problems is inspirational. Such recognition is a reflection of the role Africa has to play in the economic growth of the world. Concurring with Ichikowitz position, instead of Africa being considered as a drain, the continent is being considered as a core player of the global economy by leading figures.

As one who has had the privilege to have studied and travelled over the beautiful continent of Africa, especially from Cape to Cairo via Rwanda, I am of the view that there are high hopes for economic gains in Africa. All the same, such economic gains must definitely be backed by regional stability and peace especially in Mali and the DRC.
Africa cannot only rely on its growing sectors, such as oil, for its growth. It needs to nurture strong economic foundations spiced with peace and stability. As postulated by Ichikowitz, Africa’s anticipated growth might be second only to that of Asia, but unlike Asian economies like China and India, economic growth is occurring in the absence of the fundamental institutional framework required to absorb that growth and channel it towards more investment in the education, infrastructure, public transport and health sectors.

In Africa, resource rent from natural resources have too often been reserved for a few elitist groups, rather than for the populace and for the growth of the private sector. Africa will remain unstable creating a fragmented terrain for postulated sustainable economic prosperity, if this scenario does not change.

Central governments in Africa and regional organisations have not acted very seriously on this problem. There is need for political disputes to be quelled. There is also need for the African Union to play a major role as a mediator in the conflicts distorting the continent’s economic growth.

This article is syndicated and published at http://www.africanliberty.org/

 
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Posted by on March 15, 2013 in Uncategorized

 

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Stability in Africa now key to world economy


See on Scoop.itAfrica’s development

To hear the head of the International Monetary Fund saying security in Africa is vital for the financial stability of the entire world is incredibly uplifting, writes Ivor Ichikowitz (RT @ParamountGroup1: Stability is crucial because the growing African…

See on www.bdlive.co.za

 
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Posted by on March 12, 2013 in Uncategorized

 

An Alternative African Developmentalism : A Critique of Zero-sum Games and Palliative Economics « amaizo.info


See on Scoop.itAfrica’s development

An Alternative African Developmentalism : A Critique of Zero-sum Games and Palliative Economics: Council for the… http://t.co/OdNWGmTS

See on amaizo.info

 
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Posted by on March 12, 2013 in Uncategorized

 

Private Recreation of Wealth in Africa – Huffington Post


See on Scoop.itAfrica’s development

Financial News
Private Recreation of Wealth in Africa
Huffington Post
What has surprised many investors however, has been the steady rise of the forgotten sibling, the Last Born, Africa.

See on www.huffingtonpost.com

 
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Posted by on March 12, 2013 in Uncategorized

 

Investing in Africa: Follow the fixer | The Economist


See on Scoop.itAfrica’s development

AS GLOBAL investors salivate over Africa’s economic growth, Ashish Thakkar, founder of the Mara Group, explains why success still hinges on local knowledge.

See on www.economist.com

 
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Posted by on March 12, 2013 in Uncategorized

 
 
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