Some noticeable developments that made news this week on the continent include; the tragic death of Susan Tsvangirai wife of Zimbabwean Prime Morgan Tsvangirai. There was a conspiracy making rounds that President Robert Mugabe and his ZANU/PF had a hand in this accident--based on earlier incidents in which opposition figures have lost lives in car accidents. However even Prime Minister Tsvangirai himself laid the conspiracy to rest by admitting that it was just a tragic accident.
In the US,President Obama called on for education reform,he summed it like this "Economic progress and educational achievement have always gone hand-in-hand in America,”
Last week President Obama said that there was a strong need for education reform in this country,he summed it like this "Economic progress and educational achievement have always gone hand-in-hand in America,”
So now that we know that there is a strong connection between education and economic progress.....what is next?
On a previous show here on Upfront,we called for a need to reform Africa's education systems. We noticed that there has been little recognition of this challenge among our political leadership. Now that a high profile American leader has connected the dots for us in terms of understanding the relationship between our poor economies and education,we should hope to hear more African leaders taking on the task to spearhead reform of our education systems.
On Upfront show this week, we talked about the current economic crisis, its implications and effects on our continent. We had a number of voices from the continent talking about the rise in commodity prices,loss of jobs etc. Our guests included a young lawyer from Rwanda working in Washington D.C., a medical student from Nigeria Port Harcourt university and a Kenyan Harvard MBA student. Each of them has an interesting take on the global economic crisis and what it means to Africa.Are there any opportunities for us to leverage our investment potential?
The world bank and other development institutions say that the global economy will shrink this year for the first time since World War Two. The implication this has for Africa, among other things, is that we face higher borrowing costs as we access finance for our public projects. There is already a considerable decrease in capital flows in form of decreased remittances from the diaspora community. Robert a Rwandan lawyer in Washington DC told me that since the recession began,he has been forced to cut in half remittances to his family in Kigali. He has also been forced to put off investment projects including a house he was building for his family.
Ultimately economists say that the decrease in direct foreign investment or from diaspora communities, will as lead to a slower growth in the future.
Nobel laureate, economist Joseph Stiglitz spoke at a meeting of a U.N. Commission of Experts to explore reforms of the International Monetary and Financial System. The Commission was created to deal with the impact of the financial crisis on developing countries. Stiglitz told the Commission that poor countries unfortunately do not have the billions of dollars needed to revive their economies. Many African countries are dependent on development assistance. However as the rich nations grapple with their own economic problems,they don't have much to spare anymore. The world bank reports that donor countries have fallen behind by around $39 billion on their commitments to increase aid made at the Gleneagles Summit in 2005.
Mumo Muthengi a Harvard MBA student from Kenya told me that in this crisis,Africa could position itself as the best investment destination for people seeking to make a better return for their buck. Even though this years growth figures have not yet been announced,previous growth data supports his hypothesis.
A report released by the UN Economic Commission for Africa (UNECA) a couple of years back showed that Africa was growing faster than any other developed region. However in a report coming out this week, the World Bank says that developing countries face a financing shortfall of $270-700 billion this year, as private sector creditors shun emerging markets, and only one quarter of the most vulnerable countries have the resources to prevent a rise in poverty.
Now this paints a somewhat grim picture of our economic future,but that is the reality of the economic times we live through. Even developed countries are feeling the heat. How do we come of this crisis a
stronger continent economically will depend on our immediate responses and long term strategies.
This could be one of those generational opportunities and we can't afford to let it pass by doing business the old way. We have both the resources and skills....at least that is how it appeared to me during the recently concluded Harvard Business School African Business Conference.