Southern Africa

Part of the debate – in the House of Lords at 5:35 pm on 19th February 2003.

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Photo of Lord Griffiths of Fforestfach Lord Griffiths of Fforestfach Conservative 5:35 pm, 19th February 2003

My Lords, like the last speaker I too thank the noble Earl, Lord Sandwich, for introducing the debate. I was delighted to hear the enthusiasm of the noble Lord, Lord Sawyer, reporting on Investors in People. I must declare a potential, not actual, conflict of interest. A proposal I want to consider later could have a financial benefit for an institution with which I am closely involved in the City of London.

As mentioned by the noble Earl, the situation in Africa can only be described as really dire. Without repeating what has been said, I shall mention a few points. GDP per capita in the region throughout the nineties has declined by roughly half a percentage point. Twenty countries in sub-Saharan Africa are poorer now than they were in 1990. They count for more than half of the region's population. According to the UN, 200 million people are under-nourished. Malnutrition is a leading cause of the death of children under five.

In over one-third of the countries in sub-Saharan Africa, every other child is out of school. On present trends, which are improving slightly, Africa will not witness universal primary education until 2100. One in six children dies under the age of five. As has been mentioned, 25 million people in sub-Saharan Africa have HIV; 10 million children are orphaned by AIDS.

The conclusion of the UN and UNICEF is that,

"Africa saw some success stories during the 1990s but, on balance, the continent's record in moving towards the Millennium Development Goals has been inadequate, especially for the poor. Twenty-three sub-Saharan countries are failing in half or more of the goals; twelve do not have enough data to be assessed . . . With the exception of safe water, regional progress was less than one-tenth of the agreed target between 1990 and 2000."

I think we would all agree that that is a dire picture.

There are examples of success. One was given by the noble Earl—Mozambique. Uganda and Tanzania are others. In parts of the world with which I am more familiar, especially China, there has been spectacular success. In the light of that, surely the millennium goals are to be welcomed. They set clear targets which cover not only poverty but a whole range of indicators of social well-being. Sometimes those targets are attacked because they are arbitrary: 2015 is an arbitrary date. The period 1990–2015, 25 years, is again an arbitrary time period. However, I value the targets because they focus our attention on the urgency of the problem and the need for action now. Without those targets we would be less well off.

The danger today is that of indifference in developed countries. One may ask why the situation in sub-Saharan Africa is so dire. Partly, the reasons are external. They face, for example, a decline in the price of exports. Agricultural protection in both Europe and America is, frankly, a disgrace. It would be a tremendous boost in terms of trade and jobs to sub-Saharan Africa if agricultural protection was removed here, in other countries and in the US.

There are also internal factors. There have been weaknesses of domestic governance; misdirected policies; an investment climate which is not conducive to growth and productivity; and—dare one mention it?—there has been corruption. That is why the NePAD initiative is very important. Its principle is that Africa is saying that its development is an African responsibility and that it wishes to own it. Therefore, through peace, security and good governance, it can do something about it.

Furthermore, in the community of those interested in development—especially the World Bank—it has now become generally accepted that we cannot have real progress in reducing poverty in Africa unless the African economies themselves are prepared to strengthen the private sectors in their market economies and have private sector growth. For that to occur, one needs macroeconomic stability. There cannot be widely fluctuating budget deficits and inflation. One needs incentives to save for investment and for risk-taking and, in many countries, much clearer definitions of property rights and enforcement of contracts.

The conclusion of the World Bank, when surveying the whole area, was very interesting. It said:

"Clearly experience shows that the private market economy must be the engine of growth".

Therefore, I believe we should be urging countries in sub-Saharan Africa to strengthen their private sectors. That is absolutely critical for removing poverty. Frankly, even if all the economies in the region were to show considerable growth in the next decade or two, that would not solve the problem of clean water, primary education, better and new roads, or meet the targets of public health.

That is why we need a boost to official development aid. Some are very much opposed to it. It must be said that in the past official development aid has been wasted, abused and even stolen. However, without a major boost in official development aid as NePAD and African economies are prepared to strengthen their market economies, we shall never realise the millennium development goals. In that respect, I applaud an initiative by the Chancellor of the Exchequer, Gordon Brown, introduced at the end of his pre-Budget Report last November; namely, the international development financing facility. Noble Lords may think it extremely generous my saying that, because on some issues I have not found myself on the same side as the Chancellor. But in another place Michael Howard, in immediately responding to the Chancellor's Statement, said:

"I start on a note of consensus. I welcome what the Chancellor said in his closing remarks about the relief of global poverty. He said that he welcomed the support that that would receive from all quarters of the House, and he was absolutely right. We support those measures".—[Official Report, Commons, 27/11/02; col. 327.]

Basically, the Chancellor's proposal related to how one could get the extra £50 billion aid mentioned. Given the state of the world and individual economies, I cannot see that money coming from fresh aid. The Chancellor proposed that individual countries make a commitment not simply to give aid on an annual basis, but, for instance, for 15 years. Therefore, through the international capital markets, one could raise money by issuing bonds. Individual governments could then disperse that money as extra aid between now and 2015.

At the very least, the proposal means that the time profile of aid would change. There would be a major frontloading of aid between now and 2015 and perhaps a reduction thereafter. Some would argue that as aid increased and visible improvement was evident, it would be highly likely that the level of aid itself would also increase.

I very much back the proposal. The part I find attractive—it may not appeal to all Members of the House—is the emphasis placed by the Treasury on conditionality. The aid must meet certain conditions. Each individual country that was part of this international development financing facility would be able to lay down conditions. The US has effectively already done so through its millennium challenge account. We have the opportunity to be very creative in how we approach the issue. We could involve the NGOs and the private sector more.

This is an ambitious proposal, but, given the dire nature of the situation in sub-Saharan Africa, nothing short of an imaginative gesture will tackle the problem. I believe therefore that we should support strongly the Chancellor's initiative.