Politics and policy

World Bank seeks to renew support strategy for Africa

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Road construction works on Thika Road, Nairobi. Massive infrastructure deficit in Africa means only one in four people have access to good roads and electricity. Even fewer have access to clean water and sanitation. Photo/WILLIAM OERI

Road construction works on Thika Road, Nairobi. Massive infrastructure deficit in Africa means only one in four people have access to good roads and electricity. Even fewer have access to clean water and sanitation. Photo/WILLIAM OERI 

By Johnstone Ole Turana

Posted  Tuesday, July 13  2010 at  00:00

Last month, the World Bank started a comprehensive programme to restructure its strategy in Africa, hoping to recapture its relevance in the changing economic landscape.

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For the World Bank, the realisation that its traditional engagement policy with developing economies, especially Africa, has failed to bring the expected benefits must be a humbling experience.

This has pushed it to ditch its previous Washington- led approach to engaging Africa for a newer approach that will allow its economic policies to be determined through country participation.

The new method is expected to provide the region with an opportunity to prioritise its needs, hence align resources to critical areas such as infrastructural investment—a departure from its previous uniform programmes which were to be implemented across the continent.

“Africa has undergone tremendous changes over the last decade and our engagement needs to be in line with the new realities hence we seize this unprecedented opportunity and adjusts the strategy to best support Africa’s development challenges,” said Shantayanan Devarajan, the Chief Economist of the World Bank’s Africa Region.

The new strategy is expected to be realised through an ongoing continental consultative forums undertaken by the World Bank with participation from the governments, multilateral development institutions, the private sector, scholars, experts from think-tanks and other non-governmental organisations.

In 1990s, the World Bank and its affiliate body, the International Monetary Fund (IMF), introduced the infamous Structural Adjustment Programmes (SAPs) —a set of economic policies which were meant to pry open Africa economies.

The SAPs policies advocated for a free currency exchange regime, free foreign exchange policy and the introduction of cost-sharing in the provision of social services such as education and health.

“The introduction of the SAPs had major challenges to the Sub-Saharan Africa economies as they were not prepared to handle the new open and competitive economic policies of liberalisation,” said Prof Njuguna Ndung’u the governor of the Central Bank of Kenya (CBK).

Prof Ndung’u attributes this to the fact that the governments were largely involved in economic activities and limited the presence of a robust private sector.

Whereas the opening up of these economies has allowed foreign direct investment to flourish, the introduction of cost-sharing led to massive disruption of the social fabric as access to services was largely determined by ability to pay.

With a majority of the population living below the poverty line, the policy denied a majority of the people access to services.

The results were increased school dropout, low transmission rates from primary to secondary schools and rising incidence of disease.

By the time the countries ditched the SAPS at the turn of the century, the damage was far-reaching, with high levels of illiteracy and diseases.

Since 2005, the World Bank and its affiliate have engaged Africa on the basis of the African Action Plan (AAP), which largely operated on the basis of aid and grant provision for implementation of its projects.

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