G20 launches plan to fight poverty in Rwanda, Ethiopia
(Independent) –Under German Chancellor Angela Merkel’s “Investment Compacts”, an initial seven African countries would pledge reforms and receive technical support in order to attract new private investment.
More than half of Africans are under 25 years old and the population is set to double by mid-century, making economic growth and jobs essential for the young to stop them from leaving, Merkel has said.
Germany’s partner nations are Ghana, Ivory Coast and Tunisia, while Ethiopia, Morocco, Rwanda and Senegal are also taking part. Far poorer nations such as Niger or Somalia are so far not on the list.
“We are ready to help interested African countries and call on other partners to join the initiative,” said the G20 in their final communique.
The plan, as well as multinational initiatives on helping girls, rural youths and promoting renewable energy, would help “to address poverty and inequality as root causes of migration”.
Some 100,000 people, most of them sub-Saharan Africans, have made the dangerous journey to Europe across the Mediterranean in rickety boats this year as the migration crisis shows no sign of abating.
Anti-poverty group ONE said that the investment compacts “promised much, but too many G20 partners missed the memo and failed to contribute.
“The flimsy foundations must now be firmed up, follow through and improved, especially for Africa’s more fragile states.”
The group’s Jamie Drummond said that “this will be the African century and Chancellor Merkel wanted the G20 to get on the right side of history, but internal strife and division scattered the G20 away from this visionary path.”
Oxfam judged that the plan “rests on the dangerously naive assumption that boosting private investment will automatically help the poorest in the continent.
“If left unchecked, the Compact might simply line the pockets of wealthy foreign investors.”
Ethiopia parliament passes $13bn budget after World Bank, IMF praise
(Africa News) —The Ethiopian parliament on Friday unanimously passed a 320.8 billion birr ($13.9 billion) budget for the financial year of 2017/18, the amount represents an increase of nearly 17 percent on the previous year, the ministry of finance said.
The East African nation’s budget sets aside 114.7 billion birr for capital expenditures. Recurrent expenditure – including administrative, economic and social services – amounts to 81.8 billion birr.
The country despite its challenges – security-wise, due to refugee influx and also a biting drought in the horn of Africa region has earned economic praise from global finance outfits, the World Bank and the International Monetary Fund (IMF).
The World Bank in a recent report report stated that Ethiopia’s economy will be the most expansive on the continent for the year 2017 followed by Tanzania, Ivory Coast and Senegal in that order.
The position was contained in the global finance outfit’s Global Economic Prospect report released in June.
‘‘Ethiopia is forecast to expand by 8.3 percent in 2017, Tanzania by 7.2 percent, Ivory Coast by 6.8 percent, and Senegal by 6.7 percent, all helped by public investment. However, some countries need to contain debt accumulation and rebuild policy buffers,’‘ the report cautioned.
Before the World Bank, the IMF had in April this year ‘crowned’ the country as the new economic giant of the East Africa region dethroning neighbouring Kenya.
Their annual economic output for 2017 was expected to hit $78 billion from $72 billion recorded last year. Ethiopia’s economic growth since 2015 has been pegged at 10.8% putting a significant gap between them and Kenya. In monetary terms, Ethiopia has opened a gap of over $29 million over Kenya.
Ethiopia’s economic growth is hinged on public-led spending on infrastructure and a strong demand by locals. It has also recently become an investor destination of choice for particularly Chinese investors.
Another factor believed to be driving the economy is the country’s large population – which is almost double that of Kenya.