US-Africa Leaders’ Summit highlights Good Governance Issues

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WASHINGTON, D.C., (August 4, 2014)—The Open Society Foundations convened an impressive group of civil society advocates to urge African and the U.S. government to take meaningful steps to improve transparency and accountability. Those efforts are critical to ensuring a stable future where prosperity is widely shared and sustained in Africa.

Open Society Foundations founder and chairman George Soros was joined by the Vice President of Liberia Joseph N. Boakai, U.S. Deputy Secretary of State Heather Higginbottom, philanthropist Mo Ibrahim and leading civil society representatives from across the African continent. Participants called on the U.S. and African governments to guarantee space for civil society participation and prioritize efforts to combat poor governance and corruption.

“Civil society participation is fundamental to promote accountability and good governance in Africa. The United States and African governments must provide space for civil society to operate to ensure that Africa’s resources are used for the benefit of all people” said Elias Issac, the director of the Open Society Initiative for Southern Africa in Angola.

African governments have made firm commitments to improving governance and accountability, but the continent continues to lose billions of dollars to corruption and poor governance.  One estimate suggests that more than $1 trillion in illicit financial flows were transferred out of Africa over the last 30 years.  Since 2003, 34 African countries have acceded to the African Peer Review Mechanism, 35 countries have ratified the African Union Convention on Preventing and Combating Corruption, and 23 have ratified the African Charter on Democracy Elections and Governance. These commitments are impressive. But they do not reflect how Africa’s public resources are being managed.

The lack of political will to implement existing mechanisms and advance reform inhibits meaningful participation of citizens, fuels corruption, and hinders development. Limited transparency and poor governance is too common within the extractive industries including oil, gas, and mining. Tax evasion, trade mispricing, and opaque budgeting processes further inhibit inclusive development.  Event participants argued that inclusive economic growth goes hand in hand with strengthening democracies and institutions. Space for a vibrant civil society is essential to strengthen democracy through enhanced citizen participation and monitoring.

“While African leaders are looking for the U.S. government and businesses to expand trade and investment in Africa, we too as African citizens are asking our governments show us what has been done to ensure that such monies are used to promote inclusive and sustainable development,” Jeggan Gray-Johnson, an advocacy officer with the Open Society Foundations’ Africa Regional Office in Johannesburg, said.

The objective of the U.S.-Africa Leaders’ Summit is to “Invest in the Next Generation” in Africa.  To ensure inclusive development with wide-spread opportunity and sustained growth, U.S. and African leaders must provide space for civil society organizations to operate and they must ensure meaningful implementation of transparency and accountability efforts.

Background:

Advancing equitable development in Africa requires the U.S. and African governments to honor their commitments to combating corruption and strengthening the African Union’s standards of good governance.  We must shift from rhetoric to reality.  A vibrant civil society plays an essential role in ensuring effective governance. The U.S.-Africa Leaders’ Summit offers an opportunity for the United States and African heads of state and government to embrace the multiple pledges they have undertaken to strengthen governance and ensure the participation of citizens across the continent who demand to be governed well.

Fast facts:

Africa is the world’s fastest-growing continent, with gross domestic product expected to rise by an average of 6% annually.  Foreign direct investment flows have spiked from $15 billion in 2002 to $37 billion in 2006 and $46 billion in 2012.

While Africa has registered tremendous growth, it has at the same time recorded limited prosperity.  Inequality is widening.  This is largely due limited transparency and accountability and weak governance institutions.

One estimate suggests that more than $1 trillion in illicit financial flows were transferred out of Africa over the last 30 years,  the vast majority of which was through trade mis-pricing.  The continent’s largest economy, South Africa, is estimated to have seen $23 billion in losses in 2011. Nigeria is estimated to have lost $12 billion lost in the same timeframe.

Public spending in many resource rich countries must better promote inclusive growth.  In 2013, the Africa Progress Panel reported that Chad, Guinea, Niger, Uganda and Zimbabwe each spent less than .5% of their Gross Domestic Product on social protection programs.

There is a growing body of evidence that shows that the best way to manage public funds effectively and equitably is through budget systems that are transparent, open to public engagement and scrutiny, and that have robust mechanisms and institutions for participation and oversight.

During the U.S.-Africa Leaders’ Summit, U.S. companies will unveil at least $900 million in investment in Africa, according to the U.S. Department of Commerce.  Partnerships will be leveraged with the aim of increasing access to electricity in Sub-Saharan Africa with a total investment of $300 billion in Sub-Saharan Africa by 2030. The U.S. Millennium Challenge Account has further potential to infuse over $7 billion through Poverty Reduction Compacts in Africa and the Africa Growth and Opportunities Act is due for renewal later this year.

Many African Union member states have already made commitments to transparency and good governance in natural resource sectors, and combating corruption.  There is much on which the U.S.-Africa Leaders’ Summit should build:

34 African countries are part of the African Peer Review Mechanism, which reviews countries on the basis of their commitment to policies, standards and practices that promote sustainable and inclusive public participation, good governance and inclusive economic development;

35 countries have ratified and deposited the African Union Convention on Preventing and Combating Corruption; which calls for establishing of independent Anti-Corruption Agencies, pass laws of Access to information; passing of laws that address corruption in both private and public sectors, and pass laws that address banking secrecy;

23 have ratified and deposited the African Charter on Democracy Elections and Governance to the African Union Commission;

15 countries are Extractive Industries Transparency Initiative compliant; and

 
8 have or are creating action plans under the Open Government Partnership.
 
Jeggan Grey-Johnson,
 
Program Officer Research and Advocacy
 
Africa Regional Office, AfRO
 
President Place
 
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tel: +27 (0)     11 587 5000
 
fax: +27 (0)   11 587 5099
 
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web: www.afrimap.org

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