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BBC. Wednesday, 31 May, 2000, 18:03 GMT 19:03 UK

http://news.bbc.co.uk/hi/english/business/newsid_771000/771271.stm

African economies ‘in reverse’

Too little infrastructure, too little development

A new report by the World Bank says many African countries are worse off now than they were at independence in the 1960s.

The bank says the total combined income of 48 countries in Africa is little more than that of Belgium.

The World Bank report, called Can Africa Claim The Twenty-first Century?, says major structural changes are needed if Africa is to catch up with the rest of the world.

Even just to maintain current levels of poverty, African economies will have to grow by 5% because of rapidly growing populations.

But, the report says Africa has “enormous untapped potential and hidden growth reserves”, if it can mobilise its human resources and improve its political systems.

Years of neglect

In the last 40 years, average incomes per person in Africa have stagnated while they have grown in most of the rest of the world.

Africa now accounts for only 1% of the total world economic output and 2% of world trade.

On average, African countries have economies smaller than a town of 60,000 people in a rich country.

And infrastructure is far less developed as well.

With only 10m telephone lines, half of them in South Africa, there is little chance of most Africans gaining access to the internet.

Africa has fewer roads than Poland, only 16% of which are paved, and only one in five households has access to electricity.

Two-thirds of rural Africans lack adequate water supplies, while three quarters lack adequate sanitation.

The World Bank also points out that Africa is under-utilising its human capital, particularly its women.

The average schooling for African women has increased by only 1.2 years in the last 40 years, the lowest gain anywhere in the world.

Instead, women typically work longer hours than men, collecting water and firewood, and lack access to credit, land, or educational resources.

Africa's human resources are also being decimated by disease, with Aids infection rates reaching 25% in Zimbabwe and Botswana.

And decades of civil war and conflict, which have affected at least 20 of sub-Saharan Africa's 48 countries, have increased poverty and violence.

The political system, even where there are elections, is generally based on a winner-take-all system that is not sufficiently inclusive of Africa's diverse ethnic groups.

“Political changes .. would do much to empower people and communities and help energise the development process,” the report says

Debt burden

Africa is the world's most indebted and aid-dependent region, with 17% of GDP flowing out in debt repayments, three times what the Bank believes is a sustainable level.

But foreign donors are reluctant to give more control to corrupt and ineffective governments, and are insisting on strict conditions in return for debt forgiveness.

“Resolving the dilemma posed by aid dependence requires a radical rethinking of the relationships among Africa's civil society, governments, and donors,” the World Bank says.

It has favoured giving more grants directly to non-governmental organisations who have roots in their communities, effectively by-passing those governments.

The report calls for four key steps to improve Africa's economic prospects:

* Better government and fewer wars * More investment in people * Diversification of the economy * More aid from rich countries

The report comes at a sensitive time for the World Bank, which has been under attack from rightwing critics in the United States who would like to cut its funding radically.

They argue that the Bank has had little effect on poverty reduction, and in some cases actually helped corrupt governments stay in power.

The new report was produced in conjunction with the UN Economic Commission for Africa and the African Development Bank - ironically, one of the organisations that some argue should replace the World Bank.

Africa's problems Roads: only 16% paved Telephones: 10 per 1000 Electricity: 80% lack access Aids: 35m infected Sanitation: inadequate for 75% of rural population Source: Can Africa Claim the 21st Century