Dealing with shocks

Fascinating discussion at the parallel session on how countries should deal with external shocks.

Peter Eigen, Chairman of EITI, made the point that the financial crisis (and a sharp fall in commodity prices) should spur countries to strengthen corporate governance, transparency, and accountability. Panelists also felt that African countries needed to do a better job in ensuring food security. "African nations consume what they don't produce and produce what they don't consume," said Reginald Mengi (a prominent Tanzanian businessman and chairman of the East African Business Council). He reiterated that from a business perspective, it made sense for Africa to become a net exporter of food, which would help insulate it from volatile prices at home.

World Bank Managing Director Ngozi Okonjo-Iweala said that while food prices had fallen, they were still high and remained at 2005 levels. This made Africa vulnerable to shocks and countries needed to strengthen their ability to deal with such dislocations.