Africa’s economies are under severe challenge. The achievements of the past decade, which has seen robust economic growth, macroeconomic stability, and welcome progress in poverty reduction in a growing number of African countries, are now at risk as the world faces the gravest economic crisis in more than sixty years. Meeting in Dar es Salaam on March 10-11, 2009, African policy makers, development partners, the private sector, and civil society expressed a shared objective to ensure that the hard-won gains are preserved and the conditions for future progress are restored.
African Ministers and Governors underlined six building blocks of a stronger partnership between the Africa and the IMF: enhancing IMF surveillance over the policies of all its members, in a spirit of evenhandedness; expanding the IMF’s financing facilities and their accessibility to low-income countries; consolidating the debt relief process by adjusting the IMF’s debt sustainability framework to accommodate Africa’s new financing needs and opportunities; accelerating reforms of IMF governance to enhance Africa’s voice and representation at all levels of the institution; enhancing the policy dialogue between the IMF and its African members, including through technical assistance, to ensure that African countries’ policies benefit from the IMF’s experience and expertise; and reinforcing the IMF’s catalytic role to leverage public and private financing for Africa’s critical infrastructure needs.
1. We reaffirm that facing the global economic crisis requires strong partnerships. While it originated in the mature financial markets, the impact of the crisis is now global, requiring a global response. African policy makers are committed to sustaining sound economic policies and continuing to strengthen economic governance. Development partners need to increase their efforts to support Africa, including through aid, trade, and technical assistance. The private sector, in Africa and beyond, needs to seize the investment opportunities that represent the main engine for economic growth, employment creation, and poverty reduction in Africa. And the IMF needs both to bolster its financial resources and sharpen its surveillance over global financial markets.
Responsive And Timely Financing
2. Now more than ever, we must ensure that Africa’s financing needs are addressed. As the global crisis takes its toll, concessional support will be particularly important for helping countries to bolster their social safety nets and preserve fiscal space for vital development projects. Sustained economic development must also address Africa’s large infrastructure needs, by leveraging a quick and innovative revival of public and private sector financing. We call on Africa’s development partners to step up their support to assist Africa in these difficult times and ensure continued progress toward the Millennium Development Goals.
3. African members support the Managing Director’s call to double the IMF’s concessional resources and raise African countries’ access to IMF financing urgently. Existing IMF financial facilities have provided some additional resources for Africa. But Africa will require more, and more flexible, support. African members welcome the forthcoming review of the IMF’s financing facilities for low-income countries; these facilities need to be sufficiently responsive and flexible to meet the diverse needs of African countries, including during the global downturn. This includes raising the limits on access to existing IMF facilities, which have become increasingly binding, and developing new short-term financing instruments that can instill confidence and provide quick and more ample access to finance should conditions deteriorate. African members also welcome the forthcoming reexamination of the IMF’s framework for assessing debt sustainability, which should aim to facilitate strong and sustainable economic growth, by ensuring that the evolving financing needs of African countries can be accommodated while preserving debt sustainability.
Expanded and Accelerated Capacity Building
4. We underline the importance of strong policy frameworks and institutions to address the global economic crisis. African members welcome the decision by the IMF to open two new Regional Technical Assistance Centers in Africa, in addition to expanding the existing three, which will provide enhanced assistance to Africa, while strengthening its timeliness and ownership. Long-term economic growth in Africa depends critically on reinforcing human and institutional capacity through technical assistance and training, including on a regional basis. African members call on the IMF to review its policy to charge for technical assistance to reflect its nature as a public good.
Enhanced Policy Dialogue
5. We agree that a frank and continuous dialogue between the IMF and its African members contributes greatly to strengthening policy advice and its effectiveness. The IMF’s global expertise and experience in economic policy formulation must be responsive to Africa’s needs for economic advice. Such advice is especially valuable at the time that national policy frameworks are formulated and the IMF will ensure that its analytical work is provided in a timely and balanced manner, taking into account African countries’ development needs and specificities.
7. African countries, for their part, remain committed to the implementation of sound economic policies and the establishment of strong institutions that are consistent with their long-term development goals. They call on the IMF to further strengthen its support for regional integration, which bolsters economic development by enlarging markets and reducing vulnerability to shocks. We agree that the quality of the IMF’s policy advice is greatly enhanced through its presence on the ground and the IMF is committed to maintaining, and where possible, expanding its in-country presence in close consultation with its African members.
8. The IMF and its African members are committed to a new, enhanced partnership. Notably, we agreed that:
• We will work together towards the shared goals of making IMF financing more timely and responsive, making its technical assistance more effective, and enhancing our dialogue on the policy challenges and opportunities facing Africa.
• We will build on the first steps that were taken in 2008 to increase the voice and representation of African members of the IMF, with the aim of agreeing rapidly on further steps in this direction to ensure that the diversity of the IMF’s membership is fully reflected in its governance structures.
• The implementation of the joint commitments between the IMF and its African members will be reviewed every six months in the context of the African Consultative Group.
Dar es Salaam, March 11 2009