Hope Where There Was None

by Paul Wolfowitz
President, World Bank Group
April 12, 2007

When Sub-Saharan Africa makes headlines, it is usually about poverty, disease and conflict. From wars fought over diamonds, oil and mineral wealth to famines and diseases that devastate entire communities, Africa 's misery is well-known.

The desperate need on this vast sub-continent is undeniable. Nearly half of Africa 's population struggles to survive from one day to the next on less than $1. In the past quarter-century, when half a billion people managed to escape poverty world-wide -- largely due to private-sector growth in East and South Asia -- the number of poor in Sub-Saharan Africa nearly doubled. Africa is the one continent that is expected to fall short of the Millennium Development Goals to halve poverty and improve basic social indicators by 2015.

Yet almost without notice, that bleak landscape is changing. In many places across Africa , peace and growth are taking hold. We are seeing conflicts recede and small businesses emerge. We are seeing hope where there was none.
Supporters of Ellen Johnson-Sirleaf, Liberia's (and Africa's) first elected female president.
Over the past decade, a total of 17 African countries that are home to one out of three Africans have consistently achieved annual growth rates of 4% or better. Perhaps the most unexpected progress is unfolding in countries that have emerged from decades of horrible conflict.

In Rwanda , where nearly a million people were killed in a horrendous genocide 13 years ago, growth has averaged 7% in the last decade. And Mozambique , a country ravaged by 20 years of civil war, has averaged 8% growth. Both countries invested in infrastructure, eased regulations to make it easier to start a business, and worked hard to attract private investors. Behind these growth figures are stories of human triumphs and real improvements in people's lives, with more children attending school and more mothers delivering healthy babies.

Africa 's progress is by no means uniform, but it is a striking change from the past. Without question, growing peace and stability are major factors behind this change. Although Zimbabweans continue to suffer in the ongoing crisis and some conflicts persist -- especially the horror that is Darfur -- for countries like Liberia , Burundi , Sierra Leone and the Democratic Republic of Congo, there is hope where for years there was only violence and atrocities.

African countries are also making progress because they are taking serious steps to improve their governance. Ghana , Kenya , Mauritius , and Rwanda were the first four countries to subject their governance systems to a rigorous examination as part of the African Peer Review Mechanism. It is not an accident that three of these countries are among the 17 relatively good performers.
 
This recognition by leaders is paralleled by an increasingly informed African citizenry which is also calling for change. After more than two decades of devastating war and conflict, Liberia 's citizens voted in their first elections just over a year ago. They voted overwhelmingly for an economist who pledged to pursue reforms and rebuild the country. She is now Africa 's first female president, Ellen Johnson-Sirleaf.

Rich countries themselves recognize the importance of good governance in Africa and have placed it high on the G-8's development agenda. They too can help encourage governance improvements by sanctioning their own bribe-givers, and by helping poor countries recover assets stolen by corrupt leaders.

The African countries that are making progress are also doing so because their leaders are learning from the past and from the experience of others. Tanzania , Ghana and Mozambique are revisiting doctrinaire economic policies and creating space for their private sector to thrive.
They were inspired to do so, in no small measure, by the success of reforms in developing countries like East and South Asia . The demonstration that sustained economic development is possible has resonated with leaders and ordinary citizens alike.

Last year, the World Bank hosted high-level delegations from 24 African countries in Kuala Lumpur to learn about Malaysia 's development experience. Fifty years ago, Malaysia and Ghana started out with nearly the same endowment of human and natural resources. Yet today, Malaysia 's per-capita income is nearly 12 times that of Ghana 's and extreme poverty is almost nonexistent.
 
But Ghana has started to make up for lost time. In the last decade, it achieved average real growth of nearly 5% per year and managed to reduce extreme poverty from nearly one-half to one-third of the population. It is starting to become an African example of success for others to emulate.
Indeed, President Joseph Kabila of the Democratic Republic of the Congo came away from Ghana 's 50th anniversary celebrations last month, marveling at what Ghana had accomplished. The most compelling examples for progress are the ones closest to home.

The questions before anyone whose conscience is moved by the tragedies of Africa's past is how can we encourage today's good performers to become outstanding performers, and how can we encourage the other two-thirds of the subcontinent to follow their example. Much of the answer, of course, lies in sustaining and improving sound economic policies and good governance, and that will depend most of all on the African people and their leaders.
 
But a large part of the answer lies in providing more resources, and here the rich countries need to do much more than they currently are. True, without sound policies and good governance, money alone will not do much good and it can even do harm. But without resources to invest in education, in health care and in the infrastructure that businesses need to grow, good policies alone can't achieve much either.

In Tanzania and Ghana , businesses struggle to survive with power outages that often last 12 hours per day and with telecommunications charges that would bankrupt businesses in the U.S. or Europe . That means lost jobs and lost opportunities, more children who grow up without education, and more people denied urgent health care.

The successful East Asian emerging economies benefited enormously from public-sector investment in education, rural development and physical infrastructure, much of it financed by foreign assistance. In Korea , foreign funding financed nearly half of public investments during the formative years which paved the way for its spectacular development success.

For Africa and the poorest countries in the world, a critical source of development financing comes from the International Development Association or IDA, the World Bank Group's soft lending arm. Last fiscal year, IDA support to the poorest countries reached a historic high of $9.5 billion, with half of that dedicated to Africa .

In Uganda , IDA resources were used to improve water and sanitation in small towns, supplying water to some 190,000 residents. And in Ethiopia , IDA resources helped demobilize 150,000 soldiers and integrate them into civilian life, allowing the government to shift its spending from defense to social sectors.

This year, donors are discussing the next triennial round of replenishment for IDA. A higher level of commitment is needed from the international community, one that will match the ambitions and aspirations of the African people.

Today, we are seeing a new generation of African leaders who are increasingly aware of their responsibility to their people and pushing for reforms. They are giving the world compelling reasons to support their efforts. They don't want charity. What they want and deserve is opportunity.

And that is a historic opportunity for the rest of us -- an opportunity to help Africa 's energetic and capable people join in the march out of poverty that is transforming so much of the developing world today.

This article was printed in the Wall Street Journal on April 12, 2007.