G8 to Offer Micro-credit Help, Step Up AIDS Funding for Africa

“Development ministers from the Group of Eight (G8) undertook in Berlin on Tuesday to set up micro-credit facilities for African nations with the help of the World Bank and increase funds for the fight against AIDS.  

German Development Minister Heidemarie Wieczorek-Zeul said giving poor Africans access to credit would be at the top of the agenda when leaders of the G8 wealthiest nations meet in Germany in June. ‘The G8 will do everything it can to institute micro-financing to which the poorest in Africa can have access, in particular women,’ Wieczorek-Zeul said at the end of a two-day meeting in Berlin held to prepare for the summit. She said officials from the G8 and Africa met with representatives of the African Development Bank, which will be asked to help institute the system along with the World Bank to stimulate job creation and economic growth in the world's poorest continent. …” [Deutsche Welle (Germany)/Factiva]

AFP writes that “… Wieczorek-Zeul said G8 leaders will also announce more funding for the fight against AIDS, which afflicts Africa more than any other continent, and to increase investment in the region when they meet in Heiligendamm from June 6-8. ‘We have to replenish the Global Fund to Fight Aids. It is important that the G8 makes a contribution.’ She put no figure on new G8 pledges for the fund, which was established in 2001. …” [Agence France Presse/Factiva]

The Financial Times reports that the G8 further said Tuesday “The increasing volumes of development aid coming from powerful emerging economies such as China and India should meet higher governance and transparency standards. China already provides aid amounting to $2 billion a year, a higher figure than Belgium, Switzerland or Australia. India's estimated total of up to $1 billion a year already exceeds that of Finland and Ireland, according to the Organization for Economic Co-operation and Development club of industrial states. …

Officials at yesterday's talks said the delegates from China and India were keen to talk to the G8 on aid issues but stressed their right to set their own priorities. … G8 development ministers said a ‘global partnership’ with emerging economies was needed when setting governance benchmarks for potential recipients. … The G8 ministers also urged emerging economies to join the Extractive Industries Transparency Initiative, a voluntary framework whereby oil and gas-producing countries publish data on industry revenues and expenditures.” [The Financial Times (UK)]

Reuters further notes that at a news conference on Tuesday “Germany's development minister said a tax could be levied on jet fuel and the proceeds spent on helping developing countries offset the effects of climate change. … 

The G8 ministers [also] stressed in the meeting the need to limit deforestation in developing countries. But the US has made it clear it does not like the idea of financing the development of these countries' forestry.

The informal G8 development meeting, which closed on Tuesday, included for the first time delegates from developing nations Brazil, China, India, Mexico and South Africa. …” [Reuters/Factiva] 

Indonesia To Resume Sharing Samples Of Bird Flu

“Indonesia said yesterday it would immediately resume sharing samples of its deadly H5N1 bird flu strain. It came to an agreement with the World Health Organization (WHO), scientists and donors on a framework through which developing countries will receive greater access to vaccines for non-seasonal viruses, including bird flu.

After two days of talks in Jakarta, samples will now be sent only to four WHO collaborating laboratories, which will do diagnostic tests on them, update pandemic risk assessments and produce vaccine seeds. The decision removes a block on international efforts rapidly to develop vaccines to tackle a future pandemic. … Siti Fadillah Supari, Indonesia's health minister, said the terms of reference for permission were likely to require vaccine manufacturers to help strengthen the global influenza surveillance network for sharing of biological material, build manufacturing capacity in developing countries and improve access to ‘safe, effective and quality [bird flu] and other potential pandemic influenza vaccines.’ …” [The Financial Times (UK)]

AP reports that WHO's top flu official, David Heymann “… said an exclusive temporary arrangement was worked out with Indonesia that would require vaccine companies to seek permission before using its viruses. However, global health ministers would strike a new deal when they meet in May for the World Health Assembly. He said other countries would continue to use the current free-sharing system, but would know where their viruses were being sent. …” [The Associated Press/Factiva] 

Reuters adds that in a separate statement, the WHO said “… it welcomed the Indonesian decision, and ‘WHO Collaborating Centers will continue risk assessment on H5N1 virus samples. The centers will continue to transform virus into seed virus suitable for vaccine production.’ ‘Other agreed uses of the virus will also be outlined in the Terms of Reference - including the standard procedures for providing these seed viruses to vaccine manufacturers ... in a manner to be determined,’ the WHO statement said. …” [Reuters/Factiva] 

WSJ writes that “… Making the announcement late [Tues]day, Supari declined to say how many virus samples have accumulated in Indonesian laboratories since the country stopped sharing samples with international scientists in December. ‘The discussions were long and difficult, but the result is satisfactory,’ Supari said. She called the past system of sharing samples ‘more dangerous than the threat of an H5N1 pandemic itself.’  

During the conference, the WHO also discussed the idea of establishing a global stockpile of bird-flu vaccines that developing countries would have access to if a pandemic broke out. That idea has attracted attention from possible funders, including the Bill & Melinda Gates Foundation.” [The Wall Street Journal/Factiva]

Kyodo News notes that “… Earlier this year, Indonesia decided to stop sending samples of the bird flu strain, including to collaboration centers under the WHO. It did so to protest the development of human bird flu vaccines using the Indonesian strain of the virus by Australia-based pharmaceutical company CSL Ltd. without Jakarta's consent.” [Kyodo News (Japan)/Factiva]

Sewage Reservoir Floods in Gaza, Killing 5

“An earthen embankment around a sewage reservoir that was filled to capacity collapsed Tuesday, and officials said it spewed a ‘tsunami’ of waste and mud that killed five people and forced residents to flee Umm Naser, a village in the northern Gaza Strip. One local official blamed the collapse on shoddy infrastructure, and United Nations officials said they had warned of such a catastrophe for more than two years. …

A 2004 UN report warned that the sewage plant was at maximum capacity and that flooding was inevitable unless a new waste treatment plant was built. It said the effluent lake was a breeding ground for mosquitoes and waterborne diseases, posing a serious health hazard. Efforts to build a new waste treatment plant were repeatedly hampered by fighting between Israel and the Palestinians. Stuart Shepherd, of the UN Office for the Coordination of Humanitarian Affairs, said that since the report was published, international money for a new plant had been secured but construction could not proceed because the area was too dangerous. …” [The New York Times and The Associated Press/Factiva]

The Globe and Mail reports that “… Originally designed to serve 50,000 people, [Gaza's sewage ponds and treatment plant] were then overflowing from daily use by about 190,000 residents. About half of the children in Umm Naser were found to have digestive problems from the pollution … . …” [The Globe and Mail (UK)/Factiva]

The BBC adds that “… The head of Gaza's environmental authority, Yusuf Abdel Safir, estimated that a pool of four million cubic meters of water had built up. He told The BBC that the Palestinian Water Authority had built a small lagoon to deal with rising pressure in the main pool. ‘This new lagoon has been constructed just three months ago to release this pressure. This lagoon has collapsed today because of the pressure,’ he said.” [The BBC (UK)]

Meanwhile, The Daily Star writes that “… Fadel Kawash, head of the Palestinian Water Authority, told AP that the level of sewage in the pool had increased over the past few days, creeping up the earth embankments around the pool until one collapsed, ‘causing the sewage to pour toward the village.’ He said Gaza's poor infrastructure was to blame for the accident. The pool was recently built on high ground and local residents had objected to the project. …” [The Daily Star (Lebanon)/Factiva]

AP reports that “… Umm Naser is about 300 yards from the border with Israel, in an area where Palestinians have frequently launched rockets into Israel and Israeli artillery and aircraft have fired back. … The flooding underscored the fragility of the overburdened infrastructure in the impoverished and overcrowded coastal region of 1.4 million people. The West Bank, too, is suffering from eroding sewage and water infrastructure. 

Hamas spokesman Fawzi Barhoum blamed international ‘sanctions against Palestinians’ for the sorry condition of Gaza's infrastructure. Most foreign donors froze aid to the Palestinian government after Hamas came to power last year, but [the UN’s] Shepard said a project to build a treatment plant in northern Gaza had not been affected by the boycott. An internal World Bank document obtained by AP said the Palestinian Authority decided in 2003 to dump partially treated excess waste into the ocean, but Israel vetoed the idea.” [The Associated Press/Factiva]

South Korea National Pension To Up Overseas Investment Via World Bank

“South Korea's National Pension Service (NPS) is planning to expand overseas investments through the World Bank that local media reported could amount to $1 billion. 

‘The fund's operating committee will decide at its regular meeting in May how much to entrust, so the amount can't be disclosed at this point,’ said Kim Moon-Soo, head of the institutional networks and communications team at Korea National Pension Fund, under the NPS. Maeil Business Newspaper, citing an unnamed official at the Ministry of Health and Welfare, reported Wednesday that the World Bank is likely to manage NPS funds worth $1 billion. …” [Dow Jones/Factiva]  

Reuters reports that “… South Korea's Welfare Minister Rhyu Si-min signed a preliminary agreement with World Bank President Paul Wolfowitz on Tuesday to cooperate with the pension fund's overseas investment plan, including entrustment of some of its assets. But a spokeswoman for the ministry told Reuters the contract did not include the amount of money the World Bank would manage on behalf of the fund, which would be determined in the second half of this year. …” [Reuters/Factiva] 

The Korea Herald writes that “… Korea's pension fund is one of the five largest in the world with assets of some $200 billion. These assets are expected to continue increasing rapidly. ‘The World Bank appreciates the opportunity to partner with Korea's pension service,’ said Wolfowitz. ‘This engagement is a great example of the new ways in which the World Bank is serving its members with an exchange of knowledge that benefits everyone.’  

The World Bank has been advising Korea to increase its international investments in order to optimize its returns. The World Bank, which is owned by 185 member countries, including Korea, provides financial and technical assistance to countries around the world.” [The Korea Herald/Factiva]

World Bank Revises Kenya Program, Focuses On Graft

“The World Bank on Tuesday endorsed a revised lending program for Kenya that deepens government efforts to root out corruption and promises to unleash loans to sectors where the most progress is made. … [T]he World Bank on Tuesday also approved $154.5 million in new loans for two projects in western Kenya, including financing for micro projects in 600 communities and funding to reduce flooding and droughts by improving management of water and forest resources.

Colin Bruce, the Bank's Country Director for Kenya, said Kenya could see around $800 million in new lending under the revised Country Assistance Strategy, which has been extended through June 2008. In an interview with Reuters, Bruce said the updated program recognized Kenya's recovery after years of economic mismanagement and corruption and institutional decay. … Bruce said not everyone was benefiting from the economic recovery, where public debt has declined, prices are more stable and interest rates are lower. ‘Kenya needs to keep pushing the economy to grow even faster and dealing with inequity and governance will help sustain that recovery by attracting investment and creating jobs,’ he said. … 

In a statement, the World Bank board urged Kenya to vigorously implement its revised governance and anti-corruption program, which includes measures to make the public sector more transparent, overhaul the country's bidding system, further streamline business licenses and begin modernizing the judiciary. …” [Reuters/Factiva]  

In related country news, The Nation writes that “Kenya is fast regaining its position as one of the most developed countries in Africa, a senior World Bank official said yesterday. Michel Wormser, the Bank's director of sustainable development in Africa said the country had made steady progress in various economic fields adding that the Bank will continue to support its development agenda. He gave an example of the agricultural sector, where he said modern farming technologies had been enhanced among the farmers translating into increased food production. Wormser was speaking in Embu when he toured projects initiated through the World Bank funded Kenya Agricultural Productivity Project (KAPP). …” [The Nation (Kenya) and All Africa]

Also In This Edition: China, India, help Asian investment in Africa surge: UNCTAD; Briefly Noted...

China, India, help Asian investment in Africa surge: UNCTAD

“Chinese and Indian companies are turning into a promising source of direct investment in Africa, adding to an Asian investment surge in Africa over the past 15 years, a UN agency said in a report Tuesday. 

Nonetheless, investment outflows to African nations are still just a small fraction of the global total of investment by Asian companies abroad, which has also surged since the mid-1990s, the UN Conference on Trade and Development (UNCTAD) said. Asian investments are also sharply focused on energy and mining, it added, calling for a diversification of Foreign Direct Investment (FDI) in other sectors of African business and the economy. An average of $1.2 billion a year of the $46 billion in Asian FDI in 2002 to 2004 went to Africa, the UNCTAD report [entitled Asian Investment in Africa: a new era of cooperation] said. …” [Agence France Presse/Factiva]

Kyodo News writes that “ … Direct investments in Africa by Asian economies, such as China, India, Vietnam, Singapore and Malaysia focus on the energy sector, in particular oil development, according to UNCTAD. The trend is raising concerns that such investments may not greatly help spur industrial and economic developments in African countries. …” [Kyodo News (Japan)/Factiva] 

Reuters reports that “… Asian firms face a number of constraints when investing in Africa, including technological and infrastructural hurdles along with a relative lack of exposure to Africa's market conditions and cultural practices. But [Khalil Hamdani, UNCTAD's Director of for Investment, Technology and Enterprise, told a news conference] these constraints would begin to fall away as Africa develops and Asian companies grow more comfortable. …” [Reuters/Factiva] 

Xinhua adds that the report “…noted that African countries need to make substantial efforts to enhance their productive capacities in a variety of industries in order to reap the potential of expanding Asian interest. African countries should adopt flexible, well-targeted efforts to spur FDI that leads to broad-based growth, it said.” [Xinhua (China)/Factiva]   

Briefly Noted…

Global investors are eager to invest in Africa and have pledged $800-million to a new plan to boost the continent, Nigeria's Central Bank Governor Chukwuma Soludo said on Tuesday.  Soludo was speaking after a presentation in Johannesburg on the Africa Finance Corporation, a financing institution piloted by the Central Bank of Nigeria and modeled on the International Finance Corporation. [Reuters/Factiva]

The Liberian government and the international community have been called upon to give more support to the private sector of the nation as one sure way of creating jobs and boosting development in the country. A meeting held under the theme, "Role of the Private Sector in Rebuilding Liberia," was organized by the investment Climate Team for Africa of the World Bank Group in consultation with the Ministry of Commerce. [The Inquirer (Liberia)/Factiva] 

The National Association of Professional Environmentalists wrote a letter to the World Bank asking it to re-inspect the Uganda's Bujagali hydropower plant project claiming that the project in its current form violates the Bank's operational and procedural policies and must therefore be investigated thoroughly. [Xinhua (China)/Factiva]

Angola has announced it is to pay off its external debt of $2.3 billion to the Paris Club. Minister of Finance Jose Pedro de Morais said the country had succeeded in bilaterally paying off its obligations. [Global Insight Daily Analysis (UK)/Factiva]

Argentina has scrapped a deal with the UK to share any oil found off the Falkland Islands - days ahead of the anniversary of the war for the islands. [The BBC (UK)]

Brazilian President Luiz Inacio Lula da Silva and Italian Prime Minister Romano Prodi committed themselves in Brasilia on Tuesday to cooperating in the development of biofuels and in fostering their production in the world's poorest countries. The commitment was based on a pact signed between Brazilian state-owned oil giant Petrobras and Italian energy firm Eni establishing a cooperation framework for seeking new technologies in the energy area. [EFE News Service (Spain)/Factiva] 

The World Bank has published a report revealing waste on a massive scale in Brazil’s Unified Health System, and has called for more training to be given to healthcare managers in the public sector. The study reveals serious organizational flaws and has prompted mixed responses from stakeholders. [Global Insight Daily Analysis (UK)/Factiva]

Armenia should record significant progress to join the EU, said World Bank's Lead Economist Aristomene Varoudakis in his interview to the Capital. On the issue of Armenia's economic development a lot depends on the consecutive implementation of future reforms. [ARKA News Agency (Armenia)/Factiva]

The Ukrainian agricultural sector is risky for leasing said the International Finance Corporation and the World Bank in their survey. A generally large number of tax problems is cited as a reason for risky agricultural leasing. [Novecon (Russia)/Factiva]

Arab leaders will revive a five-year-old land-for-peace offer to Israel when they meet at a two-day summit in Saudi Arabia on Wednesday, seeking an end to decades of conflict at the heart of the region's problems. [Reuters/Factiva]

Iraq's government isn’t spending about $12.5 billion in rebuilding funds from its own 2006 budget because it lacks the tools and expertise to spend the money, State Department's Iraq coordinator, David Satterfield said on Tuesday. [Reuters/Factiva]

The EU is offering to negotiate a free trade pact with Ukraine, as it seeks to build closer political and economic ties with the country without offering it the prospect of full membership in the bloc. [Associated Press/Factiva]

EU Economic and Monetary Affairs Commissioner Joaquin Almunia said Tuesday that Romania needs to rein in public spending, echoing a similar warning from the International Monetary Fund that said the government should cut back on expenditure to lower inflation. [Associated Press/Factiva]

During a meeting with Russian President Vladimir Putin, Chinese President Hu Jintao said China is willing to upgrade bilateral ties to a higher level with Russia as both sides face a crucial period of national construction and development in the next 10 years. [Xinhua (China)/Factiva]

The world could be free of the guinea worm within two years, the World Health Organization said on Tuesday. While some 3 million people suffered from the blight in the early 1980s, the WHO said it now affects about 25,000 people in nine African countries, with most prevalence in Sudan and Ghana. [Reuters/Factiva]