De Rato urges Africa to harness increased aid flows

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The IMF expects GDP growth in sub-Saharan Africa to exceed 5 percent in 2006 for the third straight year, Rodrigo de Rato told a news conference in Lusaka during a March 13-17 visit to Zambia and Equatorial Guinea. But growth will need to be higher for Africa to meet the Millennium Development Goals.

In Bata to address a regional summit, he also urged leaders to tackle corruption and ensure effective use of increased aid.

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De Rato urges Africa to tackle corruption, build on debt write-off

The IMF expects sub-Saharan Africa's GDP to grow by 5.4 percent in 2006, the third straight year of growth above the 5 percent level, Managing Director Rodrigo de Rato told a news conference in Lusaka, Zambia, on March 16. But he warned that growth needs to be even higher if Africa is to meet the Millennium Development Goals (MDGs) and urged African leaders to ensure that increased aid flows were used effectively.

De Rato was on his fourth visit to sub-Saharan Africa as Managing Director of the IMF and his first since the IMF agreed to write off 100 percent of the debt owed to it by 19 highly indebted poor countries-13 in sub-Saharan Africa.

Speaking at a roundtable in Lusaka of finance ministers, parliamentarians, civil society leaders, and journalists from Ethiopia, Ghana, Malawi, Mozambique, Tanzania, Uganda, and Zambia, de Rato highlighted the renewed commitment by the international community to increase aid significantly to help low-income countries achieve the MDGs. But he stressed that African governments must draw up policy frameworks that allow resource flows to reach their targets, especially education and health-including measures to counter the HIV/AIDS pandemic. And he discussed ways in which the IMF could help African countries under its new medium-term strategy, including advising on how to tackle problems associated with scaled-up aid flows. De Rato underscored that African countries and the international community must make sure that the forgiven debt is not quickly replaced with new debts, possibly on worse terms.

De Rato met with Zambian President Levy Mwanawasa, Finance Minister Ng'andu Magande, and other members of the Zambian economic team. "Zambia has pursued a strategy of promoting macroeconomic stability and good public sector management and encouraging sound growth of the financial and private sectors," de...