UNIVERSITY OF PENNSYLVANIA - AFRICAN STUDIES CENTER
ECA/CM, Progress Report On Critical Capacities In Africa
ECA/CM, Progress Report On Critical Capacities In Africa
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E/ECA/CM.21/5
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UNITED NATIONS
ECONOMIC AND SOCIAL COUNCIL
ECONOMIC COMMISSION FOR AFRICA ECONOMIC COMMISSION FOR AFRICA
Sixteenth meeting of the Technical Thirtieth session of the Commission/
Preparatory Committee of the twenty-first meeting of the Conference
Whole of Ministers
Addis Ababa, Ethiopia Addis Ababa, Ethiopia
24-28 April 1995 1-4 May 1995
PROGRESS REPORT ON THE ELABORATION OF A FRAMEWORK AGENDA
FOR BUILDING AND UTILIZING CRITICAL CAPACITIES IN AFRICA
E/ECA/CM.21/5
I. INTRODUCTION
1. At its 1994 annual meeting, the ECA Conference of Ministers responsible for Economic and
Social Development and Planning considered a preliminary report on "A Framework Agenda for
building and utiliz-ing critical capacities in A frica" (document E/ECA/CM.20/6). The initiative
to focus on capacity building was borne out of the realization that the missing link and, therefore,
the major reason for the generally observed failure in the efforts deployed during the past two
decades to put Africa on the path of accelerated growth and sustainable development has been the lack
of systematic action on building and enhancing the critical capacities needed to sustain growth and
development. There is now consensus that building critical capa cities, and putting them to work
fully and efficiently are the sine qua non for the successful attainment of the objectives
of the regionally agreed strategies, programmes and plans of action adopted during this period to
reduce poverty in Africa and render the region more dynamic and ready to take its rightful place in
the emerg ing competitive world of the twenty-first century. Capacity building is conceived in this
regard in its interrelated and interlocking human, institutional and infrastructural dimen sions.
Action must be taken in each of these three areas simultaneously, reflecting the inter-dependencies
and inter-linkages between the critical development issues and priorities facing African
countries.
2. The preliminary report presented to the Conference of Ministers in 1994 identified eight
areas of focus on which policy development and practical action could meaningfully concentrate within
the context of the matrix of interrelationships provided by th e triad of critical capacities - human,
institu tional and infra-structural. The eight priority areas thus identified were: critical
capacities in support of good governance, human rights, political stability, peace and security in
Africa; critical capacities for effective socio-economic policy analys is and management; building and
fully utilizing human capacities; developing entrepreneurial capacities for public and private sector
management; building and utilizing physical infrastructural capacities; capacities to exploit natural
resources and divers ify African economies into processing and manufacturing; strengthening capacities
in support of food security and self-sufficiency; and, critical capacities for mobiliza-tion and
efficient allocation of domestic and external financial resources.
3. The objective of the Economic Commission for Africa (ECA) initiative is to build a
comprehensive consensus framework to serve as a basis for action on all the critical aspects of
capacity building at country, subregional and regional levels. The Framew ork Agend a, therefore,
will provide a mechanism for collabora-tion, coordination and harmonization, and for the monitoring of
efforts by African member States, their intergovernmental organizations and development partners,
including agencies of the United Nations system, towards African capacity building. The preliminary
report outlined the conceptual context of capacity build-ing in Africa and addressed the question why
building critical capacities is important. It provided the pre-liminary findings of the secre tariat
on what should constitute the contents and thrust of policy development and measures for building and
utilizing critical capacities in each of the eight priority areas. It also detailed the elements of a
possible regional programme of technical co operation for capacity building, and proposed measures for
the monitoring and evaluation of the Framework Agenda.
4. By resolution 771~ (XXIX), the Conference of Ministers at its meeting in 1994 endorsed the
"Frame-work Agenda for Building and Utilizing Cr itical Capacities in Africa: A Preliminary
Report". In the same resolution, the Conference of Ministers, among other things, requested the
Executive Secretary to:
(a) Undertake further studies aimed at strengthening the Framework Agenda on the basis of which
detailed programmes of action in capacity building at the national, subregional and regional levels
may be designed for implementation in the short and medium term;
(b) Formulate a programme of support by Africa's development partners to reinforc e and
complement the efforts of member States in building and strengthening critical capacities for
development in the medium and long term;
(c) Prepare a financing plan for the implementation of the first phase of the programme for the
period 1995-2005 and to hold consultations with bilateral and multilateral donors and development
finance institutions aimed at mobilizing resources; and
(d) Report to the next Conference of Ministers on actions taken in fulfilment of the mandates as
set out in this res olution.
5. On the basis of this mandate, the secretariat undertook further work, consultations and
reflection towards the finalization of the Framework Agenda. Further insights have been gained on
several of the issues addressed in the preliminary report. These relate especially to the objectives
and principles that should underlie capacity building in Africa; the issues that need to be addressed;
and the elements of a realistic programme of action including the role of the major actors in its
implement ation. This progress report outlines steps taken towards the implementation of the
Conference of Ministers resolution and presents the findings and conclusions emerging from the desk
and field work undertaken so far. A tentative timetable for subsequent work towards the finalization
of the framework document is also provided.
II. PROGRESS REPORT ON THE IMPLEMENTATION OF RESOLUTION 771~(XXIX)
6. Two categories of actions were envisaged in resolution 771~(XXIX) in regard to the
finalization of the Frame work Agenda. The first involves those that could be completed in the short
term, such as strengthening the Framework Agenda on the basis of which detailed programmes of action
in capacity build-ing at the national, subregional and regional levels can be d esigned for
implementation. The second category includes those that will be undertaken over the long term, such
as establishing an appropriate mechanism to coordinate implementation of the programme of action in
the Framework Agenda, undertaking consulta- tions with bilateral and multilateral donors to finance
the programme, and monitoring and evaluation of the programme. During the past year, the secretariat
of the Commission began the implementation of the resolu-tion by focusing on the short-term action s,
which necessarily had to precede the long-term measures envisaged in the resolution.
7. Thus, missions were fielded to a number of member States to study country experiences in
building critical capacities in specific areas. The field missions were un dertaken to Ghana,
Mauritius, Morocco, Nigeria and Zimbabwe. The choice of these countries was based on the awareness
that much could be learned from this experience in capacity building in specific priority areas. It
may be recalled that during the disc ussion on the Framework Agenda at the 1994 session of the
Commission, some countries indicated their willingness to share their experience in capacity building
in specific areas with other African countries, and invited ECA, in developing the Framework Age nda,
to visit their countries to learn about their practices and policies.
8. The specific areas studied in each of these countries were as follows: Ghana (policy
analytic and development capacity); Mauritius (human capacities development); Morocco (building and
maintaining physical infrastructure); Nigeria (entrepreneurial capa city in the private sector); and
Zimbabwe (capacities to exploit natural resources and diversify into processing and manufacturing; and
strengthening capacities for food security a nd self-sufficiency). Country missions are yet to be
fielded for two priority areas, namely good governance, political stability and security; and
mobilization and efficient utilization of financial resources. These will be undertaken soon.
9. The lessons of experience in building capacities drawn from the country missions will result
in a considerably improved Framework Agenda. For example, the country missions have provided
perspectives on essential conditions for building and utilizing ca pacity in each priority area;
pointed to particular policy actions to be undertaken at national level, regional organizations and
external partners; and offered insights into the mix of policy measures for capacity building. These
are summarized in the next section .
III. A FRAMEWORK AGENDA FOR BUILDING AND UTILIZING CRITICAL CAPACITIES
IN AFRICA: SOME FURTHER FINDINGS AND CONCLUSIONS
10. The overall programme to build or strengthen critical capacities in Africa is inspired by
the following objectives, which are to:
(a) Accelerate the continent's political, economic and social transformation, to be able to
adjust smoothly to unpredictable shocks, reduce vulnerability to climate and other natural phenomena,
and to better cope with the challenges of the twenty-first ce ntury world;
(b) Put the development process on a sustainable basis, in environmental as well as economic
terms;
(c) Bring economic recovery to every African country and accelerate the rate of growth of output
and national income; and
(d) Put th e vital means to improve their welfare at the disposal of all Africans, with special
atten-tion to socio-economic constituencies that have for long been disadvantaged.
11. In order to achieve these objectives, it will be necessary to address a number of crucial
issues the resolution of which holds the key to ending Africa's economic stagnation and its
underdevelopment relative to other regions and to arrest the spread of poverty. Some of the issues
and the principles which should underlie a programme of action include the need to:
(a) Establish a new division of responsibilities between the State (i.e., levels of government)
and the private sector;
(b) Create and maintain a conducive policy environment and a hospitable political climate for
sustained structural transformation, accelerated growth and sustainable development;
(c) Mobilize enormous amounts of resources from domestic savings and external sources to
finance capacity building and utilization; and
(d) Strengthen regional economic integrat ion as a vehicle for African countries to collectively
attain competitiveness within the world economy. In this regard, the implementation of the Abuja
Treaty should increasingly centre on promoting the emergence and growth of African enterprises;
acceler ating the opening of national markets to create an African market; and coordinating and
harmonizing national policies at the regional level, especially in the area of competition policy and
foreign direct investment (FDI).
12. These issues and principles are part of the new thrust of development policy of a growing
number of African countries. The thrust is shifting away from excessive involvement of the State in
the production, distribution, and commercial sectors and increasingly concentrating on creati ng
conducive conditions for the private sector. National priorities are shifting away from running
State-owned enterprises to investing in human development, basic infrastructure, opening domestic
markets to competition, strengthening public finances, and providing stable incentives to encourage
domestic savings and foreign direct investments. This thrust of development policy and national
priorities will be reflected in the Framework Agenda.
13. In the following, some further findings and conclusions are presented in respect of each of
the priority areas. A. Priority area 1: Critical capacities in support of good governance, human rights, political stability, peace and security in Africa
14. Good governance, stability, security and peace are the ke ys to development. Experience in
Africa and elsewhere has shown that wherever there have been prolonged civil strife or conflicts or an
absence of good governance, socio-economic development has faltered. The task of restoring economic
growth and acceler ating development in Africa thus involves not only getting socio-economic
development policies right but also creating a supportive political environment.
15. Broadly defined, a supportive political environment for development must be characterised by
goo d governance, political stability and durable peace. Considerable consensus exists on the main
components of each of these elements. There is, for example, consensus that the key components of
good governance are effective and efficient public sector man agement, accountability, an effective
legal framework, and trans-parency in public policy making. Political stability must be anchored on a
democratic order buttressed by periodic elections, freedom of association, expression and religion, as
well as prot ection of fundamental human rights. Social justice and rule-based political order
mediated by an impartial and independent judiciary are the foundations of a durable peace.
16. In this context, capacity building needs for a conducive political environment centre around
establish-ing and strengthening the processes and the institutions that foster good governance,
political stability and peace. The specific mix of institution al devices and processes will vary
among countries. Still, certain common or bas ic features can be identified. Popular participation
in the national political and policy pro-cesses is an essential element in promoting the three
components of a supportive political environment. This requires, at one level, providing a level
playing f ield for political parties and interest groups through appro-priate legislation that
guarantees them freedom of action under the law. Also, effective popular participation in development
also necessarily entails decentralization which not only ensures inv olvement of a broad spectrum of
public views to bear on decision making, but also for authority on some activities to be delegated to
the local level.
17. The institutional arrangements that are required for upholding public accountability, social
justice and the rule of law have many features in common. These institutions must be free from
political inter-ference. A major task is to devise measures th at insulate the key officials in the
watchdog or public arbitra-tion institutions from the corrosive inf luence of politics or the lure of
corruption. Again, the specific measures may vary according to country contexts. Still there are
some key features. Appointing persons of integrity and professional competence, as well as
remunerating them adequately a nd giving them tenured appointments, are essential requirements for
preserving the integrity of the holders of major offices of public trust.
18. There are additional requirements for promoting good governance and political stability.
Prominent among the se are that there should be consistency and predicability in applying laws and
administrative regulations; there should be equality before the law; all citizens should be able to
challenge administrative laws and policies that are perceived as harmful to t heir rights; and
transparency in public policy should be reinforced by greater access by citizens to relevant
information and data on government activities. Since this level of transparency and public
responsiveness is predicated on the level of education , literacy and public awareness that has been
attained in society, it then behooves governments to ensure that basic and civic education and
literacy reach a broad spectrum of society.
19. Obviously, African countries are at different stages of adopting the policy and practical
measures for fulfilling the requirements of the key dimensions of a supportive political environment.
As some coun-tries are more advanced than others in this ef fort, the specific actions which have to
be taken will depend on progress already achieved along these directions in the country concerned.
The list of issues raised below are illustrative and much will need to be done by African countries
themselves. B. Priority area 2: Critical capacities for effective socio-economic
policy analysis and management
20. Weak or inadequate capacities for policy analysis and management are among the structural
impedi-ments to economic growth and accelerated development in Africa. This recognition has spurred
not only national actions but a lso international initiatives for building policy analysis and
management capacities in Africa. Individual countries are, therefore, at different stages in building
capacities for policy analysis and management, with each country giving needed attention t o perceived
areas of importance.
21. Efforts in capacity building for policy analysis and management,in general, centre around
three inter-related facets. These are production of needed skills for policy analysis and management
(the human resource develo pment dimension); strengthening the institutions for generating and
consuming policy analysis and management (the institutional dimension); and facilitating the process
of policy analysis and management (the enabling environment including infrastructural s upport
dimension).
22. A primary task in building policy analysis and management capacity is producing a critical
mass of professional people equipped with the necessary skills. Training in those disciplines
directly related to policy analysis and manage ment is the key to achieving this goal. The core
disciplines are economics, statistics, sociology, public administration, business administration and
political science. Much of the training required to produce skilled policy analysts and managers has
to be in institutions of higher learning. As such, strengthening the relevant departments/faculties
of universities is an important element in human resource development for policy analysis and
management.
23. But universities are not the only centres for t raining in policy analysis and management.
Increas-ingly, national institutes of public administration (NIPAs) are assuming major roles in
training. In addition, donor-funded policy analysis and management centres are being established in
various African countries.
24. Developing or strengthening the institutional structures for generating policy analysis is
another essential component of building policy analytic and management capacity. Typically,many
government ministries or departments have policy an alysis units which undertake strategic planning
and research for government policy makers. This is particularly true of "central guidance
cluster" institutions/ministries of finance, planning, central bank and cabinet economic
committee. However, where t here is marked weakness or inadequacy of intra-departmental capacity for
generating policy analysis, reliance on indigenous non-governmental institutions (NGOs) or even
expatriate personnel has been significant.
25. Indeed, the growth of private or donor- funded semi-autonomous policy and management centres
is a salutary trend in African countries. Sustaining this trend will contribute to strengthening the
policy and analytic capacity in Africa, by enhancing the plurality of sources of policy advice.
26. Whether African countries are able to produce and retain the critical mass of skilled policy
analysts and managers and sustain the institutional arrangements for generating policy analysis will
depend crucially on an enabling policy environment. This will include good governance, political
pluralism that allows competing views to flourish, rule of law and stable macro-economic
environment.
27. Moreover, effective policy analysis and management requires a reliable and modern
information infrastructure: reliable in terms of availability of necessary and up-to-date data, and
modern in terms of equipment for storage, retrieval and dissemination . Very often, the information
data base on which policy analysis and decisions are predicated lack all these characteristics.
28. Effective development management requires strong planning capabilities at the national and
the local level; at the national level to ensure that an enabling environment and stable economic
policies are in place, and at the local (regional, district are a council) level that planning
capacities exist to underpin local democracy and people-centred development.
C. Priority area 3: Building and fully utilizing human capacities
29. Socio-economic development policy must be predicated on the fa ct that Africa's major
development resource is her people and that development cannot be initiated and sustained without the
capacities of the people being developed and properly utilized. To effectively build and utilize
human capacities so that they are able to promote and sustain the socio-economic development process
requires that literacy is spread widely in society; primary and post-primary education reach the
entire population; access to food and health care is enjoyed by all; the people are able to
participate in the production of goods and services and unemployment is kept to the minimum. There
are ample opportunities for continuing and adult education and training. To meet these needs, African
countries will have to make heavy investments in hum an capacity building.
30. The spread of literacy is important to enable people to respond to certain programmes and
strategies that may have to be pursued by government towards the attainment of certain socio-economic
development goals, such as primary an d reproductive health; the acceptance of modern methods of
production in agricul-ture; meeting the training and re-training needs of the workforce; participating
fully and critically in political and socio-economic development, and in the process of formul ation
and prosecution of public policy.
31. Human capacity can only be built and strengthened if the education and training systems are
them-selves invested with the capacities necessary to produce a critical mass of people with the
requisite skills, know ledge and attitudes that can be of use to society and the economy. This,
therefore, requires access to primary, post-primary, secondary, post-secondary and tertiary
education.
32. Primary education should be universal and free in order to ensure that, over time, the
entire popula-tion becomes fully literate and numerate - two pre-conditions for effective skills
training. Post-primary education should be a means of ensuring cont inuity with numeracy and literacy
work for those who would not proceed to seco ndary education but could be made employable through pre-
vocational training. Secondary education is important as a grounding for tertiary and higher
education, as well as a major foundation for the preparation of middle-level manpower for the economy.
Po st-secondary education helps to channel people into specific occupations, trades and professions.
Higher education is where the nation's scientific, technical and economic managers are produced.
33. For human capacities to be built and maintained, all ch ildren and youths must have primary
and post-primary education. At least 60 per cent of the population must go through secondary
education and a further 10 per cent through post-secondary and higher education. The quality of
education should underpin the se quantitative targets. Teaching and learning resources such as text
and workbooks, libraries, equipment, re-agents, etc., should be accessible to all, and the teaching
staff should be well-trained, well-paid and highly motivated. Opportunities should a lso exist for
the workforce to continuously upgrade its skills and know-ledge through training and self-development.
The quality of training should be buttressed by the high quality of trainers. This requires close
supervision and monitoring to ensure co mpetence and professionalism in training.
34. An intellectually disciplined, enlightened and literate population will, with greater ease,
create more opportunities for employment to spread within the economy and for the salutary effects to
be felt among a larger number of people. Employment levels will then remain high and productivity
will increase, calling for higher levels of skill and more labour force training and increasingly
specialized education programmes. The policy and institutional responses t o these changes in the
structure of the economy must be timely.
35. Policies and programmes must be in place for the empowerment and full utilization of the
entire labour force, particularly women, who remain underutilized even though they constitute over 50
per cent of the population. These must be effected through sound and relevant education and training,
preventive and reproductive health, and nutrition programmes. There must also be sufficient
flexibility in the workplace to permit women to move in and out of the labour force to fulfil other
social roles without compromising their rights as workers.
36. Health policy must be realistic and, structures and infrastructure must be strong, and pay
equal atten-tion to preventive as to curative health. Fo od policy should aim at least for food
security, if not self-suffi-ciency, and a high nutritional status should be enjoyed by all. A well-
trained cadre of health manpower covering all fields of health should be put in place. Health
infrastructure should also be such as to ensure that all the primary health needs of the population
are fully met. Government should provide the necessary incentives and encouragement for the private
sector to participate fully in the provision of health care, although governm ent must ensure that it
holds primary responsibility in this regard.
37. The private sector must be stimulated to participate fully in the economy and generate jobs.
Incen-tives must be provided for the expansion of large-, medium- and small-scale enterprises and
employers encouraged to participate in meeting the training and skills development needs of the
workforce, as well as in ensuring that the range of skills in the economy is significantly
broadened.
38. The workforce, particularly in the public s ector, has to be well motivated in terms of
financial and material incentives. Wages, salaries and fringe benefits must be attractive and
differentials between the public and the private sectors kept to the minimum, so as not to undermine
the strength and efficiency of the public service.
39. While the public sector must take responsibility for the provision of the bulk of the
services in educa-tion and health and for employment-generation programmes, the private sector must
also be encouraged, through th e appropriate fiscal and other incentives, to contribute to the
provision of these services. Private sector participation should ultimately be much higher than that
of the public sector.
40. Public policy and institutions should be oriented towards the development and strengthening
of human capacities. Training should be regarded as the main catalyst in the creation of a dynamic
and flexible workforce capable of responding to the changing needs of the economy and society at
large. Therefore, training policy should be at the heart of public policy making with special
provisions for the funding of train-ing, perhaps through the creation of a training fund.
41. The majority of line ministries must carry responsibilities for some elements of the human
resources planning, development and utilization function. The interface between these public
institutions and the private sector must be strong and continuous. Fiscal policy must be responsive
to the human capacity-building needs of the economy, and the management of resources must be efficient
and cost-effective.
D. Priority area 4: Developing entrepreneurial capacities for
public and private sector management
42. Africa's ability to break out of its current economic crisis will depend to a great extent
on its ability to harness the entrepreneurial potential visible in its streets, the market place and
small- and medium-scale industries. The full realization of Africa's entrepreneurial potential would
require creating an appropriate enabling policy enviro nment for private sector development in general
and entrepreneurship development in particular; developing appropriate entrepreneurship development
programmes, the establishment of finan-cial institutions that promote, encourage and nurture the
development of small- and medium-scale enterprises and infrastructural and research support to
entrepreneurs through industrial development centres, industrial estates and relevant research
institutions.
43. Policies that remove the barriers to growth of entrepreneur ship, that gradually enhance
competitive-ness of the small-scale entrepreneurs, institute interest and foreign exchange rate
policies that are not destruc-tive to the small- and medium-scale entrepreneurs, and control inflation
are of paramount importance. Stable and predictable policies should be in place if entrepreneurship
is to thrive in Africa.
44. The establishment of development banks that can extend credit to entrepreneurs, as well as
assist them with counselling can contribute to boosting their c apacity and improving their survival
and growth. Banks with a specific mandate to assist small entrepreneurs in this way should be
established.
45. African Governments should not only recognize the significant role entrepreneurs can play in
the economy and extend the necessary financial support in terms of availing credits but should also
encourage the bankers to be more supportive of entrepreneu rs. Bank officers should be equipped with
entrepreneurial appraisal and monitoring skills necessary to determi ne an individual's
entrepreneurial and managerial capabi-lities and thereby reduce the risk of loan default. The banks
should broaden their responsibilities to include the concept of counselling beyond their concern for
loan recovery. While efforts to r e-orient bankers should be intensified, governments should also
provide for credit guarantee schemes so that the banks could be assured that recovery mechanisms are
in place in the event of defaults.
46. Financial support alone would not be adequate to en sure the success of entrepreneurs. It is
now recognized that entrepreneurship is a function of opportunities, technical and commercial skills,
entrepre-neurial spirit, finance, infrastructure and the overall environment within which the
enterprises operat e. Apart from the training required to upgrade the managerial, financial and
marketing skills, entrepreneurs would also require extension services through the establishment of
industrial development centres, industrial estates and business and technical i ncubators; assistance
in product design and improvement, as well as assistance in the manufacturing or purchase of
appropriate machinery capable of using local raw materials and the requisite research back up to
enhance their capacity to produce.
47. Industrial centres are needed to provide guidance and counselling on investment
opportunities for modern small-scale industries; preparation and appraisal of pre-investment proposals
and feasibility studies; preparation of market studies and area econo mic surveys; functional
consultancy services in production management, accounting, marketing etc; extension services in
installation and commissioning of new factory plants; repairs and maintenance of equipment; in-plant
technical assistance; etc.
48. Industrial estates make life easy for entrepreneurs setting up in business. The provision
of ready-built factory shades that can be let for a fee enables the entrepreneur to consolidate his
limited resources to procure urgently needed equipment. In a ddition to th e factory sheds, the
industrial estates provide electricity, water, warehouses, central purchasing and central repairs
facilities. Such facilities through indus-trial estates could go a long way in reducing the overhead
costs of entrepreneurs and this cou ld be parti-cularly useful in a high-cost environment where the
cost of utilities and infrastructure can be prohibitive to the struggling first-time entrepreneur.
49. Technical incubators that provide a comprehensive range of common services, including in
cubator space, enterprise counselling, shared secretariat, start-up financing and assistance with
product development and marketing could assist in enhancing the technical and managerial capacity of
the entrepreneurs. Research centres providing information in the use of locally found raw materials,
development of projects that would stimulate the local production of raw materials for use in the
manufacturing sector, assisting with the development of appropriate technology for adoption by micro-
and small-s cale industries could provide useful services that would facilitate the operation of the
entrepreneurs.
50. The key to the whole effort to promote and enhance entrepreneurial skills and culture in
Africa is well-designed, well-organized and well-executed entrepreneurship development programmes
(EDPs). The EDP trainer is the key to the success of the program me and every effort should be made
to select a competent trainer/motivator. Such trainers may not be readily available in the market, in
which case th ey would have to be prepared for the task. The selection of would-be trainer/motivators
with the right attitude becomes crucial for the success of the programmes. For EDPs to succeed, it is
important to develop such trainer/motivators. Given the huge ta rget population needing the training
and the absence of adequate training facilities capable of meeting such needs, African countries could
benefit from the "training of trainers approach" for its multiplier effect. The EDP has
also to be given serious at tention in the educational systems. The educational curriculum at all
levels must try to incorporate EDP and foster the entrepreneur-ship spirit in future generations.
E. Priority area 5: Building and maintaining physical infrastructure
51. The provision of adequate infrastructure is one of the prerequisites for attaining
sustainable economic development. The structure of the African economies dictates that a regional
integrated systems approach be adopted for the development and better utilization o f existing
capacities of electrical power grids, natural gas pipelines, transport and communication networks, as
well as river and lake basin development. While recognizing that capacity-building efforts will vary
among countries, depending on unique nati onal priorities and endowments, there is however general
consensus as to what constitutes the key policy actions which are required for building development
capacities. These are human resources, institutional development, policy reforms, regional coopera
tion and resource mobilization.
52. The policy measures which must be taken in the area of human resources development include
emphasis on training at all levels so as to raise the technical capability of staff; better
utilization of existing human resources (motivation of staff, better management, regular assessment,
etc). The use of national institutions of higher learning, as well as regional institutions must be
encouraged, to be supplemented by any technical assistance which might be available from A frica's
external development partners.
53. In the area of institutional development, there is a need for a reassessment of existing
institutional structures in particular countries, as some of them might not be suited to the
prevailing social and economic needs. The role of government and the State must be revised as
necessary so as to create a conducive environment for participatory development by all sectors of
society. Specifically, the State must create a fair, transparent and stable policy environm ent
through the appropriate legal and regulatory framework to support private involvement in the
maintenance of the existing infrastructure and in the provision of new infrastructure services.
54. In order to ensure efficient, responsive delivery of infrastructure services, institutional
development and policy reforms are required to achieve the following objectives:
(a) Infrastructure should be managed like a business, not a bureaucracy. Private sector
involve-ment, for example in management under cont ract plans which is increasingly being adopted by
the railways sector in Africa, is one alternative which is yielding good results in some countries.
Similarly, port opera-tions may be contracted out to private operators;
(b) Competition should be introduced through liberalization of specific sectors and reduction
of monopoly conditions. The telecommunications sector is proving successful at this, partly because
techno-logical advances have virtually forced competition, s uch as satellite communications and
cellular technology;
(c) Mechanisms should be established for consumer/user involvement in such infrastructure
development activities as water supplies or irrigation systems. Alternatively, cost-based pricing of
services is one mechanism for assessing consumer opinions on th e level of services being
provided.
55. In view of the current trend to global markets made up of regional trading blocs, Africa
simply has no other alternative but to follow the path of regional cooperation. The signing of the
Abuja Treaty establishing the African Economic Community presupposes that the 53 disparate countries
in Africa will be physically integrated by the provision of adequate and efficient infrastructure
services. It is therefore essen-tial that measures be ta ken to implement the various protocols and
other arrangements which already exist in Africa, either at the subregional or at the regional
level.
56. The final aspect which underlies the whole effort of capacity building is that of resources.
The resource s required to bring Africa's infrastructural capacities to levels which are needed to
support sustain-able economic development are enormous. It is evident that African Governments, which
have in the past assumed the burden of the development of all econo mic sectors, will not be in any
position to provide the necessary resources for this purpose. Therefore, public-private partnership
must be developed in order to generate the necessary financing.
57. There are many lessons to learn in this regard from ot her developing regions and countries,
notably South-east Asia and China. New approaches to financing infrastructure development include
arrangements such as build-operate-transfer (BOT) in which private investors build and operate the
infrastructure under franchise until they achieve the agreed upon investment returns and transfer the
facility to the State; or joint venture arrangements between private and public partners; etc.
58. The following are possible modalities which should be given serious consid eration by African
coun-tries for financing the development of infrastructure:
(a) Public ownership and public operation - the enterprise, such as a national airline carrier,
must be run on an autonomous and commercial basis;
(b) Public ownership and private operation - such as contract plans and lease arrangements in
railways, port operations and water supply;
(c) Private ownership and private operations - especially suitable in high technology and
competitive operations such as telecommunications and power generation;
(d) Community and user provision of common services - suitable for small-scale infrastructure
services such as feeder roads, community water supply and sanitation, and distribution canals for
irrigation.
F. Priority area 6: Capacities to exploit natural resources and
diversify African economies into processing and manufacturing
59. The objectives in this priority area of capacity building are: to satisfy basic and other
consumer needs of Africa's fast-growing population; to create employment opportunities to absorb the
growing urban labour force, including rural-to-urban migrants that the agricultural sector will
increasingly be unable to absorb; to sustain the growth of family incomes and reduce the incidence of
poverty; and to ge nerate competitive exports to the rest of the world to pay for imports of consumer
goods, production inputs and technology. In order to achieve these objectives, it is necessary to
address the factors which have hindered the African industrialization proc ess.
60. One of these factors is the over-dominant role of the State vis à vis the
private sector. This has been exercised through arbitrary price controls and market regulation, as
well as through direct take-overs and ownership of industrial enterprises. Governments have promoted
an industrialization strategy based on import sub stitution rather than export-led growth, in spite of
the small size and undifferentiated nature of the African economies. This has stifled the emergence
of dynamic and efficien t enterprises across the whole spectrum from micro and small enterprises to
medium and large corporations, with a wide range of design and manufacturing expertise. And yet a
large number of such enterprises are essential in the modern industrial economy w here complex
products are assembled from numerous precision-manufactured components produced by specialized
subcontractors. African countries have lost competitiveness within the global economy due to the
over-protection of African enterprises from extern al competition. Africa's competitive position was
also damaged by macro-economic policies that fuelled inflation; and national currency exchange rates
remained fixed at increasingly unrealistic rates that penalized exporters and under-priced imports
even of consumer goods that could be locally produced. The inhospitable policy environment plus
persistent political instabilities and even conflicts in some countries repelled foreign investors.
These conditions were also not conducive for the mobilization o f private domestic savings and their
investment in African industrial enterprises.
61. Countries have not developed adequate levels of industrial skills in their populations, due
to low rates of enrolment at the secondary and tertiary levels of education, neglect of vocational
training, and poor curricula that do not lay a solid basis fo r science and applied technology and an
industrial culture. In order to build an industrial culture, the young need to be taught
entrepreneurial and technical skills at th e high school level. To this end, institutions of higher
learning and vocational schools should increase their provi-sion of work-study programmes so as to
expose the young worker to real work situations. The private sector should participate more active ly
in enriching the curricula of institutions of higher learning, with practical problems in the
manufacturing sector. More research and development (R&D) work is required in industry as well as
in the institutions of higher learning and mechanisms should be put in place to commercialize
research phototypes.
62. More should be done to lend support to the indigenous entrepreneurs and government-created
small enterprise development services and credit guarantee companies. Commercial banks should be
encouraged to set up small business units that underpin the fin ancing of small-scale enterprises
(SSEs)/small-scale industries (SSIs).
63. African countries' economic infrastructure (i.e., roads, railways, ports, airlines,
telecommunications, energy supplies, w ater and sanitation) remain inadequate, inefficient or
unreliable - another important factor which undermines their competitiveness within the global
economy. Industrialization based on the full exploitation of Africa's comparative advantage in
natural re sources cannot be achieved without the develop-ment of reliable transport and
telecommunication infrastructure linking such resources, often located in remote areas, to industrial
facilities, and linking such facilities to domestic, regional and export mar kets for the sale of
finished and semi-finished products. Nor is it possible to extract and process natural resources
without abundant supplies of reasonably priced energy and water supplies.
64. African nascent industries have not only lacked strong forward and backward linkages to the
continent's abundant natural resource base. They have also failed to develop strong linkages to the
agricul-tural sector, based on the production of tools and implements, fertilisers, and other inputs
to boost agricul-tur al productivity, and adding value to agricultural output through processing and
packaging. Also, back-ward and forward linkages between African industry and infrastructure have not
been developed. It is these missed linkages that have caused the disartic ulated nature of the
African economy and the stunted nature of its industrial sector which, in most countries, contributes
less than 15 per cent to the GDP.
65. The failure of African industrialisation based on the exploitation of its natural resources
is also due to the persistence of physical restraints, tariff and non-tariff barriers between African
countries. These con-tinue to fracture the continent into a multiplicity of small non-viable national
markets, and have prevented the growth of intra-Afric an trade, opportunities for economies of scale,
complementarities based on local comparative advantages, and the emergence of dynamic African
enterprises that would compete in the modern world that is dominated by large trans-national
corporations. Conseq uently, intra-African trade has stagnated in the order of 5 per cent of total
trade while the loss in global competitiveness has resulted in Africa's share of global trade
declining to the order of 2 per cent of the total volume of world trade.
G. Priority area 7: Capacity building for sustainable
food and agricultural production
66. Because the food and agricultural sector dominates most African economies in terms of
contribution to GDP, employment and incomes, its growth and development are essential for the
region's overall recovery, growth and transformation. The food and agriculture sector must grow
enough food and raw materials for Africa's rising population and new industries; produce exports that
will earn the foreign exchange needed to purchas e essential machinery and equipment and service
foreign debts; and, as producti-vity increases, release labour and capital for the development of
other sectors. There are certain critical capa-cities that must be developed and/or better utilized if
the hea vy burden facing African agriculture is to be successfully overcome.
67. In Africa, publicly stated commitments to the support of farmers have often not been matched
by the promised action. This has to change. The empowerment of the African farmer will be brought
about through certain policy measures which will lead to im provements in his access to credit;
production inputs such as seeds, fertilizer, and pesticides; means of production, such as land and
skills; and markets.
68. In many African countri es, there are insufficient highly trained managers, technical experts
and economists needed to understand, plan, implement, monitor and modify food and agricultural
policies on a continuing and sustainable basis. Even where such expertise exists, it is of ten
inappropriately utilized. There is, therefore, a need to build and/or better utilize capacity for the
analysis and formulation of sound agricultural policies, if national and regional agricultural goals
are to be met.
69. Many African farmers are stil l using low-yielding agricultural technologies which contribute
not only to low production but also to reduced labour productivity. There is a need for long-term
public and private investments in agricultural research, as well as a systematic effort to in troduce
improved technologies from the global research system and to adapt them to local conditions.
70. To achieve its food and agriculture goals, national policies and strategies must be
supported on a broad front by a set of institutions, both public a nd private, which provide economic
and other services, which directly or indirectly influence the success of the farmers involved. These
institutions must make and implement strategic decisions that influence the allocation of resources,
regulate and stab ilize socio-economic processes, adjudicate between competing interests, and convert
public resources into common benefits. Public and private investments geared towards improvements of
the performance of institutions involving marketing, credit, research, extension, and land reform
are, therefore, critical.
71. Physical infrastructure provide services which are critical for the attainment of national
and regional food and agriculture production goals. The contributions of physical infrastructure in
reducing the cost of marketing food and agricultural product s in Africa are obvious and well-known.
Imperfections in rural labour markets can often be traced back, in most cases in Africa, to inadequate
infrastructure. Appropriate investments in physical infra structure, such as rural roads and dams
will, therefore, deliver major benefits in food and agricultural production growth, poverty
alleviation, and environmental sustainability, providing that these investments respond to the felt
needs and constraints of the farmers.
72. Human resources development in the agricultural sector is fundamental to longer-term
sustainable growth in food and agricultural production. This will become even more important in the
future with the globalization of production and the increasing importance of human capital.
Investments in rural health and education are, therefore, critical not only for sustainable increases
in food and agricultural production but also for long-run sustainable reduction in poverty. To be
effective, ho wever, these investments must be allocated efficiently across activities, regions and
ethnic groups. Furthermore, sensitivity to gender considerations is critical because the building of
capacity among rural women through education and training would have a positive impact on the welfare
of other members of the household, particularly children, as well as on their long-term production and
income-earning prospects.
H. Priority area 8: Capacities for the mobilization and
efficient allocation of financial resources
73. The successful realization of the programme of action in the other seven priority areas of
the proposed Framework Agenda is predicated on African countries being able to mobilize from domestic,
as well as external sources, enormous amounts o f financial resources on a sustained basis and to
allocate these scarce resources efficiently to competing areas of capacity building. The issues which
must be addressed are based on the following needs:
(a) To boost the supply of domestic savings: Policies should aim at sustained economic growth,
employment generation, growth of family incomes, especially among the segments of the population sub-
merged under poverty. Efficient and incorruptible nationa l revenue authorities should be
established. Effe c-tive mechanisms should be put in place to monitor public disbursement, increase
accountability, plug leakages, and to ensure optimum selection of capacity-building programmes and
projects, and their timely execution without cost over-runs;
(b) The need to boost the rate of capital investment in Africa: Governments must create
political and economic conditions attractive to indigenous and foreign investors alike, without
jeopardizing national sovereignty over strategic sectors and activitie s. The private sector should
be encouraged to participate more in all sectors of the economy;
(c) The need to increase the efficiency of invested capital: To increase the efficiency of
capital investment requires policy measures aimed at redressing the imbalance between the State and
the private sector, removing market distortions, and creating a n environment rich in lucrative
opportunities. To recoup some of the resources invested in State-owned enterprises, while also
promoting private sector growth, governments should accelerate the restructuring and privatization of
non-strategic public enterprises;
(d) The need to correct the structural deficit on Africa's trade account with the rest of the
world: This is rooted in the continued exclusive dependence on primary commodity exports with
declining world market prices. African countries have to boost the ir competitiveness within the
world economy. They must build capacities to be able to efficiently diversify their production base
and export a range of manufacture d goods to world markets on the basis of quality, prompt supply and
competitive prices. These attributes are most easily achieved by facilitating the emergence and
growth of African private enterprises, and by attract-ing foreign firms (including transnat ional
corporations) to set up modern production facilities in Africa. The capacity of African enterprises
to export must be encouraged through policy incentives. Another important policy measure is to give
the financial market ample leeway to determine t he exchange rate of national currencies, reflecting
the scarcity value of external resources and thereby minimizing the bill for imports;
(e) The need to surmount the external debt problem and to manage future liabilities with
prudence: The solution to the external debt problem is squarely in the hands of Africa's creditors.
It is an area where external development partners can demonstrat e their commitment to putting the
continent back on the path of sustained growth. On their part, African countries m ust draw very
important lessons from the old debt problem in setting a new approach to managing future external
liabilities to finance growth: Scarce resources must be invested in the most productive opportunities
available. Future external liabilities mu st be linked directly to increasing African countries'
capacity to export to regional and world markets. External liabilities which involve a balanced
sharing of risks with creditors (e.g., direct equity in African production facilities, or loans to
Africa n enterprises without public guarantees) should be favoured over the use of public debt
instruments that impose 100 per cent obligation on the State. Institutional structures must be
established to monitor and oversee all external obligations, seeing to i t that external resources are
used to enhance economic capacity and competitiveness, minimising risk exposure and ensuring a
sustainable debt service profile;
(f) The need to mobilize increased net transfer of external financial resources to Africa: Betw
een 10 to 25 per cent of gross domestic investment for capacity building activities in Africa will
need to be mobilized from external sources. This is in view of the problems enumerated above in
mobilising domestic resources which will linger for a while, as well as the fact that technology
transfers from the rest of the world will be an important component of African capacity building;
(g) Attracting external savings in Africa in the form of foreign direct investment and portfolio
funds by institutional investors will require that competitiveness, rates of return, risk factors and
volatility offered by African economies be put on a par or made even better than opportunities in the
trade-dynamic regions of the world. African countries will have to build the confidence of external
investors and credit markets, a most fragile asset even under the best of conditions. Given the low
credit rating of most African countries, official development assistance (ODA) on grant and
concessional terms from bilateral an d multi-lateral sources will be crucial in the first five to ten
years of launching the African capacity-building pro-gramme. During this period, too, public
guarantees by Africa's bilateral and multilateral partners to external investors will be indispen
sable, to reassure them about the security of their assets from expropriation and a number of other
risks. On Africa's part, however, governments will have to enter into iron-clad bilateral agreements
or to accede to multilateral conventions governing the security and privileges of international
investment;
(h) States will also need to set up competent investment promotion agencies to market Africa's
investment potential, to supply all the information and data that prospective investors might request,
to facili-tate deals between indigenous entrepreneurs and their foreign counterparts, and to expedite
the legal process of establishing investments (i.e., by offering "one-stop" services to
investors);
(i) The need to develop healthy financial intermediari es and dynamic capital markets in Africa:
A market-based economy and a strong private sector are inconceivable without dynamic intermediaries
and capital markets. African Governments therefore should implement far-reaching policy measures to
restruc-ture their financial sectors, to end financial repression, and to rationalize restrictions on
market entry and promote competition. They have to introduce non-inflationary market-based
instruments to finance public borrowing. They have to encourage the emerge nce and growth of diverse
financial institutions, to promote competition. This, however, requires an adequate legal and
regulatory framework enforced by the relevant institutions to ensure prudent management of resources
and to safeguard the interests of depositors, insurance policy holders, and investors.
IV. IMPLEMENTATION ISSUES AND TIMETABLE FOR THE FINALIZATION
OF THE FRAMEWORK AGENDA
74. No matter how correct in identifying the strategic development goals of the member States,
the Framework Agenda will remain a dead letter unless effective modalities for its implementation are
adopted.
75. The implementation of the Framework Agenda must be seen in terms of action by specific
partners at the national, regional and international levels. Naturally, the action that matters most
is at the national level. True to the new political-economic o rientation of development policy in
Africa, the role of govern-ment will neither be exclusive nor directive. Rather, it will facilitate,
mobilize and galvanize pri vate sector partners (i.e., families, local communities, civic
organizations and enterprises) to advance national develop-ment objectives by working in their own
interests; manage the macro-economy competently; maintain a conducive policy environment and a
hospitable political climate.
76. At the regional level, the implementation of the Framework Agenda will be in the domain of
building and utilizing regional cooperation and economic integration. Cooperation will be essential
in capacity build-ing initia tives where economies of scale are vital, for instance, jointly creating
facilities and institutions that individual countries could not afford to establish on an optimal
scale. Duplication will be precluded, saving scarce resources to be deployed elsewhe re. Small
national markets will be integrated, creating a dynamic African market. African enterprises will be
given wider space in which to grow, expand, diversify or specialize in niches, according to the
development strategy that each may choose.
77. The partners at the regional level therefore are national governments; enterprises (both
indigenous and foreign) operating in the African economic space; national civic organizations; and the
people them-selves. Regional economic communities and regional organizations, notably the
Organization of African Unity (OAU), the African Development Bank (ADB) and the African Export-Import
(AFREXIM) Bank and regional "centres of excellence", such as the Eastern and Southern
African Management Institute (ESAMI), the African Regional Centre for Engineering, Design and
Manufacturing (ARCEDEM) and the African Institute for Economic Development and Planning (IDEP) and
other regional research, design and training institutions will all provide forums where national
institu tions can interact; mechanisms for harmonization and coordination of national policies and the
removal of barriers; and ways to pool national resources to achieve common objectives. Indeed, there
is a need for African countries to put more resources into strengthening the capacities of all these
regional institutions.
78. Action at the international level is envisaged to be mostly supportive. This is as it
should be: Africans bear the principal responsibility for developing the critical capacities on which
their societies need to thrive in the competitive modern world. Development and critical capacities
are not products that can merely be imported. Nevertheless, there is still a substantial role for
external partners in complementing and supplementing the resources and efforts that Africans will
bring to bear in their own development. An integral part of the external partners' contribution will
be the transfer of development experiences (including technologies, managerial and analytical
expertise, and how to avoid mistakes committed by others in the past), and working with the African
people to adapt these experiences to local peculiarities in different parts of Africa.
79. External partners are envisaged to include all the members of the United Nation s system,
including the Bretton Woods institutions and the World Trade Organization. This system of
multilateral organizations should be useful as value-neutral and objective conduits for the transfer
of development experiences from the rest of the world to Africa. In addition, the Bretton Woods
institutions and the funding agencies of the United Nations will be indispensable in mobilising
external resources to finance Africa's capacity-building endeavours. External partners also include
African States' bilateral partners, multilateral organizations, external NGOs and civic organizations
with interests in Africa, foreign enterprises and institutional funds.
80. Indeed, over the past two decades, all the major agencies of the United Nations system,
including the Bretton Woods institutions, have announced capacity building-related initiatives for
Africa, particularly in the areas of human development, macro-eco nomic policy, and food and
agricultural production. These initiatives have often been implemente d in individual countries in
isolation without a coherent framework for coordination at the regional level. While development
activities in one area impact on other areas, there have scarcely been attempts to bring work in
disparate areas into a common an d comprehensive framework gathering together the diverse multilateral
agencies and their initiatives, coordinating and harmonizing them.
81. The Framework Agenda should offer African States, the agencies of the United Nations system
and the Bretton Woods institutions, bilateral partners, local and external NGOs and civic
organizations a compre-hensive and coherent policy structure in which to implement development
initiatives specific to the mandate and competence of each organization, within priorities of
individual countries, and coordinated at the regional level.
82. Because the issues and actions encompassed by the Agenda are interconnected, the framework
docu-ment must be a consensus document which has the fullest support of all concerned. It must b e
established on the basis of the widest possible consultations. It is, accordingly, envisaged that the
draft of the final document will be reviewed by an ad hoc group of carefully selected experts and,
subsequently, by an inter-agency meeting of represen tatives of relevant United Nations specialized
agencies and organizations. The draft document will then be circulated to member States of the
Commission for their views and further comments.
83. The following is the proposed timetable for these consultations and for the launching of the
framework document.
End June 1995 In-house seminar on the Framework Agenda
End July 1995 Inter-Agency meeting to review the draft framework document
Early September Meeting of an ad hoc group of African and non-African experts
October 1995 Circulation of the document to ECA member States for observations and
comments
December 1995 Finalization of the framework document
January 1996 Official launching of the document
84. The Conference may wish to take not e of this progress report and provide further guidance
towards the finalization of the Framework Agenda.