Kofi Annan’s take on “Equity in Extractives: Managing Africa’s Mineral Wealth”

Africa stands to reap a natural resource windfall that could change the face of the continent, reducing the need for international development assistance and setting Africa on the road to self-sufficiency, observed Kofi Annan, former Secretary-General of the United Nations.

He has however charged Africa’s governments to manage these resource revenues wisely to lift millions of people out of poverty, and urged leaders to invest more upfront, especially in sovereign wealth funds.

“As a starting point, African governments should adopt national strategies that set the terms on which their natural resources will be developed, and link these strategies to plans for poverty reduction and inclusive growth,” he said.

These strategies, he noted, must identify extractive projects that can generate more jobs, through linkages with the local economy. “And by processing natural resources before export, they can thus bring extra value. Africa cannot build dynamic equitable growth while extractive projects operate within enclaves”.

With a young, growing, and low-cost workforce, Mr. Annan is optimistic Africa could become a highly competitive manufacturing hub, as well as one of the world’s largest consumer markets.

He is also optimistic about Africa’s agriculture. “With enormous room for improvements in productivity and an estimated 60 per cent of the world’s uncultivated arable land, Africa could one day become a major player in the global food security and nutrition system”.

Addressing the Graduate Institute in Geneva, Mr. Annan however said the optimistic must be tempered with vigilance and caution.

“Building on the Africa Mining Vision, a blueprint for development formulated by African nations, African governments should adopt legislation that requires companies bidding for concessions and licences to disclose fully their beneficial ownership. Tender and concession granting processes must be open and transparent”, he said.

A report called “Equity in Extractives”, released earlier this year by the Africa Progress Panel, chaired by Kofi Anann, cautioned Africa and its partners will miss the opportunity to transform the lives of future as well as present generations, however, if they carry on with business as usual.

 

Story by Kofi Adu Domfeh