Africa needs to look at domestic development funding: Alweendo

19 Oct 2016 20:50pm
RUNDU, 19 OCT (NAMPA) – The Minister of Economic Planning said funding for development in Africa has shifted from external sources and should now be sourced at home because without the funding, the continent’s development aspirations will be elusive.
Tom Alweendo was speaking on Wednesday at the Africa Redemption International Conference (ARIC) that started at Rundu on Tuesday and ends on Friday.
It brought together about 200 academics and policy makers to deliberate on issues that deter the continent from emerging from poverty.
Alweendo said the relationship between economic development and money cannot be ignored.
“It is a fact that sustainable economic development cannot take place without adequate funding. And that is why how to fund Africa’s development resource gap has long been a preoccupation of not only policy makers but also the development community in general.”
He explained that in the 1990s, attention was largely focused on external sources of development finance, which included schemes such as debt relief, increased aid and foreign direct investment (FDI), but that has changed with a lesson.
“Today there is empirical evidence that proves that relying on others to fund our development has not worked. In many countries it has seen high levels of in-debtness and economic stagnation.”
Alweendo said the flow of FDI into the continent was not always of good quality and that its impact on development in terms of job creation, technology transfer, and forward and backward linkages in the host economy were not always notable.
He said it is also the case, more often than not, that FDI flow on the continent is mostly in the extractive sectors especially oil, gas and minerals industries, which tend to be capital intensive.
“There is therefore no doubt that for Africa to sustainably develop its economies, the time has come to heavily rely on domestic financial resources.”
He said an increasing share of Africa’s development needs from domestic sources would give the continent much needed flexibility in the formulation and implementation of policies that address its socio-economic and development challenges.