South Africa leader welcomes G20

Notice the tragic comedy and irony. South Africa is NOT in a recession, even though it's official unemployment is over 20%.

- Kali

South Africa's leader Kgalema Motlanthe has said the G20 summit had taken some decisive and courageous steps.

The world leaders pledged $100bn in aid for developing countries and promised to give more voice to developing countries in economic decision-making.

Mr Motlanthe said the deal focused on ways to avoid unemployment and acknowledged the importance of emerging markets to boost trade.

But it might not be adequate to address the full extent of the crisis, he said.

South Africa, which has so far avoided a recession, is the only African country in the G20.

“ You can't shave somebody's head in his absence... In an almost 30-page communique, Africa is not even mentioned ”
Kenyan economist Oduor Ong'wen
"We have as the central pillar of the recovery plan the saving of jobs because there's a recognition that this summit could not only focus on technical aspects of the economy but that the economic meltdown affects people, affects ordinary working people," the South African president said.

Economists have been warning that up to 300,000 jobs could be lost this year, pushing South Africa's unemployment up from the current level of 22%.

Other developing countries have suffered from a downturn in tourism, remittances from workers living abroad, and the collapse of commodity prices.

'Fire-fighting'

"I don't see much in terms of rescue for Africa," Kenyan economist Oduor Ong'wen of the the Southern and Eastern African Trade Information and Negotiations Institute told the BBC's Network Africa.

NEW FUNDING PLEDGES
$500bn for the IMF to lend to struggling economies
$250bn to boost world trade
$250bn for a new IMF "overdraft facility" countries can draw on
$100bn that international development banks can lend to poorest countries
IMF will raise $6bn from selling gold reserves to increase lending for the poorest countries Source: BBC

"You can't shave somebody's head in his absence... In an almost 30 page communique, Africa is not even mentioned.

"In as far as it is fire-fighting it is OK, but we have to go behind what caused the fire," he said.

But Stephen Gelb, executive director of South Africa's Edge Institute think tank, says as well as the aid package, the $750bn to the International Monetary Fund and the $250bn to boost global trade will have an impact on Africa.

"It will make a rapid difference to the flow of trade because trade has been suffering from a lack of credit to importers and exporters," he told the BBC.

He said his greatest fear is protectionism, which has been creeping in despite promises from richer nations not to do so.

Nigerian businessman John Adeleke sees the tripling of the IMF's funds as a mistake.

"I think some of the most successful developing countries have advanced in spite of the IMF and a lot of the failures have been failures that were perhaps mismanaged by a lot of the [IMF] advice," he told the BBC's World Today.

In a speech after the summit, US President Barack Obama announced that he aims to double US food and agriculture aid to Africa and other poor regions to more than $1bn.

Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/2/hi/africa/7980910.stm

Published: 2009/04/03 10:19:31 GMT