The Africa Report
By Hannibal
The Arab Spring revolts that overthrew long-standing regimes were triggered by popular outrage that reforms seemed only to benefit a politically connected few. But whilst a $40bn promise has yet to arrive, the African Development Bank – headed by its president Donald Kaberuka, have responded quickly.
Unlike many revolutions, protestors’ demands usually came with no economic ideology attached.
A lack of new policy approaches is now being felt across the region, where lack of growth and downturns in key sectors have led a growing number of citizens to doubt their leaders’ ability to improve lives.
Months after Hosni Mubarak’s departure, Hannibal heard one Egyptian activist well schooled in the ‘Washington Consensus’ tell a group of peers that the fallen regime had kept knowledge of huge hidden resources including “a mountain of gold” that, along with seized assets, would unpin a new beginning. It has yet to be revealed.
Even countries that accelerated reform and avoided full-scale revolts, like Morocco, have felt the pinch – especially as they are so closely aligned to the anemic eurozone.
Just as Morocco has reached a new International Monetary Fund (IMF) agreement, so Egypt – which shunned the IMF in the revolution’s early months – is cooking up a new deal, now that Mohamed Morsi is bedding into the presidency.
On 22 August, Morsi and Prime Minister Hisham Qandil met IMF managing director Christine Lagarde to discuss an estimated $4.8bn loan.
Qandil’s policy orientations should be sufficient to meet the IMF’s demands. They include swingeing subsidy cuts proposed by Mubarak’s finance minister, Youssef Boutros Ghali.
Meanwhile, the promised $40bn from the so-called Deauville Consensus has yet to arrive.
A few institutions, like the African Development Bank, headed by its president Donald Kaberuka, have responded quickly.
The European Bank for Reconstruction and Development is gearing up to support a more dynamic business base across the region.
Morsi’s first international visit included a stop in Beijing to attract more investment in late August.
Gulf funds have helped to prop up the Tunisian and Egyptian governments, but secular and Islamist factions talk about support for Salafists and other rivals being linked to Gulf money.
Western commentators and Egyptian critics saw a United States decision to write off $1bn of debt as saying much about Washington’s desire to shore up relations.
The region needs money, but some funds cost more than others, and everything now seems to come with more strings attached than most North Africans think they need●
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