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12.08.2009 Business & Finance

Provide Stimulus Packages-CSOs

By Daily Guide
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Civil Society Organizations (CSOs) attending the 2009 Annual Review and Strategy Meeting of the Africa Trade Network (ATN) in Accra, have called for stimulus packages for domestic industries in order to put them on the path of industrialization.

The leaders of the CSOs, who spoke to CITY & BUSINESS GUIDE in various interviews yesterday at the opening of the meeting, emphasized the need for African governments to take their destinies into their own hands by providing incentives to support the domestic economy.

Since the global financial crisis started last year, various Developed countries such as the USA, Britain, Japan and Germany have provided stimulus packages and incentives for local banks and companies.

For instance, the US government provided an incentive package to General Motors, which employs many Americans in order to avert the company's collapse.

Soren Ameron of Action Aid Kenya told this paper that prescriptions by the International Monetary Fund (IMF) will not help African governments.

Recently, the IMF demanded some strict conditions for some loans that it approved for Ghana.

Ameron said: “We need African leaders to be more aggressive in questioning the basic financial economic policies from these Bretton Wood Institutions and we need to build our local industries.”

Tetteh Homeku, Programmes Manager of Third World Network, shared similar sentiments, adding “there were three broad areas that needed to be addressed and they include addressing trade and exports financing gaps, reviewing policies like the Economic Partnership Agreement, and refraining from pressures from the IMF and the World Bank.”

“Africa is peculiar to this crisis because of the structure of its economies, if the crisis stays for five years or more, we would have to create a proper industrial strategy,” Homeku reiterated.

Mr. Homeku further expressed dissatisfaction with policies of the World Bank and IMF, saying “it will not help the continent; this is not the time to talk about tightening spending and targeting inflational framework.”

He also chastised the World Bank for not lowering its interest rate, thus denying businesses and individuals from borrowing from the bank.”

Rangarirai Machemedze from Zimbabwe also called on local governments to support the domestic capacities of industries in order to make them more competitive, adding that agriculture needed more support.

He also called for the diversification of commodities and to add value to various products.

By Charles Nixon Yeboah & Andrew Liu

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