Windhoek
African Union Heads of State and Government are to meet in Addis Ababa, Ethiopia, this weekend, 30 and 31 January. The theme for the AU summit is human rights with a particular focus on the rights of women.
African leaders heading to the 26th African Union (AU) summit this weekend should also put on the agenda – along with issues of security and peace – the continent’s anaemic economy, and the fact that despite a forecast of modest economic growth this year, actual growth would remain subject to serious economic shocks from weakening commodity prices and weak consumption growth.
The question of how modest economic growth would put pressure on government resources is important, says Dr Alfredo Tjiurimo Hengari, a senior research fellow at the South African Institute of International Affairs. He says this translates into high costs of living and limited opportunities for citizens, who when frustrated are likely to cause social disruption and compound the burden on African economies.
Earlier this month the World Bank expressed concern in its outlook statement for 2016 over “serious risks from the possibility of an escalation of conflict, a further decline in oil prices, and failure to improve living conditions, which could spark social unrest.”
According to the draft agenda released by the AU this week, the summit would have two closed sessions on strategic issues and actual deliberations with reports from the Peace and Security Council on its activities and the state of peace and security in Africa.
“In the banquet of issues that I would like to see being discussed at the African Union summit is the economy. I would want to see a conversation about how African economies would deal with the decreases in commodity prices, and slow economic growth.
“The World Bank had said the year 2015 was bad for the economy, with a growth decrease from 4.6 percent to 3.7 percent in 2015 and this trend is likely to continue because of commodity prices,” Hengari said from South Africa yesterday in an exclusive interview with New Era.
Hengari reminds that citizens are likely to protest against high cost of living, as happened in the aftermath of the 2008 global financial crisis in Mozambique, Senegal and Ivory Coast.
He also notes that often during times of crisis the amount of fiscal space African governments have to operate in is limited, partly due to the fact that they have large spending programmes with not enough savings to buffer their domestic economies in time of fiscal or economic hardship.
The World Bank’s forecast statement, released on January 6, said growth in the Sub-Saharan Africa region is forecast to accelerate to 4.2 percent in 2016 from 3.4 percent in 2015, as commodity prices stabilise.
“Economic activity will vary across Sub-Saharan Africa, with consumption growth remaining weak in oil exporting countries as fuel costs rise, while lower inflation in oil importing countries helps boost consumer spending,” said the statement.
Singled out were Nigeria – which is forecast to expand by 4.6 percent after growing by 3.3 percent last year, and South Africa, which is expected to advance only modestly to 1.4 percent growth compared to 1.3 percent in the year just ended.
For the Middle East and North Africa the growth is forecast to accelerate to 5.1 percent in 2016 from 2.5 percent in the year just ended, as the expected suspension or removal of economic sanctions against the Islamic Republic of Iran will allow that country to play a larger role in global energy markets.
“Growth is expected to pick up in other oil exporters as well, predominantly on the assumption that oil prices will stabilise. The region is subject to serious risks from the possibility of an escalation of conflict, a further decline in oil prices, and failure to improve living conditions, which could spark social unrest,” the report noted.
In case of social unrest African governments would have to stand up to protect the vulnerable in society and curb anarchy.
Hence, Hengari says it is crucial at this time that the AU remind Africa’s leaders of their commitment to uphold human rights and civil liberties, even in times of crisis.