NEPAD-OECD AFRICA INVESTMENT INITIATIVE · NEPAD-OECD Africa Investment Initiative 3 1. ... %...
Transcript of NEPAD-OECD AFRICA INVESTMENT INITIATIVE · NEPAD-OECD Africa Investment Initiative 3 1. ... %...
2NEPAD-OECD Africa Investment Initiative
Presentation outline
1. CONTEXT
2. GOALS & DESIGN
3. ACTIVITIES & WORK METHODS
4. EXPECTED IMPACT
5. GOVERNANCE
3NEPAD-OECD Africa Investment Initiative
1. CONTEXT
Investment is a driver of economic development and poverty reduction,
but obstacles to investment keep African country investment rates low
4NEPAD-OECD Africa Investment Initiative
Africa’s poverty rate is declining, but is unlikely to meet MDG target
0
10
20
30
40
50
60
1990 2000 2007 2015
Actual (Sub-Saharan Africa)
Path to goal
Population living on less than $1 a day%
Source: UN-OECD
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Africa attracts a small share of global FDI, yet relative to GDP,
FDI is large and rising…
Europe
48.7 %
Americas
25.1 %
Asia and
Oceania
23.5 %
Africa
2.7 %
Share of global FDI inflows, 2006
0
5
10
15
20
25
30
1985 1990 1995 2000 2005 2006
Africa
World
%
FDI inward stock as % of GDP, 2006
Source: UNCTAD-OECD Source: UNCTAD-OECD
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Mauritius
… but mostly in oil-rich countries...
Net oil importer
Above 30%
Below 15%
15% to 30%
Net oil exporter
Above 30%
Below 15%
15% to 30%
FDI inward stock as a % of GDP (2005)
Algeria
Libya Egypt
Mauritania
Mali
Niger
Chad
Dem.Rep.
Congo
Sudan
Central African
Republic
Equatorial Guinea
Gabon Congo
Cameroon
Angola
Guinea-Bissau
Guinea
Sierra Leone
Liberia
Côte
d'Ivoire
Tunisia
Burkina
Faso
Ghana
NigeriaTogo
Ethiopia
Somalia
Djibouti
Kenya
Tanzania
Mozambique
South
Africa
Botswana
Zimbabwe
Namibia
Zambia
Swaziland
Lesotho
Malawi
Uganda
Burundi
Rwanda
Madagascar
Senegal
The Gambia
Cape Verde
Benin
Comoros
Eritrea
Sao Tome & Principe
Seychelles
Morocco
Source: UNCTAD-OECD
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Investment climates still need much
improvement so as to attract FDI…
NEPAD-OECD Africa Investment Initiative
The cost of doing business in Africa remains the highest in the world:
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Low savings rates limit Africa’s growth potential…
Savings trends: regional comparison per decade
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Above 20%
… and domestic investment rates therefore also remain very weak.
Business investment as a % of GDP (2005)
10% to 20%
Below 10%
Algeria
Libya Egypt
Mauritania
Mali
Niger
Chad
Dem.Rep.
Congo
Sudan
Central African
Republic
Equatorial Guinea
Gabon Congo
Cameroon
Angola
Guinea-Bissau
Guinea
Sierra Leone
Liberia
Côte
d'Ivoire
Tunisia
Burkina
Faso
Ghana
NigeriaTogo
Ethiopia
Somalia
Djibouti
Kenya
Tanzania
Mozambique
South
Africa
Botswana
Zimbabwe
Namibia
Zambia
Swaziland
Lesotho
Malawi
Uganda
Burundi
Rwanda
Madagascar
Senegal
The Gambia
Mauritius
Cape Verde
Benin
Comoros
Eritrea
Sao Tome & Principe
Seychelles
Morocco
Source: UNCTAD-OECD
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Advancing private sector development in African countries
2. GOALS & DESIGN STRUCTURE
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Objectives of the Initiative
• To support and strengthen the capacity of African countries to identify and implement concrete policy reforms that improve the investment climate
• To raise the profile and image of Africa as a place in which to invest
• To facilitate regional co-operation among African countries
• To strengthen Africa’s voice in international dialogue on policies for investment
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• Demand-driven, African-led partnership with NEPAD and OECD support
• Focused on areas of technical need and where OECD experience and expertise add maximum value
• Cost-effective, process-based and result-oriented, with outcomes aimed at impacting policy development and capacity-building within African governments
• Complementary and in co-operation with other institutions active in the field (e.g. World Bank, AfDB, RECs, UNECA, UNCTAD)
Design principles of the Initiative
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• A partnership approach to policy capacity building, based on experience-sharing and peer learning
• The availability of multilaterally-backed investment policy tools which African countries can adapt and develop to their specific needs
• Comprehensive, coherent and process-oriented policy assessments
• Mobilisation of other fields of OECD expertise and its role as a facilitator
• A forum for conditionality-free policy co-operation and dialogue with the world’s major investing countries
Value added from OECDco-operation with NEPAD
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Political support for the Initiativeis strong
“African countries need to build a much stronger investment climate:
we will continue to help them do so, including through the promotion
of a stable, efficient and harmonised legal business framework",
noting "the improvement of the investment climate through the OECD-NEPAD Investment Initiative".
G8 Heads of State Communiqué on Africa, Gleneagles, July 2005
"We will individually and collectively continue to support initiatives which address the investment climate, such as … the NEPAD-OECD
Africa Investment Initiative."
G8 Summit Declaration on Growth and Responsibility in Africa, Heiligendamm, June 2007
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Political support for the Initiativeis strong
“The G8 will continue to advance a number of initiatives to improve
the investment climate and strengthening financial markets in Africa,
such as the NEPAD-OECD Africa Investment Initiative”.
Progress Report by the G8 Africa Personal Representatives (APRs) on
implementation of the Africa Action Plan, Hokkaido Toyako, July 2008
"In the next 5 years the TICAD process will specifically focus on … promotion of good governance, including strengthening economic
governance through the NEPAD-OECD Africa Investment
Initiative”.
TICAD IV Yokohama Action Plan,
Yokohama, May 2008
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3. ACTIVITIES & WORK METHODS
Result-oriented and process driven, using and adapting multilaterally-
backed policy assessment and capacity-building tools
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The Initiative supports the efforts of NEPAD governments to enhance
their investment climates by:
• Strengthening country capacity for designing, implementing and monitoring investment policy reforms
• Creating a network of dialogue between investment policy makers from NEPAD and OECD countries
• Creating a favourable environment for employment creation through investment climate improvements
• Assisting ministries and government agencies in co-ordinating their work
• Reinforcing the impact of development initiatives supported by international, regional and bilateral donors
NEPAD-OECD Africa Investment Initiative
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The Initiative follows a comprehensive approach to driving feasible reforms (A)…
Administrative
practicabilityPolitical
support
Assessing this …
… helps stimulate
this
… helps stimulate thisBuilding capacity here …
Obstacles to
investment
A
Source: Adapted from Lax and Sebenius
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Administrative
practicabilityPolitical
support
Obstacles to
investment
A
NEPAD-OECD Africa Investment Initiative
Source: Adapted from Lax and Sebenius
Administrative
practicabilityPolitical
support
Obstacles to
investment
A
Administrative
practicabilityPolitical
support
Obstacles to
investment
A
… using and adapting policy assessment and capacity building tools…
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…such as the Policy Framework for Investment
• PFI is a tool to support African governments in:
– Coherently identifying the bottlenecks to investment
– Formulating the right policies and governance structures to address the obstacles
– Enabling effective implementation and monitoring of policy reforms
• Key features of the PFI:
– Non-prescriptive
– Focus on policy governance
– Domestic and international investment
– Comprehensive, covering all policies that are important for investment
• Download the PFI at: www.oecd.org/daf/investment/pfi
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Recent achievements
Brazzaville roundtable (Dec. 2006):Main outcomes• A dialogue was initiated between the APRM Secretariat, other
NEPAD actors and reform-oriented countries wishing a more robust investment dimension in the APRM
• African countries have begun to use the PFI for self-evaluation
Lusaka roundtable (Nov. 2007):Main outcomes• Country experiences were given on challenges relating to the
investment climate content of Africa’s own peer review process (APRM). The decision was taken to review the APRM country self-assessment questionnaire.
• The PFI User’s Toolkit was discussed based on its application in Zambia and on its role in supporting investment climate reform
• The investment environment conditions conducive to attracting sustainable investment in water and sanitation were analysed in light of new trends in private involvement in the sector.
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Next steps
Next roundtable (Uganda, 10-11 Dec. 2008):Main focus• Making the most of best practices that will help NEPAD
countries implement investment policy reforms, using innovative policy papers and country-specific experiences as a springboard for comprehensive , multi-stakeholder dialogue.
• Engaging the business sector as an agent for development
• Taking advantage of Africa’s own peer review process (APRM) and of multilaterally-backed policy tools such as the Policy Framework for Investment (PFI).
• Sharing best practices to identify the business environment conditions conducive to attracting investment in Africa’s road transport infrastructure.
• Investigating regional initiatives for improving transport infrastructure in the East African context
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Next steps
Renewal of the Initiative for 2009-2011:
• The first phase of the Initiative has focused on region-wide dialogue on investment policy. The second phase will focus on implementation. It will prioritize:
• Consolidating the regional dialogue on investment policies, including on reforms aimed at facilitating regional infrastructure projects and on strengthening the APRM’s investment dimension;
• Engaging the private sector and reinforcing the dialogue with African governments on issues such as corporate responsibility; and
• Supporting pilot countries that are willing to review/reform their investment framework, by: evaluating the current investment climate based on the PFI, providing technical support, and facilitating peer-sharing of national experiences.
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4. EXPECTED IMPACT
An increase in beneficial private investment in African countries and closer regional economic integration
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Expected impacts of the Initiative
• Better-informed decision-making
• Policy coherence within the Government on investment climate issues
• More effective policies for development-geared, pro-poor investment
• Strengthened capacity in African countries to reform and implement policies which create a level playing field for all investors
• Better perceptions and reality of African countries as locations to invest
• Improved competitiveness, attracting more FDI and domestic investment
• Closer integration into the global economy
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5. GOVERNANCE
The Initiative is governed by a Steering Group and is entirely
funded through voluntary contributions
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A Steering Group manages the Initiative
• Roles: To provide strategic direction, oversee the work programme, mobilise political and financial support and assist in the dissemination of outputs of the Initiative
• Chair: Chief Executive, NEPAD Secretariat. Vice Chairs from a NEPAD and an OECD country
• Other members: Senior investment experts from NEPAD countries, OECD countries, AU Commission, the Regional Economic Communities, multilateral development banks, UNCTAD, the OECD’s Network on Poverty Reduction (POVNET) and Development Centre, the Africa Partnership Forum (APF), the Investment Climate Facility for Africa (ICF), the donor community, and the private sector
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Financing the Initiative
• The Initiative is entirely funded through voluntary contributions
• Japan, Belgium and Germany have so far provided financial support to the Initiative
• Support for the programme is building, but more is needed
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From the NEPAD secretariat:Mr. Victor Mathale, Advisor: Private Sector Initiativese-mail [email protected]: +27 (11) 313 3384; Fax +27 (11) 313 3583
From the OECD secretariat: Mr. Karim Dahou, Executive Programme Manager,e-mail: [email protected]: +33 145241938; Fax +33 144306135
Mr. Toru Homma, Project Manager,e-mail: [email protected]: +33 145248448; Fax +33 144306135
Contact informationVisit: www.oecd.org/daf/investment/africa
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