Browsing: Development

Africa’s role in the world economy derives from its economic importance to the rest of the world in international trade and as a destination for international investment. Africa has recently become home to the largest free trade area in the world, both by area and by the number of countries.

As economies have been hard hit by the Covid-19 pandemic, the Africa Continental Free Trade Area (AfCFTA) holds economic promise for the continent. The AfCFTA comprises 55 countries with a population of 1.3 billion and combined GDP of about $3.4 trillion. Business leaders and observers regard economic and regional integration as essential for accelerating Africa’s manufacturing, e-commerce, and digitization to reduce an over-reliance on imports, especially from China.

However, there is still much more to do as major components of the agreement still must be negotiated, between many countries and regional economic communities. Moreover, according to the IMF, removing non-tariff barriers could be up to four times more effective in boosting trade than tariff reductions.

Unfortunately, even with an increased power supply, electricity is mostly used for lighting but the vast part of the community still relies on biomass ‘…which makes up close to 90% of the total primary energy consumption in Tanzania.’

According to REA, this reliance on biomass leads to the deforestation of 100,000 hectares every year and only about a quarter of this is ever reforested. At the moment, at least 63.5% of the households in Tanzania Mainland use firewood as the main source of energy for cooking which is the main cause of deforestation along with the clearing of forests for cultivation.

Another 26.2% of Tanzanians rely on charcoal for cooking and another 5.1% use, liquified petroleum gas and a mere 3 per cent use electricity. These figures show that even though there is an increased supply of electricity there is still profound destruction of forests and the atmosphere through deforestation and the burning of fossil fuels respectively.

That’s right—it is not on mere goodwill that the magnanimous sums are dished out; it is a two-way street. We give you this amount if you do this for us. This give and take barter in economics is known as conditionality.

To put it in the words of Kjell J. Havenevik, author of ‘The IMF and the World Bank in Africa (Conditionality, Impact and Alternatives), ‘Conditionality is the term given to the conditions relating to macro-policy elements which countries have to meet in order to get access to international loans and/or aid.’

We in the journalism science get information about the big sums ‘handed’ to African countries; what we usually do not get through the all-too-frequent press releases is the conditionality that comes with that money.