SECRETARY-GENERAL URGES LEADERS OF GOVERNMENT AND PRIVATE SECTOR TO EXAMINE UNEXPLORED OPPORTUNITIES AFRICA HAS TO OFFER

6 March 1998

Press Release
SG/SM/6478
AFR/43

SECRETARY-GENERAL URGES LEADERS OF GOVERNMENT AND PRIVATE SECTOR TO EXAMINE UNEXPLORED OPPORTUNITIES AFRICA HAS TO OFFER

19980306 Emphasizes Importance of Dialogue among Key Actors, In Message to Trade and Investment Forum in Addis Ababa

Following is the text of Secretary-General Kofi Annan's message to be delivered by his Special Envoy for Afghanistan, Lakhdar Brahimi, at the Addis Forum for Trade and Investment in Africa, to be held in Addis Ababa from 8 to 9 March:

I am honoured and very pleased to extend my warmest greetings to the participants in this important forum, which brings together leaders of government and the private sector to discuss a subject of critical importance for the future of Africa. I would like to thank everyone involved, including the host country, Ethiopia, for their contributions. My sincere appreciation goes to His Excellency Meles Zenawi, Prime Minister of Ethiopia, and to the many representatives of corporations and civic groups around the world for their generous sponsorship.

You have gathered in Addis Ababa against a backdrop of considerable change in Africa. The peace and security situation on the continent continues to show real progress despite persistent conflict and instability in some areas. Democratically elected governments are the majority. Political reforms are leading to the increased participation of civil society. Institutions such as the legislature and judiciary are on increasingly secure footing.

The economic situation is also demonstrating encouraging signs of vitality after years of stagnation and decline. Recovery is occurring in all five of the continent's subregions, with the exception of a few countries. For the first time in many years, the growth of domestic output has been greater than that of population. And Africa as a whole is set to record growth of close to 5 per cent for the second consecutive year.

One of the more pivotal changes is the higher profile of the private sector in economic and social development. The key role of private enterprise is now fully acknowledged. There is increased understanding, in particular, of how much foreign direct investment can contribute to development: through job creation, technology transfer, improved domestic infrastructure and production capacity and integration into the world economy. Foreign direct investment, in short, is both welcomed and actively sought.

African countries are liberalizing their economies and undertaking large privatization programmes in sectors such as telecommunications, energy, agriculture and banking. They are battling corruption, enhancing regulatory frameworks and strengthening law enforcement. They are working to improve transport and communications infrastructure, and cooperating with each other to harmonize investment codes and customs duties. Such initiatives not only aim to improve African standards of living, but also to attract investment.

A number of African countries have been successful in attracting increasing flows of foreign direct investment. Still, parts of Africa are being bypassed by global investment and trade flows, and the threat of economic marginalization has become pronounced. This is not for lack of opportunity: Africa is rich in resources and is a vast, untapped market. Those who have invested in Africa have found good rates of return: in some cases, higher profitability than in other regions and returns that are higher than average for both developed and developing countries.

Rather, the low levels of foreign direct investment in Africa are to a significant extent the result of an information gap on investment opportunities and conditions in Africa. That is where this dialogue among key actors can play such an important role. I hope that this forum will take a new look at Africa, and it will examine closely the unexplored opportunities Africa has to offer.

The United Nations, for its part, has undertaken its own dialogue with the private sector and is committed to complementing and supporting your efforts. We have worked with a variety of business people, ranging from the Business Consultative Council established by the World Economic Forum in Davos and the Prince of Wales Business Leaders' Group to the Federation of Indian Chambers of Commerce and Industry.

Last month, after meeting with representatives of the International Chamber of Commerce, we issued a joint statement emphasizing that the goals of the United Nations -- promoting peace and development -- and the goals of business -- creating wealth and prosperity -- can be mutually supportive. We agreed to join forces, with a particular focus on Africa and the least

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developed countries. In this spirit, collaboration should help promote greater investment flows into the continent.

Such cooperation between the United Nations and business has already taken practical form. We help nations prepare the ground for business to invest on a scale and in a manner conducive to sustainable growth and development. We advise investment promotion agencies on how to maximize the benefits of foreign direct investment in light of a country's development priorities. And we provide technical assistance so that countries can build infrastructure and skills that will attract commercial interest.

In joint ventures with the private sector, we prepare investment guides for least developed countries, which provide information about opportunities and legal, economic and sectoral conditions and are also meant to contribute to a policy dialogue among investors and governments. Such guides, available for most developing countries, are lacking in Africa. Efforts by the international community could help to fill this gap. Even more, they could help counterbalance biased perceptions regarding Africa and promote better understanding about the continent.

Initiatives such as the Addis Forum are essential if we are to reach these goals; if we are to show the business community just how much more it can do for the cause of African development; and if we are to realize not only Africa's foreign direct investment potential but also the continent's great human potential.

I wish to thank you once again for your commitment to Africa's well-being. Please accept my best wishes for the success of your efforts.

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