PRESS CONFERENCE BY UNITED NATIONS DEVELOPMENT PROGRAMME ADMINISTRATOR

Sub-Saharan countries were growing at an average rate that was faster than that of the world economy, Kemal Derviş, Administrator of the United Nations Development Programme (UNDP), said today, on returning from a two-visit to Southern and East Africa.

He said at a Headquarters press conference that those figures gave reason for encouragement, adding that the gross domestic product (GDP) of sub-Saharan countries over the period 2002-2003 had risen from 3.7 per cent to an average rate exceeding 5.6 per cent during the period 2004-2006, perhaps the most rapid growth seen in the region in decades.  The estimated growth for 2007 would probably be around 6 per cent -- more than one percentage point higher that the world average.

Although oil-exporting countries had grown some 1.5 per cent more over the last six years than oil-importing countries, the difference was not huge, he said.  The average investment/GDP ratio had risen from 15 to 20 per cent over the last six years, which, while not sufficient, constituted considerable progress nevertheless.  One of the key issues was that progress in countries where conflict had ended was greater than in those where there was still strife.  The top priority, therefore, should be conflict resolution and prevention.  The overall macro-framework was also good, as high inflation and price instabilities had been overcome for the most part.  That was one of the reasons why progress was accelerating.

He went on to stress that capacity-building, at both the local and national levels, remained the top challenge, and that was where the United Nations, including the UNDP, had a key role to play.  The excellent leadership in the ministries of many countries was characterized by a new “can-do, results-oriented and pragmatic” attitude.  However, capacity remained weak in terms of overall administration.  The UNDP focused on the capacity of African Governments to deal with the global economy and foreign investment.  Their capacity to negotiate optimal contracts with foreign investors that were truly beneficial to their respective countries was an issue that needed greater attention.  The income from two to three well negotiated contracts could be the equivalent of the total foreign aid going to a country.

Having visited Mozambique, Rwanda and the United Republic of Tanzania -- three of the four pilot United Nations coherence-reform countries in Africa -- he reported from the teams on the ground, and from the Governments, that the initiative had progressed very well, perhaps outpacing that at Headquarters.  The economies realized by the country teams, as well as the better teamwork and greater ability to coordinate the work of the United Nations family with the national development strategy in all three countries, had improved significantly.  A progress report on the pilot countries would be prepared for November.

Asked how he could paint a positive picture when observers claimed that no African country would meet the Millennium Development Goals, the Administrator conceded that it would be hard for most African countries to meet all the targets, but their progress had accelerated, particularly in such areas as primary school enrolment and access to clean water.  Some countries were making quite rapid progress, which was accelerating.

Responding to questions about the investigation of the UNDP in the Democratic People’s Republic of Korea, he said the external review, headed by former Prime Minister Miklós Németh of Hungary, had started, and it was better to await its end.  It was to be hoped that the independent external review would establish all the facts.  The documentation in North Korea was safeguarded in the World Food Programme (WFP) offices inside the Democratic People’s Republic of Korea.  The Board of Auditors was asking to visit the country, but the response had been negative.

Regarding other control mechanisms, he said the UNDP was a decentralized, grass-roots organization that was present all over the world.  Audit follow-ups and financial controls were, therefore, extremely important and should be strengthened.  However, in countries with weak capacity, there was always the temptation “to do it yourself”, which, in the long run, would be self-defeating.  It was, therefore, important that financial controls and transparency be looked at in combination with the capacity-building framework.  It should be a joint effort.

In response to another question, he said Chinese investment and trade were becoming extremely important.  China’s rapid growth was a source of the growing demand for African goods, particularly primary commodities.  That new demand was benefiting development.  Hopefully, the overall coordinating mechanisms of foreign aid, contained in the famous Paris Declaration, would gradually encompass all donors, including new donors or investors such as China.

Also present at the press conference was Gilbert Houngbo, UNDP’s Regional Director for Africa, who said that, apart from increasing demand from China and that country’s investments, the improvement in governance over the last 10 years was having an impact.  There was a new generation of country leaders and contract negotiations were now focused on how to maximize domestic revenues.  A better business environment had been created.

Asked about UNDP’s position regarding the Ethics Office, Mr. Derviş said the heads of Funds and Programmes wanted a harmonized ethics procedure and had agreed on the basic structure.  The goal was to have a strong, harmonized and independent system that brought the whole United Nations family together in a transparent way that would afford full protection against arbitrary behaviour or management retaliation.  At the same time, it was important that people take advantage of existing mechanisms within their own organization.  If that failed, there was a possibility to go to a level higher, but an outside ethics office could not take care of all the problems.

Questioned about a UNDP trust fund in Nigeria that helped pay the salaries of some government officials, he stressed that capacity-building covered not only procedures and computers, but also included skilled people in the Government and other public systems.  Salary structures in some countries made it extremely hard to retain skilled people, and the primary approach was support for civil service reform so that better salaries could be paid to retain skilled people within the system.  The UNDP had an approach to helping civil service reform that included facilitating the return of migrants.  One of the most important things one could do was to help such migrants return home or let skilled professionals stay in the country.

Mr. Houngbo added that the trust fund was not funded with UNDP money, but by the Nigerian Government and one important national donor.  The UNDP merely managed the fund, which had been set up for a temporary period and then phased out.  There were similar projects in other countries, including Liberia.  As for UNDP activities in the Niger delta, both the Programme and the Department of Political Affairs were working together to bring all internal actors together in a round-table format, on the request of the Nigerian Government.  The Department of Political Affairs was assisting in that, but the Government of Nigeria was “in the driver’s seat”.

Commenting on another question regarding the United Republic of Tanzania’s position that unless the country would get an infusion of $100 million, the pilot programme could not be deemed a success, he said success should not be seen merely in terms of harmonizing the work of the United Nations system, but ultimately by how effective that support was for a country’s development agenda.  Unless there was a scale-up in official development assistance (ODA) resource availability, little progress would be achieved in the Millennium Development Goals.  That was the core of the Tanzanian position.

Asked about the difference between $1.3 billion spent in Latin America last year and $526 million in Africa, according to one of the Member States on the UNDP Executive Board, Mr. Houngbo said that statement was misleading because the Latin American amount also included funds managed by the UNDP on behalf of others.  The majority of UNDP resources were dedicated to Africa.

As for UNDP involvement in the Zimbabwean River Ranch diamond mine, partly owned by the husband of that country’s Vice-President, he said, 15 years ago, the World Bank, the UNDP and some donors decided to help small and medium-size enterprises in their growth.  Money had been made available to set up the African Management Services Company, which recruited and provided staff for enterprises.  In order to expedite logistics, it had been easier to let the staff travel under the aegis of the United Nations.  Any linkage was purely legalistic.

Asked whether audit results would be made available to Member States or countries on the Executive Board, he said that issue was substantive and political.  The Executive Board had to give guidance, but debate within the Board was not consensual and was still ongoing.  The debate had started during the oil-for-food affair.

Commenting on an internal World Bank study stating that the UNDP had neglected Africa’s agricultural sector, he said one tended to forget that 75 to 80 per cent of Africans still lived on agricultural production and the “huge” contribution of the sector to gross domestic product.  Attention must, therefore, be paid to the basics.  The emphasis on agriculture should also be linked to the Gates Foundation’s commitment to agriculture and the Green Revolution initiative of the former Secretary-General.  There would be no poverty alleviation without investment in agriculture.  The whole issue was, of course, also linked to the question of trade.

Asked about the impact of foreign direct investment in the three countries visited, he said it could be seen in the stability and social cohesion necessary to attract foreign investment.  Investment also depended on a conducive environment and a specific country plan.  Rwanda was pushing for investments in information technologies, the United Republic of Tanzania wanted investment in mining, and Mozambique wanted it for mining and tourism.

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For information media • not an official record