Experts urge African nations to take precautions in finance crisis

Oct 30, 2008, 17:56 GMT

Kampala - International economists and policy experts on Thursday warned that Africa could be devastated by the current global credit crisis if governments fail to take serious precautions.

Dangers include: a dwindling of aid from the United States, Europe and other developed countries; a downturn in tourism; and losses of revenue from the export of oil and other commodities. These dangers could disrupt national economic plans, warned experts meeting at a one-day summit hosted by the Copenhagen-based Africa Commission.

'We might see a downward trend for commodity prices. ... The crisis is already affecting oil revenues,' said Greg Mills, director of the Brent Hurst Foundation and chairman of the conference.

Koen Vervaeke, European Union special representative and head of the EU delegation to the African Union, said the EU wants to increase aid to Africa, but has not yet decided how to target its funding.

The EU and its member states give 26 billion euros (33.6 billion dollars) for development aid to African countries annually, said Vervaeke.

Mills added that 'it is going to be difficult to continue generosity for others when there are problems at home. Every African state worth its salt must have Plan B to handle the crisis.'

Meeting participants recommended African governments stamp out corruption, develop stronger infrastructure, strengthen their private sectors, bolster agricultural output and remain cognizant of international economic developments if they hope to weather the crisis.

The Africa Commission was formed in April 2008 to help find solutions to problems with African economic growth.