Citation
NAIROBI, May 9 (Reuter) - Poverty and a lack of commitment by African
leaders are hampering a bank created to foster trade and develop
capital markets in east, south and central Africa, its chief executive
said on Monday.
Martin Ogang, president of the Eastern and Southern Africa Trade and
Development Bank (PTA Bank) told reporters only 14 of 22 eligible
members in the preferential trade area had enrolled while others had
only pledged to join or said nothing about it.
Membership subscription is the main revenue base for the bank. Without
the money it was difficult for the bank to meet its mandate, Ogang
said.
Ogang said civil wars, poverty, regional external debt running at
around $270 billion, and other structural economic problems had
seriously restricted the contributions of members.
He told a news conference in Nairobi -- the bank's headquarters was
temporarily moved here after ethnic violence threatened its base in
Burundi last year -- that problems such as unbalanced tariffs and
currency restrictions in some member states cut the bank's efforts to
expand its work.
Ogang, a Ugandan, said some African leaders were not serious about
treaties they signed and commitments they had made.
Our countries must be told in very clear terms that once you sign and
become party to an agreement, then you must implement it. There should
be no turning back,
Ogang told reporters.
Ogang said many PTA countries produced the same range of commodities
and were affected by wide-ranging tariff barriers that needed to be
urgently addressed by the states affected.
But he said there was still a lot of movement of goods across the
borders, nothing formal, just smuggling
.
Some 15 PTA states meeting in the Ugandan capital Kampala late last
year signed a treaty to transform the PTA into the common market for
eastern and southern Africa (COMESA).
Its aim is sustainable economic growth in the region through trade
liberalisation and customs cooperation, free movement of capital and
finance, and a higher level of tourism and travel within the region. It
also wants to establish a COMESA monetary union early in the next
century.
Ogang said lack of cash meant increased industrialisation and
manufacturing, agricultural development and food security, trade
liberalisation and promotion, and a more efficient communications
system could be phased in only gradually.
Officials said part of the PTA Bank mandate was to push intra-regional
trade to 20-25 percent of total trade by the year 2000, from a marginal
six percent now, and to help raise $50 million from donors to finance
funding for PTA programmes.
They said the task remained huge in a region of about 200 million
people, in which at least a dozen countries were classified as least
developed countries (LDCs).
The PTA Bank was set up in 1986. But marketing began last year because
members were slow in paying their subscriptions.
Infrastructure is destroyed in PTA members like Angola and Mozambique
and the economy is ruined in Somalia.
Ethnic violence has ground Rwanda's economic development to a halt and
threatened to halt growth in neighbouring Burundi and Sudan -- Africa's
largest nation.
Officials say only Mauritius and Seychelles are prosperous but
Tanzania, Comoros, Djibouti, Kenya, Lesotho, Malawi, Madagascar,
Uganda, Namibia, Swaziland, Zambia, Zimbabwe are stable.
(c) Reuters Limited 1994
