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Statement at the Annual Meetings of 37th AfDB / 28th AfDF (Addis Ababa, Ethiopia / May 28, 2002)

Japanese

Statementby the Mr. Kiyoshi Kodera, Temporary Governor for Japan,
atthe Annual Meetings of the African Development Bank
andthe African Development Fund

Addis Ababa, 28 May 2002



1.       Introduction


          Mr. Chairman, Mr.President, distinguished Governors, ladies and gentlemen:

          It is a great honor forme to address the 37th Annual Meeting of the African Development Bank and the28th Annual Meeting of the African Development Fund. On behalf of the Governmentof Japan, I would first like to express our gratitude to our hosts, theGovernment of Ethiopia and the people of Addis Ababa, for their warmhospitality.


2.       Recent developments in the African economy

           At the outset ofthe new century, we note that conflicts in a number of African countries havebeen stabilized, and that several countries in the region have demonstratedincrease in their real GDP growth rates. There is also an emerging movement inAfrica to take the initiative in addressing its own economic issues, asexemplified by NEPAD – the New Partnership for Africa’s Development. Weshould be pleased with such a progress in strengthening the foothold forsustainable economic development.

           Having said that,however, it is true that Africa lags way behind other parts of the world in itsfight against poverty with almost half the people across the continent stillliving on less than $1 a day. Poverty reduction will thus continue to be thebiggest challenge for Africa.


3.       Good governance, another challenge for African development

           To promote povertyreduction, it is essential to allocate limited economic and social resourceseffectively, efficiently, and equitably. Good governance means theimplementation of this process in a participatory and transparent manner. Thepublic sector is responsible for this process as well as for creating andimproving the environment for the private sector. Thus, promoting goodgovernance through the public sector’s capacity building is the key to povertyreduction in the medium-to-long terms.

           Budget andexpenditure management in the public sector as well as tax and customadministration, in particular, are the vital building blocks for governmentcapacity. So, strengthening the capacity of government institutions and humanresources in these areas is an urgent task. Good governance should also beenhanced in broader terms: improvement of legal and regulatory systems, andestablishment of fair judicial systems, government auditing agency andprocurement systems.

            One thing Iwould like to emphasize here is that good governance is not something you canaccomplish overnight. A hasty attempt to seek immediate results can hinder theestablishment of ownership in development. As enhancing governance is a long,enduring process, we believe it is essential to keep moving forward one step ata time, and never allows a reversal. We will keep a close eye on those stepspatiently.


4.       Challenges for the ADB Group

           I would like toturn to the issues the ADB is now faced with.

 Strategic allocation of assistance resources

           We recognize thatnew momentum has emerged in the recent years in strategic allocation ofresources. Increased allocation of resources to the priority areas specified inthe Bank’s Vision is one example. The introduction of a performance-basedallocation system is another.

           While based on theMOU signed with the World Bank last year, the ADB Group should continue toallocate its resources with a particular focus on agriculture and ruraldevelopment, infrastructure building, and social development, while paying dueconsiderations to such development themes as HIV/AIDS, good governance, regionalintegration, and assistance to post-conflict countries.

            It isessential that the CSPs (Country Strategy Papers) will duly reflect thesepolicies, while retaining a stronger linkage with the PRSP process.

 Measurement of the effectiveness of assistance

            As to theeffectiveness of assistance, it is essential to monitor the impact of ADB-implementingprojects and programs at sectoral and country levels with measurable indicators.It is equally essential to extract “lessons learned” from the non-measurableinformation and to establish a practical feedback mechanism so that futureoperations can build upon those lessons.

            In thisregard, the ADB Group is expected to adequately coordinate with othermultilateral development banks.

 Corporate management

            I welcome thetimely reorganization of the ADB in January this year. For the future, Ihope for continued efforts by the Staff to deliver tangible results, such asincreased operational efficiency under the new organizational structure.


5.        Japan’s Support for NEPAD

            With regardto NEPAD, Japan strongly supports the spirit that this is the homegrowninitiative by African countries.

            At the sametime, however, we note that there are a number of issues in moving forward, suchas increasing the number of commitments from individual African countries andfurther elaborating Action programs.

           The ADB Group isalready takes an active part in NEPAD as a task group member to providetechnical support in infrastructure, and banking and financial sector. I hopethat the ADB Group will further contribute to promotion of NEPAD through theseactivities.

           For its part, theGovernment of Japan intends to promote dialogue between the third TokyoInternational Conference for African Development (TICAD III), and NEPADprocesses, in time for TICAD III scheduled for the latter half of next year.


6.       Japan’s contribution to the HIPC Initiative

           The total value ofJapan’s bilateral debt reduction to the 22 African countries that have reachedtheir decision points under the HIPC Initiative would amount almost to 1.9billion US dollars. This is the largest among creditor countries. I stronglyhope that the HIPC countries will capitalize on this opportunity so that theirrenewed efforts will lead to effective poverty reduction.


7.        Japan’s contribution to ADF-IX

            With regardto the Ninth General Replenishment of the African Development Fund (ADF-IX), Iwelcome the latest agreement on Interim Financial Arrangement. We recognize thatthe ADF is an institution indispensable to Africa’s development. Although ourfiscal situation continues to be extremely severe, I am pleased to announce thatJapan joins the Interim Financial Arrangement, by contributing 6.5 billion yen(approximately 53 million US dollars).

            As for thefull-scale negotiations for ADF-IX, I believe it is essential that an agreementwill be reached at an early time this year.


8.       Conclusion

           Africa’sdevelopment will remain among the most important agenda for internationaldevelopment.

           In closing, I hopethat the ADB will help advance NEPAD further in the future, and continue to playits significant role in economic development in Africa.


           Thank you.