Foreign aid and investment in the development of Africa, Latin America, and the Caribbean have been seriously impaired by the recent global economic crisis. Leaders in these regions are thus looking inward to find the resources necessary to support their own economies and overcome longstanding, nettlesome obstacles to sustainable development. As the international crisis continues, limiting resources available to the Third World, internal tensions may grow within developing countries. Committing to regional integration will ensure that Africa maintains a strong and credible voice in international problem solving, in areas ranging from climate change to global financial systems. Critical problems for governments include managing revenues from natural resources and raising revenue via taxes.
Commission for Latin America and W o r l d T r e n d s & F o r e c a s t s the Caribbean. The countries most at risk are those most dependent on re- source-based revenues and import Government taxes; as trade suffers, so do revenue streams. Without cooperative action, the developing world could drift further from achieving the UN’s Millennium Development Goals, warns Abdoulie Africa, Latin America Seek Fiscal Reforms Janneh, UN under-secretary-general In a global economic crisis, the developing world finds itself on its own. and executive secretary of the Eco- nomic Commission for Africa (ECA). F “The global economic and finan- oreign aid and investment in the more private spending. A significant cial crisis began just as it seemed that development of Africa, Latin amount would most likely be put the worst was over with regard to America, and the Caribbean away in savings,” pointed out Alicia the food and fuel crisis,” Janneh told have been seriously impaired by the Bárcena, Uruguay’s minister of econ- the June 2009 meeting of the African recent global economic crisis. Lead- omy and finance. “Increasing spend- Union and the ECA in Cairo. “After ers in these regions are thus looking ing is more effective, but countries growing at an average of nearly 6% inward to find the resources neces- do not always have projects ready over the preceding half decade, Afri- sary to support their own economies that may be implemented rapidly.” ca’s average growth rate is expected and overcome longstanding, nettle- As the international crisis contin- to decline by up to four percentage some obstacles to sustainable devel- ues, limiting resources available to points this year.” opment. the Third World, internal tensions Janneh predicts an increase of 3 In Uruguay in May 2009, policy of- may grow within developing coun- million jobless Africans in 2009, com- ficials from the European Union, tries. For example, governments may pounding already critical social Latin America, and the Caribbean see demand for policies that subsi- problems for the continent, which debated the impacts of various ap- dize vulnerable sectors, but they will has little in the way of unemploy- proaches to fiscal reform, such as also face pressures to avoid protec- ment benefits or other social safety lowering taxes rather than raising tionism. nets to protect people. them in order to increase private in- Chile, Colombia, Mexico, Peru, “As Africa grapples with the fall- vestment. and Venezuela are already experienc- out of the financial crisis, it is imper- “Lowering taxes is easier
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