O'NEILL SIGNALS SHIFT IN U.S. AID POLICY.
Paul O'Neill, US treasury secretary, has signaled a significant shift of emphasis in development policy during his trip round Africa, by softening the traditional US opposition to directly underwriting poor country government budgets with US overseas aid, FT.com reports.
The move was hailed by Bono, the rock star traveling with O'Neill, as an early success of their joint fact-finding mission to Ghana, South Africa, Uganda and Ethiopia.
Traditionally, US aid has been earmarked for individual projects, often built by US companies, driven by a desire to ensure strict accountability of funds spent. Some development experts and ministers from developing countries have criticized this approach, saying it leads to unnecessary bureaucracy and badly-conceived prestige projects being constructed.
On Tuesday, following a meeting with Ghanaian president John Kufuor, O'Neill said that in well-performing countries, aid should not be tied to a series of stand-alone projects. "As the president said this morning, aid should be more about programs than about projects," he said. "As a general proposition, we should be supportive, not prescriptive."
Meanwhile, Accra Mail (Ghana) reports O'Neill has called on African governments to create a congenial and conducive business environment in order to attract investors to increase productivity on the continent. He said: "Investors are slow to put their capital into Africa because they are afraid that the buildings and machines and businesses their capital will help build could be confiscated through corruption or violent change of power." AFP reports Bono praised the Ghanaian workforce, calling them "the smartest and most hard-working workers you will find anywhere. . . I would like to see the dominant international view of Africa change. I will tell anyone investing in Ghana, take a look at the people."
The New York Times (A1) notes that to Bono, the rock star who has made alleviating African poverty his cause, Ghana is ''the birthplace of cool,'' a country so vibrant with its own metaphorical jazz that the right dose of aid and investment could secure it a place in the global economy,.
To Treasury Secretary O'Neill, Ghana's prospects are equally upbeat. But he is less focused on the rhythms of the country and more intent on having enforceable contracts and strict proof that aid is used effectively.
Ghana is Stop 1 on the O'Neill-Bono Africa Tour 2002, nearly two weeks of fact-finding travel across the world's most ravaged continent by the well-starched former corporate chief executive who signs the dollar bill and the earring-laden, Grammy-collecting lead singer of U2.
Even as Bono brings new public attention to debt relief and AIDS in Africa, many development economists and African leaders are stressing that only increased trade can bring permanent advancement. Bono and his advisers said they are all for expanded trade. But the singer is clearly struggling with how far to go in endorsing free-market solutions to Africa's problems, the piece says.
Meanwhile, the Guardian (UK) says much more than good PR could ride on the odd couple's tour. Post-September 11, the US has been under intense criticism for its paltry foreign aid, which amounts to just 0.1 percent of GDP. With a pivotal G8 meeting on the way, the first since the Genoa debacle last year, everyone from the World Bank to protest groups will be watching their progress
The fact that O'Neill is going around with $5bn in his back pocket as part of President Bush's millennium fund for the world's poor only makes the trip more intriguing. Can the Irish preacher convert him? Or could O'Neill persuade Bono that debt relief is a waste of money and Africa should be seen as a group of failing businesses in need of restructuring?
It's doubtful a miracle will occur, either way, the piece says. O'Neill is in the hands of the US treasury and Bono is minded by people from Christian Aid, Oxfam and other non-government groups.
AP says that in an effort to find out what kind of aid really works, O'Neill and Bono, whose real name is Paul Hewson, will visit AIDS clinics, schools and projects sponsored by the World Bank other development agencies. The Washington Times (A11) and Toronto Star also report.