Wednesday, 22 October 2008

The commonwealth Ministerial Debt Sustainability Forum-St. Lucia

The Commonwealth Ministerial Debt Sustainability Forum (CMDSF) held its 14th meeting on 6 October 2008 in St Lucia, prior to the 2008 Commonwealth Finance Ministers Meeting. Finance Ministers from, Cameroon, the Gambia, Guyana, Ghana, Malawi, Mozambique, Sierra Leone, United Republic of Tanzania, Uganda, and Zambia attended. In addition, representatives from Kenya, Australia and United Kingdom attended the meeting by special invitation. This meeting was chaired by Dr the Honourable Ashni Singh, Minister of Finance, Guyana.
Ministers recalled their discussions at the substantive meeting in Washington DC in April 2008. They noted that the Washington Ministerial Statement had been forwarded by the Chair to the joint IMF/World Bank Development Committee and the IMF’s International Monetary and Finance Committee.
. Ministers reviewed other developments since their April meeting and noted the donor recommitment to aid increases at the Hokkaido Summit and through the EU. They reiterated the urgent need for delivery on these commitments.
Ministers also noted progress with the IMF ESF review, and repeated their call for greater flexibility in its design and application, especially in relation to expanded access and less onerous conditionality.
Ministers reiterated the need for timely commencement and conclusion of negotiations for the replenishment of the Fund for Special Operations within the Inter-American Development Bank.
They remained concerned that there had been no change in the number of countries reaching HIPC completion and decision points. They were also concerned that there had hardly been any progress on issues of non-Paris Club participation in the HIPC Initiative, or on creditor litigation, and that under the Debt Sustainability Framework (DSF), a significant number of Completion Point countries will continue to remain in a moderate or high risk of debt distress.
Minister agreed on several actions to be taken to enhance information exchange on debt relief negotiations under E-HIPC including the preparation of more detailed information for HIPCs on creditor participation, best possible relief terms and litigation experiences to be presented at the April 2009 CMDSF and noted that actions should be taken to ensure that information on debt relief is sufficiently timely so as to effectively assist countries in their negotiations.
Ministers noted that CMDSF needed to remain engaged on a large number of debt related issues, which require further advocacy, monitoring or technical support. They agreed the following work programme, which would produce action papers to be discussed at the April 2009 meeting:
i. debt strategy capacity building needs and how to fulfill them sustainably;
ii. enhanced actions and information exchange on creditor participation or litigation;
iii. diversifying concessional and non-concessional financing sources;
iv. how the international community can better assist in mitigating shocks, notably those from climate change, historically high oil and food prices, as well as the current global financial crisis; and
v. best practices in ensuring fiscal sustainability of total (including domestic) public debt.

They also identified three priority issues to take forward over the next six months:
a) Ensuring that debt relief provides additional concessional resources to finance the MDGs, and does not come at the expense of new concessional flows. This would involve advocating that:
· concessional resources are allocated on the basis of MDG-related needs, as well as performance, in particular by adjusting the PBA formulas of IDA and the Regional Development Banks; and
· negotiations are started immediately and concluded urgently on a replenishment of the IADB FSO.
b) Holding donors to their promises to meet their 0.7% GNI commitment, by advocating that those donors with clear timetable for 0.7% stick to them, and those without clear commitments to make them.
c) Lobbying for increased creditor participation in debt relief, to include:
· consideration of changes in laws in creditor countries to restrict prospects for litigation by vulture funds and other creditors;
· G8 members launching top level diplomatic initiatives to convince non-Paris Club bilateral creditors to participate;
· donors to provide assistance to clear HIPC to HIPC debt; and
· all Commonwealth creditors to provide full HIPC relief and commit not to sell on their claims to other creditors.
They also noted that, subject to developments in discussions on debt converse/on for climate change, and on redesigning IDA and Regional Development Bank (RDB) performance-based allocation formulas, more detailed proposals on these might be discussed in April 2009.
They recognized the valuable role of the Commonwealth Secretariat in capacity building at the national level particularly in terms of equipping countries with the skills and tools to conduct independent debt sustainability analysis. They urged that greater resources be devoted to this area and that greater attention be placed on ensuring that capacity building was both effective and sustainable. They noted with appreciation the Commonwealth Secretariat undertaking to work with partners to increase the level of available resources to support this type of activity.

. Ministers agreed that there should be continuing collaboration with the Organisation Internationale de la Francophonie (OIF), including participation and contribution of Ministers from non-Commonwealth HIPCs in the substantive CMDSF meetings in Spring each year. They noted that both groups shared common concerns and therefore could share experiences and, by combining forces, strengthen advocacy in the international forums. They requested the Chairperson to explore the possibility of holding a joint Commonwealth/Francophonie Meeting in Spring 2009.
Ministers supported continuing participation by special invitation of the representatives of Commonwealth donors (which they felt needed to be extended to a wider group of donors), international and regional institutions, civil society, parliamentarians and capacity building institutions

Ayoub mzee at the Pool side the Pad where i was living

Ministers reviewed several options for the timing and duration of future meetings and decided to continue the present format, with a slightly longer duration (1½ day) substantive meeting in Spring each year, prior to the IMFC/Development Committee meetings. This would provide adequate time for discussion by the increased membership of the Forum. They continued to see value in the brief meeting prior to CFMM, which serves to strengthen the advocacy of their recommendations in the international commun

Ayoub mzee with a St Lucia Police Officer
"Realising human potential is the foundation and purpose of politics and public policy. Poverty and degradation are the antithesis of this. The scale of poverty in the Commonwealth remains shocking – over a third of our citizens live in absolute poverty. The Millennium Development Goals have given us the framework to enhance human dignity and realise its potential". said the Commonwealth Secretary General

"One of our hallmarks is a commitment to finding collective solutions to collective challenges. No single country has all the answers, and no country can act alone. All have a shared stake in progress irrespective of size and endowment.
The world is changing rapidly, with more and more global output coming from emerging economies outside the advanced economies. Managing an orderly transition will require strengthened commitment to multilateralism". said Commonwealth secretary General
Barbados International Airport

Aims of the Nairobi meeting; more AMISOM troops arrive
As current chairperson of IGAD, Prime Minister Meles has begun to send out invitations for the IGAD meeting on Somalia , to be held in Nairobi , October 27-29. It had originally been intended to hold the meeting in Baidoa, the seat of the Somali Transitional Parliament, but Kenya had offered Nairobi . Those invited include the Heads of State and foreign ministers of all current members of IGAD ( Djibouti , Kenya , Somalia , Sudan and Uganda ); Eritrea , of course, suspended its participation from IGAD last year. Others invited to attend include the Chairman of the AU Commission, the Special Representative for Somalia of the UN Secretary-General, Mr. Ould-Abdullah, and the IGAD Partners Forum, of which the Italian Ambassador is the local chair, as well as, of course, the leading members of Somalia's Transitional Federal Institutions, including the President, the Prime Minister, the Speaker of the Parliament and all the members of the Somali Parliament. The decision to hold an IGAD summit on Somalia was taken by IGAD ministers attending the UN General Assembly in New York and endorsed by the AMISOM troop-contributing countries. In an interview with the BBC's Somali Service this week, Ethiopian Minister of State for Foreign Affairs, Dr. Tekeda Alemu, explained the main point of the agenda will be to look into the problems currently hindering the creation of an effective government in Somalia . These have been causing serious concern in recent weeks because there are only ten more months before the Transitional Charter comes to an end, and once the transitional period ends there would be no party with any recognition. There is, he said, the necessity to talk to TFG officials and parliamentarians frankly, to pin them down on what they are now prepared to do to implement all the things they have so conspicuously failed to do since 2004. Indeed, the IGAD ministers in New York loudly expressed the deep frustration felt by everybody at the performance of the TFG and the members of the TFIs.

The State Minister noted that there had been a lot of talk as to whether this Nairobi meeting was contradictory or complementary to the Djibouti process bringing the TFG and opposition together. He emphasized that the IGAD ministers had made it absolutely clear that they had no interest in undercutting the Djibouti process held under UN auspices, but rather to complement the activities of Mr. Ould-Abdullah. Mr. Ould-Abdullah’s office announced yesterday [16th Oct] that the UN and the World Bank are organizing an international donor’s conference for Somalia , to take place early in 2009 in Stockholm to raise resources for a one year recovery program. One of the issues raised about the Nairobi meeting was whether or not the opposition would be attending. The State Minister said this had not yet been discussed but he thought it could not be ruled out. He noted that the Djibouti talks between the TFG and the opposition were on-going. So far, they had led to the establishment of joint committees and the process was continuing. A mixed delegation from the High Level Political and Joint Security Committees this week attended a seminar in Cape Town on political and security affairs. Surprisingly, Mr. Ould-Abdallah has now announced that these committees will be holding their third round of talks in Djibouti on October 25 and 26. As all the participants would be expected in Nairobi , it appears UNPOS has made a mistake. It makes no sense for the two meetings to be held back-to-back in different places. No doubt the committee meetings are important but they could certainly take place after Nairobi without difficulty, and keeping Djibouti as a venue would be a sensible course of action. A postponement would also allow for the possibility that Nairobi might include further opportunities for TFG/Opposition talks, though in what form or under what modalities would have to be discussed. The Ethiopian State Minister made clear that the Nairobi meeting would have nothing to do with any extension of the Transitional Charter whatever suppositions might have been made. Any amendments to the Charter could only be made by consensus between the TFG and the opposition.

Meanwhile, last weekend [11th-12th Oct] and early this week another Burundi battalion of 850 troops for AMISOM finally arrived in Mogadishu . They flew in from Bujumbura to join the other Burundi battalion which has been deployed in southern Mogadishu . This brings the number of Burundi troops to 1,700, and raises the AMISOM force to just over 3,400. This increase in the numbers of AMISOM forces could have led to a real improvement in the security situation but political difficulties have meant these opportunities have not been properly taken. Some two weeks ago Al-Shabaab fighters were driven out of the Bakara market by the local population, though latest information suggests some might now be returning. Retreating from there to Medina district, Al-Shabaab units were also ordered out by a population tired of Al-Shabaab excesses and maltreatment of the civilian population. Similarly, last month, an attempt by Yusuf ‘Indhe Adde’, a leading member of the extremist elements, to attack a police station in Karan district of Mogadishu was driven off with heavy casualties, by local militia forces and the local population. When Al-Shabaab attempted to close Mogadishu airport last month, there was strong popular opposition. Within a week or two, when it was obvious that Al-Shabaab was unable to make good its threat and that almost all Mogadishu elders and businessmen were against it, an Al-Shabaab spokesman unconvincingly announced they were thinking again about the idea for humanitarian reasons. It is on the basis of these activities that political progress might have been expected. Unfortunately the TFG has continued to remain paralyzed. It is this which explains why the Nairobi meeting is so critical.