Gambia-l,
Here are the Burning Issues from FOROYAA NEWSPAPER NO: 40/2002 11 - 14 July,
2002
The topics in this issue are:
1. The African union The Future Or A Dream?
2. What Is Action Aid's Future In The Gambia?
3. Nation-wide Vaccination Campaign: Who Should Or Should Not Be Vaccinated?
4. Focus On The Gambia's Economic Situation
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Editorial
The African union The Future Or A Dream?
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The meeting in Durban, South Africa which is going to witness the transformation of the
Organisation of African Unity into a the African Union marks the beginning of the end of an
era, the era of narrow nationalist politics. As the African leaders meet in Durban they should
look back at the days of the establishment of the OAU in 1963.
It was Nkrumah who said during the celebration of the independence of Ghana in 1957 that
Ghana's independence was meaningless unless it was linked to the total liberation of the
African continent. Nkrumah saw political liberation as the conquering of state power from
the colonial masters as the first step of enabling the African people to take charge of their
destiny. This is why he uttered that Africans must seek the political kingdom and all the
rest shall come. This statement has been misconstrued to mean that once countries attain
political independence they should also solve all their economic problems. What Nkrumah
meant was simple. He felt that if each African country becomes politically independent the
leaders will form one African Union government, Central Bank, Security Force with a
continental plan for African development.
Nkrumah felt that no African country can do it alone against the United States or USSR's
domination of world politics at the time. When heads of state met in 1963 most of them
rejected the idea of a union.
They advocated for each nation to maintain its own sovereign government and regional
communities to be set up like ECOWAS to encourage gradual regional integration. The
OAU became an organisation which enables African heads of state and their ministers of
Foreign Affairs to agree or to disagree on any fundamental issues regarding Africa's
development.
The 21st century marks the beginning of the realisation that Africa cannot come out of it's
current dependency, poverty and indebtedness without continental initiative. All leaders are
now convinced that none of the them can do it alone.
This is why the African Union has gone beyond the confines of the OAU to call for an
assembly, executive council, Pan-African parliament, court of justice, Central Bank, African
monetary fund and African investment bank. After the
Durban meeting the African people should watch very closely whether the lessons are
committed to a union or are simply paying lip service for it.
This attitude will determine whether the union is the future of Africa or a mere dream.
History will be the final judge.
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What Is Action Aid's Future In The Gambia?
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Information has reached FOROYAA that the awareness campaign by the Action Aid the
Gambia has been stopped by the Government.
Sources close to the Action Aid have indicated that the Department of State for Local
Government had written to the Action Aid Country Director to stop the civic education
programme and accuse them of conducting party politics in the country.
Information has also reached the FOROYAA that the Action Aid has been given an
ultimatum to leave the country if they do not stop their paralegal training programme
immediately. A telephone from the province to FOROYAA also indicated that Action Aid
has stopped its programmes in the Gambia. Many people are highly alarmed by this
rumours noting that it would be a serious negative impact on the poor farming communities
in URD and NBD, who are depending on Action Aid for seasonal loans to purchase seed
nuts and fertiliser etc.
FOROYAA contacted the Action Aid Headquarters for confirmation of the rumours but are
told that Action Aid would in due course send a press release to the press that would
explain or clarify the situation.
We hope the state too would come out with an explanation on this matter as it is a general
concern.
An alarm has been sounded that the organisation may suspend it's activities in the Gambia.
ACTION AID is one of those NGOs which operates by giving direct assistance to the
education and productive sectors of the rural economy and finally went into advocy and
civic education come to realize that their efforts have not generally
led to the eradication of poverty. Some have seen the provocation of fair trade and the
empowerment of the people.
This is a view that development is not done for people but is done by people; those who
wish to assist countries should the people to realize their development potentials. At the
moment. FOROYAA could not get much from the action Aid or the Gambian authorities.
There is the possibility that the two are still engaged in negotiation to settle their
differences. In FOROYAA's view it is necessary for the Gambia government to bear in mind
the achievements of our own development. Wer have better things to do than send NGOs
packing. They will simply go to other countries. There is no doubt that NGOs bring
substantial amount of foreign exchange into the country and do provide gainful employment
to many Gambians. Many international aid organizations are moved by the advocacy of well
established NGO's. Development has many angles. Government should cooperate with any
group which can add something to the Gambian people if this help to identify priorities and
motivate NGO's to adopt such programmes. The mission statemen is cooperation not
dictation.
We hope that the matter will be settled without delay.
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Nation-wide Vaccination Campaign: Who Should Or Should Not Be Vaccinated?
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The Department of State for Health has launched a nation wide vaccination campaign at the
home village of the president in Kanilai on the 4th of July 2002. On Monday the 8th July
2002, teams started the nation wide exercise in all health facilities. A Foroyaa reporter went
to the Poly Clinic in Banjul where hundreds of people lined up to be vaccinated. Upon
arrival, this reporter talked to some elders who were at the poly clinic. The first to be talked
to was one Assan Faye. He was asked why he was at the poly clinic. He said he had come
to answer to the call of the health department in order to be vaccinated against what he
called the killer disease meningitis. Mr. Faye used the opportunity to call on all elders to
make sure that all their family members make themselves available at the vaccination
centres. He took the opportunity to remind his fellow citizens of very serious out breaks of
the disease in early 60s in which the nation lost thousands of lives.
EPI's Explanation and Advice: This reporter then spoke to Alpha Njie, National Programme
Manager for the Expanded Immunisation Programmes. When asked about the reasons for
the vaccination campaign Mr. Njie said the objective was to prevent
any future outbreak. On whether there are any reports of out breaks any where in the
country, Mr. Njie replied in the negative. Further asked the targeted age groups, he said
from one year upwards. He added that their aim is to exclude
pregnant women and those below one year. When finally asked if teams would visit
schools, Mr. Njie answered in the positive but further went to say that not in all schools but
that teams will go in to the wider society at community levels.
He stressed that they will visit all village bantabas and other community centres nation-
wide. He called on all family and house heads to make sure that all their members within
the stipulated age groups are vaccinated. He said the exercise will close on the 23rd July
2002.
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Focus On The Gambia's Economic Situation
Continued from last issue
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We have been focusing on the Gambian economy and of late, we have been looking into the
'Gambia Human Development report, 2000" which has an indeptht analysis of the Gambian
economy as well as accurate statistical date which can be very
useful to all of us especially students of economics.
In the last issue, we have published what the report said about "The Liberalization
Experience in The Gambia" as well as the Privatization Experience which had followed. The
report however, did not speak favorably of both experiences. It says the original objective of
the Structural Adjustment Programmes (SAP) was for the Gambian economy to be open up
to international
trade, barriers to be removed for foreign investment, corporate regulations and taxes to be
reduced as well as other disincentives to be reduced to economic activities, but as the
report asserted these objectives have not been fully
attained. It says the SAPs of the 80s and 90s have been implemented with these goals in
mind. It also says for the Gambia to participate in the global economy, the Gambia
government have affected trade policy measures that could, to some
extend be termed liberal in order to create the required environment for a truly open
economy.
The report however asserted that the Gambia has moved towards liberal and free market
policies driven by the private sector under the World Bank Supported Economic Recovery
Programme (ERP) in 1985. this, it says; has caused agricultural subsides to be removed,
the GPMB to be sold which was responsible for the purchasing, processing and marketing
of groundnut. The report went on to say that the ERP programme required that no restriction
should be on the quality of goods imported into the Gambia or exported from the Gambia;
that foreign exchange transactions have also been liberalized since the floating of the
Dalasi in 1985.
According to the reports' findings, in the aftermath of liberalization, and in the face of rapid
population growth, poverty has increased by36 percentage points (from 33 percent of the
population in 1992/93 to 69 percent in 1998). It says social conditions deteriorated,
weakening the foundation for Human Development. It says in fact mortality rate has also
increased from 92 percent per 1000 for both sexes in 1993 to 144 and 122 per 1000 for
male and female respectively in 1998.
In this issue, we will focus on the questions raised by the readers after which we would
move further to deal with the international economy to see how Gambia is faring in what is
termed "Globalization".
Dear Editors,
I am an economic student and I am very much interested in your "Focus on
Gambia's Economic Situation" section because it is very interesting.
One thing that baffles my mind is that most of what I read from the focus makes a lot of
economic sense to me because it is all backed by scientific analysis and statistiscal facts;
but as I said, it sort of contradicts what I am learning
from my economy class, in the sense that my teachers do not appreciate government or
what you call the public sector to do investment in the productive sectors of our economy.
They tend to suggest the contrary.
However, what I would like you to dwell on now is an argument which has propped up
between me and some fellow students as to whether government can or cannot print more
money to eradicate the poverty of the people. Is it wise to print more money sometimes or
would that create a problem for the Gambia?
Thank you very much for your question. This is a very healthy situation because one of the
objectives of the topic is to create awareness and debates on issues of the economy. One
would think that this question is frivolous but it is a very
important question.
In the earlier face of Africa's independence, dictators who have no idea of economics such
as Idi Amin, Bokassa etc use to think that printing more money would simply increase
wealth in a country, but this is far from the reality.
In reality the amount of money printed in a country should commensurate or be equal to the
total value of the products produced in a country. This is not an easy matter but if we know
the estimated value of goods and services, we would
be able to have an idea as to whether our gross national product has risen up or down. If we
know that it has gone up, we should be able to estimate as well how much percentage it
has gone up or down. We would then be able to calculate the
estimated value of products produced in that year and print the estimated amount in
currency terms as the case may be, or discard the estimated amount.
One may ask, why should we discard our money, well the idea is that if we do not discard
it, it means that we are in fact in a way printing more money which does not commensurate
to or is not equal to the value of the wealth in our country.
In that case, this would tantamount to what is called inflation. And inflation is one of the
undesirable situations we should do everything to avoid.
However, the need for revenue may lead a desperate government to increase the money
supply even though they may be aware that the resulting increase in inflation erodes the
real value of all financial assets with the exception of those that are fully indexed. This
creates what is called inflation Tax. In this case debtors gain and creditors lose.
In other countries such as the United States which are considered credit markets, financial
assets that pay tax, such as bonds are likely to have a yield to compensate for any erosion
in their real value which is of course caused by the foreseeable inflation. Apart from bonds
being indexed, any sudden or unexpected increase in inflation is likely to be compensated
for by high nominal interest rates and even such holders of bonds can suffer from erosion of
the real value of their assets.
In most cases, it is governments who are the main issuers of bonds and the main holders
are usually the domestic private sector, any sudden increase in inflation would reduce real
value of government debt. In such countries, the effect of inflation amounts to levying a tax
on bonds and using the revenue to pay debts.
But as I said, this is rarely the principle use to get financing in this country and can yield
hardly any tax as a response to a sudden rise in inflation.
However some governments without the economic foresight do increase the money supply
at a rate far greater than that would maximize real public revenue, because they are
motivated by the desire for government's immediate need for cash to pay its bills such as
salary arrears etc. the banks which are the immediate recipients of the reduction in the real
value of checking accounts since as it is said, it appears as liabilities on their balance
sheets, and when taxes are increased it is the government which acquires the gains and
prevent the banks from profiting unduly from the inflation caused.
Studies however had proven that to use inflation to raise taxes has serious disadvantages
because that can distort relative prices and generate uncertainty as well as cause serious
loss to those low income holders of cash.
Studies have also shown that inflation can as well erode other kinds of government revenue
because the possibility of having difficulty in collecting taxes is there and delays in the
adjustment of some tax rates to rising prices can mean that the real revenues of
government to fall as inflation increases.
According to some researchers, the situation can in fact out weigh any possible gains of
government with such high inflation rate. The fact however remains that governments stands
to gain more if inflation is low and prices are relatively stable, because the possibility of
raising substantial amounts of revenue is there and that stability can of course make a
currency attractive to foreigners who may have unstable economies or whose country's
economies are riddled with inflation.
This is why many rich people in our country and in the third world generally are motivated to
save their monies in countries whose currencies are deemed to be stable.
Whether we know it or not, many people are having illegally holdings of foreign currencies
because of their rising value rather than keeping the Dalasi. It can enable our banks to even
import capital at a lower cost than now. That is the
benefit of a stable financial system which can be guaranteed only by revamping the
productive base of our economy with a view to create sufficient 'made in Gambia" products
that would be able to compete in the national and international markets, not by printing or
increasing the money supply indiscriminately.
In the next issue we will answer more questions before starting a discourse on the
international economy.
See next issue for more comments.
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Source: FOROYAA (Freedom) NO: 40/2002 11 - 14 July, 2002 ISSN: 0796- 08573
Address: FOROYAA, P.O.Box 2306, Serrekunda, The Gambia, West Africa
Telephone: (220) 393177 Fax: (220) 393177
Email address: [log in to unmask]
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