NEW YORK, March 30 -- A World Bank study which has classified Uganda and Ghana as success cases of reform and Nigeria as a non-performer in Africa, has given direction to new approaches that the Bank and other donors would adopt in working with African countries.
The study, covering ten African countries from the 1980s to the mid 1990s, sought to identify the relationship between aid and policy reforms. It covers Cote d'Ivoire, the Democratic Republic of Congo, Cote d'Ivoire, Ethiopia, Ghana, Kenya, Nigeria, Mali, Tanzania, Zambia and Uganda.
One of the main findings of the study is that national ownership is imperative for the success of reforms and that unwilling countries drawn into reforms with the offer of aid, even with conditionalities, do not record success.
This conclusion negates the usual approach that the Bank, the IMF and other donors employed in get countries to reform. But the study also found that countries that were willing to reform were successful because aid increased the benefit of reform, which helped to sustain it.
Illustrating this situation are the cases of Uganda and Ghana which were found to have succeeded in their reforms because the reforms were home-owned and also supported by foreign aid.
On the other side of the situation are Nigeria and the DR Congo, which were found to have failed in their reforms because they lacked local support, even among implementers.
Commenting on reforms in Nigeria at the launch of the report in Washington Tuesday, a Bank official and one of the authors, David Dollar said: "What you saw was a very modest, incipient movement in Nigeria at that point that pretty much pettered out, so that where you were by 1996 is a country with very poor economic policies; very poor governance; and not that different from 1980."
Even under the present civilian government, the Bank official said, one cannot yet see good economic policies in place. "In my view, it is still to be seen if Nigeria is going to succeed in putting good economic policies into place," Dollar remarked, adding that political reforms, like in the case of Nigeria, do not always translate automatically into economic reforms.
But he pointed out that Nigeria's case illustrates the new approach that donors should adopt to reforms: watch out for commitment to reform and move in with aid as soon as there are positive signs.
"This new government in Nigeria, this is a good example of where donors should be looking out, .. for evidence of commitment and should be willing to move in very quickly, obviously with advice and technical assistance immediately and with large scale finance, if we actually observe policy reform occurring in Nigeria."
The study argues that financial aid should be made available to only countries genuinely commitment to reform while only advice and technical assistance be extended to the reluctant ones. It also argues for the use of very minimal conditionalities, which were found to have made no difference in reforms.
In order to deepen domestic ownership of reforms, Dollar said the World Bank has decided to extend its consensus-building process to parliaments that were formerly largely left out.
The Bank's efforts are not only to engage national parliaments but also to strengthen their capacity and institutions to play a role in economic management, he explained.
The new approach, he said, is taking hold under the Poverty Reduction Strategy Papers that countries have to develop to receive funding from donors.
The study identified a number of problems, including poor coordination among donors, declining external assistance and lack of access for products of poor countries to markets of developed countries.
In Africa, the study also identified the problems of the HIV/AIDS epidemic and the rise in conflicts as issues of concern. While the Bank has attended to the AIDS problem by putting together a credit of 500 million dollars for a start, Bank officials said, their institution's involvement in conflicts is mainly at the level of supporting post-conflict reconstruction.
