The persistent dependence on external financing by African countries has made it difficult for them to remain on the sustainable development track. However, many other factors have also contributed to economic stagnation; these include governance, civil strife and disasters. Regional engagement by multilateral financial institutions such as the WB and the IMF comes at a price for recipient countries. Sub-Saharan Africa's total external debt rose from US$176 874 million in 1990 to US$216 359 million in 1999 (World Bank 2001b). Some 48 of the 52 African countries spend about US$13.5 000 million every year repaying debts to rich foreign creditors. The region's massive foreign debt burden has been described as 'a new form of slavery, as vicious as the slave trade' (Colgan 2001). African countries have been receiving financial assistance from the developed countries in order to balance their development budgets in the midst of growing financial difficulties due to poor commodity prices, globalization and other factors (UNDP/UNEP/WB/WRI 2000). For example, sub-Saharan countries exported goods and services worth about US$96 584 million in 1999, while total external debt amounted to US$216 359 million in the same year (World Bank 2001b).
Saddled with heavy debt commitments, many African countries are unable to build and maintain economic reserves. The overall result is: further erosion of regional coping capacities; greater vulnerability to both internal and external stresses and shocks; indebtedness; increasing reliance on foreign aid; and reduced competitiveness in the face of economic globalization. Africa's heavy international debt burden contributes substantially to human vulnerability and security in the region. The servicing of debt consumes resources which could be spent on development, poverty alleviation and increasing coping capacities. Allied with the question of debt is that of SAPs, which often include obligations to reduce state spending, especially on social development and environmental management-a situation which tends to exacerbate the vulnerability of the poor and other marginal groups to environmental, economic and social stresses. Heavily Indebted Poor Countries (HIPCs) in Africa are also increasingly resorting to unsustainable exploitation of the region's natural resource base in order to boost foreign exchange earnings to service debt.
Table 3.5 gives summary data on the situation described in the Box 3.13.
|Box 3. 13 Africa's indebtedness|
|Table 3.5 Africa-total external debt|
|Source: Compiled from WB 2001|
Sub-Saharan African economic and financial problems were made much worse in the 1970s and the 1980s by a combination of: