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Reflections from Archbishop Ndungane on the MDG Summit outcomes
30 September 2010 
Few people are better placed to give an opinion on the MDG Summit outcomes from an African perspective than Archbishop Ndungane.
Archbishop Ndungani is founder and president of African Monitor, an independent body monitoring development commitments, delivery and impact. Jason Collodi and Alan Stanley, from IDS Knowledge Services, recently had the opportunity to ask the former Anglican Archbishop of Cape Town, anti-apartheid activist and prominent social justice campaigner his reflections on the Summit.
In the extract below the Archbishop talks of the need to balance aid with measures to tackle resource extraction and illicit financial flows.
You recently described Aid to Africa as being like "pouring water in a bucket full of holes". Can you explain this statement?
The statement referred to the resources that flow out of the continent mainly in an illicit manner and in our 2010 Development Support Monitor (DSM) we identified them as follows.
- Big foreign companies take money out of their countries through tax breaks or illegal tax evasion.
- Multinational companies are also not properly taxed due to the lack of capacity of African authorities to put in place tax systems.
- The failure by multinational companies to declare profits translates into capital flight.
- Falsified invoicing, or the inflating or undervaluing of prices to increase costs and diminish tax liability.
- "Round-tripping" where companies operating in a country send their money offshore and bring it back as "foreign investment" to get preferential tax treatment
- Transfer mispricing, a phenomenon in which companies sell to each other at inflated prices, inflating costs in intra-corporate financial transactions.
These are in addition to the continent primarily exporting value in terms of primary products. As such, while we praise efforts for increasing resource flows to the continent in the form of Official Development Assistance (ODA), we highlight the fact that until this hemorrhaging is stopped there will always be a net effect of zero or even negative.
The Summit outcome document promises action on issues such as illicit financial flows. Are you confident a process like the MDGs can really address these and other fundamental root causes of poverty in Africa?
The commitment in the outcome document to implement measures to curtail illicit financial flows at all levels must be executed with deep seriousness. The measures in the outcome document are rightly listed but action must be taken to implement them. While [the] MDGs [process] may not address these fundamental root causes, the key players were in New York; the leaders, the corporations etc. As such, the actual players who can address the issue are part of the action towards achieving the MDGs. The MDG summit has done well in bringing this issue to the agenda.
So what further action is needed?
.... What is needed is to ensure that the issues raised are linked to other key platforms that operationalise these decisions. The non-state actors should continue to increase awareness among the populations in the affected countries, including being watchdogs, and therefore empowering the potentially powerful constituencies. These issues are a niche for non-state actors who should target the constituencies with power and influence, for example some of the illicit financial activities need to be criminalised and correct legislation put in place to deal with them at all levels.
One commentator said of the Summit: "One of the most important contributions of these summits is just that they are happening at all, and the fact that world leaders still think it's worth giving up several days of their extremely valuable time to sit together and talk about the MDGs and about global poverty." Do you agree with this view?
It is better to talk than not to talk at all; it is better that the talk becomes binding and that it is translated into action. This talking gives us a document by which we can judge the delivery on these commitments. But as I have indicated we have been here before; people talk, commit and do not effectively implement.Secondly, once these public utterances have been made, it strengthens the arm of monitors like African Monitor and other players within civil society to hold leaders, both individually and collectively to account.
How well represented are African voices?
The worry is that African voices tend to be used for window dressing in such gatherings and therefore the real people who could make a difference are not always consulted.
Read the full interview with Archbishop Ndungane.
Image credit: Archbishop Ndungane courtesy of African Monitor
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