Monday, 26 April 2010

Acquire trade rating, African states told

AN ECONOMIST Dambisa Moyo has challenged African countries including Zambia to ensure that they acquire credit ratings and enhance the ease of doing business to enable them attract more investors.

Dr Moyo, who is author of the world renowned book ‘Dead Aid’, said it is sad that only 19 African countries are currently rated and that many African countries are doing badly on the International Transparency corruption perception index.

She said this when she addressed the 3rd Common Market for Eastern and Southern Africa (COMESA) Investment Forum during a formal discussion hosted by Blomberg archor personality Maryam Namazee.

Dr Moyo said investors usually ask firstly whether a country is rated or not. She said credit ratings are not expensive and it is important for countries to consider acquiring them if they want to attract more investors.

Zambia is in the process of resuming its efforts to acquire a sovereign rating after earlier efforts were abandoned in the wake of the global financial crisis.Bank of Zambia governor Caleb Fundanga said Zambia has resumed the process of acquiring a sovereign rating.

Dr Moyo told the gathering that many African countries are also doing badly on the World Bank’s doing business index.

Dr Moyo, a Zambian, previously worked at the World Bank in Washington, DC. She is currently a member of the Boards of Lundin Petroleum and SAB Miller.She said that despite going through a genocide 15 years ago, Rwanda is now ranked as the most improved in the 2009 World Bank’s doing business report.

She said if African countries want to attract investments, they should be mindful that they are competing with other regions worldwide and should ensure they perform well on the corruption perception index as well as reduce the cost of doing business.

Dr Moyo said that whether African countries are really corrupt or are just perceived to be, the perception on the Transparency International Index matters to investors.

The forum, which ended on Tuesday, was attended by over 500 people, including businesspersons and policy-makers such as ministers, from 19 COMESA member states.

The forum discussed investment opportunities in the region.

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