29
Governance: An International Journal of Policy, Administration, and Institutions , Vol. 18, No. 2, April 2005 (pp. 283–311). © 2005 Blackwell Publishing, 350 Main St., Malden, MA 02148, USA, and 9600 Garsington Road, Oxford, OX4 2DQ, UK. ISSN 0952-1895 Blackwell Publishing Ltd.Oxford, UK and Malden, USAGOVEGovernance0952-18952005 Blackwell Publishing Ltd.April 2005182283311Articles THE AFRICAN PEER REVIEW MECHANISM KEMPE RONALD HOPE, SR. *United Nations (U.N.). The views expressed here are those of the author and not necessarily those of the U.N. Practitioner Perspective Toward Good Governance and Sustainable Development: The African Peer Review Mechanism KEMPE RONALD HOPE, SR.* To accomplish the objectives and the outcomes of the New Partnership for Africa’s Development (NEPAD), African leaders have agreed, among other things, to subject their countries to peer review through the use of a unique and innovative African Peer Review Mechanism (APRM). This paper analytically describes and assesses the APRM. It contends that peer review represents a sea of change in the thinking of African leaders as they seek to reverse the trend of lack of accountability, political authoritarianism, state failure, and corruption to embrace and consolidate democracy as well as effect sound and transparent economic management. It is further argued that peer review would provide a number of benefits to those countries that subject themselves to it and that, in turn, would have positive multiplier effects on Africa’s development performance. INTRODUCTION To accomplish the objectives and the outcomes of the New Partnership for Africa’s Development (NEPAD)—an initiative that represents the lat- est attempt by African leaders to place the African continent on a path of sustainable development encompassing good governance and prosperity with a consolidation of peace, security, and stability—African leaders have agreed, among other things, to subject their countries to peer review through the use of a unique and innovative African Peer Review Mecha- nism (APRM). The APRM will cover issues, codes, and standards pertain- ing to governance and sustainable development. It will be used to assess the performance of African countries in terms of their compliance with a number of agreed codes, standards, and commitments that underpin the good governance and sustainable development framework. The NEPAD emanated from the view of a new generation of enlight- ened African leaders that Africans and Africa both hold the key and the capacity to extricate themselves from poverty and global marginaliza- tion. Moreover, it was recognized that this needed to be done with

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Governance An International Journal of Policy Administration and Institutions

Vol 18 No 2April 2005 (pp 283ndash311) copy 2005 Blackwell Publishing 350 Main St Malden MA 02148USA and 9600 Garsington Road Oxford OX4 2DQ UK ISSN 0952-1895

Blackwell Publishing LtdOxford UK and Malden USAGOVEGovernance0952-18952005 Blackwell Publishing LtdApril 2005182283311Articles

THE AFRICAN PEER REVIEW MECHANISM

KEMPE RONALD HOPE SR

United Nations (UN) The views expressed here are those of the author and not necessarilythose of the UN

Practitioner Perspective

Toward Good Governance and Sustainable Development The African Peer Review Mechanism

KEMPE RONALD HOPE SR

To accomplish the objectives and the outcomes of the New Partnership forAfricarsquos Development (NEPAD) African leaders have agreed among otherthings to subject their countries to peer review through the use of a uniqueand innovative African Peer Review Mechanism (APRM) This paperanalytically describes and assesses the APRM It contends that peer reviewrepresents a sea of change in the thinking of African leaders as they seekto reverse the trend of lack of accountability political authoritarianismstate failure and corruption to embrace and consolidate democracy as wellas effect sound and transparent economic management It is further arguedthat peer review would provide a number of benefits to those countries thatsubject themselves to it and that in turn would have positive multipliereffects on Africarsquos development performance

INTRODUCTION

To accomplish the objectives and the outcomes of the New Partnershipfor Africarsquos Development (NEPAD)mdashan initiative that represents the lat-est attempt by African leaders to place the African continent on a path ofsustainable development encompassing good governance and prosperitywith a consolidation of peace security and stabilitymdashAfrican leadershave agreed among other things to subject their countries to peer reviewthrough the use of a unique and innovative African Peer Review Mecha-nism (APRM) The APRM will cover issues codes and standards pertain-ing to governance and sustainable development It will be used to assessthe performance of African countries in terms of their compliance with anumber of agreed codes standards and commitments that underpin thegood governance and sustainable development framework

The NEPAD emanated from the view of a new generation of enlight-ened African leaders that Africans and Africa both hold the key and thecapacity to extricate themselves from poverty and global marginaliza-tion Moreover it was recognized that this needed to be done with

284 KEMPE RONALD HOPE SR

some urgency to stake Africarsquos claim to the twenty-first century At thebeginning of the twenty-first century per capita income in sub-SaharanAfrica was 10 percent below the level reached in 1980 In other wordsthe majority of the countries on the continent were worse off than theywere two decades ago Despite being one of the most richly endowedregions of the world Africa remains the poorest continent (Hope2002a) According to the United Nations Development Programme(UNDP 2004) human development in sub-Saharan Africa has actuallyregressed in recent years and poor people are now worse off The shareof people living on US$1 per day increased to 47 percent by 2001 from45 percent in 1990 (United Nations 2004 World Bank 2004) A recentstudy by Elsa Artadi and Xavier Sala-i-Martin puts the proportion ofthe population in sub-Saharan Africa living on less than US$1 a day atclose to 60 percent in 2000

This paper analytically describes and assesses the APRM within theframework of the NEPAD initiative It contends that peer review repre-sents a sea of change in the thinking of African leaders as they seek toreverse the trend of lack of accountability political authoritarianism statefailure and corruption to embrace and consolidate democracy as well aseffect sound and transparent economic management In addition it isfurther argued that peer review would provide a number of benefits tothose countries that subject themselves to it and that in turn would havepositive multiplier effects on Africarsquos development performance

THE NEPAD INITIATIVE GOOD GOVERNANCE AND SUSTAINABLE DEVELOPMENT

The NEPAD initiative is governed by a Heads of State and GovernmentImplementation Committee (HSGIC) composed of 20 members with fourdrawn from each of the five subregions of the continentmdashEast AfricaWest Africa Southern Africa North Africa and Central Africa It lists anumber of prerequisites for African countries to move forward in theirquest for sustainable development Key among these is the proper adher-ence to good political economic and corporate governance

Drawing on Kempe Ronald Hope (2002b) it can be noted that goodgovernance in all its facets has been demonstrated to be positively cor-related with the achievement of better growth rates particularly throughthe building of institutions in support of markets Recent empirical anal-ysis suggests a positive correlation between democratic governance andthe levels of income investment human capital economic liberalizationand distributive income growth in society (Tavares and Wacziarg)Indeed some analysts such as Alfred Zack-Williams have successfullyargued that good governance particularly its aspects of democratic con-solidation is a sine qua non for development Consequently the newmaxim for Africa in the twenty-first century should be ldquono democracy nodevelopmentrdquo (Zack-Williams 221)

THE AFRICAN PEER REVIEW MECHANISM 285

Similarly United Nations (UN) Secretary-General Kofi Annan hassaid that ldquogood governance is perhaps the single most important factorin eradicating poverty and promoting developmentrdquo (United Nations1998 13) Moreover a former Kenyan vice president has also noted thatldquogood political and economic governance underpins sustainable devel-opmentrdquo (Saitoti 257) The President of the African Development Bank(AfDB) has emphasized that ldquogood governance is not only a worthy goalper se but also a prerequisite for sustainable development and povertyreduction in the longer termrdquo (Kabbaj 7) while the Executive Secretaryof the United Nations Economic Commission for Africa (UNECA) hasproclaimed that ldquogood governance is essential for the political and eco-nomic transformation of Africardquo (Amoako 155)

Governance has to do with the manner in which responsibility is dis-charged Such a responsibility may be acquired through election appoint-ment or delegation in the public domain or in the area of commerce (iecorporate governance) Therefore good governance is taken here to meana condition whereby such responsibility is discharged in an effectivetransparent and accountable manner while bad governance is associatedwith maladministration in the discharge of responsibility (Abed) Goodgovernance entails the existence of efficient and accountable institu-tionsmdashpolitical judicial administrative economic corporatemdashandentrenched rules that promote development protect human rightsrespect the rule of law and ensure that people are free to participate inand be heard on decisions that affect their lives

The NEPAD initiativersquos framework document recognizes the salientimportance of good governance for achieving sustainable developmentin Africa and sets out principles pertaining to the strengthening of democ-racy and political governance as well as economic and corporate gover-nance On democracy and political governance it states that developmentis impossible in the absence of democracy respect for human rightspeace and good governance The purpose of the principles here is tocontribute to the strengthening of the political and administrative frame-work of African countries in line with the principles of democracytransparency accountability integrity respect for human rights and pro-motion of the rule of law (NEPAD Secretariat 2001)

The necessity for institutional reform has been recognized to drive theprocess forward given the capacity limitations across African countriesAs identified in the NEPAD framework document the institutionalreforms to strengthen political governance in Africa will need to focus on(1) the administrative and civil services (2) the strengthening of parlia-mentary oversight (3) the promotion of participatory decision making(4) the adoption of effective measures to combat corruption and embez-zlement and (5) the undertaking of judicial reforms (NEPAD Secretariat2001) These five areas of focus have been exhaustively discussed inUNECA (2002a) Suffice it to say here that for the first time in post-independence Africa the African leaders themselves are pointing to the

286 KEMPE RONALD HOPE SR

shortcomings of the institutional structure over which they presidedirectly or have much say

Institutions in particular public institutions have been a failure inAfrica Many of these institutions have been captured by the elite to servenarrow personal interests The resultant effect has been the lack of theability of the state to provide the requisite institutional framework tosupport good governance In too many African countries both the publicand private sectors do not operate according to widely accepted rules thatare transparent and enforced by accountable institutions Consequentlythe challenge for African policy makers under the NEPAD is to shapepolicies and institutional development in ways that enhance good gover-nance and sustainable development

With respect to economic and corporate governance the NEPADframework document states that the objective here is to promote a set ofconcrete and time-bound programs aimed at enhancing the quality ofeconomic and public financial management as well as good corporategovernance (NEPAD Secretariat 2001) Good economic and corporategovernance is good for Africa Countries attract more investment andachieve higher rates of per capita growth where the state improves certainbasic aspects of its performance A state that applies rules and policiespredictably and fairly ensures order and the rule of law and protectsproperty rights will generate confidence and attract more domestic andforeign investment That in turn generates trade and faster economicgrowth as well as provides the wherewithal for sustainable development(UNECA 2002a)

Here again the role of institutions looms large The existence of weakinstitutions of economic and corporate governance as a constraint onsustainable development in Africa is clear and convincing This hasaccordingly limited the public sector in the fulfillment of its economicfunctions Those economic functions can be broadly classified into threedistinct categories (1) making and implementing economic policy (2)delivering services and (3) ensuring accountability for the use of publicresources and public regulatory power (World Bank 2000) Institutions areneeded to maintain fiscal and monetary discipline mobilize resourcesand set priorities among the competing demands for those resources asintegral aspects of the making and implementation of good economicpolicy Similarly institutional arrangements are required for the efficientdelivery of public services that are also pro-poor In addition there mustbe institutional mechanisms that ensure accountability through the capac-ity to monitor and enforce rules and to regulate economic activities in thepublic interest However regulatory frameworks should be minimal sim-ple and easy to implement (Saitoti)

Good governance is worth pursuing in its own right in Africa Muchhas been observed and volumes have been written about the deleteriouseffects of bad governance in Africa Through the NEPAD a new genera-tion of enlightened leaders is aiming to reverse that trend Respect for

THE AFRICAN PEER REVIEW MECHANISM 287

human rights and democratic principles honest and good quality admin-istration and protecting the rights and freedoms under the rule of laware concerned with values that apply equally to every state and citizenDemocracy for example is a universally recognized ideal based on val-ues common to people everywhere regardless of cultural political socialor economic differences (IPU) These transcend the functional importanceof aspects of good governance such as for sustainable development (Sci-entific Council for Government Policy)

President Thabo Mbeki of South Africa has argued quite convincinglyfor example that Africa wishes to realize the goal of good governance inall its elements ldquonot because we seek to improve our relations with therest of the world as a first objective critically important as this is but toend political and economic mismanagement on our continent and theconsequential violent conflicts instability denial of democracy andhuman rights deepening poverty and global marginalizationrdquo (Mbeki 2)Nonetheless as noted above the various components of good governanceare also necessary and functional for sustainable development processes

Quite clearly growth and development cannot be achieved in theabsence of good governance Among other things good governanceensures the most efficient utilization of already scarce resources in thepromotion of development enhances participation responsibility andaccountability and has the potential to emancipate people from povertyas state legitimacy is recognized and entrenched In fact any effort toreduce poverty and sustain development must start with and build upongood governance (Hope 2002b) Good governance can therefore be alsoregarded as governance on behalf of development-oriented policy

According to UNDP (2002) good governance advances sustainabledevelopment for three reasons First enjoying political freedom and par-ticipating in the decisions that shape onersquos life are fundamental humanrights In those African countries where leaders are not elected or selectedby election (eg Libya) or where elections are flawed (eg Zimbabwe)choices are severely restricted The denial of these rights is a denial ofhuman development Second good governance helps to protect peoplefrom economic and political catastrophes such as famines and othercrises (Sen) There is a direct correlation between bad governance andfamines for example in Africa In other words those countries frequentlysuffering from famines in Africa tend not to have good governance Thirdgood governance can promote sustainable development by empoweringcitizens to influence policies that promote growth and prosperity andreflect their priorities

Y Feng has also empirically demonstrated that good governance doesmatter for national economic growth and development ldquoIn particular apolitical system characterized by freedom and stability is best suited topromoting a growth-oriented economic agendardquo (Feng 295) In additionR Alence has empirically shown that the effects of governance on nationalincome and economic performance in Africa are large and statistically

288 KEMPE RONALD HOPE SR

robust Democratic institutions for example were found to systematicallyenhance the performance of African states as agents of development byamong other things countering temptations for politically opportunisticbehaviormdashsuch as economically incoherent policies ineffective imple-mentation and the abuse of public resources for private gain relative tothe provision of welfare-enhancing public goodsmdashthat is economicallydamaging (Alence) Similarly others such as Daniel Kaufmann and AartKraay Kaufmann Kraay and Pablo Zoido-Lobatoacuten and Joseph SiegleMichael Weinstein and Morton Halperin have shown that the qualityof governance is positively associated with economic growth anddevelopment

However despite the empirical evidence supporting the positive rela-tionship between good governance and sustainable development on theone hand and the attempt by African leaders through the NEPAD tomake that relationship a reality in Africa on the other the NEPAD frame-work has been the subject of some criticism and Afro-pessimism Butinterestingly enough no credible alternative plan to the NEPAD has sofar been put forward by its critics Perhaps the most comprehensivesummaries of the various criticism to date can be found in PeterAnyangrsquoNyongrsquoo Aseghedech Ghirmazion and Davinder Lamba and inIan Taylor The key criticisms are usually focused around pessimismgiven Africarsquos culture of corruption and neopatrimonial rule its historyof human rights abuses rigged elections and coups the notion thatpartnerships between Africa and the West are unworkable given the dom-inance and influence of the latter and the perception that civil society hadnot been properly consulted in the drawing up of the NEPAD frameworkdocument With respect to the latter issue it must be said first that a lackof proper consultation with some interested parties does not necessarilyrender the content of the outcome document as irrelevant Second with-out taking sides on the validity or lack thereof with respect to the criti-cisms Africarsquos leaders found themselves in a ldquodamned if they do damnedif they donrsquotrdquo position They were damned for not demonstrating leader-ship to solve Africarsquos development problems and then having done thatby launching the NEPAD they were damned for not consulting others todemonstrate their leadership

The fact of the matter is that the NEPAD potentially ldquoconstitutes themost important advance in African development policy during the pastfour decadesrdquo (Hope 2002b 401) Moreover it is a home-grown initiativefor development based on a set of core principles that have beenembraced by national regional and international public opinion as beingpreconditions for the renewal of the African continent (Hope 2002b) Asthis work also shows the NEPAD has been endorsed and supported bythe international community including the G8 countries and multilateraland bilateral organizations such as the World Bank the InternationalMonetary Fund (IMF) the UN the Organisation for Economic Co-operation and Development (OECD) the United States Agency for

THE AFRICAN PEER REVIEW MECHANISM 289

International Development (USAID) the Department for InternationalDevelopment (DFID) of the UK and others The active involvement forexample of four members of the HSGICmdashPresident Thabo Mbeki ofSouth Africa President Olusegun Obasanjo of Nigeria President JoaquimChissano of Mozambique and President John Kufuor of Ghanamdashin theremoval from office and exiling of the corrupt warlord President CharlesTaylor from Liberia in 2003 has certainly deepened international supportfor the NEPAD and what it represents

Indeed another perspective offered in the various commentaries onthe NEPAD is that ldquoAfrican leaders merit a chance to reverse the numer-ous crises in the continent which they are proposing as outlined in theNEPAD documentrdquo (AnyangrsquoNyongrsquoo Ghirmazion and Lamba 3) Fur-thermore ldquotheir [Africarsquos leaders] acknowledgement of the need for arenaissance in Africa and of the concepts of democracy accountabilitytransparency and peer review should account for more than the pessimis-tic criticism and call for dismissal of the [NEPAD] document being calledfor by some scholarsrdquo (AnyangrsquoNyongrsquoo Ghirmazion and Lamba 3ndash4)This would seem to constitute an enlightened conclusion and particularlyso given that the critics and Afro-pessimists have offered no alternativedevelopment framework and that some of them are in fact guilty ofchampioning discredited and abandoned ideas from the past Moreoverit ought to be accepted by all critics and Afro-pessimistsmdashin the spirit ofthe good governance that they presumably seek for Africamdashthat theweight responsibility and accountability for leadership on the continentultimately rests with those who sought election and were democraticallyelected by the majority of their fellow citizens

THE PEER REVIEW CONCEPT AND THE AFRICAN PEER REVIEW MECHANISM

The APRM is an African-led innovation representing a bold approach toreform for building capable states with enduring good governance andsustainable development The APRM is designed to monitor and assessthe progress made by African countries in meeting their commitmenttoward achieving good governance social reforms and sustainabledevelopment It will also provide a platform for countries to share expe-riences with a view to fostering good governance and democratic pro-cesses But before going further on the APRM it is useful to set the stagefor the rest of the discussion to follow by first examining the concept ofpeer review

What Is Peer Review

Peer reviews were pioneered by the OECD Since its creation as an insti-tution four decades ago the OECD has successfully used this method ofassessment of the performance of its member states In addition several

290 KEMPE RONALD HOPE SR

other intergovernmental and international organizations such as theEuropean Union (EU) UN bodies and the IMF use peer review tomonitor and assess national policies and performance in several sectors(OECD)

Peer review refers to the systematic examination and assessment of theperformance of a state by other states (peers) by designated institutionsor by a combination of states and designated institutions (OECD UNECA2002b 2002c) The ultimate goal is to assist the reviewed state to improveits policy making adopt best practices and comply with establishedstandards principles codes and other agreed commitments Peer reviewexaminations and assessments are conducted in a nonadversarial mannerand they rely heavily on the mutual trust and understanding between thestate being reviewed and the reviewers as well as their shared confidencein the process (OECD UNECA 2002b)

The international experience shows peer reviews can be conductedbased on subject areas or themes For example an individual country peerreview could relate to economics governance education health the envi-ronment or other policies and practices Within one or more of thesesubject areas a state may be examined against a wide range of codes andstandards for compliance for example (OECD UNECA 2002b) Similarlyseveral countries can be examined at the same time with respect to aparticular theme for instance ldquoCombating Corruption for SustainableDevelopmentrdquo (UNECA 2002b) However whether based on subject areasor themes individual country peer reviews are typically undertaken ona regular basis with each review exercise resulting in a report thatassesses accomplishments indicates shortcomings and makes recom-mendations They usually do not entail sanctions or a punitive decisionbut they can lead to embarrassment and negative market reactions suchas lower levels of investment or exchange rate fluctuations biased againstthe national currency

Nonetheless related to the concept of peer review is the concept of peerpressure According to the OECD and Takatoshi Ito the effectiveness ofpeer review relies on the influence of peer pressure that is the persuasionexercised by the peers The peer review process can give rise to peerpressure through for example a mix of formal recommendations andinformal consultations by peer countries public scrutiny comparisonsand ranking among countries and the impact of the foregoing on publicopinion policy makers and other stakeholders The lessons of peerreviews conducted in the developed countries suggest that the greatestimpact is derived when the outcomes of peer reviews are put in the publicdomain It is that public scrutiny that is most likely to influence changeand bring about corrective actions In addition the East Asian experiencesuggests that peer pressure provides an effective incentive to commitmember countries to perform the required activities and take the neces-sary actions for common policy objectives (Wang and Yoon)

THE AFRICAN PEER REVIEW MECHANISM 291

The APRM

UNECA originally developed the APRM in response to a request by theNEPAD HSGIC Its (the APRMrsquos) mandate ensures that the policies andpractices of participating states conform to the agreed political economicand corporate governance codes and standards contained in the

Declara-tion on Democracy Political Economic and Corporate Governance

that wasapproved by the African Union (AU) Summit in July 2002 (NEPAD Sec-retariat 2002a) The APRM is a mutually agreed instrument for self-mon-itoring by the participating member states It is voluntarily acceded to bymember states of the AU (NEPAD Secretariat 2003a)

The primary purpose of the APRM is to foster the adoption of policiesstandards and practices that lead to political stability high economicgrowth sustainable development and accelerated integration throughthe sharing of experiences and the reinforcement of successful and bestpractice including identifying deficiencies and assessing the needs forcapacity building This is to be accomplished by using the relevant indi-cators contained in the APRM to measure and determine the progress ofpeer-reviewed countries in meeting the goals of achieving good gover-nance and sustainable development The overarching goal of the APRMis for all participating countries to accelerate their progress toward adopt-ing and implementing the priorities and programs of the NEPAD achiev-ing the mutually agreed objectives and compliance with best practice inrespect to each of the areas of good governance and sustainable develop-ment (NEPAD Secretariat 2003a) As articulated by Chris Stalsmdasha memberof the APR Panel which is discussed belowmdashthe application of theAPRM and the resultant ldquorecommendations are not meant to punish orexclude countries the main objective is to help each country to identifyits own weaknesses and to find ways and means for addressing theshortcomingsrdquo (Stals 5)

Every peer review exercise undertaken under the authority of theAPRM must be technically competent and free of political manipulationIt must comply with the mandate of the APRM referred to above Thesestipulations together constitute the core guiding principles of the mecha-nism And with respect to the process and procedures for the applicationof the APRM the NEPAD HSGIC has approved four distinct organiza-tional components and five stages (NEPAD Secretariat 2003b) The firstorganizational component is the Committee of Participating Heads ofState and Government (the APR Heads of State Forum) which is thehighest decision-making authority in the APRM with overall responsibil-ity for the said APRM The APR Heads of State Forum will consist ofHeads of State and Government of the member states of the AU who havevoluntarily chosen to accede to the APRM The next organizational com-ponent is the Panel of Eminent Persons (APR Panel) This is an indepen-dent body that will oversee the day-to-day functioning of the peer review

292 KEMPE RONALD HOPE SR

process and ensure the credibility and integrity of that process The thirdorganizational component is the APR Secretariat which will provide thesecretarial coordinating and administrative support services for theAPRM through the APR Panel The final organizational component isthe APR Teams which will be conducting the actual technical assessmentsthat will constitute the country peer reviews

The functions of the APR Heads of State Forum include but are notlimited to (1) appointing the APR Panel and its chairperson (2) consider-ing adopting and taking ownership of country peer review reports (3)communicating the recommendations of the APR Heads of State Forumto the peer-reviewed countries (4) exercising peer pressure to effectchanges in country practice where recommended (5) persuading devel-opment partners to provide technical assistance to eliminate capacitygaps as recommended by the country peer review reports (6) transmit-ting peer review reports to the appropriate AU structures and (7) makingpublic through the APR Secretariat country peer review reports andpress releases pertaining thereto

The functions of the APR Panel include but are not limited to (1)exercising oversight of the APR process including providing leadershipto country review teams with a view to ensuring the independenceprofessionalism and credibility of that process (2) recommending appro-priate African institutions or individuals to conduct technical assess-ments (3) reviewing and adopting the country peer review reportsincluding the recommendations contained therein and (4) submitting tothe APR Heads of State Forum all country peer review reports withrecommendations on measures that could be taken to assist the reviewedcountries in the improvement of their governance and socio-developmentperformance By November 2003 the HSGIC had appointed seven mem-bers of the APR Panel More members may be appointed at a later datewith a probable final complement of ten two from each of the fivesubregions

The functions of the APR Secretariat include (1) providing secretarialand administrative support services to the APR Panel under the directsupervision of the Chairperson of that Panel (2) organizing regionalnetworks and workshops for the sharing of experience and best practicerelated to the goals of achieving good governance and sustainable devel-opment and (3) ensuring full documentation of the peer review processesat country subregional and continental levels to facilitate mutual learning

The APR Teams are responsible for conducting the technical countryassessments that will comprise the country peer reviews Credible andtechnically competent institutions such as the UNDP the UNECA andthe AfDB have been selected to assist with some of the peer reviewtechnical assessments The UNECA will assist with the technical assess-ments in economic governance and management while the AfDB willassist with banking and financial standards for example The APR Panelwill select other credible and technically competent institutions or indi-

THE AFRICAN PEER REVIEW MECHANISM 293

viduals to undertake the peer review assessments in the areas of politicalgovernance corporate governance and socioeconomic development

As mentioned before there are five stages to the peer review processStage One entails a careful analysis of the governance and developmentenvironment in the country being reviewed Key governance and devel-opment issues will be analyzed to provide background information withrespect to political representativeness and rights institutional effective-ness and economic management and governance Political representa-tiveness and rights will cover issues of political systems and electoralprocesses representation and participation of various stakeholders indecision making Institutional effectiveness will include issues related tothe nature and workings of the legislative judiciary and executivebranches of government as well as the state of the nongovernmentalsector Economic management and governance will address issues ofmacroeconomic management public financial accountability monetaryand financial transparency accounting and auditing systems and regula-tory oversight bodies as well as issues of capacity effectiveness andaccountability of the economic decision making and service deliverysystems

Stage two constitutes the country visits by the peer review technicalassessment teams This stage is informed by the analysis prepared inStage One The technical assessment teams will consult and extensivelyinterview relevant government officials parliamentarians oppositionparty members not in parliament private sector representatives repre-sentatives of civil society groups (including the media academia tradeunions and nongovernmental organizations) and officials of residentmissions of regional and international organizations

Stage Three involves the preparation of the peer review reports basedon the technical assessments conducted in Stage Two A draft of eachreport will be discussed with the government concerned prior to submis-sion to the APR Panel Those discussions will be designed to ensure theaccuracy of the information and to provide the government an opportu-nity to react to the findings and recommendations of the assessment teamThese responses of the government will be appended to the final draft ofthe report However each report will remain independent and its find-ings will not be altered or vetted by the government concerned

Stage Four entails discussion and adoption of the peer review reportsby the APR Panel first followed by the APR Heads of State Forum Thisstage terminates when the Chairperson of the latter communicates thedecisions and recommendations to the government of the country beingpeer reviewed Stage Five is the formal and public tabling of the peerreview reports in key regional and subregional structures and in partic-ular the AU structures These reports will also be put in the publicdomain

The NEPAD HSGIC has also approved a number of indicators basedon key objectives that will be used to assess and measure performance

294 KEMPE RONALD HOPE SR

in the four peer review areas of (1) democracy and political governance(2) economic governance and management (3) corporate governance and(4) socioeconomic development (NEPAD Secretariat 2003a) The keyobjectives for democracy and political governance include (1) to preventand reduce intra- and intercountry conflicts (2) the consolidation of con-stitutional democracy including periodic political competition andopportunity for choice the rule of law a Bill of Rights and the supremacyof the constitution being firmly established (3) promotion and protectionof economic social cultural civil and political rights as enshrined in allAfrican and international human rights instruments (4) upholding theseparation of powers including the protection of the independence of thejudiciary and of an effective parliament (5) ensuring accountable effi-cient and effective public office holders and civil servants (6) fightingcorruption in the political arena (7) promotion and protection of therights of women (8) promotion and protection of the rights of the childand young persons and (9) promotion and protection of the rights ofvulnerable groups including displaced persons

The key objectives for economic governance and management are (1)promoting macroeconomic policies that support sustainable develop-ment (2) implementing transparent predictable and credible governmenteconomic policies (3) promoting sound public finance management (4)fighting corruption and money laundering and (5) accelerating regionalintegration by participating in the harmonization of monetary trade andinvestment policies among participating states

The key corporate governance objectives are (1) providing an enablingenvironment and effective regulatory framework for economic activities(2) ensuring that corporations act as good corporate citizens with regardto human rights social responsibility and environmental sustainability(3) promoting the adoption of codes of good business ethics in achievingthe objectives of the organization (4) ensuring that corporations treat alltheir stakeholders in a fair and just manner and (5) providing for account-ability of corporations and directors

The key objectives for socioeconomic development are to (1) promoteself-reliance in development and build capacity for self-sustaining devel-opment (2) accelerate socioeconomic development to achieve sustainabledevelopment and poverty eradication (3) strengthen policies deliverymechanisms and outputs in key social development areas such as edu-cation for all and the combating of HIVAIDS and other communicablediseases (4) ensure affordable access to water energy finance marketsand information and communication technologies to all citizens (5) makeprogress toward gender equality particularly equal access to educationfor girls at all levels and (6) encourage broad-based participation indevelopment by all stakeholders at all levels

The 2002 AU Summit also approved the frequency of peer reviewsSpecifically there will be four types of peer reviews The first countryreview being the base review will be undertaken within 18 months of acountryrsquos becoming a member of the APRM The second type is the

THE AFRICAN PEER REVIEW MECHANISM 295

periodic review that should take place every two years The next type isa requested review where a member country can for its own reasons askfor a review that is not part of the periodically mandated reviews Thefinal type amounts to an imposed review and may be resorted to by theHSGIC if there is sufficient cause to conclude that there are early signs ofimpending political andor economic crises in a member country

Despite the fact that participation in the APRM is open to all memberstates of the AU on a voluntary basis there is now a somewhat morebureaucratic and unnecessarily cumbersome process that countries haveto contend with The APRM has evolved from its original technicallystraightforward framework to become a somewhat more burdensomeadministrative process Nonetheless this eventuality does not seem tohave particularly influenced the desire and decision by the member statesto seek participation in the process This is probably not surprising asundoubtedly countries that are actually peer reviewed stand to reap anumber of benefits as discussed in the next section It should be notedhere that in November 2002 a total of 12 of the 53 African countries hadoriginally declared their intent to be peer reviewed Those countries wereAlgeria Republic of Congo Egypt Ethiopia Gabon Ghana Mali Mau-ritius Mozambique Nigeria Rwanda and South Africa As of August2004 a total of 23 countriesmdashincluding the additional 11 of Angola BeninBurkina Faso Cameroon Kenya Lesotho Malawi Senegal Sierra LeoneTanzania and Ugandamdashhad signed the Memorandum of Understandingthat represents the basic framework for formal accession to the APRM(NEPAD Secretariat 2002b 2003c 2003d 2003e 2004) Other countries areexpected to accede in time However Ghana will be noted in Africarsquoseconomic and political history as the first country on the continent to bereviewed under the APRM The country inaugurated the APRM processin May 2004 By August 2004 four countriesmdashGhana Kenya Mauritiusand Rwandamdashhad been visited by peer review support mission teamsand were at various stages in the process

BENEFITS OF THE APRM AN ANALYTICAL ASSESSMENT

Given the international experience with peer reviews the APRMmdashas amechanism for measuring and monitoring progress toward good gover-nance and sustainable development in Africamdashhas the potential to pro-vide a number of benefits to those African countries that subjectthemselves to it and through multiplier effects to the continent as awhole Peer reviews have been demonstrated to have a number of bene-ficial effects as applied across the world As African countries seek toimprove their governance and march toward sustainable developmentpeer reviews can provide the basis for policy changes to meet commit-ments and to observe the agreed standards and codes

Indeed peer reviews will facilitate the monitoring of compliance withthe agreements entered into upon accession to the APRM States are muchmore inclined to comply when they know their implementation is moni-

296 KEMPE RONALD HOPE SR

tored and when the implementation of their peers is being monitored aswell (Henning) Given the history and resultant disastrous effects of badgovernance in Africa with a lack of openness and rampant corruptionacceding to peer review represents a sea change in the thinking of Africanleaders and a major milestone in the political development and history ofthe continent Below we concentrate on six key areas where peer reviewswill add value and enhance the prospects for African states to achievegood governance and sustainable development

Greater Transparency

Following Seiichi Kondo transparency is taken here to mean that reliablerelevant and timely information about the activities of government isavailable to the public Associated with transparency is the concept ofopenness whereby public participation in shaping and implementinggovernment policy is encouraged and guaranteed Transparency in gov-ernment is a good thing for governments in Africa have the most poten-tial for going awry given their monopoly on force and power and the easewith which they use and abuse that force and power Where there istransparency government officials will be prevented from exercising dis-cretionary powers Transparency therefore complements and reinforcespredictability reduces uncertainty and inhibits and reduces the scope ofcorruption among public officials (Siegle Weinstein and Halperin)

The APRM will be particularly applied to democracy and politicalgovernance issues and economic and corporate governance issues Inboth cases transparency looms large The openness of the political spaceis a critical barometer of the nature of democracy in a given countrySimilarly in the economic sphere the extent of fiscal transparencyprovides a very solid indication of the manner in which budgets (expen-ditures and revenues) for example are crafted reconciled and imple-mented Determining the nature of transparency in governmentoperations and functioning in Africa will expose the shortcomings andany deliberate secrecy or misreporting of government operations

Transparency in government operations particularly in Africa hasseveral dimensions (Kopits and Craig) The first dimension consists ofmainly behavioral aspects such as clearly established conflict-of-interestrules for elected and appointed officials a transparent regulatory frame-work open public procurement and employment practices a code ofconduct for public officials and freedom-of-information requirementsThe next is the provision of reliable information on the governmentrsquoseconomic policy intentions and forecasts The third is the requirement fordetailed data and information on government operations including thepublication of comprehensive budget and other planning and policy doc-uments In all three dimensions transparency is closely associated withthe successful implementation of good governance and the achievementof sustainable development

THE AFRICAN PEER REVIEW MECHANISM 297

The APRM to the extent that it enhances transparency in Africancountries will acknowledge democratic progress and scorn antidemo-cratic measures Consequently it can confer or withhold internationalrecognition and raise or lower the domestic legitimacy of governments(Henning) Moreover transparency increases the political risk of unsus-tainable policies whereas the lack thereof means that such policies cango undetected longer than they otherwise would Generally countriescharacterized by a relatively high degree of transparency have exhibitedgreater political and economic discipline and in many instances havebeen able to achieve a more robust political and economic performancecompared to countries with less transparent policies even within a sameregion (Henning)

This positive correlation between transparency and good governancehas also been empirically demonstrated across the spectrum of bothdeveloped and developing countries R Islam for instance has shownthat governments that are more transparent govern better as measuredby a wide number of governance indicators such as government effective-ness regulatory burden corruption voice and accountability the rule oflaw bureaucratic efficiency contract repudiation and expropriation riskAnd as better governance has also been empirically demonstrated to becorrelated with higher growth rates it can be extrapolated that there is aclose relationship between greater transparency and how fast economiesgrow (Islam) Botswana for example is internationally recognized for itssubstantial degree of transparency with a liberal democratic political sys-tem and a prudent and open budgetary process (Hope 2002a Kopits andCraig) As a result Botswana continues to experience political and mac-roeconomic stability with strong growth The country has consistentlybeen one of the fastest growing in the world with an annual averagegrowth rate of per capita gross domestic product (GDP) of 51 percentduring the period 1975ndash2002 compared with an annual average of

minus

08percent for sub-Saharan Africa during the same period (UNDP 2004)

That relationship between transparency good governance and growthin Botswana is further reflected in the growth competitiveness index(GCI) of the World Economic Forum The GCI is composed of threesubindexes identified as pillars in the evolution of growth in a country(1) the quality of the macroeconomic environment (2) the state of publicinstitutions and (3) the level of technological readiness The GCI uses acombination of hard data such as inflation rates budget deficits the levelof Internet access in schools and survey data in areas such as judicialindependence the prevalence of institutionalized corruption and theextent of inefficient government intervention in the economy (Lopez-Claros) Botswana has consistently ranked in first place among all Africancountries in the overall GCI as well as in the macroeconomic environmentand public institutions subindexes For the 2003 GCI computationsBotswana was ranked at 36 just behind Greece on the worldwide com-parisons (World Economic Forum)

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

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Capacity Building Gov-ernance and Economic Reform in Africa

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Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

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Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

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Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

284 KEMPE RONALD HOPE SR

some urgency to stake Africarsquos claim to the twenty-first century At thebeginning of the twenty-first century per capita income in sub-SaharanAfrica was 10 percent below the level reached in 1980 In other wordsthe majority of the countries on the continent were worse off than theywere two decades ago Despite being one of the most richly endowedregions of the world Africa remains the poorest continent (Hope2002a) According to the United Nations Development Programme(UNDP 2004) human development in sub-Saharan Africa has actuallyregressed in recent years and poor people are now worse off The shareof people living on US$1 per day increased to 47 percent by 2001 from45 percent in 1990 (United Nations 2004 World Bank 2004) A recentstudy by Elsa Artadi and Xavier Sala-i-Martin puts the proportion ofthe population in sub-Saharan Africa living on less than US$1 a day atclose to 60 percent in 2000

This paper analytically describes and assesses the APRM within theframework of the NEPAD initiative It contends that peer review repre-sents a sea of change in the thinking of African leaders as they seek toreverse the trend of lack of accountability political authoritarianism statefailure and corruption to embrace and consolidate democracy as well aseffect sound and transparent economic management In addition it isfurther argued that peer review would provide a number of benefits tothose countries that subject themselves to it and that in turn would havepositive multiplier effects on Africarsquos development performance

THE NEPAD INITIATIVE GOOD GOVERNANCE AND SUSTAINABLE DEVELOPMENT

The NEPAD initiative is governed by a Heads of State and GovernmentImplementation Committee (HSGIC) composed of 20 members with fourdrawn from each of the five subregions of the continentmdashEast AfricaWest Africa Southern Africa North Africa and Central Africa It lists anumber of prerequisites for African countries to move forward in theirquest for sustainable development Key among these is the proper adher-ence to good political economic and corporate governance

Drawing on Kempe Ronald Hope (2002b) it can be noted that goodgovernance in all its facets has been demonstrated to be positively cor-related with the achievement of better growth rates particularly throughthe building of institutions in support of markets Recent empirical anal-ysis suggests a positive correlation between democratic governance andthe levels of income investment human capital economic liberalizationand distributive income growth in society (Tavares and Wacziarg)Indeed some analysts such as Alfred Zack-Williams have successfullyargued that good governance particularly its aspects of democratic con-solidation is a sine qua non for development Consequently the newmaxim for Africa in the twenty-first century should be ldquono democracy nodevelopmentrdquo (Zack-Williams 221)

THE AFRICAN PEER REVIEW MECHANISM 285

Similarly United Nations (UN) Secretary-General Kofi Annan hassaid that ldquogood governance is perhaps the single most important factorin eradicating poverty and promoting developmentrdquo (United Nations1998 13) Moreover a former Kenyan vice president has also noted thatldquogood political and economic governance underpins sustainable devel-opmentrdquo (Saitoti 257) The President of the African Development Bank(AfDB) has emphasized that ldquogood governance is not only a worthy goalper se but also a prerequisite for sustainable development and povertyreduction in the longer termrdquo (Kabbaj 7) while the Executive Secretaryof the United Nations Economic Commission for Africa (UNECA) hasproclaimed that ldquogood governance is essential for the political and eco-nomic transformation of Africardquo (Amoako 155)

Governance has to do with the manner in which responsibility is dis-charged Such a responsibility may be acquired through election appoint-ment or delegation in the public domain or in the area of commerce (iecorporate governance) Therefore good governance is taken here to meana condition whereby such responsibility is discharged in an effectivetransparent and accountable manner while bad governance is associatedwith maladministration in the discharge of responsibility (Abed) Goodgovernance entails the existence of efficient and accountable institu-tionsmdashpolitical judicial administrative economic corporatemdashandentrenched rules that promote development protect human rightsrespect the rule of law and ensure that people are free to participate inand be heard on decisions that affect their lives

The NEPAD initiativersquos framework document recognizes the salientimportance of good governance for achieving sustainable developmentin Africa and sets out principles pertaining to the strengthening of democ-racy and political governance as well as economic and corporate gover-nance On democracy and political governance it states that developmentis impossible in the absence of democracy respect for human rightspeace and good governance The purpose of the principles here is tocontribute to the strengthening of the political and administrative frame-work of African countries in line with the principles of democracytransparency accountability integrity respect for human rights and pro-motion of the rule of law (NEPAD Secretariat 2001)

The necessity for institutional reform has been recognized to drive theprocess forward given the capacity limitations across African countriesAs identified in the NEPAD framework document the institutionalreforms to strengthen political governance in Africa will need to focus on(1) the administrative and civil services (2) the strengthening of parlia-mentary oversight (3) the promotion of participatory decision making(4) the adoption of effective measures to combat corruption and embez-zlement and (5) the undertaking of judicial reforms (NEPAD Secretariat2001) These five areas of focus have been exhaustively discussed inUNECA (2002a) Suffice it to say here that for the first time in post-independence Africa the African leaders themselves are pointing to the

286 KEMPE RONALD HOPE SR

shortcomings of the institutional structure over which they presidedirectly or have much say

Institutions in particular public institutions have been a failure inAfrica Many of these institutions have been captured by the elite to servenarrow personal interests The resultant effect has been the lack of theability of the state to provide the requisite institutional framework tosupport good governance In too many African countries both the publicand private sectors do not operate according to widely accepted rules thatare transparent and enforced by accountable institutions Consequentlythe challenge for African policy makers under the NEPAD is to shapepolicies and institutional development in ways that enhance good gover-nance and sustainable development

With respect to economic and corporate governance the NEPADframework document states that the objective here is to promote a set ofconcrete and time-bound programs aimed at enhancing the quality ofeconomic and public financial management as well as good corporategovernance (NEPAD Secretariat 2001) Good economic and corporategovernance is good for Africa Countries attract more investment andachieve higher rates of per capita growth where the state improves certainbasic aspects of its performance A state that applies rules and policiespredictably and fairly ensures order and the rule of law and protectsproperty rights will generate confidence and attract more domestic andforeign investment That in turn generates trade and faster economicgrowth as well as provides the wherewithal for sustainable development(UNECA 2002a)

Here again the role of institutions looms large The existence of weakinstitutions of economic and corporate governance as a constraint onsustainable development in Africa is clear and convincing This hasaccordingly limited the public sector in the fulfillment of its economicfunctions Those economic functions can be broadly classified into threedistinct categories (1) making and implementing economic policy (2)delivering services and (3) ensuring accountability for the use of publicresources and public regulatory power (World Bank 2000) Institutions areneeded to maintain fiscal and monetary discipline mobilize resourcesand set priorities among the competing demands for those resources asintegral aspects of the making and implementation of good economicpolicy Similarly institutional arrangements are required for the efficientdelivery of public services that are also pro-poor In addition there mustbe institutional mechanisms that ensure accountability through the capac-ity to monitor and enforce rules and to regulate economic activities in thepublic interest However regulatory frameworks should be minimal sim-ple and easy to implement (Saitoti)

Good governance is worth pursuing in its own right in Africa Muchhas been observed and volumes have been written about the deleteriouseffects of bad governance in Africa Through the NEPAD a new genera-tion of enlightened leaders is aiming to reverse that trend Respect for

THE AFRICAN PEER REVIEW MECHANISM 287

human rights and democratic principles honest and good quality admin-istration and protecting the rights and freedoms under the rule of laware concerned with values that apply equally to every state and citizenDemocracy for example is a universally recognized ideal based on val-ues common to people everywhere regardless of cultural political socialor economic differences (IPU) These transcend the functional importanceof aspects of good governance such as for sustainable development (Sci-entific Council for Government Policy)

President Thabo Mbeki of South Africa has argued quite convincinglyfor example that Africa wishes to realize the goal of good governance inall its elements ldquonot because we seek to improve our relations with therest of the world as a first objective critically important as this is but toend political and economic mismanagement on our continent and theconsequential violent conflicts instability denial of democracy andhuman rights deepening poverty and global marginalizationrdquo (Mbeki 2)Nonetheless as noted above the various components of good governanceare also necessary and functional for sustainable development processes

Quite clearly growth and development cannot be achieved in theabsence of good governance Among other things good governanceensures the most efficient utilization of already scarce resources in thepromotion of development enhances participation responsibility andaccountability and has the potential to emancipate people from povertyas state legitimacy is recognized and entrenched In fact any effort toreduce poverty and sustain development must start with and build upongood governance (Hope 2002b) Good governance can therefore be alsoregarded as governance on behalf of development-oriented policy

According to UNDP (2002) good governance advances sustainabledevelopment for three reasons First enjoying political freedom and par-ticipating in the decisions that shape onersquos life are fundamental humanrights In those African countries where leaders are not elected or selectedby election (eg Libya) or where elections are flawed (eg Zimbabwe)choices are severely restricted The denial of these rights is a denial ofhuman development Second good governance helps to protect peoplefrom economic and political catastrophes such as famines and othercrises (Sen) There is a direct correlation between bad governance andfamines for example in Africa In other words those countries frequentlysuffering from famines in Africa tend not to have good governance Thirdgood governance can promote sustainable development by empoweringcitizens to influence policies that promote growth and prosperity andreflect their priorities

Y Feng has also empirically demonstrated that good governance doesmatter for national economic growth and development ldquoIn particular apolitical system characterized by freedom and stability is best suited topromoting a growth-oriented economic agendardquo (Feng 295) In additionR Alence has empirically shown that the effects of governance on nationalincome and economic performance in Africa are large and statistically

288 KEMPE RONALD HOPE SR

robust Democratic institutions for example were found to systematicallyenhance the performance of African states as agents of development byamong other things countering temptations for politically opportunisticbehaviormdashsuch as economically incoherent policies ineffective imple-mentation and the abuse of public resources for private gain relative tothe provision of welfare-enhancing public goodsmdashthat is economicallydamaging (Alence) Similarly others such as Daniel Kaufmann and AartKraay Kaufmann Kraay and Pablo Zoido-Lobatoacuten and Joseph SiegleMichael Weinstein and Morton Halperin have shown that the qualityof governance is positively associated with economic growth anddevelopment

However despite the empirical evidence supporting the positive rela-tionship between good governance and sustainable development on theone hand and the attempt by African leaders through the NEPAD tomake that relationship a reality in Africa on the other the NEPAD frame-work has been the subject of some criticism and Afro-pessimism Butinterestingly enough no credible alternative plan to the NEPAD has sofar been put forward by its critics Perhaps the most comprehensivesummaries of the various criticism to date can be found in PeterAnyangrsquoNyongrsquoo Aseghedech Ghirmazion and Davinder Lamba and inIan Taylor The key criticisms are usually focused around pessimismgiven Africarsquos culture of corruption and neopatrimonial rule its historyof human rights abuses rigged elections and coups the notion thatpartnerships between Africa and the West are unworkable given the dom-inance and influence of the latter and the perception that civil society hadnot been properly consulted in the drawing up of the NEPAD frameworkdocument With respect to the latter issue it must be said first that a lackof proper consultation with some interested parties does not necessarilyrender the content of the outcome document as irrelevant Second with-out taking sides on the validity or lack thereof with respect to the criti-cisms Africarsquos leaders found themselves in a ldquodamned if they do damnedif they donrsquotrdquo position They were damned for not demonstrating leader-ship to solve Africarsquos development problems and then having done thatby launching the NEPAD they were damned for not consulting others todemonstrate their leadership

The fact of the matter is that the NEPAD potentially ldquoconstitutes themost important advance in African development policy during the pastfour decadesrdquo (Hope 2002b 401) Moreover it is a home-grown initiativefor development based on a set of core principles that have beenembraced by national regional and international public opinion as beingpreconditions for the renewal of the African continent (Hope 2002b) Asthis work also shows the NEPAD has been endorsed and supported bythe international community including the G8 countries and multilateraland bilateral organizations such as the World Bank the InternationalMonetary Fund (IMF) the UN the Organisation for Economic Co-operation and Development (OECD) the United States Agency for

THE AFRICAN PEER REVIEW MECHANISM 289

International Development (USAID) the Department for InternationalDevelopment (DFID) of the UK and others The active involvement forexample of four members of the HSGICmdashPresident Thabo Mbeki ofSouth Africa President Olusegun Obasanjo of Nigeria President JoaquimChissano of Mozambique and President John Kufuor of Ghanamdashin theremoval from office and exiling of the corrupt warlord President CharlesTaylor from Liberia in 2003 has certainly deepened international supportfor the NEPAD and what it represents

Indeed another perspective offered in the various commentaries onthe NEPAD is that ldquoAfrican leaders merit a chance to reverse the numer-ous crises in the continent which they are proposing as outlined in theNEPAD documentrdquo (AnyangrsquoNyongrsquoo Ghirmazion and Lamba 3) Fur-thermore ldquotheir [Africarsquos leaders] acknowledgement of the need for arenaissance in Africa and of the concepts of democracy accountabilitytransparency and peer review should account for more than the pessimis-tic criticism and call for dismissal of the [NEPAD] document being calledfor by some scholarsrdquo (AnyangrsquoNyongrsquoo Ghirmazion and Lamba 3ndash4)This would seem to constitute an enlightened conclusion and particularlyso given that the critics and Afro-pessimists have offered no alternativedevelopment framework and that some of them are in fact guilty ofchampioning discredited and abandoned ideas from the past Moreoverit ought to be accepted by all critics and Afro-pessimistsmdashin the spirit ofthe good governance that they presumably seek for Africamdashthat theweight responsibility and accountability for leadership on the continentultimately rests with those who sought election and were democraticallyelected by the majority of their fellow citizens

THE PEER REVIEW CONCEPT AND THE AFRICAN PEER REVIEW MECHANISM

The APRM is an African-led innovation representing a bold approach toreform for building capable states with enduring good governance andsustainable development The APRM is designed to monitor and assessthe progress made by African countries in meeting their commitmenttoward achieving good governance social reforms and sustainabledevelopment It will also provide a platform for countries to share expe-riences with a view to fostering good governance and democratic pro-cesses But before going further on the APRM it is useful to set the stagefor the rest of the discussion to follow by first examining the concept ofpeer review

What Is Peer Review

Peer reviews were pioneered by the OECD Since its creation as an insti-tution four decades ago the OECD has successfully used this method ofassessment of the performance of its member states In addition several

290 KEMPE RONALD HOPE SR

other intergovernmental and international organizations such as theEuropean Union (EU) UN bodies and the IMF use peer review tomonitor and assess national policies and performance in several sectors(OECD)

Peer review refers to the systematic examination and assessment of theperformance of a state by other states (peers) by designated institutionsor by a combination of states and designated institutions (OECD UNECA2002b 2002c) The ultimate goal is to assist the reviewed state to improveits policy making adopt best practices and comply with establishedstandards principles codes and other agreed commitments Peer reviewexaminations and assessments are conducted in a nonadversarial mannerand they rely heavily on the mutual trust and understanding between thestate being reviewed and the reviewers as well as their shared confidencein the process (OECD UNECA 2002b)

The international experience shows peer reviews can be conductedbased on subject areas or themes For example an individual country peerreview could relate to economics governance education health the envi-ronment or other policies and practices Within one or more of thesesubject areas a state may be examined against a wide range of codes andstandards for compliance for example (OECD UNECA 2002b) Similarlyseveral countries can be examined at the same time with respect to aparticular theme for instance ldquoCombating Corruption for SustainableDevelopmentrdquo (UNECA 2002b) However whether based on subject areasor themes individual country peer reviews are typically undertaken ona regular basis with each review exercise resulting in a report thatassesses accomplishments indicates shortcomings and makes recom-mendations They usually do not entail sanctions or a punitive decisionbut they can lead to embarrassment and negative market reactions suchas lower levels of investment or exchange rate fluctuations biased againstthe national currency

Nonetheless related to the concept of peer review is the concept of peerpressure According to the OECD and Takatoshi Ito the effectiveness ofpeer review relies on the influence of peer pressure that is the persuasionexercised by the peers The peer review process can give rise to peerpressure through for example a mix of formal recommendations andinformal consultations by peer countries public scrutiny comparisonsand ranking among countries and the impact of the foregoing on publicopinion policy makers and other stakeholders The lessons of peerreviews conducted in the developed countries suggest that the greatestimpact is derived when the outcomes of peer reviews are put in the publicdomain It is that public scrutiny that is most likely to influence changeand bring about corrective actions In addition the East Asian experiencesuggests that peer pressure provides an effective incentive to commitmember countries to perform the required activities and take the neces-sary actions for common policy objectives (Wang and Yoon)

THE AFRICAN PEER REVIEW MECHANISM 291

The APRM

UNECA originally developed the APRM in response to a request by theNEPAD HSGIC Its (the APRMrsquos) mandate ensures that the policies andpractices of participating states conform to the agreed political economicand corporate governance codes and standards contained in the

Declara-tion on Democracy Political Economic and Corporate Governance

that wasapproved by the African Union (AU) Summit in July 2002 (NEPAD Sec-retariat 2002a) The APRM is a mutually agreed instrument for self-mon-itoring by the participating member states It is voluntarily acceded to bymember states of the AU (NEPAD Secretariat 2003a)

The primary purpose of the APRM is to foster the adoption of policiesstandards and practices that lead to political stability high economicgrowth sustainable development and accelerated integration throughthe sharing of experiences and the reinforcement of successful and bestpractice including identifying deficiencies and assessing the needs forcapacity building This is to be accomplished by using the relevant indi-cators contained in the APRM to measure and determine the progress ofpeer-reviewed countries in meeting the goals of achieving good gover-nance and sustainable development The overarching goal of the APRMis for all participating countries to accelerate their progress toward adopt-ing and implementing the priorities and programs of the NEPAD achiev-ing the mutually agreed objectives and compliance with best practice inrespect to each of the areas of good governance and sustainable develop-ment (NEPAD Secretariat 2003a) As articulated by Chris Stalsmdasha memberof the APR Panel which is discussed belowmdashthe application of theAPRM and the resultant ldquorecommendations are not meant to punish orexclude countries the main objective is to help each country to identifyits own weaknesses and to find ways and means for addressing theshortcomingsrdquo (Stals 5)

Every peer review exercise undertaken under the authority of theAPRM must be technically competent and free of political manipulationIt must comply with the mandate of the APRM referred to above Thesestipulations together constitute the core guiding principles of the mecha-nism And with respect to the process and procedures for the applicationof the APRM the NEPAD HSGIC has approved four distinct organiza-tional components and five stages (NEPAD Secretariat 2003b) The firstorganizational component is the Committee of Participating Heads ofState and Government (the APR Heads of State Forum) which is thehighest decision-making authority in the APRM with overall responsibil-ity for the said APRM The APR Heads of State Forum will consist ofHeads of State and Government of the member states of the AU who havevoluntarily chosen to accede to the APRM The next organizational com-ponent is the Panel of Eminent Persons (APR Panel) This is an indepen-dent body that will oversee the day-to-day functioning of the peer review

292 KEMPE RONALD HOPE SR

process and ensure the credibility and integrity of that process The thirdorganizational component is the APR Secretariat which will provide thesecretarial coordinating and administrative support services for theAPRM through the APR Panel The final organizational component isthe APR Teams which will be conducting the actual technical assessmentsthat will constitute the country peer reviews

The functions of the APR Heads of State Forum include but are notlimited to (1) appointing the APR Panel and its chairperson (2) consider-ing adopting and taking ownership of country peer review reports (3)communicating the recommendations of the APR Heads of State Forumto the peer-reviewed countries (4) exercising peer pressure to effectchanges in country practice where recommended (5) persuading devel-opment partners to provide technical assistance to eliminate capacitygaps as recommended by the country peer review reports (6) transmit-ting peer review reports to the appropriate AU structures and (7) makingpublic through the APR Secretariat country peer review reports andpress releases pertaining thereto

The functions of the APR Panel include but are not limited to (1)exercising oversight of the APR process including providing leadershipto country review teams with a view to ensuring the independenceprofessionalism and credibility of that process (2) recommending appro-priate African institutions or individuals to conduct technical assess-ments (3) reviewing and adopting the country peer review reportsincluding the recommendations contained therein and (4) submitting tothe APR Heads of State Forum all country peer review reports withrecommendations on measures that could be taken to assist the reviewedcountries in the improvement of their governance and socio-developmentperformance By November 2003 the HSGIC had appointed seven mem-bers of the APR Panel More members may be appointed at a later datewith a probable final complement of ten two from each of the fivesubregions

The functions of the APR Secretariat include (1) providing secretarialand administrative support services to the APR Panel under the directsupervision of the Chairperson of that Panel (2) organizing regionalnetworks and workshops for the sharing of experience and best practicerelated to the goals of achieving good governance and sustainable devel-opment and (3) ensuring full documentation of the peer review processesat country subregional and continental levels to facilitate mutual learning

The APR Teams are responsible for conducting the technical countryassessments that will comprise the country peer reviews Credible andtechnically competent institutions such as the UNDP the UNECA andthe AfDB have been selected to assist with some of the peer reviewtechnical assessments The UNECA will assist with the technical assess-ments in economic governance and management while the AfDB willassist with banking and financial standards for example The APR Panelwill select other credible and technically competent institutions or indi-

THE AFRICAN PEER REVIEW MECHANISM 293

viduals to undertake the peer review assessments in the areas of politicalgovernance corporate governance and socioeconomic development

As mentioned before there are five stages to the peer review processStage One entails a careful analysis of the governance and developmentenvironment in the country being reviewed Key governance and devel-opment issues will be analyzed to provide background information withrespect to political representativeness and rights institutional effective-ness and economic management and governance Political representa-tiveness and rights will cover issues of political systems and electoralprocesses representation and participation of various stakeholders indecision making Institutional effectiveness will include issues related tothe nature and workings of the legislative judiciary and executivebranches of government as well as the state of the nongovernmentalsector Economic management and governance will address issues ofmacroeconomic management public financial accountability monetaryand financial transparency accounting and auditing systems and regula-tory oversight bodies as well as issues of capacity effectiveness andaccountability of the economic decision making and service deliverysystems

Stage two constitutes the country visits by the peer review technicalassessment teams This stage is informed by the analysis prepared inStage One The technical assessment teams will consult and extensivelyinterview relevant government officials parliamentarians oppositionparty members not in parliament private sector representatives repre-sentatives of civil society groups (including the media academia tradeunions and nongovernmental organizations) and officials of residentmissions of regional and international organizations

Stage Three involves the preparation of the peer review reports basedon the technical assessments conducted in Stage Two A draft of eachreport will be discussed with the government concerned prior to submis-sion to the APR Panel Those discussions will be designed to ensure theaccuracy of the information and to provide the government an opportu-nity to react to the findings and recommendations of the assessment teamThese responses of the government will be appended to the final draft ofthe report However each report will remain independent and its find-ings will not be altered or vetted by the government concerned

Stage Four entails discussion and adoption of the peer review reportsby the APR Panel first followed by the APR Heads of State Forum Thisstage terminates when the Chairperson of the latter communicates thedecisions and recommendations to the government of the country beingpeer reviewed Stage Five is the formal and public tabling of the peerreview reports in key regional and subregional structures and in partic-ular the AU structures These reports will also be put in the publicdomain

The NEPAD HSGIC has also approved a number of indicators basedon key objectives that will be used to assess and measure performance

294 KEMPE RONALD HOPE SR

in the four peer review areas of (1) democracy and political governance(2) economic governance and management (3) corporate governance and(4) socioeconomic development (NEPAD Secretariat 2003a) The keyobjectives for democracy and political governance include (1) to preventand reduce intra- and intercountry conflicts (2) the consolidation of con-stitutional democracy including periodic political competition andopportunity for choice the rule of law a Bill of Rights and the supremacyof the constitution being firmly established (3) promotion and protectionof economic social cultural civil and political rights as enshrined in allAfrican and international human rights instruments (4) upholding theseparation of powers including the protection of the independence of thejudiciary and of an effective parliament (5) ensuring accountable effi-cient and effective public office holders and civil servants (6) fightingcorruption in the political arena (7) promotion and protection of therights of women (8) promotion and protection of the rights of the childand young persons and (9) promotion and protection of the rights ofvulnerable groups including displaced persons

The key objectives for economic governance and management are (1)promoting macroeconomic policies that support sustainable develop-ment (2) implementing transparent predictable and credible governmenteconomic policies (3) promoting sound public finance management (4)fighting corruption and money laundering and (5) accelerating regionalintegration by participating in the harmonization of monetary trade andinvestment policies among participating states

The key corporate governance objectives are (1) providing an enablingenvironment and effective regulatory framework for economic activities(2) ensuring that corporations act as good corporate citizens with regardto human rights social responsibility and environmental sustainability(3) promoting the adoption of codes of good business ethics in achievingthe objectives of the organization (4) ensuring that corporations treat alltheir stakeholders in a fair and just manner and (5) providing for account-ability of corporations and directors

The key objectives for socioeconomic development are to (1) promoteself-reliance in development and build capacity for self-sustaining devel-opment (2) accelerate socioeconomic development to achieve sustainabledevelopment and poverty eradication (3) strengthen policies deliverymechanisms and outputs in key social development areas such as edu-cation for all and the combating of HIVAIDS and other communicablediseases (4) ensure affordable access to water energy finance marketsand information and communication technologies to all citizens (5) makeprogress toward gender equality particularly equal access to educationfor girls at all levels and (6) encourage broad-based participation indevelopment by all stakeholders at all levels

The 2002 AU Summit also approved the frequency of peer reviewsSpecifically there will be four types of peer reviews The first countryreview being the base review will be undertaken within 18 months of acountryrsquos becoming a member of the APRM The second type is the

THE AFRICAN PEER REVIEW MECHANISM 295

periodic review that should take place every two years The next type isa requested review where a member country can for its own reasons askfor a review that is not part of the periodically mandated reviews Thefinal type amounts to an imposed review and may be resorted to by theHSGIC if there is sufficient cause to conclude that there are early signs ofimpending political andor economic crises in a member country

Despite the fact that participation in the APRM is open to all memberstates of the AU on a voluntary basis there is now a somewhat morebureaucratic and unnecessarily cumbersome process that countries haveto contend with The APRM has evolved from its original technicallystraightforward framework to become a somewhat more burdensomeadministrative process Nonetheless this eventuality does not seem tohave particularly influenced the desire and decision by the member statesto seek participation in the process This is probably not surprising asundoubtedly countries that are actually peer reviewed stand to reap anumber of benefits as discussed in the next section It should be notedhere that in November 2002 a total of 12 of the 53 African countries hadoriginally declared their intent to be peer reviewed Those countries wereAlgeria Republic of Congo Egypt Ethiopia Gabon Ghana Mali Mau-ritius Mozambique Nigeria Rwanda and South Africa As of August2004 a total of 23 countriesmdashincluding the additional 11 of Angola BeninBurkina Faso Cameroon Kenya Lesotho Malawi Senegal Sierra LeoneTanzania and Ugandamdashhad signed the Memorandum of Understandingthat represents the basic framework for formal accession to the APRM(NEPAD Secretariat 2002b 2003c 2003d 2003e 2004) Other countries areexpected to accede in time However Ghana will be noted in Africarsquoseconomic and political history as the first country on the continent to bereviewed under the APRM The country inaugurated the APRM processin May 2004 By August 2004 four countriesmdashGhana Kenya Mauritiusand Rwandamdashhad been visited by peer review support mission teamsand were at various stages in the process

BENEFITS OF THE APRM AN ANALYTICAL ASSESSMENT

Given the international experience with peer reviews the APRMmdashas amechanism for measuring and monitoring progress toward good gover-nance and sustainable development in Africamdashhas the potential to pro-vide a number of benefits to those African countries that subjectthemselves to it and through multiplier effects to the continent as awhole Peer reviews have been demonstrated to have a number of bene-ficial effects as applied across the world As African countries seek toimprove their governance and march toward sustainable developmentpeer reviews can provide the basis for policy changes to meet commit-ments and to observe the agreed standards and codes

Indeed peer reviews will facilitate the monitoring of compliance withthe agreements entered into upon accession to the APRM States are muchmore inclined to comply when they know their implementation is moni-

296 KEMPE RONALD HOPE SR

tored and when the implementation of their peers is being monitored aswell (Henning) Given the history and resultant disastrous effects of badgovernance in Africa with a lack of openness and rampant corruptionacceding to peer review represents a sea change in the thinking of Africanleaders and a major milestone in the political development and history ofthe continent Below we concentrate on six key areas where peer reviewswill add value and enhance the prospects for African states to achievegood governance and sustainable development

Greater Transparency

Following Seiichi Kondo transparency is taken here to mean that reliablerelevant and timely information about the activities of government isavailable to the public Associated with transparency is the concept ofopenness whereby public participation in shaping and implementinggovernment policy is encouraged and guaranteed Transparency in gov-ernment is a good thing for governments in Africa have the most poten-tial for going awry given their monopoly on force and power and the easewith which they use and abuse that force and power Where there istransparency government officials will be prevented from exercising dis-cretionary powers Transparency therefore complements and reinforcespredictability reduces uncertainty and inhibits and reduces the scope ofcorruption among public officials (Siegle Weinstein and Halperin)

The APRM will be particularly applied to democracy and politicalgovernance issues and economic and corporate governance issues Inboth cases transparency looms large The openness of the political spaceis a critical barometer of the nature of democracy in a given countrySimilarly in the economic sphere the extent of fiscal transparencyprovides a very solid indication of the manner in which budgets (expen-ditures and revenues) for example are crafted reconciled and imple-mented Determining the nature of transparency in governmentoperations and functioning in Africa will expose the shortcomings andany deliberate secrecy or misreporting of government operations

Transparency in government operations particularly in Africa hasseveral dimensions (Kopits and Craig) The first dimension consists ofmainly behavioral aspects such as clearly established conflict-of-interestrules for elected and appointed officials a transparent regulatory frame-work open public procurement and employment practices a code ofconduct for public officials and freedom-of-information requirementsThe next is the provision of reliable information on the governmentrsquoseconomic policy intentions and forecasts The third is the requirement fordetailed data and information on government operations including thepublication of comprehensive budget and other planning and policy doc-uments In all three dimensions transparency is closely associated withthe successful implementation of good governance and the achievementof sustainable development

THE AFRICAN PEER REVIEW MECHANISM 297

The APRM to the extent that it enhances transparency in Africancountries will acknowledge democratic progress and scorn antidemo-cratic measures Consequently it can confer or withhold internationalrecognition and raise or lower the domestic legitimacy of governments(Henning) Moreover transparency increases the political risk of unsus-tainable policies whereas the lack thereof means that such policies cango undetected longer than they otherwise would Generally countriescharacterized by a relatively high degree of transparency have exhibitedgreater political and economic discipline and in many instances havebeen able to achieve a more robust political and economic performancecompared to countries with less transparent policies even within a sameregion (Henning)

This positive correlation between transparency and good governancehas also been empirically demonstrated across the spectrum of bothdeveloped and developing countries R Islam for instance has shownthat governments that are more transparent govern better as measuredby a wide number of governance indicators such as government effective-ness regulatory burden corruption voice and accountability the rule oflaw bureaucratic efficiency contract repudiation and expropriation riskAnd as better governance has also been empirically demonstrated to becorrelated with higher growth rates it can be extrapolated that there is aclose relationship between greater transparency and how fast economiesgrow (Islam) Botswana for example is internationally recognized for itssubstantial degree of transparency with a liberal democratic political sys-tem and a prudent and open budgetary process (Hope 2002a Kopits andCraig) As a result Botswana continues to experience political and mac-roeconomic stability with strong growth The country has consistentlybeen one of the fastest growing in the world with an annual averagegrowth rate of per capita gross domestic product (GDP) of 51 percentduring the period 1975ndash2002 compared with an annual average of

minus

08percent for sub-Saharan Africa during the same period (UNDP 2004)

That relationship between transparency good governance and growthin Botswana is further reflected in the growth competitiveness index(GCI) of the World Economic Forum The GCI is composed of threesubindexes identified as pillars in the evolution of growth in a country(1) the quality of the macroeconomic environment (2) the state of publicinstitutions and (3) the level of technological readiness The GCI uses acombination of hard data such as inflation rates budget deficits the levelof Internet access in schools and survey data in areas such as judicialindependence the prevalence of institutionalized corruption and theextent of inefficient government intervention in the economy (Lopez-Claros) Botswana has consistently ranked in first place among all Africancountries in the overall GCI as well as in the macroeconomic environmentand public institutions subindexes For the 2003 GCI computationsBotswana was ranked at 36 just behind Greece on the worldwide com-parisons (World Economic Forum)

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

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Abed G T 2001 The Changing Role of the State Governance and New CapacityRequirements In M A Dessart and R E Ubogu eds

Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

THE AFRICAN PEER REVIEW MECHANISM 285

Similarly United Nations (UN) Secretary-General Kofi Annan hassaid that ldquogood governance is perhaps the single most important factorin eradicating poverty and promoting developmentrdquo (United Nations1998 13) Moreover a former Kenyan vice president has also noted thatldquogood political and economic governance underpins sustainable devel-opmentrdquo (Saitoti 257) The President of the African Development Bank(AfDB) has emphasized that ldquogood governance is not only a worthy goalper se but also a prerequisite for sustainable development and povertyreduction in the longer termrdquo (Kabbaj 7) while the Executive Secretaryof the United Nations Economic Commission for Africa (UNECA) hasproclaimed that ldquogood governance is essential for the political and eco-nomic transformation of Africardquo (Amoako 155)

Governance has to do with the manner in which responsibility is dis-charged Such a responsibility may be acquired through election appoint-ment or delegation in the public domain or in the area of commerce (iecorporate governance) Therefore good governance is taken here to meana condition whereby such responsibility is discharged in an effectivetransparent and accountable manner while bad governance is associatedwith maladministration in the discharge of responsibility (Abed) Goodgovernance entails the existence of efficient and accountable institu-tionsmdashpolitical judicial administrative economic corporatemdashandentrenched rules that promote development protect human rightsrespect the rule of law and ensure that people are free to participate inand be heard on decisions that affect their lives

The NEPAD initiativersquos framework document recognizes the salientimportance of good governance for achieving sustainable developmentin Africa and sets out principles pertaining to the strengthening of democ-racy and political governance as well as economic and corporate gover-nance On democracy and political governance it states that developmentis impossible in the absence of democracy respect for human rightspeace and good governance The purpose of the principles here is tocontribute to the strengthening of the political and administrative frame-work of African countries in line with the principles of democracytransparency accountability integrity respect for human rights and pro-motion of the rule of law (NEPAD Secretariat 2001)

The necessity for institutional reform has been recognized to drive theprocess forward given the capacity limitations across African countriesAs identified in the NEPAD framework document the institutionalreforms to strengthen political governance in Africa will need to focus on(1) the administrative and civil services (2) the strengthening of parlia-mentary oversight (3) the promotion of participatory decision making(4) the adoption of effective measures to combat corruption and embez-zlement and (5) the undertaking of judicial reforms (NEPAD Secretariat2001) These five areas of focus have been exhaustively discussed inUNECA (2002a) Suffice it to say here that for the first time in post-independence Africa the African leaders themselves are pointing to the

286 KEMPE RONALD HOPE SR

shortcomings of the institutional structure over which they presidedirectly or have much say

Institutions in particular public institutions have been a failure inAfrica Many of these institutions have been captured by the elite to servenarrow personal interests The resultant effect has been the lack of theability of the state to provide the requisite institutional framework tosupport good governance In too many African countries both the publicand private sectors do not operate according to widely accepted rules thatare transparent and enforced by accountable institutions Consequentlythe challenge for African policy makers under the NEPAD is to shapepolicies and institutional development in ways that enhance good gover-nance and sustainable development

With respect to economic and corporate governance the NEPADframework document states that the objective here is to promote a set ofconcrete and time-bound programs aimed at enhancing the quality ofeconomic and public financial management as well as good corporategovernance (NEPAD Secretariat 2001) Good economic and corporategovernance is good for Africa Countries attract more investment andachieve higher rates of per capita growth where the state improves certainbasic aspects of its performance A state that applies rules and policiespredictably and fairly ensures order and the rule of law and protectsproperty rights will generate confidence and attract more domestic andforeign investment That in turn generates trade and faster economicgrowth as well as provides the wherewithal for sustainable development(UNECA 2002a)

Here again the role of institutions looms large The existence of weakinstitutions of economic and corporate governance as a constraint onsustainable development in Africa is clear and convincing This hasaccordingly limited the public sector in the fulfillment of its economicfunctions Those economic functions can be broadly classified into threedistinct categories (1) making and implementing economic policy (2)delivering services and (3) ensuring accountability for the use of publicresources and public regulatory power (World Bank 2000) Institutions areneeded to maintain fiscal and monetary discipline mobilize resourcesand set priorities among the competing demands for those resources asintegral aspects of the making and implementation of good economicpolicy Similarly institutional arrangements are required for the efficientdelivery of public services that are also pro-poor In addition there mustbe institutional mechanisms that ensure accountability through the capac-ity to monitor and enforce rules and to regulate economic activities in thepublic interest However regulatory frameworks should be minimal sim-ple and easy to implement (Saitoti)

Good governance is worth pursuing in its own right in Africa Muchhas been observed and volumes have been written about the deleteriouseffects of bad governance in Africa Through the NEPAD a new genera-tion of enlightened leaders is aiming to reverse that trend Respect for

THE AFRICAN PEER REVIEW MECHANISM 287

human rights and democratic principles honest and good quality admin-istration and protecting the rights and freedoms under the rule of laware concerned with values that apply equally to every state and citizenDemocracy for example is a universally recognized ideal based on val-ues common to people everywhere regardless of cultural political socialor economic differences (IPU) These transcend the functional importanceof aspects of good governance such as for sustainable development (Sci-entific Council for Government Policy)

President Thabo Mbeki of South Africa has argued quite convincinglyfor example that Africa wishes to realize the goal of good governance inall its elements ldquonot because we seek to improve our relations with therest of the world as a first objective critically important as this is but toend political and economic mismanagement on our continent and theconsequential violent conflicts instability denial of democracy andhuman rights deepening poverty and global marginalizationrdquo (Mbeki 2)Nonetheless as noted above the various components of good governanceare also necessary and functional for sustainable development processes

Quite clearly growth and development cannot be achieved in theabsence of good governance Among other things good governanceensures the most efficient utilization of already scarce resources in thepromotion of development enhances participation responsibility andaccountability and has the potential to emancipate people from povertyas state legitimacy is recognized and entrenched In fact any effort toreduce poverty and sustain development must start with and build upongood governance (Hope 2002b) Good governance can therefore be alsoregarded as governance on behalf of development-oriented policy

According to UNDP (2002) good governance advances sustainabledevelopment for three reasons First enjoying political freedom and par-ticipating in the decisions that shape onersquos life are fundamental humanrights In those African countries where leaders are not elected or selectedby election (eg Libya) or where elections are flawed (eg Zimbabwe)choices are severely restricted The denial of these rights is a denial ofhuman development Second good governance helps to protect peoplefrom economic and political catastrophes such as famines and othercrises (Sen) There is a direct correlation between bad governance andfamines for example in Africa In other words those countries frequentlysuffering from famines in Africa tend not to have good governance Thirdgood governance can promote sustainable development by empoweringcitizens to influence policies that promote growth and prosperity andreflect their priorities

Y Feng has also empirically demonstrated that good governance doesmatter for national economic growth and development ldquoIn particular apolitical system characterized by freedom and stability is best suited topromoting a growth-oriented economic agendardquo (Feng 295) In additionR Alence has empirically shown that the effects of governance on nationalincome and economic performance in Africa are large and statistically

288 KEMPE RONALD HOPE SR

robust Democratic institutions for example were found to systematicallyenhance the performance of African states as agents of development byamong other things countering temptations for politically opportunisticbehaviormdashsuch as economically incoherent policies ineffective imple-mentation and the abuse of public resources for private gain relative tothe provision of welfare-enhancing public goodsmdashthat is economicallydamaging (Alence) Similarly others such as Daniel Kaufmann and AartKraay Kaufmann Kraay and Pablo Zoido-Lobatoacuten and Joseph SiegleMichael Weinstein and Morton Halperin have shown that the qualityof governance is positively associated with economic growth anddevelopment

However despite the empirical evidence supporting the positive rela-tionship between good governance and sustainable development on theone hand and the attempt by African leaders through the NEPAD tomake that relationship a reality in Africa on the other the NEPAD frame-work has been the subject of some criticism and Afro-pessimism Butinterestingly enough no credible alternative plan to the NEPAD has sofar been put forward by its critics Perhaps the most comprehensivesummaries of the various criticism to date can be found in PeterAnyangrsquoNyongrsquoo Aseghedech Ghirmazion and Davinder Lamba and inIan Taylor The key criticisms are usually focused around pessimismgiven Africarsquos culture of corruption and neopatrimonial rule its historyof human rights abuses rigged elections and coups the notion thatpartnerships between Africa and the West are unworkable given the dom-inance and influence of the latter and the perception that civil society hadnot been properly consulted in the drawing up of the NEPAD frameworkdocument With respect to the latter issue it must be said first that a lackof proper consultation with some interested parties does not necessarilyrender the content of the outcome document as irrelevant Second with-out taking sides on the validity or lack thereof with respect to the criti-cisms Africarsquos leaders found themselves in a ldquodamned if they do damnedif they donrsquotrdquo position They were damned for not demonstrating leader-ship to solve Africarsquos development problems and then having done thatby launching the NEPAD they were damned for not consulting others todemonstrate their leadership

The fact of the matter is that the NEPAD potentially ldquoconstitutes themost important advance in African development policy during the pastfour decadesrdquo (Hope 2002b 401) Moreover it is a home-grown initiativefor development based on a set of core principles that have beenembraced by national regional and international public opinion as beingpreconditions for the renewal of the African continent (Hope 2002b) Asthis work also shows the NEPAD has been endorsed and supported bythe international community including the G8 countries and multilateraland bilateral organizations such as the World Bank the InternationalMonetary Fund (IMF) the UN the Organisation for Economic Co-operation and Development (OECD) the United States Agency for

THE AFRICAN PEER REVIEW MECHANISM 289

International Development (USAID) the Department for InternationalDevelopment (DFID) of the UK and others The active involvement forexample of four members of the HSGICmdashPresident Thabo Mbeki ofSouth Africa President Olusegun Obasanjo of Nigeria President JoaquimChissano of Mozambique and President John Kufuor of Ghanamdashin theremoval from office and exiling of the corrupt warlord President CharlesTaylor from Liberia in 2003 has certainly deepened international supportfor the NEPAD and what it represents

Indeed another perspective offered in the various commentaries onthe NEPAD is that ldquoAfrican leaders merit a chance to reverse the numer-ous crises in the continent which they are proposing as outlined in theNEPAD documentrdquo (AnyangrsquoNyongrsquoo Ghirmazion and Lamba 3) Fur-thermore ldquotheir [Africarsquos leaders] acknowledgement of the need for arenaissance in Africa and of the concepts of democracy accountabilitytransparency and peer review should account for more than the pessimis-tic criticism and call for dismissal of the [NEPAD] document being calledfor by some scholarsrdquo (AnyangrsquoNyongrsquoo Ghirmazion and Lamba 3ndash4)This would seem to constitute an enlightened conclusion and particularlyso given that the critics and Afro-pessimists have offered no alternativedevelopment framework and that some of them are in fact guilty ofchampioning discredited and abandoned ideas from the past Moreoverit ought to be accepted by all critics and Afro-pessimistsmdashin the spirit ofthe good governance that they presumably seek for Africamdashthat theweight responsibility and accountability for leadership on the continentultimately rests with those who sought election and were democraticallyelected by the majority of their fellow citizens

THE PEER REVIEW CONCEPT AND THE AFRICAN PEER REVIEW MECHANISM

The APRM is an African-led innovation representing a bold approach toreform for building capable states with enduring good governance andsustainable development The APRM is designed to monitor and assessthe progress made by African countries in meeting their commitmenttoward achieving good governance social reforms and sustainabledevelopment It will also provide a platform for countries to share expe-riences with a view to fostering good governance and democratic pro-cesses But before going further on the APRM it is useful to set the stagefor the rest of the discussion to follow by first examining the concept ofpeer review

What Is Peer Review

Peer reviews were pioneered by the OECD Since its creation as an insti-tution four decades ago the OECD has successfully used this method ofassessment of the performance of its member states In addition several

290 KEMPE RONALD HOPE SR

other intergovernmental and international organizations such as theEuropean Union (EU) UN bodies and the IMF use peer review tomonitor and assess national policies and performance in several sectors(OECD)

Peer review refers to the systematic examination and assessment of theperformance of a state by other states (peers) by designated institutionsor by a combination of states and designated institutions (OECD UNECA2002b 2002c) The ultimate goal is to assist the reviewed state to improveits policy making adopt best practices and comply with establishedstandards principles codes and other agreed commitments Peer reviewexaminations and assessments are conducted in a nonadversarial mannerand they rely heavily on the mutual trust and understanding between thestate being reviewed and the reviewers as well as their shared confidencein the process (OECD UNECA 2002b)

The international experience shows peer reviews can be conductedbased on subject areas or themes For example an individual country peerreview could relate to economics governance education health the envi-ronment or other policies and practices Within one or more of thesesubject areas a state may be examined against a wide range of codes andstandards for compliance for example (OECD UNECA 2002b) Similarlyseveral countries can be examined at the same time with respect to aparticular theme for instance ldquoCombating Corruption for SustainableDevelopmentrdquo (UNECA 2002b) However whether based on subject areasor themes individual country peer reviews are typically undertaken ona regular basis with each review exercise resulting in a report thatassesses accomplishments indicates shortcomings and makes recom-mendations They usually do not entail sanctions or a punitive decisionbut they can lead to embarrassment and negative market reactions suchas lower levels of investment or exchange rate fluctuations biased againstthe national currency

Nonetheless related to the concept of peer review is the concept of peerpressure According to the OECD and Takatoshi Ito the effectiveness ofpeer review relies on the influence of peer pressure that is the persuasionexercised by the peers The peer review process can give rise to peerpressure through for example a mix of formal recommendations andinformal consultations by peer countries public scrutiny comparisonsand ranking among countries and the impact of the foregoing on publicopinion policy makers and other stakeholders The lessons of peerreviews conducted in the developed countries suggest that the greatestimpact is derived when the outcomes of peer reviews are put in the publicdomain It is that public scrutiny that is most likely to influence changeand bring about corrective actions In addition the East Asian experiencesuggests that peer pressure provides an effective incentive to commitmember countries to perform the required activities and take the neces-sary actions for common policy objectives (Wang and Yoon)

THE AFRICAN PEER REVIEW MECHANISM 291

The APRM

UNECA originally developed the APRM in response to a request by theNEPAD HSGIC Its (the APRMrsquos) mandate ensures that the policies andpractices of participating states conform to the agreed political economicand corporate governance codes and standards contained in the

Declara-tion on Democracy Political Economic and Corporate Governance

that wasapproved by the African Union (AU) Summit in July 2002 (NEPAD Sec-retariat 2002a) The APRM is a mutually agreed instrument for self-mon-itoring by the participating member states It is voluntarily acceded to bymember states of the AU (NEPAD Secretariat 2003a)

The primary purpose of the APRM is to foster the adoption of policiesstandards and practices that lead to political stability high economicgrowth sustainable development and accelerated integration throughthe sharing of experiences and the reinforcement of successful and bestpractice including identifying deficiencies and assessing the needs forcapacity building This is to be accomplished by using the relevant indi-cators contained in the APRM to measure and determine the progress ofpeer-reviewed countries in meeting the goals of achieving good gover-nance and sustainable development The overarching goal of the APRMis for all participating countries to accelerate their progress toward adopt-ing and implementing the priorities and programs of the NEPAD achiev-ing the mutually agreed objectives and compliance with best practice inrespect to each of the areas of good governance and sustainable develop-ment (NEPAD Secretariat 2003a) As articulated by Chris Stalsmdasha memberof the APR Panel which is discussed belowmdashthe application of theAPRM and the resultant ldquorecommendations are not meant to punish orexclude countries the main objective is to help each country to identifyits own weaknesses and to find ways and means for addressing theshortcomingsrdquo (Stals 5)

Every peer review exercise undertaken under the authority of theAPRM must be technically competent and free of political manipulationIt must comply with the mandate of the APRM referred to above Thesestipulations together constitute the core guiding principles of the mecha-nism And with respect to the process and procedures for the applicationof the APRM the NEPAD HSGIC has approved four distinct organiza-tional components and five stages (NEPAD Secretariat 2003b) The firstorganizational component is the Committee of Participating Heads ofState and Government (the APR Heads of State Forum) which is thehighest decision-making authority in the APRM with overall responsibil-ity for the said APRM The APR Heads of State Forum will consist ofHeads of State and Government of the member states of the AU who havevoluntarily chosen to accede to the APRM The next organizational com-ponent is the Panel of Eminent Persons (APR Panel) This is an indepen-dent body that will oversee the day-to-day functioning of the peer review

292 KEMPE RONALD HOPE SR

process and ensure the credibility and integrity of that process The thirdorganizational component is the APR Secretariat which will provide thesecretarial coordinating and administrative support services for theAPRM through the APR Panel The final organizational component isthe APR Teams which will be conducting the actual technical assessmentsthat will constitute the country peer reviews

The functions of the APR Heads of State Forum include but are notlimited to (1) appointing the APR Panel and its chairperson (2) consider-ing adopting and taking ownership of country peer review reports (3)communicating the recommendations of the APR Heads of State Forumto the peer-reviewed countries (4) exercising peer pressure to effectchanges in country practice where recommended (5) persuading devel-opment partners to provide technical assistance to eliminate capacitygaps as recommended by the country peer review reports (6) transmit-ting peer review reports to the appropriate AU structures and (7) makingpublic through the APR Secretariat country peer review reports andpress releases pertaining thereto

The functions of the APR Panel include but are not limited to (1)exercising oversight of the APR process including providing leadershipto country review teams with a view to ensuring the independenceprofessionalism and credibility of that process (2) recommending appro-priate African institutions or individuals to conduct technical assess-ments (3) reviewing and adopting the country peer review reportsincluding the recommendations contained therein and (4) submitting tothe APR Heads of State Forum all country peer review reports withrecommendations on measures that could be taken to assist the reviewedcountries in the improvement of their governance and socio-developmentperformance By November 2003 the HSGIC had appointed seven mem-bers of the APR Panel More members may be appointed at a later datewith a probable final complement of ten two from each of the fivesubregions

The functions of the APR Secretariat include (1) providing secretarialand administrative support services to the APR Panel under the directsupervision of the Chairperson of that Panel (2) organizing regionalnetworks and workshops for the sharing of experience and best practicerelated to the goals of achieving good governance and sustainable devel-opment and (3) ensuring full documentation of the peer review processesat country subregional and continental levels to facilitate mutual learning

The APR Teams are responsible for conducting the technical countryassessments that will comprise the country peer reviews Credible andtechnically competent institutions such as the UNDP the UNECA andthe AfDB have been selected to assist with some of the peer reviewtechnical assessments The UNECA will assist with the technical assess-ments in economic governance and management while the AfDB willassist with banking and financial standards for example The APR Panelwill select other credible and technically competent institutions or indi-

THE AFRICAN PEER REVIEW MECHANISM 293

viduals to undertake the peer review assessments in the areas of politicalgovernance corporate governance and socioeconomic development

As mentioned before there are five stages to the peer review processStage One entails a careful analysis of the governance and developmentenvironment in the country being reviewed Key governance and devel-opment issues will be analyzed to provide background information withrespect to political representativeness and rights institutional effective-ness and economic management and governance Political representa-tiveness and rights will cover issues of political systems and electoralprocesses representation and participation of various stakeholders indecision making Institutional effectiveness will include issues related tothe nature and workings of the legislative judiciary and executivebranches of government as well as the state of the nongovernmentalsector Economic management and governance will address issues ofmacroeconomic management public financial accountability monetaryand financial transparency accounting and auditing systems and regula-tory oversight bodies as well as issues of capacity effectiveness andaccountability of the economic decision making and service deliverysystems

Stage two constitutes the country visits by the peer review technicalassessment teams This stage is informed by the analysis prepared inStage One The technical assessment teams will consult and extensivelyinterview relevant government officials parliamentarians oppositionparty members not in parliament private sector representatives repre-sentatives of civil society groups (including the media academia tradeunions and nongovernmental organizations) and officials of residentmissions of regional and international organizations

Stage Three involves the preparation of the peer review reports basedon the technical assessments conducted in Stage Two A draft of eachreport will be discussed with the government concerned prior to submis-sion to the APR Panel Those discussions will be designed to ensure theaccuracy of the information and to provide the government an opportu-nity to react to the findings and recommendations of the assessment teamThese responses of the government will be appended to the final draft ofthe report However each report will remain independent and its find-ings will not be altered or vetted by the government concerned

Stage Four entails discussion and adoption of the peer review reportsby the APR Panel first followed by the APR Heads of State Forum Thisstage terminates when the Chairperson of the latter communicates thedecisions and recommendations to the government of the country beingpeer reviewed Stage Five is the formal and public tabling of the peerreview reports in key regional and subregional structures and in partic-ular the AU structures These reports will also be put in the publicdomain

The NEPAD HSGIC has also approved a number of indicators basedon key objectives that will be used to assess and measure performance

294 KEMPE RONALD HOPE SR

in the four peer review areas of (1) democracy and political governance(2) economic governance and management (3) corporate governance and(4) socioeconomic development (NEPAD Secretariat 2003a) The keyobjectives for democracy and political governance include (1) to preventand reduce intra- and intercountry conflicts (2) the consolidation of con-stitutional democracy including periodic political competition andopportunity for choice the rule of law a Bill of Rights and the supremacyof the constitution being firmly established (3) promotion and protectionof economic social cultural civil and political rights as enshrined in allAfrican and international human rights instruments (4) upholding theseparation of powers including the protection of the independence of thejudiciary and of an effective parliament (5) ensuring accountable effi-cient and effective public office holders and civil servants (6) fightingcorruption in the political arena (7) promotion and protection of therights of women (8) promotion and protection of the rights of the childand young persons and (9) promotion and protection of the rights ofvulnerable groups including displaced persons

The key objectives for economic governance and management are (1)promoting macroeconomic policies that support sustainable develop-ment (2) implementing transparent predictable and credible governmenteconomic policies (3) promoting sound public finance management (4)fighting corruption and money laundering and (5) accelerating regionalintegration by participating in the harmonization of monetary trade andinvestment policies among participating states

The key corporate governance objectives are (1) providing an enablingenvironment and effective regulatory framework for economic activities(2) ensuring that corporations act as good corporate citizens with regardto human rights social responsibility and environmental sustainability(3) promoting the adoption of codes of good business ethics in achievingthe objectives of the organization (4) ensuring that corporations treat alltheir stakeholders in a fair and just manner and (5) providing for account-ability of corporations and directors

The key objectives for socioeconomic development are to (1) promoteself-reliance in development and build capacity for self-sustaining devel-opment (2) accelerate socioeconomic development to achieve sustainabledevelopment and poverty eradication (3) strengthen policies deliverymechanisms and outputs in key social development areas such as edu-cation for all and the combating of HIVAIDS and other communicablediseases (4) ensure affordable access to water energy finance marketsand information and communication technologies to all citizens (5) makeprogress toward gender equality particularly equal access to educationfor girls at all levels and (6) encourage broad-based participation indevelopment by all stakeholders at all levels

The 2002 AU Summit also approved the frequency of peer reviewsSpecifically there will be four types of peer reviews The first countryreview being the base review will be undertaken within 18 months of acountryrsquos becoming a member of the APRM The second type is the

THE AFRICAN PEER REVIEW MECHANISM 295

periodic review that should take place every two years The next type isa requested review where a member country can for its own reasons askfor a review that is not part of the periodically mandated reviews Thefinal type amounts to an imposed review and may be resorted to by theHSGIC if there is sufficient cause to conclude that there are early signs ofimpending political andor economic crises in a member country

Despite the fact that participation in the APRM is open to all memberstates of the AU on a voluntary basis there is now a somewhat morebureaucratic and unnecessarily cumbersome process that countries haveto contend with The APRM has evolved from its original technicallystraightforward framework to become a somewhat more burdensomeadministrative process Nonetheless this eventuality does not seem tohave particularly influenced the desire and decision by the member statesto seek participation in the process This is probably not surprising asundoubtedly countries that are actually peer reviewed stand to reap anumber of benefits as discussed in the next section It should be notedhere that in November 2002 a total of 12 of the 53 African countries hadoriginally declared their intent to be peer reviewed Those countries wereAlgeria Republic of Congo Egypt Ethiopia Gabon Ghana Mali Mau-ritius Mozambique Nigeria Rwanda and South Africa As of August2004 a total of 23 countriesmdashincluding the additional 11 of Angola BeninBurkina Faso Cameroon Kenya Lesotho Malawi Senegal Sierra LeoneTanzania and Ugandamdashhad signed the Memorandum of Understandingthat represents the basic framework for formal accession to the APRM(NEPAD Secretariat 2002b 2003c 2003d 2003e 2004) Other countries areexpected to accede in time However Ghana will be noted in Africarsquoseconomic and political history as the first country on the continent to bereviewed under the APRM The country inaugurated the APRM processin May 2004 By August 2004 four countriesmdashGhana Kenya Mauritiusand Rwandamdashhad been visited by peer review support mission teamsand were at various stages in the process

BENEFITS OF THE APRM AN ANALYTICAL ASSESSMENT

Given the international experience with peer reviews the APRMmdashas amechanism for measuring and monitoring progress toward good gover-nance and sustainable development in Africamdashhas the potential to pro-vide a number of benefits to those African countries that subjectthemselves to it and through multiplier effects to the continent as awhole Peer reviews have been demonstrated to have a number of bene-ficial effects as applied across the world As African countries seek toimprove their governance and march toward sustainable developmentpeer reviews can provide the basis for policy changes to meet commit-ments and to observe the agreed standards and codes

Indeed peer reviews will facilitate the monitoring of compliance withthe agreements entered into upon accession to the APRM States are muchmore inclined to comply when they know their implementation is moni-

296 KEMPE RONALD HOPE SR

tored and when the implementation of their peers is being monitored aswell (Henning) Given the history and resultant disastrous effects of badgovernance in Africa with a lack of openness and rampant corruptionacceding to peer review represents a sea change in the thinking of Africanleaders and a major milestone in the political development and history ofthe continent Below we concentrate on six key areas where peer reviewswill add value and enhance the prospects for African states to achievegood governance and sustainable development

Greater Transparency

Following Seiichi Kondo transparency is taken here to mean that reliablerelevant and timely information about the activities of government isavailable to the public Associated with transparency is the concept ofopenness whereby public participation in shaping and implementinggovernment policy is encouraged and guaranteed Transparency in gov-ernment is a good thing for governments in Africa have the most poten-tial for going awry given their monopoly on force and power and the easewith which they use and abuse that force and power Where there istransparency government officials will be prevented from exercising dis-cretionary powers Transparency therefore complements and reinforcespredictability reduces uncertainty and inhibits and reduces the scope ofcorruption among public officials (Siegle Weinstein and Halperin)

The APRM will be particularly applied to democracy and politicalgovernance issues and economic and corporate governance issues Inboth cases transparency looms large The openness of the political spaceis a critical barometer of the nature of democracy in a given countrySimilarly in the economic sphere the extent of fiscal transparencyprovides a very solid indication of the manner in which budgets (expen-ditures and revenues) for example are crafted reconciled and imple-mented Determining the nature of transparency in governmentoperations and functioning in Africa will expose the shortcomings andany deliberate secrecy or misreporting of government operations

Transparency in government operations particularly in Africa hasseveral dimensions (Kopits and Craig) The first dimension consists ofmainly behavioral aspects such as clearly established conflict-of-interestrules for elected and appointed officials a transparent regulatory frame-work open public procurement and employment practices a code ofconduct for public officials and freedom-of-information requirementsThe next is the provision of reliable information on the governmentrsquoseconomic policy intentions and forecasts The third is the requirement fordetailed data and information on government operations including thepublication of comprehensive budget and other planning and policy doc-uments In all three dimensions transparency is closely associated withthe successful implementation of good governance and the achievementof sustainable development

THE AFRICAN PEER REVIEW MECHANISM 297

The APRM to the extent that it enhances transparency in Africancountries will acknowledge democratic progress and scorn antidemo-cratic measures Consequently it can confer or withhold internationalrecognition and raise or lower the domestic legitimacy of governments(Henning) Moreover transparency increases the political risk of unsus-tainable policies whereas the lack thereof means that such policies cango undetected longer than they otherwise would Generally countriescharacterized by a relatively high degree of transparency have exhibitedgreater political and economic discipline and in many instances havebeen able to achieve a more robust political and economic performancecompared to countries with less transparent policies even within a sameregion (Henning)

This positive correlation between transparency and good governancehas also been empirically demonstrated across the spectrum of bothdeveloped and developing countries R Islam for instance has shownthat governments that are more transparent govern better as measuredby a wide number of governance indicators such as government effective-ness regulatory burden corruption voice and accountability the rule oflaw bureaucratic efficiency contract repudiation and expropriation riskAnd as better governance has also been empirically demonstrated to becorrelated with higher growth rates it can be extrapolated that there is aclose relationship between greater transparency and how fast economiesgrow (Islam) Botswana for example is internationally recognized for itssubstantial degree of transparency with a liberal democratic political sys-tem and a prudent and open budgetary process (Hope 2002a Kopits andCraig) As a result Botswana continues to experience political and mac-roeconomic stability with strong growth The country has consistentlybeen one of the fastest growing in the world with an annual averagegrowth rate of per capita gross domestic product (GDP) of 51 percentduring the period 1975ndash2002 compared with an annual average of

minus

08percent for sub-Saharan Africa during the same period (UNDP 2004)

That relationship between transparency good governance and growthin Botswana is further reflected in the growth competitiveness index(GCI) of the World Economic Forum The GCI is composed of threesubindexes identified as pillars in the evolution of growth in a country(1) the quality of the macroeconomic environment (2) the state of publicinstitutions and (3) the level of technological readiness The GCI uses acombination of hard data such as inflation rates budget deficits the levelof Internet access in schools and survey data in areas such as judicialindependence the prevalence of institutionalized corruption and theextent of inefficient government intervention in the economy (Lopez-Claros) Botswana has consistently ranked in first place among all Africancountries in the overall GCI as well as in the macroeconomic environmentand public institutions subindexes For the 2003 GCI computationsBotswana was ranked at 36 just behind Greece on the worldwide com-parisons (World Economic Forum)

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

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Abed G T 2001 The Changing Role of the State Governance and New CapacityRequirements In M A Dessart and R E Ubogu eds

Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

286 KEMPE RONALD HOPE SR

shortcomings of the institutional structure over which they presidedirectly or have much say

Institutions in particular public institutions have been a failure inAfrica Many of these institutions have been captured by the elite to servenarrow personal interests The resultant effect has been the lack of theability of the state to provide the requisite institutional framework tosupport good governance In too many African countries both the publicand private sectors do not operate according to widely accepted rules thatare transparent and enforced by accountable institutions Consequentlythe challenge for African policy makers under the NEPAD is to shapepolicies and institutional development in ways that enhance good gover-nance and sustainable development

With respect to economic and corporate governance the NEPADframework document states that the objective here is to promote a set ofconcrete and time-bound programs aimed at enhancing the quality ofeconomic and public financial management as well as good corporategovernance (NEPAD Secretariat 2001) Good economic and corporategovernance is good for Africa Countries attract more investment andachieve higher rates of per capita growth where the state improves certainbasic aspects of its performance A state that applies rules and policiespredictably and fairly ensures order and the rule of law and protectsproperty rights will generate confidence and attract more domestic andforeign investment That in turn generates trade and faster economicgrowth as well as provides the wherewithal for sustainable development(UNECA 2002a)

Here again the role of institutions looms large The existence of weakinstitutions of economic and corporate governance as a constraint onsustainable development in Africa is clear and convincing This hasaccordingly limited the public sector in the fulfillment of its economicfunctions Those economic functions can be broadly classified into threedistinct categories (1) making and implementing economic policy (2)delivering services and (3) ensuring accountability for the use of publicresources and public regulatory power (World Bank 2000) Institutions areneeded to maintain fiscal and monetary discipline mobilize resourcesand set priorities among the competing demands for those resources asintegral aspects of the making and implementation of good economicpolicy Similarly institutional arrangements are required for the efficientdelivery of public services that are also pro-poor In addition there mustbe institutional mechanisms that ensure accountability through the capac-ity to monitor and enforce rules and to regulate economic activities in thepublic interest However regulatory frameworks should be minimal sim-ple and easy to implement (Saitoti)

Good governance is worth pursuing in its own right in Africa Muchhas been observed and volumes have been written about the deleteriouseffects of bad governance in Africa Through the NEPAD a new genera-tion of enlightened leaders is aiming to reverse that trend Respect for

THE AFRICAN PEER REVIEW MECHANISM 287

human rights and democratic principles honest and good quality admin-istration and protecting the rights and freedoms under the rule of laware concerned with values that apply equally to every state and citizenDemocracy for example is a universally recognized ideal based on val-ues common to people everywhere regardless of cultural political socialor economic differences (IPU) These transcend the functional importanceof aspects of good governance such as for sustainable development (Sci-entific Council for Government Policy)

President Thabo Mbeki of South Africa has argued quite convincinglyfor example that Africa wishes to realize the goal of good governance inall its elements ldquonot because we seek to improve our relations with therest of the world as a first objective critically important as this is but toend political and economic mismanagement on our continent and theconsequential violent conflicts instability denial of democracy andhuman rights deepening poverty and global marginalizationrdquo (Mbeki 2)Nonetheless as noted above the various components of good governanceare also necessary and functional for sustainable development processes

Quite clearly growth and development cannot be achieved in theabsence of good governance Among other things good governanceensures the most efficient utilization of already scarce resources in thepromotion of development enhances participation responsibility andaccountability and has the potential to emancipate people from povertyas state legitimacy is recognized and entrenched In fact any effort toreduce poverty and sustain development must start with and build upongood governance (Hope 2002b) Good governance can therefore be alsoregarded as governance on behalf of development-oriented policy

According to UNDP (2002) good governance advances sustainabledevelopment for three reasons First enjoying political freedom and par-ticipating in the decisions that shape onersquos life are fundamental humanrights In those African countries where leaders are not elected or selectedby election (eg Libya) or where elections are flawed (eg Zimbabwe)choices are severely restricted The denial of these rights is a denial ofhuman development Second good governance helps to protect peoplefrom economic and political catastrophes such as famines and othercrises (Sen) There is a direct correlation between bad governance andfamines for example in Africa In other words those countries frequentlysuffering from famines in Africa tend not to have good governance Thirdgood governance can promote sustainable development by empoweringcitizens to influence policies that promote growth and prosperity andreflect their priorities

Y Feng has also empirically demonstrated that good governance doesmatter for national economic growth and development ldquoIn particular apolitical system characterized by freedom and stability is best suited topromoting a growth-oriented economic agendardquo (Feng 295) In additionR Alence has empirically shown that the effects of governance on nationalincome and economic performance in Africa are large and statistically

288 KEMPE RONALD HOPE SR

robust Democratic institutions for example were found to systematicallyenhance the performance of African states as agents of development byamong other things countering temptations for politically opportunisticbehaviormdashsuch as economically incoherent policies ineffective imple-mentation and the abuse of public resources for private gain relative tothe provision of welfare-enhancing public goodsmdashthat is economicallydamaging (Alence) Similarly others such as Daniel Kaufmann and AartKraay Kaufmann Kraay and Pablo Zoido-Lobatoacuten and Joseph SiegleMichael Weinstein and Morton Halperin have shown that the qualityof governance is positively associated with economic growth anddevelopment

However despite the empirical evidence supporting the positive rela-tionship between good governance and sustainable development on theone hand and the attempt by African leaders through the NEPAD tomake that relationship a reality in Africa on the other the NEPAD frame-work has been the subject of some criticism and Afro-pessimism Butinterestingly enough no credible alternative plan to the NEPAD has sofar been put forward by its critics Perhaps the most comprehensivesummaries of the various criticism to date can be found in PeterAnyangrsquoNyongrsquoo Aseghedech Ghirmazion and Davinder Lamba and inIan Taylor The key criticisms are usually focused around pessimismgiven Africarsquos culture of corruption and neopatrimonial rule its historyof human rights abuses rigged elections and coups the notion thatpartnerships between Africa and the West are unworkable given the dom-inance and influence of the latter and the perception that civil society hadnot been properly consulted in the drawing up of the NEPAD frameworkdocument With respect to the latter issue it must be said first that a lackof proper consultation with some interested parties does not necessarilyrender the content of the outcome document as irrelevant Second with-out taking sides on the validity or lack thereof with respect to the criti-cisms Africarsquos leaders found themselves in a ldquodamned if they do damnedif they donrsquotrdquo position They were damned for not demonstrating leader-ship to solve Africarsquos development problems and then having done thatby launching the NEPAD they were damned for not consulting others todemonstrate their leadership

The fact of the matter is that the NEPAD potentially ldquoconstitutes themost important advance in African development policy during the pastfour decadesrdquo (Hope 2002b 401) Moreover it is a home-grown initiativefor development based on a set of core principles that have beenembraced by national regional and international public opinion as beingpreconditions for the renewal of the African continent (Hope 2002b) Asthis work also shows the NEPAD has been endorsed and supported bythe international community including the G8 countries and multilateraland bilateral organizations such as the World Bank the InternationalMonetary Fund (IMF) the UN the Organisation for Economic Co-operation and Development (OECD) the United States Agency for

THE AFRICAN PEER REVIEW MECHANISM 289

International Development (USAID) the Department for InternationalDevelopment (DFID) of the UK and others The active involvement forexample of four members of the HSGICmdashPresident Thabo Mbeki ofSouth Africa President Olusegun Obasanjo of Nigeria President JoaquimChissano of Mozambique and President John Kufuor of Ghanamdashin theremoval from office and exiling of the corrupt warlord President CharlesTaylor from Liberia in 2003 has certainly deepened international supportfor the NEPAD and what it represents

Indeed another perspective offered in the various commentaries onthe NEPAD is that ldquoAfrican leaders merit a chance to reverse the numer-ous crises in the continent which they are proposing as outlined in theNEPAD documentrdquo (AnyangrsquoNyongrsquoo Ghirmazion and Lamba 3) Fur-thermore ldquotheir [Africarsquos leaders] acknowledgement of the need for arenaissance in Africa and of the concepts of democracy accountabilitytransparency and peer review should account for more than the pessimis-tic criticism and call for dismissal of the [NEPAD] document being calledfor by some scholarsrdquo (AnyangrsquoNyongrsquoo Ghirmazion and Lamba 3ndash4)This would seem to constitute an enlightened conclusion and particularlyso given that the critics and Afro-pessimists have offered no alternativedevelopment framework and that some of them are in fact guilty ofchampioning discredited and abandoned ideas from the past Moreoverit ought to be accepted by all critics and Afro-pessimistsmdashin the spirit ofthe good governance that they presumably seek for Africamdashthat theweight responsibility and accountability for leadership on the continentultimately rests with those who sought election and were democraticallyelected by the majority of their fellow citizens

THE PEER REVIEW CONCEPT AND THE AFRICAN PEER REVIEW MECHANISM

The APRM is an African-led innovation representing a bold approach toreform for building capable states with enduring good governance andsustainable development The APRM is designed to monitor and assessthe progress made by African countries in meeting their commitmenttoward achieving good governance social reforms and sustainabledevelopment It will also provide a platform for countries to share expe-riences with a view to fostering good governance and democratic pro-cesses But before going further on the APRM it is useful to set the stagefor the rest of the discussion to follow by first examining the concept ofpeer review

What Is Peer Review

Peer reviews were pioneered by the OECD Since its creation as an insti-tution four decades ago the OECD has successfully used this method ofassessment of the performance of its member states In addition several

290 KEMPE RONALD HOPE SR

other intergovernmental and international organizations such as theEuropean Union (EU) UN bodies and the IMF use peer review tomonitor and assess national policies and performance in several sectors(OECD)

Peer review refers to the systematic examination and assessment of theperformance of a state by other states (peers) by designated institutionsor by a combination of states and designated institutions (OECD UNECA2002b 2002c) The ultimate goal is to assist the reviewed state to improveits policy making adopt best practices and comply with establishedstandards principles codes and other agreed commitments Peer reviewexaminations and assessments are conducted in a nonadversarial mannerand they rely heavily on the mutual trust and understanding between thestate being reviewed and the reviewers as well as their shared confidencein the process (OECD UNECA 2002b)

The international experience shows peer reviews can be conductedbased on subject areas or themes For example an individual country peerreview could relate to economics governance education health the envi-ronment or other policies and practices Within one or more of thesesubject areas a state may be examined against a wide range of codes andstandards for compliance for example (OECD UNECA 2002b) Similarlyseveral countries can be examined at the same time with respect to aparticular theme for instance ldquoCombating Corruption for SustainableDevelopmentrdquo (UNECA 2002b) However whether based on subject areasor themes individual country peer reviews are typically undertaken ona regular basis with each review exercise resulting in a report thatassesses accomplishments indicates shortcomings and makes recom-mendations They usually do not entail sanctions or a punitive decisionbut they can lead to embarrassment and negative market reactions suchas lower levels of investment or exchange rate fluctuations biased againstthe national currency

Nonetheless related to the concept of peer review is the concept of peerpressure According to the OECD and Takatoshi Ito the effectiveness ofpeer review relies on the influence of peer pressure that is the persuasionexercised by the peers The peer review process can give rise to peerpressure through for example a mix of formal recommendations andinformal consultations by peer countries public scrutiny comparisonsand ranking among countries and the impact of the foregoing on publicopinion policy makers and other stakeholders The lessons of peerreviews conducted in the developed countries suggest that the greatestimpact is derived when the outcomes of peer reviews are put in the publicdomain It is that public scrutiny that is most likely to influence changeand bring about corrective actions In addition the East Asian experiencesuggests that peer pressure provides an effective incentive to commitmember countries to perform the required activities and take the neces-sary actions for common policy objectives (Wang and Yoon)

THE AFRICAN PEER REVIEW MECHANISM 291

The APRM

UNECA originally developed the APRM in response to a request by theNEPAD HSGIC Its (the APRMrsquos) mandate ensures that the policies andpractices of participating states conform to the agreed political economicand corporate governance codes and standards contained in the

Declara-tion on Democracy Political Economic and Corporate Governance

that wasapproved by the African Union (AU) Summit in July 2002 (NEPAD Sec-retariat 2002a) The APRM is a mutually agreed instrument for self-mon-itoring by the participating member states It is voluntarily acceded to bymember states of the AU (NEPAD Secretariat 2003a)

The primary purpose of the APRM is to foster the adoption of policiesstandards and practices that lead to political stability high economicgrowth sustainable development and accelerated integration throughthe sharing of experiences and the reinforcement of successful and bestpractice including identifying deficiencies and assessing the needs forcapacity building This is to be accomplished by using the relevant indi-cators contained in the APRM to measure and determine the progress ofpeer-reviewed countries in meeting the goals of achieving good gover-nance and sustainable development The overarching goal of the APRMis for all participating countries to accelerate their progress toward adopt-ing and implementing the priorities and programs of the NEPAD achiev-ing the mutually agreed objectives and compliance with best practice inrespect to each of the areas of good governance and sustainable develop-ment (NEPAD Secretariat 2003a) As articulated by Chris Stalsmdasha memberof the APR Panel which is discussed belowmdashthe application of theAPRM and the resultant ldquorecommendations are not meant to punish orexclude countries the main objective is to help each country to identifyits own weaknesses and to find ways and means for addressing theshortcomingsrdquo (Stals 5)

Every peer review exercise undertaken under the authority of theAPRM must be technically competent and free of political manipulationIt must comply with the mandate of the APRM referred to above Thesestipulations together constitute the core guiding principles of the mecha-nism And with respect to the process and procedures for the applicationof the APRM the NEPAD HSGIC has approved four distinct organiza-tional components and five stages (NEPAD Secretariat 2003b) The firstorganizational component is the Committee of Participating Heads ofState and Government (the APR Heads of State Forum) which is thehighest decision-making authority in the APRM with overall responsibil-ity for the said APRM The APR Heads of State Forum will consist ofHeads of State and Government of the member states of the AU who havevoluntarily chosen to accede to the APRM The next organizational com-ponent is the Panel of Eminent Persons (APR Panel) This is an indepen-dent body that will oversee the day-to-day functioning of the peer review

292 KEMPE RONALD HOPE SR

process and ensure the credibility and integrity of that process The thirdorganizational component is the APR Secretariat which will provide thesecretarial coordinating and administrative support services for theAPRM through the APR Panel The final organizational component isthe APR Teams which will be conducting the actual technical assessmentsthat will constitute the country peer reviews

The functions of the APR Heads of State Forum include but are notlimited to (1) appointing the APR Panel and its chairperson (2) consider-ing adopting and taking ownership of country peer review reports (3)communicating the recommendations of the APR Heads of State Forumto the peer-reviewed countries (4) exercising peer pressure to effectchanges in country practice where recommended (5) persuading devel-opment partners to provide technical assistance to eliminate capacitygaps as recommended by the country peer review reports (6) transmit-ting peer review reports to the appropriate AU structures and (7) makingpublic through the APR Secretariat country peer review reports andpress releases pertaining thereto

The functions of the APR Panel include but are not limited to (1)exercising oversight of the APR process including providing leadershipto country review teams with a view to ensuring the independenceprofessionalism and credibility of that process (2) recommending appro-priate African institutions or individuals to conduct technical assess-ments (3) reviewing and adopting the country peer review reportsincluding the recommendations contained therein and (4) submitting tothe APR Heads of State Forum all country peer review reports withrecommendations on measures that could be taken to assist the reviewedcountries in the improvement of their governance and socio-developmentperformance By November 2003 the HSGIC had appointed seven mem-bers of the APR Panel More members may be appointed at a later datewith a probable final complement of ten two from each of the fivesubregions

The functions of the APR Secretariat include (1) providing secretarialand administrative support services to the APR Panel under the directsupervision of the Chairperson of that Panel (2) organizing regionalnetworks and workshops for the sharing of experience and best practicerelated to the goals of achieving good governance and sustainable devel-opment and (3) ensuring full documentation of the peer review processesat country subregional and continental levels to facilitate mutual learning

The APR Teams are responsible for conducting the technical countryassessments that will comprise the country peer reviews Credible andtechnically competent institutions such as the UNDP the UNECA andthe AfDB have been selected to assist with some of the peer reviewtechnical assessments The UNECA will assist with the technical assess-ments in economic governance and management while the AfDB willassist with banking and financial standards for example The APR Panelwill select other credible and technically competent institutions or indi-

THE AFRICAN PEER REVIEW MECHANISM 293

viduals to undertake the peer review assessments in the areas of politicalgovernance corporate governance and socioeconomic development

As mentioned before there are five stages to the peer review processStage One entails a careful analysis of the governance and developmentenvironment in the country being reviewed Key governance and devel-opment issues will be analyzed to provide background information withrespect to political representativeness and rights institutional effective-ness and economic management and governance Political representa-tiveness and rights will cover issues of political systems and electoralprocesses representation and participation of various stakeholders indecision making Institutional effectiveness will include issues related tothe nature and workings of the legislative judiciary and executivebranches of government as well as the state of the nongovernmentalsector Economic management and governance will address issues ofmacroeconomic management public financial accountability monetaryand financial transparency accounting and auditing systems and regula-tory oversight bodies as well as issues of capacity effectiveness andaccountability of the economic decision making and service deliverysystems

Stage two constitutes the country visits by the peer review technicalassessment teams This stage is informed by the analysis prepared inStage One The technical assessment teams will consult and extensivelyinterview relevant government officials parliamentarians oppositionparty members not in parliament private sector representatives repre-sentatives of civil society groups (including the media academia tradeunions and nongovernmental organizations) and officials of residentmissions of regional and international organizations

Stage Three involves the preparation of the peer review reports basedon the technical assessments conducted in Stage Two A draft of eachreport will be discussed with the government concerned prior to submis-sion to the APR Panel Those discussions will be designed to ensure theaccuracy of the information and to provide the government an opportu-nity to react to the findings and recommendations of the assessment teamThese responses of the government will be appended to the final draft ofthe report However each report will remain independent and its find-ings will not be altered or vetted by the government concerned

Stage Four entails discussion and adoption of the peer review reportsby the APR Panel first followed by the APR Heads of State Forum Thisstage terminates when the Chairperson of the latter communicates thedecisions and recommendations to the government of the country beingpeer reviewed Stage Five is the formal and public tabling of the peerreview reports in key regional and subregional structures and in partic-ular the AU structures These reports will also be put in the publicdomain

The NEPAD HSGIC has also approved a number of indicators basedon key objectives that will be used to assess and measure performance

294 KEMPE RONALD HOPE SR

in the four peer review areas of (1) democracy and political governance(2) economic governance and management (3) corporate governance and(4) socioeconomic development (NEPAD Secretariat 2003a) The keyobjectives for democracy and political governance include (1) to preventand reduce intra- and intercountry conflicts (2) the consolidation of con-stitutional democracy including periodic political competition andopportunity for choice the rule of law a Bill of Rights and the supremacyof the constitution being firmly established (3) promotion and protectionof economic social cultural civil and political rights as enshrined in allAfrican and international human rights instruments (4) upholding theseparation of powers including the protection of the independence of thejudiciary and of an effective parliament (5) ensuring accountable effi-cient and effective public office holders and civil servants (6) fightingcorruption in the political arena (7) promotion and protection of therights of women (8) promotion and protection of the rights of the childand young persons and (9) promotion and protection of the rights ofvulnerable groups including displaced persons

The key objectives for economic governance and management are (1)promoting macroeconomic policies that support sustainable develop-ment (2) implementing transparent predictable and credible governmenteconomic policies (3) promoting sound public finance management (4)fighting corruption and money laundering and (5) accelerating regionalintegration by participating in the harmonization of monetary trade andinvestment policies among participating states

The key corporate governance objectives are (1) providing an enablingenvironment and effective regulatory framework for economic activities(2) ensuring that corporations act as good corporate citizens with regardto human rights social responsibility and environmental sustainability(3) promoting the adoption of codes of good business ethics in achievingthe objectives of the organization (4) ensuring that corporations treat alltheir stakeholders in a fair and just manner and (5) providing for account-ability of corporations and directors

The key objectives for socioeconomic development are to (1) promoteself-reliance in development and build capacity for self-sustaining devel-opment (2) accelerate socioeconomic development to achieve sustainabledevelopment and poverty eradication (3) strengthen policies deliverymechanisms and outputs in key social development areas such as edu-cation for all and the combating of HIVAIDS and other communicablediseases (4) ensure affordable access to water energy finance marketsand information and communication technologies to all citizens (5) makeprogress toward gender equality particularly equal access to educationfor girls at all levels and (6) encourage broad-based participation indevelopment by all stakeholders at all levels

The 2002 AU Summit also approved the frequency of peer reviewsSpecifically there will be four types of peer reviews The first countryreview being the base review will be undertaken within 18 months of acountryrsquos becoming a member of the APRM The second type is the

THE AFRICAN PEER REVIEW MECHANISM 295

periodic review that should take place every two years The next type isa requested review where a member country can for its own reasons askfor a review that is not part of the periodically mandated reviews Thefinal type amounts to an imposed review and may be resorted to by theHSGIC if there is sufficient cause to conclude that there are early signs ofimpending political andor economic crises in a member country

Despite the fact that participation in the APRM is open to all memberstates of the AU on a voluntary basis there is now a somewhat morebureaucratic and unnecessarily cumbersome process that countries haveto contend with The APRM has evolved from its original technicallystraightforward framework to become a somewhat more burdensomeadministrative process Nonetheless this eventuality does not seem tohave particularly influenced the desire and decision by the member statesto seek participation in the process This is probably not surprising asundoubtedly countries that are actually peer reviewed stand to reap anumber of benefits as discussed in the next section It should be notedhere that in November 2002 a total of 12 of the 53 African countries hadoriginally declared their intent to be peer reviewed Those countries wereAlgeria Republic of Congo Egypt Ethiopia Gabon Ghana Mali Mau-ritius Mozambique Nigeria Rwanda and South Africa As of August2004 a total of 23 countriesmdashincluding the additional 11 of Angola BeninBurkina Faso Cameroon Kenya Lesotho Malawi Senegal Sierra LeoneTanzania and Ugandamdashhad signed the Memorandum of Understandingthat represents the basic framework for formal accession to the APRM(NEPAD Secretariat 2002b 2003c 2003d 2003e 2004) Other countries areexpected to accede in time However Ghana will be noted in Africarsquoseconomic and political history as the first country on the continent to bereviewed under the APRM The country inaugurated the APRM processin May 2004 By August 2004 four countriesmdashGhana Kenya Mauritiusand Rwandamdashhad been visited by peer review support mission teamsand were at various stages in the process

BENEFITS OF THE APRM AN ANALYTICAL ASSESSMENT

Given the international experience with peer reviews the APRMmdashas amechanism for measuring and monitoring progress toward good gover-nance and sustainable development in Africamdashhas the potential to pro-vide a number of benefits to those African countries that subjectthemselves to it and through multiplier effects to the continent as awhole Peer reviews have been demonstrated to have a number of bene-ficial effects as applied across the world As African countries seek toimprove their governance and march toward sustainable developmentpeer reviews can provide the basis for policy changes to meet commit-ments and to observe the agreed standards and codes

Indeed peer reviews will facilitate the monitoring of compliance withthe agreements entered into upon accession to the APRM States are muchmore inclined to comply when they know their implementation is moni-

296 KEMPE RONALD HOPE SR

tored and when the implementation of their peers is being monitored aswell (Henning) Given the history and resultant disastrous effects of badgovernance in Africa with a lack of openness and rampant corruptionacceding to peer review represents a sea change in the thinking of Africanleaders and a major milestone in the political development and history ofthe continent Below we concentrate on six key areas where peer reviewswill add value and enhance the prospects for African states to achievegood governance and sustainable development

Greater Transparency

Following Seiichi Kondo transparency is taken here to mean that reliablerelevant and timely information about the activities of government isavailable to the public Associated with transparency is the concept ofopenness whereby public participation in shaping and implementinggovernment policy is encouraged and guaranteed Transparency in gov-ernment is a good thing for governments in Africa have the most poten-tial for going awry given their monopoly on force and power and the easewith which they use and abuse that force and power Where there istransparency government officials will be prevented from exercising dis-cretionary powers Transparency therefore complements and reinforcespredictability reduces uncertainty and inhibits and reduces the scope ofcorruption among public officials (Siegle Weinstein and Halperin)

The APRM will be particularly applied to democracy and politicalgovernance issues and economic and corporate governance issues Inboth cases transparency looms large The openness of the political spaceis a critical barometer of the nature of democracy in a given countrySimilarly in the economic sphere the extent of fiscal transparencyprovides a very solid indication of the manner in which budgets (expen-ditures and revenues) for example are crafted reconciled and imple-mented Determining the nature of transparency in governmentoperations and functioning in Africa will expose the shortcomings andany deliberate secrecy or misreporting of government operations

Transparency in government operations particularly in Africa hasseveral dimensions (Kopits and Craig) The first dimension consists ofmainly behavioral aspects such as clearly established conflict-of-interestrules for elected and appointed officials a transparent regulatory frame-work open public procurement and employment practices a code ofconduct for public officials and freedom-of-information requirementsThe next is the provision of reliable information on the governmentrsquoseconomic policy intentions and forecasts The third is the requirement fordetailed data and information on government operations including thepublication of comprehensive budget and other planning and policy doc-uments In all three dimensions transparency is closely associated withthe successful implementation of good governance and the achievementof sustainable development

THE AFRICAN PEER REVIEW MECHANISM 297

The APRM to the extent that it enhances transparency in Africancountries will acknowledge democratic progress and scorn antidemo-cratic measures Consequently it can confer or withhold internationalrecognition and raise or lower the domestic legitimacy of governments(Henning) Moreover transparency increases the political risk of unsus-tainable policies whereas the lack thereof means that such policies cango undetected longer than they otherwise would Generally countriescharacterized by a relatively high degree of transparency have exhibitedgreater political and economic discipline and in many instances havebeen able to achieve a more robust political and economic performancecompared to countries with less transparent policies even within a sameregion (Henning)

This positive correlation between transparency and good governancehas also been empirically demonstrated across the spectrum of bothdeveloped and developing countries R Islam for instance has shownthat governments that are more transparent govern better as measuredby a wide number of governance indicators such as government effective-ness regulatory burden corruption voice and accountability the rule oflaw bureaucratic efficiency contract repudiation and expropriation riskAnd as better governance has also been empirically demonstrated to becorrelated with higher growth rates it can be extrapolated that there is aclose relationship between greater transparency and how fast economiesgrow (Islam) Botswana for example is internationally recognized for itssubstantial degree of transparency with a liberal democratic political sys-tem and a prudent and open budgetary process (Hope 2002a Kopits andCraig) As a result Botswana continues to experience political and mac-roeconomic stability with strong growth The country has consistentlybeen one of the fastest growing in the world with an annual averagegrowth rate of per capita gross domestic product (GDP) of 51 percentduring the period 1975ndash2002 compared with an annual average of

minus

08percent for sub-Saharan Africa during the same period (UNDP 2004)

That relationship between transparency good governance and growthin Botswana is further reflected in the growth competitiveness index(GCI) of the World Economic Forum The GCI is composed of threesubindexes identified as pillars in the evolution of growth in a country(1) the quality of the macroeconomic environment (2) the state of publicinstitutions and (3) the level of technological readiness The GCI uses acombination of hard data such as inflation rates budget deficits the levelof Internet access in schools and survey data in areas such as judicialindependence the prevalence of institutionalized corruption and theextent of inefficient government intervention in the economy (Lopez-Claros) Botswana has consistently ranked in first place among all Africancountries in the overall GCI as well as in the macroeconomic environmentand public institutions subindexes For the 2003 GCI computationsBotswana was ranked at 36 just behind Greece on the worldwide com-parisons (World Economic Forum)

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

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Capacity Building Gov-ernance and Economic Reform in Africa

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Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

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Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

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Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

THE AFRICAN PEER REVIEW MECHANISM 287

human rights and democratic principles honest and good quality admin-istration and protecting the rights and freedoms under the rule of laware concerned with values that apply equally to every state and citizenDemocracy for example is a universally recognized ideal based on val-ues common to people everywhere regardless of cultural political socialor economic differences (IPU) These transcend the functional importanceof aspects of good governance such as for sustainable development (Sci-entific Council for Government Policy)

President Thabo Mbeki of South Africa has argued quite convincinglyfor example that Africa wishes to realize the goal of good governance inall its elements ldquonot because we seek to improve our relations with therest of the world as a first objective critically important as this is but toend political and economic mismanagement on our continent and theconsequential violent conflicts instability denial of democracy andhuman rights deepening poverty and global marginalizationrdquo (Mbeki 2)Nonetheless as noted above the various components of good governanceare also necessary and functional for sustainable development processes

Quite clearly growth and development cannot be achieved in theabsence of good governance Among other things good governanceensures the most efficient utilization of already scarce resources in thepromotion of development enhances participation responsibility andaccountability and has the potential to emancipate people from povertyas state legitimacy is recognized and entrenched In fact any effort toreduce poverty and sustain development must start with and build upongood governance (Hope 2002b) Good governance can therefore be alsoregarded as governance on behalf of development-oriented policy

According to UNDP (2002) good governance advances sustainabledevelopment for three reasons First enjoying political freedom and par-ticipating in the decisions that shape onersquos life are fundamental humanrights In those African countries where leaders are not elected or selectedby election (eg Libya) or where elections are flawed (eg Zimbabwe)choices are severely restricted The denial of these rights is a denial ofhuman development Second good governance helps to protect peoplefrom economic and political catastrophes such as famines and othercrises (Sen) There is a direct correlation between bad governance andfamines for example in Africa In other words those countries frequentlysuffering from famines in Africa tend not to have good governance Thirdgood governance can promote sustainable development by empoweringcitizens to influence policies that promote growth and prosperity andreflect their priorities

Y Feng has also empirically demonstrated that good governance doesmatter for national economic growth and development ldquoIn particular apolitical system characterized by freedom and stability is best suited topromoting a growth-oriented economic agendardquo (Feng 295) In additionR Alence has empirically shown that the effects of governance on nationalincome and economic performance in Africa are large and statistically

288 KEMPE RONALD HOPE SR

robust Democratic institutions for example were found to systematicallyenhance the performance of African states as agents of development byamong other things countering temptations for politically opportunisticbehaviormdashsuch as economically incoherent policies ineffective imple-mentation and the abuse of public resources for private gain relative tothe provision of welfare-enhancing public goodsmdashthat is economicallydamaging (Alence) Similarly others such as Daniel Kaufmann and AartKraay Kaufmann Kraay and Pablo Zoido-Lobatoacuten and Joseph SiegleMichael Weinstein and Morton Halperin have shown that the qualityof governance is positively associated with economic growth anddevelopment

However despite the empirical evidence supporting the positive rela-tionship between good governance and sustainable development on theone hand and the attempt by African leaders through the NEPAD tomake that relationship a reality in Africa on the other the NEPAD frame-work has been the subject of some criticism and Afro-pessimism Butinterestingly enough no credible alternative plan to the NEPAD has sofar been put forward by its critics Perhaps the most comprehensivesummaries of the various criticism to date can be found in PeterAnyangrsquoNyongrsquoo Aseghedech Ghirmazion and Davinder Lamba and inIan Taylor The key criticisms are usually focused around pessimismgiven Africarsquos culture of corruption and neopatrimonial rule its historyof human rights abuses rigged elections and coups the notion thatpartnerships between Africa and the West are unworkable given the dom-inance and influence of the latter and the perception that civil society hadnot been properly consulted in the drawing up of the NEPAD frameworkdocument With respect to the latter issue it must be said first that a lackof proper consultation with some interested parties does not necessarilyrender the content of the outcome document as irrelevant Second with-out taking sides on the validity or lack thereof with respect to the criti-cisms Africarsquos leaders found themselves in a ldquodamned if they do damnedif they donrsquotrdquo position They were damned for not demonstrating leader-ship to solve Africarsquos development problems and then having done thatby launching the NEPAD they were damned for not consulting others todemonstrate their leadership

The fact of the matter is that the NEPAD potentially ldquoconstitutes themost important advance in African development policy during the pastfour decadesrdquo (Hope 2002b 401) Moreover it is a home-grown initiativefor development based on a set of core principles that have beenembraced by national regional and international public opinion as beingpreconditions for the renewal of the African continent (Hope 2002b) Asthis work also shows the NEPAD has been endorsed and supported bythe international community including the G8 countries and multilateraland bilateral organizations such as the World Bank the InternationalMonetary Fund (IMF) the UN the Organisation for Economic Co-operation and Development (OECD) the United States Agency for

THE AFRICAN PEER REVIEW MECHANISM 289

International Development (USAID) the Department for InternationalDevelopment (DFID) of the UK and others The active involvement forexample of four members of the HSGICmdashPresident Thabo Mbeki ofSouth Africa President Olusegun Obasanjo of Nigeria President JoaquimChissano of Mozambique and President John Kufuor of Ghanamdashin theremoval from office and exiling of the corrupt warlord President CharlesTaylor from Liberia in 2003 has certainly deepened international supportfor the NEPAD and what it represents

Indeed another perspective offered in the various commentaries onthe NEPAD is that ldquoAfrican leaders merit a chance to reverse the numer-ous crises in the continent which they are proposing as outlined in theNEPAD documentrdquo (AnyangrsquoNyongrsquoo Ghirmazion and Lamba 3) Fur-thermore ldquotheir [Africarsquos leaders] acknowledgement of the need for arenaissance in Africa and of the concepts of democracy accountabilitytransparency and peer review should account for more than the pessimis-tic criticism and call for dismissal of the [NEPAD] document being calledfor by some scholarsrdquo (AnyangrsquoNyongrsquoo Ghirmazion and Lamba 3ndash4)This would seem to constitute an enlightened conclusion and particularlyso given that the critics and Afro-pessimists have offered no alternativedevelopment framework and that some of them are in fact guilty ofchampioning discredited and abandoned ideas from the past Moreoverit ought to be accepted by all critics and Afro-pessimistsmdashin the spirit ofthe good governance that they presumably seek for Africamdashthat theweight responsibility and accountability for leadership on the continentultimately rests with those who sought election and were democraticallyelected by the majority of their fellow citizens

THE PEER REVIEW CONCEPT AND THE AFRICAN PEER REVIEW MECHANISM

The APRM is an African-led innovation representing a bold approach toreform for building capable states with enduring good governance andsustainable development The APRM is designed to monitor and assessthe progress made by African countries in meeting their commitmenttoward achieving good governance social reforms and sustainabledevelopment It will also provide a platform for countries to share expe-riences with a view to fostering good governance and democratic pro-cesses But before going further on the APRM it is useful to set the stagefor the rest of the discussion to follow by first examining the concept ofpeer review

What Is Peer Review

Peer reviews were pioneered by the OECD Since its creation as an insti-tution four decades ago the OECD has successfully used this method ofassessment of the performance of its member states In addition several

290 KEMPE RONALD HOPE SR

other intergovernmental and international organizations such as theEuropean Union (EU) UN bodies and the IMF use peer review tomonitor and assess national policies and performance in several sectors(OECD)

Peer review refers to the systematic examination and assessment of theperformance of a state by other states (peers) by designated institutionsor by a combination of states and designated institutions (OECD UNECA2002b 2002c) The ultimate goal is to assist the reviewed state to improveits policy making adopt best practices and comply with establishedstandards principles codes and other agreed commitments Peer reviewexaminations and assessments are conducted in a nonadversarial mannerand they rely heavily on the mutual trust and understanding between thestate being reviewed and the reviewers as well as their shared confidencein the process (OECD UNECA 2002b)

The international experience shows peer reviews can be conductedbased on subject areas or themes For example an individual country peerreview could relate to economics governance education health the envi-ronment or other policies and practices Within one or more of thesesubject areas a state may be examined against a wide range of codes andstandards for compliance for example (OECD UNECA 2002b) Similarlyseveral countries can be examined at the same time with respect to aparticular theme for instance ldquoCombating Corruption for SustainableDevelopmentrdquo (UNECA 2002b) However whether based on subject areasor themes individual country peer reviews are typically undertaken ona regular basis with each review exercise resulting in a report thatassesses accomplishments indicates shortcomings and makes recom-mendations They usually do not entail sanctions or a punitive decisionbut they can lead to embarrassment and negative market reactions suchas lower levels of investment or exchange rate fluctuations biased againstthe national currency

Nonetheless related to the concept of peer review is the concept of peerpressure According to the OECD and Takatoshi Ito the effectiveness ofpeer review relies on the influence of peer pressure that is the persuasionexercised by the peers The peer review process can give rise to peerpressure through for example a mix of formal recommendations andinformal consultations by peer countries public scrutiny comparisonsand ranking among countries and the impact of the foregoing on publicopinion policy makers and other stakeholders The lessons of peerreviews conducted in the developed countries suggest that the greatestimpact is derived when the outcomes of peer reviews are put in the publicdomain It is that public scrutiny that is most likely to influence changeand bring about corrective actions In addition the East Asian experiencesuggests that peer pressure provides an effective incentive to commitmember countries to perform the required activities and take the neces-sary actions for common policy objectives (Wang and Yoon)

THE AFRICAN PEER REVIEW MECHANISM 291

The APRM

UNECA originally developed the APRM in response to a request by theNEPAD HSGIC Its (the APRMrsquos) mandate ensures that the policies andpractices of participating states conform to the agreed political economicand corporate governance codes and standards contained in the

Declara-tion on Democracy Political Economic and Corporate Governance

that wasapproved by the African Union (AU) Summit in July 2002 (NEPAD Sec-retariat 2002a) The APRM is a mutually agreed instrument for self-mon-itoring by the participating member states It is voluntarily acceded to bymember states of the AU (NEPAD Secretariat 2003a)

The primary purpose of the APRM is to foster the adoption of policiesstandards and practices that lead to political stability high economicgrowth sustainable development and accelerated integration throughthe sharing of experiences and the reinforcement of successful and bestpractice including identifying deficiencies and assessing the needs forcapacity building This is to be accomplished by using the relevant indi-cators contained in the APRM to measure and determine the progress ofpeer-reviewed countries in meeting the goals of achieving good gover-nance and sustainable development The overarching goal of the APRMis for all participating countries to accelerate their progress toward adopt-ing and implementing the priorities and programs of the NEPAD achiev-ing the mutually agreed objectives and compliance with best practice inrespect to each of the areas of good governance and sustainable develop-ment (NEPAD Secretariat 2003a) As articulated by Chris Stalsmdasha memberof the APR Panel which is discussed belowmdashthe application of theAPRM and the resultant ldquorecommendations are not meant to punish orexclude countries the main objective is to help each country to identifyits own weaknesses and to find ways and means for addressing theshortcomingsrdquo (Stals 5)

Every peer review exercise undertaken under the authority of theAPRM must be technically competent and free of political manipulationIt must comply with the mandate of the APRM referred to above Thesestipulations together constitute the core guiding principles of the mecha-nism And with respect to the process and procedures for the applicationof the APRM the NEPAD HSGIC has approved four distinct organiza-tional components and five stages (NEPAD Secretariat 2003b) The firstorganizational component is the Committee of Participating Heads ofState and Government (the APR Heads of State Forum) which is thehighest decision-making authority in the APRM with overall responsibil-ity for the said APRM The APR Heads of State Forum will consist ofHeads of State and Government of the member states of the AU who havevoluntarily chosen to accede to the APRM The next organizational com-ponent is the Panel of Eminent Persons (APR Panel) This is an indepen-dent body that will oversee the day-to-day functioning of the peer review

292 KEMPE RONALD HOPE SR

process and ensure the credibility and integrity of that process The thirdorganizational component is the APR Secretariat which will provide thesecretarial coordinating and administrative support services for theAPRM through the APR Panel The final organizational component isthe APR Teams which will be conducting the actual technical assessmentsthat will constitute the country peer reviews

The functions of the APR Heads of State Forum include but are notlimited to (1) appointing the APR Panel and its chairperson (2) consider-ing adopting and taking ownership of country peer review reports (3)communicating the recommendations of the APR Heads of State Forumto the peer-reviewed countries (4) exercising peer pressure to effectchanges in country practice where recommended (5) persuading devel-opment partners to provide technical assistance to eliminate capacitygaps as recommended by the country peer review reports (6) transmit-ting peer review reports to the appropriate AU structures and (7) makingpublic through the APR Secretariat country peer review reports andpress releases pertaining thereto

The functions of the APR Panel include but are not limited to (1)exercising oversight of the APR process including providing leadershipto country review teams with a view to ensuring the independenceprofessionalism and credibility of that process (2) recommending appro-priate African institutions or individuals to conduct technical assess-ments (3) reviewing and adopting the country peer review reportsincluding the recommendations contained therein and (4) submitting tothe APR Heads of State Forum all country peer review reports withrecommendations on measures that could be taken to assist the reviewedcountries in the improvement of their governance and socio-developmentperformance By November 2003 the HSGIC had appointed seven mem-bers of the APR Panel More members may be appointed at a later datewith a probable final complement of ten two from each of the fivesubregions

The functions of the APR Secretariat include (1) providing secretarialand administrative support services to the APR Panel under the directsupervision of the Chairperson of that Panel (2) organizing regionalnetworks and workshops for the sharing of experience and best practicerelated to the goals of achieving good governance and sustainable devel-opment and (3) ensuring full documentation of the peer review processesat country subregional and continental levels to facilitate mutual learning

The APR Teams are responsible for conducting the technical countryassessments that will comprise the country peer reviews Credible andtechnically competent institutions such as the UNDP the UNECA andthe AfDB have been selected to assist with some of the peer reviewtechnical assessments The UNECA will assist with the technical assess-ments in economic governance and management while the AfDB willassist with banking and financial standards for example The APR Panelwill select other credible and technically competent institutions or indi-

THE AFRICAN PEER REVIEW MECHANISM 293

viduals to undertake the peer review assessments in the areas of politicalgovernance corporate governance and socioeconomic development

As mentioned before there are five stages to the peer review processStage One entails a careful analysis of the governance and developmentenvironment in the country being reviewed Key governance and devel-opment issues will be analyzed to provide background information withrespect to political representativeness and rights institutional effective-ness and economic management and governance Political representa-tiveness and rights will cover issues of political systems and electoralprocesses representation and participation of various stakeholders indecision making Institutional effectiveness will include issues related tothe nature and workings of the legislative judiciary and executivebranches of government as well as the state of the nongovernmentalsector Economic management and governance will address issues ofmacroeconomic management public financial accountability monetaryand financial transparency accounting and auditing systems and regula-tory oversight bodies as well as issues of capacity effectiveness andaccountability of the economic decision making and service deliverysystems

Stage two constitutes the country visits by the peer review technicalassessment teams This stage is informed by the analysis prepared inStage One The technical assessment teams will consult and extensivelyinterview relevant government officials parliamentarians oppositionparty members not in parliament private sector representatives repre-sentatives of civil society groups (including the media academia tradeunions and nongovernmental organizations) and officials of residentmissions of regional and international organizations

Stage Three involves the preparation of the peer review reports basedon the technical assessments conducted in Stage Two A draft of eachreport will be discussed with the government concerned prior to submis-sion to the APR Panel Those discussions will be designed to ensure theaccuracy of the information and to provide the government an opportu-nity to react to the findings and recommendations of the assessment teamThese responses of the government will be appended to the final draft ofthe report However each report will remain independent and its find-ings will not be altered or vetted by the government concerned

Stage Four entails discussion and adoption of the peer review reportsby the APR Panel first followed by the APR Heads of State Forum Thisstage terminates when the Chairperson of the latter communicates thedecisions and recommendations to the government of the country beingpeer reviewed Stage Five is the formal and public tabling of the peerreview reports in key regional and subregional structures and in partic-ular the AU structures These reports will also be put in the publicdomain

The NEPAD HSGIC has also approved a number of indicators basedon key objectives that will be used to assess and measure performance

294 KEMPE RONALD HOPE SR

in the four peer review areas of (1) democracy and political governance(2) economic governance and management (3) corporate governance and(4) socioeconomic development (NEPAD Secretariat 2003a) The keyobjectives for democracy and political governance include (1) to preventand reduce intra- and intercountry conflicts (2) the consolidation of con-stitutional democracy including periodic political competition andopportunity for choice the rule of law a Bill of Rights and the supremacyof the constitution being firmly established (3) promotion and protectionof economic social cultural civil and political rights as enshrined in allAfrican and international human rights instruments (4) upholding theseparation of powers including the protection of the independence of thejudiciary and of an effective parliament (5) ensuring accountable effi-cient and effective public office holders and civil servants (6) fightingcorruption in the political arena (7) promotion and protection of therights of women (8) promotion and protection of the rights of the childand young persons and (9) promotion and protection of the rights ofvulnerable groups including displaced persons

The key objectives for economic governance and management are (1)promoting macroeconomic policies that support sustainable develop-ment (2) implementing transparent predictable and credible governmenteconomic policies (3) promoting sound public finance management (4)fighting corruption and money laundering and (5) accelerating regionalintegration by participating in the harmonization of monetary trade andinvestment policies among participating states

The key corporate governance objectives are (1) providing an enablingenvironment and effective regulatory framework for economic activities(2) ensuring that corporations act as good corporate citizens with regardto human rights social responsibility and environmental sustainability(3) promoting the adoption of codes of good business ethics in achievingthe objectives of the organization (4) ensuring that corporations treat alltheir stakeholders in a fair and just manner and (5) providing for account-ability of corporations and directors

The key objectives for socioeconomic development are to (1) promoteself-reliance in development and build capacity for self-sustaining devel-opment (2) accelerate socioeconomic development to achieve sustainabledevelopment and poverty eradication (3) strengthen policies deliverymechanisms and outputs in key social development areas such as edu-cation for all and the combating of HIVAIDS and other communicablediseases (4) ensure affordable access to water energy finance marketsand information and communication technologies to all citizens (5) makeprogress toward gender equality particularly equal access to educationfor girls at all levels and (6) encourage broad-based participation indevelopment by all stakeholders at all levels

The 2002 AU Summit also approved the frequency of peer reviewsSpecifically there will be four types of peer reviews The first countryreview being the base review will be undertaken within 18 months of acountryrsquos becoming a member of the APRM The second type is the

THE AFRICAN PEER REVIEW MECHANISM 295

periodic review that should take place every two years The next type isa requested review where a member country can for its own reasons askfor a review that is not part of the periodically mandated reviews Thefinal type amounts to an imposed review and may be resorted to by theHSGIC if there is sufficient cause to conclude that there are early signs ofimpending political andor economic crises in a member country

Despite the fact that participation in the APRM is open to all memberstates of the AU on a voluntary basis there is now a somewhat morebureaucratic and unnecessarily cumbersome process that countries haveto contend with The APRM has evolved from its original technicallystraightforward framework to become a somewhat more burdensomeadministrative process Nonetheless this eventuality does not seem tohave particularly influenced the desire and decision by the member statesto seek participation in the process This is probably not surprising asundoubtedly countries that are actually peer reviewed stand to reap anumber of benefits as discussed in the next section It should be notedhere that in November 2002 a total of 12 of the 53 African countries hadoriginally declared their intent to be peer reviewed Those countries wereAlgeria Republic of Congo Egypt Ethiopia Gabon Ghana Mali Mau-ritius Mozambique Nigeria Rwanda and South Africa As of August2004 a total of 23 countriesmdashincluding the additional 11 of Angola BeninBurkina Faso Cameroon Kenya Lesotho Malawi Senegal Sierra LeoneTanzania and Ugandamdashhad signed the Memorandum of Understandingthat represents the basic framework for formal accession to the APRM(NEPAD Secretariat 2002b 2003c 2003d 2003e 2004) Other countries areexpected to accede in time However Ghana will be noted in Africarsquoseconomic and political history as the first country on the continent to bereviewed under the APRM The country inaugurated the APRM processin May 2004 By August 2004 four countriesmdashGhana Kenya Mauritiusand Rwandamdashhad been visited by peer review support mission teamsand were at various stages in the process

BENEFITS OF THE APRM AN ANALYTICAL ASSESSMENT

Given the international experience with peer reviews the APRMmdashas amechanism for measuring and monitoring progress toward good gover-nance and sustainable development in Africamdashhas the potential to pro-vide a number of benefits to those African countries that subjectthemselves to it and through multiplier effects to the continent as awhole Peer reviews have been demonstrated to have a number of bene-ficial effects as applied across the world As African countries seek toimprove their governance and march toward sustainable developmentpeer reviews can provide the basis for policy changes to meet commit-ments and to observe the agreed standards and codes

Indeed peer reviews will facilitate the monitoring of compliance withthe agreements entered into upon accession to the APRM States are muchmore inclined to comply when they know their implementation is moni-

296 KEMPE RONALD HOPE SR

tored and when the implementation of their peers is being monitored aswell (Henning) Given the history and resultant disastrous effects of badgovernance in Africa with a lack of openness and rampant corruptionacceding to peer review represents a sea change in the thinking of Africanleaders and a major milestone in the political development and history ofthe continent Below we concentrate on six key areas where peer reviewswill add value and enhance the prospects for African states to achievegood governance and sustainable development

Greater Transparency

Following Seiichi Kondo transparency is taken here to mean that reliablerelevant and timely information about the activities of government isavailable to the public Associated with transparency is the concept ofopenness whereby public participation in shaping and implementinggovernment policy is encouraged and guaranteed Transparency in gov-ernment is a good thing for governments in Africa have the most poten-tial for going awry given their monopoly on force and power and the easewith which they use and abuse that force and power Where there istransparency government officials will be prevented from exercising dis-cretionary powers Transparency therefore complements and reinforcespredictability reduces uncertainty and inhibits and reduces the scope ofcorruption among public officials (Siegle Weinstein and Halperin)

The APRM will be particularly applied to democracy and politicalgovernance issues and economic and corporate governance issues Inboth cases transparency looms large The openness of the political spaceis a critical barometer of the nature of democracy in a given countrySimilarly in the economic sphere the extent of fiscal transparencyprovides a very solid indication of the manner in which budgets (expen-ditures and revenues) for example are crafted reconciled and imple-mented Determining the nature of transparency in governmentoperations and functioning in Africa will expose the shortcomings andany deliberate secrecy or misreporting of government operations

Transparency in government operations particularly in Africa hasseveral dimensions (Kopits and Craig) The first dimension consists ofmainly behavioral aspects such as clearly established conflict-of-interestrules for elected and appointed officials a transparent regulatory frame-work open public procurement and employment practices a code ofconduct for public officials and freedom-of-information requirementsThe next is the provision of reliable information on the governmentrsquoseconomic policy intentions and forecasts The third is the requirement fordetailed data and information on government operations including thepublication of comprehensive budget and other planning and policy doc-uments In all three dimensions transparency is closely associated withthe successful implementation of good governance and the achievementof sustainable development

THE AFRICAN PEER REVIEW MECHANISM 297

The APRM to the extent that it enhances transparency in Africancountries will acknowledge democratic progress and scorn antidemo-cratic measures Consequently it can confer or withhold internationalrecognition and raise or lower the domestic legitimacy of governments(Henning) Moreover transparency increases the political risk of unsus-tainable policies whereas the lack thereof means that such policies cango undetected longer than they otherwise would Generally countriescharacterized by a relatively high degree of transparency have exhibitedgreater political and economic discipline and in many instances havebeen able to achieve a more robust political and economic performancecompared to countries with less transparent policies even within a sameregion (Henning)

This positive correlation between transparency and good governancehas also been empirically demonstrated across the spectrum of bothdeveloped and developing countries R Islam for instance has shownthat governments that are more transparent govern better as measuredby a wide number of governance indicators such as government effective-ness regulatory burden corruption voice and accountability the rule oflaw bureaucratic efficiency contract repudiation and expropriation riskAnd as better governance has also been empirically demonstrated to becorrelated with higher growth rates it can be extrapolated that there is aclose relationship between greater transparency and how fast economiesgrow (Islam) Botswana for example is internationally recognized for itssubstantial degree of transparency with a liberal democratic political sys-tem and a prudent and open budgetary process (Hope 2002a Kopits andCraig) As a result Botswana continues to experience political and mac-roeconomic stability with strong growth The country has consistentlybeen one of the fastest growing in the world with an annual averagegrowth rate of per capita gross domestic product (GDP) of 51 percentduring the period 1975ndash2002 compared with an annual average of

minus

08percent for sub-Saharan Africa during the same period (UNDP 2004)

That relationship between transparency good governance and growthin Botswana is further reflected in the growth competitiveness index(GCI) of the World Economic Forum The GCI is composed of threesubindexes identified as pillars in the evolution of growth in a country(1) the quality of the macroeconomic environment (2) the state of publicinstitutions and (3) the level of technological readiness The GCI uses acombination of hard data such as inflation rates budget deficits the levelof Internet access in schools and survey data in areas such as judicialindependence the prevalence of institutionalized corruption and theextent of inefficient government intervention in the economy (Lopez-Claros) Botswana has consistently ranked in first place among all Africancountries in the overall GCI as well as in the macroeconomic environmentand public institutions subindexes For the 2003 GCI computationsBotswana was ranked at 36 just behind Greece on the worldwide com-parisons (World Economic Forum)

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

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NEPAD A NewPath

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Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

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Development Is Back

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Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

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Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

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Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

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Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

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Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

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G8 Africa Action Plan

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Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

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African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

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Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

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Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

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Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

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Regional Surveillance Mechanisms in East Asia

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Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

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The Challenge of African Development

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Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

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Transparency in Government Operations

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Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

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The New Partnership for Africarsquos Development

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Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

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Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

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African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

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Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

288 KEMPE RONALD HOPE SR

robust Democratic institutions for example were found to systematicallyenhance the performance of African states as agents of development byamong other things countering temptations for politically opportunisticbehaviormdashsuch as economically incoherent policies ineffective imple-mentation and the abuse of public resources for private gain relative tothe provision of welfare-enhancing public goodsmdashthat is economicallydamaging (Alence) Similarly others such as Daniel Kaufmann and AartKraay Kaufmann Kraay and Pablo Zoido-Lobatoacuten and Joseph SiegleMichael Weinstein and Morton Halperin have shown that the qualityof governance is positively associated with economic growth anddevelopment

However despite the empirical evidence supporting the positive rela-tionship between good governance and sustainable development on theone hand and the attempt by African leaders through the NEPAD tomake that relationship a reality in Africa on the other the NEPAD frame-work has been the subject of some criticism and Afro-pessimism Butinterestingly enough no credible alternative plan to the NEPAD has sofar been put forward by its critics Perhaps the most comprehensivesummaries of the various criticism to date can be found in PeterAnyangrsquoNyongrsquoo Aseghedech Ghirmazion and Davinder Lamba and inIan Taylor The key criticisms are usually focused around pessimismgiven Africarsquos culture of corruption and neopatrimonial rule its historyof human rights abuses rigged elections and coups the notion thatpartnerships between Africa and the West are unworkable given the dom-inance and influence of the latter and the perception that civil society hadnot been properly consulted in the drawing up of the NEPAD frameworkdocument With respect to the latter issue it must be said first that a lackof proper consultation with some interested parties does not necessarilyrender the content of the outcome document as irrelevant Second with-out taking sides on the validity or lack thereof with respect to the criti-cisms Africarsquos leaders found themselves in a ldquodamned if they do damnedif they donrsquotrdquo position They were damned for not demonstrating leader-ship to solve Africarsquos development problems and then having done thatby launching the NEPAD they were damned for not consulting others todemonstrate their leadership

The fact of the matter is that the NEPAD potentially ldquoconstitutes themost important advance in African development policy during the pastfour decadesrdquo (Hope 2002b 401) Moreover it is a home-grown initiativefor development based on a set of core principles that have beenembraced by national regional and international public opinion as beingpreconditions for the renewal of the African continent (Hope 2002b) Asthis work also shows the NEPAD has been endorsed and supported bythe international community including the G8 countries and multilateraland bilateral organizations such as the World Bank the InternationalMonetary Fund (IMF) the UN the Organisation for Economic Co-operation and Development (OECD) the United States Agency for

THE AFRICAN PEER REVIEW MECHANISM 289

International Development (USAID) the Department for InternationalDevelopment (DFID) of the UK and others The active involvement forexample of four members of the HSGICmdashPresident Thabo Mbeki ofSouth Africa President Olusegun Obasanjo of Nigeria President JoaquimChissano of Mozambique and President John Kufuor of Ghanamdashin theremoval from office and exiling of the corrupt warlord President CharlesTaylor from Liberia in 2003 has certainly deepened international supportfor the NEPAD and what it represents

Indeed another perspective offered in the various commentaries onthe NEPAD is that ldquoAfrican leaders merit a chance to reverse the numer-ous crises in the continent which they are proposing as outlined in theNEPAD documentrdquo (AnyangrsquoNyongrsquoo Ghirmazion and Lamba 3) Fur-thermore ldquotheir [Africarsquos leaders] acknowledgement of the need for arenaissance in Africa and of the concepts of democracy accountabilitytransparency and peer review should account for more than the pessimis-tic criticism and call for dismissal of the [NEPAD] document being calledfor by some scholarsrdquo (AnyangrsquoNyongrsquoo Ghirmazion and Lamba 3ndash4)This would seem to constitute an enlightened conclusion and particularlyso given that the critics and Afro-pessimists have offered no alternativedevelopment framework and that some of them are in fact guilty ofchampioning discredited and abandoned ideas from the past Moreoverit ought to be accepted by all critics and Afro-pessimistsmdashin the spirit ofthe good governance that they presumably seek for Africamdashthat theweight responsibility and accountability for leadership on the continentultimately rests with those who sought election and were democraticallyelected by the majority of their fellow citizens

THE PEER REVIEW CONCEPT AND THE AFRICAN PEER REVIEW MECHANISM

The APRM is an African-led innovation representing a bold approach toreform for building capable states with enduring good governance andsustainable development The APRM is designed to monitor and assessthe progress made by African countries in meeting their commitmenttoward achieving good governance social reforms and sustainabledevelopment It will also provide a platform for countries to share expe-riences with a view to fostering good governance and democratic pro-cesses But before going further on the APRM it is useful to set the stagefor the rest of the discussion to follow by first examining the concept ofpeer review

What Is Peer Review

Peer reviews were pioneered by the OECD Since its creation as an insti-tution four decades ago the OECD has successfully used this method ofassessment of the performance of its member states In addition several

290 KEMPE RONALD HOPE SR

other intergovernmental and international organizations such as theEuropean Union (EU) UN bodies and the IMF use peer review tomonitor and assess national policies and performance in several sectors(OECD)

Peer review refers to the systematic examination and assessment of theperformance of a state by other states (peers) by designated institutionsor by a combination of states and designated institutions (OECD UNECA2002b 2002c) The ultimate goal is to assist the reviewed state to improveits policy making adopt best practices and comply with establishedstandards principles codes and other agreed commitments Peer reviewexaminations and assessments are conducted in a nonadversarial mannerand they rely heavily on the mutual trust and understanding between thestate being reviewed and the reviewers as well as their shared confidencein the process (OECD UNECA 2002b)

The international experience shows peer reviews can be conductedbased on subject areas or themes For example an individual country peerreview could relate to economics governance education health the envi-ronment or other policies and practices Within one or more of thesesubject areas a state may be examined against a wide range of codes andstandards for compliance for example (OECD UNECA 2002b) Similarlyseveral countries can be examined at the same time with respect to aparticular theme for instance ldquoCombating Corruption for SustainableDevelopmentrdquo (UNECA 2002b) However whether based on subject areasor themes individual country peer reviews are typically undertaken ona regular basis with each review exercise resulting in a report thatassesses accomplishments indicates shortcomings and makes recom-mendations They usually do not entail sanctions or a punitive decisionbut they can lead to embarrassment and negative market reactions suchas lower levels of investment or exchange rate fluctuations biased againstthe national currency

Nonetheless related to the concept of peer review is the concept of peerpressure According to the OECD and Takatoshi Ito the effectiveness ofpeer review relies on the influence of peer pressure that is the persuasionexercised by the peers The peer review process can give rise to peerpressure through for example a mix of formal recommendations andinformal consultations by peer countries public scrutiny comparisonsand ranking among countries and the impact of the foregoing on publicopinion policy makers and other stakeholders The lessons of peerreviews conducted in the developed countries suggest that the greatestimpact is derived when the outcomes of peer reviews are put in the publicdomain It is that public scrutiny that is most likely to influence changeand bring about corrective actions In addition the East Asian experiencesuggests that peer pressure provides an effective incentive to commitmember countries to perform the required activities and take the neces-sary actions for common policy objectives (Wang and Yoon)

THE AFRICAN PEER REVIEW MECHANISM 291

The APRM

UNECA originally developed the APRM in response to a request by theNEPAD HSGIC Its (the APRMrsquos) mandate ensures that the policies andpractices of participating states conform to the agreed political economicand corporate governance codes and standards contained in the

Declara-tion on Democracy Political Economic and Corporate Governance

that wasapproved by the African Union (AU) Summit in July 2002 (NEPAD Sec-retariat 2002a) The APRM is a mutually agreed instrument for self-mon-itoring by the participating member states It is voluntarily acceded to bymember states of the AU (NEPAD Secretariat 2003a)

The primary purpose of the APRM is to foster the adoption of policiesstandards and practices that lead to political stability high economicgrowth sustainable development and accelerated integration throughthe sharing of experiences and the reinforcement of successful and bestpractice including identifying deficiencies and assessing the needs forcapacity building This is to be accomplished by using the relevant indi-cators contained in the APRM to measure and determine the progress ofpeer-reviewed countries in meeting the goals of achieving good gover-nance and sustainable development The overarching goal of the APRMis for all participating countries to accelerate their progress toward adopt-ing and implementing the priorities and programs of the NEPAD achiev-ing the mutually agreed objectives and compliance with best practice inrespect to each of the areas of good governance and sustainable develop-ment (NEPAD Secretariat 2003a) As articulated by Chris Stalsmdasha memberof the APR Panel which is discussed belowmdashthe application of theAPRM and the resultant ldquorecommendations are not meant to punish orexclude countries the main objective is to help each country to identifyits own weaknesses and to find ways and means for addressing theshortcomingsrdquo (Stals 5)

Every peer review exercise undertaken under the authority of theAPRM must be technically competent and free of political manipulationIt must comply with the mandate of the APRM referred to above Thesestipulations together constitute the core guiding principles of the mecha-nism And with respect to the process and procedures for the applicationof the APRM the NEPAD HSGIC has approved four distinct organiza-tional components and five stages (NEPAD Secretariat 2003b) The firstorganizational component is the Committee of Participating Heads ofState and Government (the APR Heads of State Forum) which is thehighest decision-making authority in the APRM with overall responsibil-ity for the said APRM The APR Heads of State Forum will consist ofHeads of State and Government of the member states of the AU who havevoluntarily chosen to accede to the APRM The next organizational com-ponent is the Panel of Eminent Persons (APR Panel) This is an indepen-dent body that will oversee the day-to-day functioning of the peer review

292 KEMPE RONALD HOPE SR

process and ensure the credibility and integrity of that process The thirdorganizational component is the APR Secretariat which will provide thesecretarial coordinating and administrative support services for theAPRM through the APR Panel The final organizational component isthe APR Teams which will be conducting the actual technical assessmentsthat will constitute the country peer reviews

The functions of the APR Heads of State Forum include but are notlimited to (1) appointing the APR Panel and its chairperson (2) consider-ing adopting and taking ownership of country peer review reports (3)communicating the recommendations of the APR Heads of State Forumto the peer-reviewed countries (4) exercising peer pressure to effectchanges in country practice where recommended (5) persuading devel-opment partners to provide technical assistance to eliminate capacitygaps as recommended by the country peer review reports (6) transmit-ting peer review reports to the appropriate AU structures and (7) makingpublic through the APR Secretariat country peer review reports andpress releases pertaining thereto

The functions of the APR Panel include but are not limited to (1)exercising oversight of the APR process including providing leadershipto country review teams with a view to ensuring the independenceprofessionalism and credibility of that process (2) recommending appro-priate African institutions or individuals to conduct technical assess-ments (3) reviewing and adopting the country peer review reportsincluding the recommendations contained therein and (4) submitting tothe APR Heads of State Forum all country peer review reports withrecommendations on measures that could be taken to assist the reviewedcountries in the improvement of their governance and socio-developmentperformance By November 2003 the HSGIC had appointed seven mem-bers of the APR Panel More members may be appointed at a later datewith a probable final complement of ten two from each of the fivesubregions

The functions of the APR Secretariat include (1) providing secretarialand administrative support services to the APR Panel under the directsupervision of the Chairperson of that Panel (2) organizing regionalnetworks and workshops for the sharing of experience and best practicerelated to the goals of achieving good governance and sustainable devel-opment and (3) ensuring full documentation of the peer review processesat country subregional and continental levels to facilitate mutual learning

The APR Teams are responsible for conducting the technical countryassessments that will comprise the country peer reviews Credible andtechnically competent institutions such as the UNDP the UNECA andthe AfDB have been selected to assist with some of the peer reviewtechnical assessments The UNECA will assist with the technical assess-ments in economic governance and management while the AfDB willassist with banking and financial standards for example The APR Panelwill select other credible and technically competent institutions or indi-

THE AFRICAN PEER REVIEW MECHANISM 293

viduals to undertake the peer review assessments in the areas of politicalgovernance corporate governance and socioeconomic development

As mentioned before there are five stages to the peer review processStage One entails a careful analysis of the governance and developmentenvironment in the country being reviewed Key governance and devel-opment issues will be analyzed to provide background information withrespect to political representativeness and rights institutional effective-ness and economic management and governance Political representa-tiveness and rights will cover issues of political systems and electoralprocesses representation and participation of various stakeholders indecision making Institutional effectiveness will include issues related tothe nature and workings of the legislative judiciary and executivebranches of government as well as the state of the nongovernmentalsector Economic management and governance will address issues ofmacroeconomic management public financial accountability monetaryand financial transparency accounting and auditing systems and regula-tory oversight bodies as well as issues of capacity effectiveness andaccountability of the economic decision making and service deliverysystems

Stage two constitutes the country visits by the peer review technicalassessment teams This stage is informed by the analysis prepared inStage One The technical assessment teams will consult and extensivelyinterview relevant government officials parliamentarians oppositionparty members not in parliament private sector representatives repre-sentatives of civil society groups (including the media academia tradeunions and nongovernmental organizations) and officials of residentmissions of regional and international organizations

Stage Three involves the preparation of the peer review reports basedon the technical assessments conducted in Stage Two A draft of eachreport will be discussed with the government concerned prior to submis-sion to the APR Panel Those discussions will be designed to ensure theaccuracy of the information and to provide the government an opportu-nity to react to the findings and recommendations of the assessment teamThese responses of the government will be appended to the final draft ofthe report However each report will remain independent and its find-ings will not be altered or vetted by the government concerned

Stage Four entails discussion and adoption of the peer review reportsby the APR Panel first followed by the APR Heads of State Forum Thisstage terminates when the Chairperson of the latter communicates thedecisions and recommendations to the government of the country beingpeer reviewed Stage Five is the formal and public tabling of the peerreview reports in key regional and subregional structures and in partic-ular the AU structures These reports will also be put in the publicdomain

The NEPAD HSGIC has also approved a number of indicators basedon key objectives that will be used to assess and measure performance

294 KEMPE RONALD HOPE SR

in the four peer review areas of (1) democracy and political governance(2) economic governance and management (3) corporate governance and(4) socioeconomic development (NEPAD Secretariat 2003a) The keyobjectives for democracy and political governance include (1) to preventand reduce intra- and intercountry conflicts (2) the consolidation of con-stitutional democracy including periodic political competition andopportunity for choice the rule of law a Bill of Rights and the supremacyof the constitution being firmly established (3) promotion and protectionof economic social cultural civil and political rights as enshrined in allAfrican and international human rights instruments (4) upholding theseparation of powers including the protection of the independence of thejudiciary and of an effective parliament (5) ensuring accountable effi-cient and effective public office holders and civil servants (6) fightingcorruption in the political arena (7) promotion and protection of therights of women (8) promotion and protection of the rights of the childand young persons and (9) promotion and protection of the rights ofvulnerable groups including displaced persons

The key objectives for economic governance and management are (1)promoting macroeconomic policies that support sustainable develop-ment (2) implementing transparent predictable and credible governmenteconomic policies (3) promoting sound public finance management (4)fighting corruption and money laundering and (5) accelerating regionalintegration by participating in the harmonization of monetary trade andinvestment policies among participating states

The key corporate governance objectives are (1) providing an enablingenvironment and effective regulatory framework for economic activities(2) ensuring that corporations act as good corporate citizens with regardto human rights social responsibility and environmental sustainability(3) promoting the adoption of codes of good business ethics in achievingthe objectives of the organization (4) ensuring that corporations treat alltheir stakeholders in a fair and just manner and (5) providing for account-ability of corporations and directors

The key objectives for socioeconomic development are to (1) promoteself-reliance in development and build capacity for self-sustaining devel-opment (2) accelerate socioeconomic development to achieve sustainabledevelopment and poverty eradication (3) strengthen policies deliverymechanisms and outputs in key social development areas such as edu-cation for all and the combating of HIVAIDS and other communicablediseases (4) ensure affordable access to water energy finance marketsand information and communication technologies to all citizens (5) makeprogress toward gender equality particularly equal access to educationfor girls at all levels and (6) encourage broad-based participation indevelopment by all stakeholders at all levels

The 2002 AU Summit also approved the frequency of peer reviewsSpecifically there will be four types of peer reviews The first countryreview being the base review will be undertaken within 18 months of acountryrsquos becoming a member of the APRM The second type is the

THE AFRICAN PEER REVIEW MECHANISM 295

periodic review that should take place every two years The next type isa requested review where a member country can for its own reasons askfor a review that is not part of the periodically mandated reviews Thefinal type amounts to an imposed review and may be resorted to by theHSGIC if there is sufficient cause to conclude that there are early signs ofimpending political andor economic crises in a member country

Despite the fact that participation in the APRM is open to all memberstates of the AU on a voluntary basis there is now a somewhat morebureaucratic and unnecessarily cumbersome process that countries haveto contend with The APRM has evolved from its original technicallystraightforward framework to become a somewhat more burdensomeadministrative process Nonetheless this eventuality does not seem tohave particularly influenced the desire and decision by the member statesto seek participation in the process This is probably not surprising asundoubtedly countries that are actually peer reviewed stand to reap anumber of benefits as discussed in the next section It should be notedhere that in November 2002 a total of 12 of the 53 African countries hadoriginally declared their intent to be peer reviewed Those countries wereAlgeria Republic of Congo Egypt Ethiopia Gabon Ghana Mali Mau-ritius Mozambique Nigeria Rwanda and South Africa As of August2004 a total of 23 countriesmdashincluding the additional 11 of Angola BeninBurkina Faso Cameroon Kenya Lesotho Malawi Senegal Sierra LeoneTanzania and Ugandamdashhad signed the Memorandum of Understandingthat represents the basic framework for formal accession to the APRM(NEPAD Secretariat 2002b 2003c 2003d 2003e 2004) Other countries areexpected to accede in time However Ghana will be noted in Africarsquoseconomic and political history as the first country on the continent to bereviewed under the APRM The country inaugurated the APRM processin May 2004 By August 2004 four countriesmdashGhana Kenya Mauritiusand Rwandamdashhad been visited by peer review support mission teamsand were at various stages in the process

BENEFITS OF THE APRM AN ANALYTICAL ASSESSMENT

Given the international experience with peer reviews the APRMmdashas amechanism for measuring and monitoring progress toward good gover-nance and sustainable development in Africamdashhas the potential to pro-vide a number of benefits to those African countries that subjectthemselves to it and through multiplier effects to the continent as awhole Peer reviews have been demonstrated to have a number of bene-ficial effects as applied across the world As African countries seek toimprove their governance and march toward sustainable developmentpeer reviews can provide the basis for policy changes to meet commit-ments and to observe the agreed standards and codes

Indeed peer reviews will facilitate the monitoring of compliance withthe agreements entered into upon accession to the APRM States are muchmore inclined to comply when they know their implementation is moni-

296 KEMPE RONALD HOPE SR

tored and when the implementation of their peers is being monitored aswell (Henning) Given the history and resultant disastrous effects of badgovernance in Africa with a lack of openness and rampant corruptionacceding to peer review represents a sea change in the thinking of Africanleaders and a major milestone in the political development and history ofthe continent Below we concentrate on six key areas where peer reviewswill add value and enhance the prospects for African states to achievegood governance and sustainable development

Greater Transparency

Following Seiichi Kondo transparency is taken here to mean that reliablerelevant and timely information about the activities of government isavailable to the public Associated with transparency is the concept ofopenness whereby public participation in shaping and implementinggovernment policy is encouraged and guaranteed Transparency in gov-ernment is a good thing for governments in Africa have the most poten-tial for going awry given their monopoly on force and power and the easewith which they use and abuse that force and power Where there istransparency government officials will be prevented from exercising dis-cretionary powers Transparency therefore complements and reinforcespredictability reduces uncertainty and inhibits and reduces the scope ofcorruption among public officials (Siegle Weinstein and Halperin)

The APRM will be particularly applied to democracy and politicalgovernance issues and economic and corporate governance issues Inboth cases transparency looms large The openness of the political spaceis a critical barometer of the nature of democracy in a given countrySimilarly in the economic sphere the extent of fiscal transparencyprovides a very solid indication of the manner in which budgets (expen-ditures and revenues) for example are crafted reconciled and imple-mented Determining the nature of transparency in governmentoperations and functioning in Africa will expose the shortcomings andany deliberate secrecy or misreporting of government operations

Transparency in government operations particularly in Africa hasseveral dimensions (Kopits and Craig) The first dimension consists ofmainly behavioral aspects such as clearly established conflict-of-interestrules for elected and appointed officials a transparent regulatory frame-work open public procurement and employment practices a code ofconduct for public officials and freedom-of-information requirementsThe next is the provision of reliable information on the governmentrsquoseconomic policy intentions and forecasts The third is the requirement fordetailed data and information on government operations including thepublication of comprehensive budget and other planning and policy doc-uments In all three dimensions transparency is closely associated withthe successful implementation of good governance and the achievementof sustainable development

THE AFRICAN PEER REVIEW MECHANISM 297

The APRM to the extent that it enhances transparency in Africancountries will acknowledge democratic progress and scorn antidemo-cratic measures Consequently it can confer or withhold internationalrecognition and raise or lower the domestic legitimacy of governments(Henning) Moreover transparency increases the political risk of unsus-tainable policies whereas the lack thereof means that such policies cango undetected longer than they otherwise would Generally countriescharacterized by a relatively high degree of transparency have exhibitedgreater political and economic discipline and in many instances havebeen able to achieve a more robust political and economic performancecompared to countries with less transparent policies even within a sameregion (Henning)

This positive correlation between transparency and good governancehas also been empirically demonstrated across the spectrum of bothdeveloped and developing countries R Islam for instance has shownthat governments that are more transparent govern better as measuredby a wide number of governance indicators such as government effective-ness regulatory burden corruption voice and accountability the rule oflaw bureaucratic efficiency contract repudiation and expropriation riskAnd as better governance has also been empirically demonstrated to becorrelated with higher growth rates it can be extrapolated that there is aclose relationship between greater transparency and how fast economiesgrow (Islam) Botswana for example is internationally recognized for itssubstantial degree of transparency with a liberal democratic political sys-tem and a prudent and open budgetary process (Hope 2002a Kopits andCraig) As a result Botswana continues to experience political and mac-roeconomic stability with strong growth The country has consistentlybeen one of the fastest growing in the world with an annual averagegrowth rate of per capita gross domestic product (GDP) of 51 percentduring the period 1975ndash2002 compared with an annual average of

minus

08percent for sub-Saharan Africa during the same period (UNDP 2004)

That relationship between transparency good governance and growthin Botswana is further reflected in the growth competitiveness index(GCI) of the World Economic Forum The GCI is composed of threesubindexes identified as pillars in the evolution of growth in a country(1) the quality of the macroeconomic environment (2) the state of publicinstitutions and (3) the level of technological readiness The GCI uses acombination of hard data such as inflation rates budget deficits the levelof Internet access in schools and survey data in areas such as judicialindependence the prevalence of institutionalized corruption and theextent of inefficient government intervention in the economy (Lopez-Claros) Botswana has consistently ranked in first place among all Africancountries in the overall GCI as well as in the macroeconomic environmentand public institutions subindexes For the 2003 GCI computationsBotswana was ranked at 36 just behind Greece on the worldwide com-parisons (World Economic Forum)

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

REFERENCES

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Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

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Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

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G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

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Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

THE AFRICAN PEER REVIEW MECHANISM 289

International Development (USAID) the Department for InternationalDevelopment (DFID) of the UK and others The active involvement forexample of four members of the HSGICmdashPresident Thabo Mbeki ofSouth Africa President Olusegun Obasanjo of Nigeria President JoaquimChissano of Mozambique and President John Kufuor of Ghanamdashin theremoval from office and exiling of the corrupt warlord President CharlesTaylor from Liberia in 2003 has certainly deepened international supportfor the NEPAD and what it represents

Indeed another perspective offered in the various commentaries onthe NEPAD is that ldquoAfrican leaders merit a chance to reverse the numer-ous crises in the continent which they are proposing as outlined in theNEPAD documentrdquo (AnyangrsquoNyongrsquoo Ghirmazion and Lamba 3) Fur-thermore ldquotheir [Africarsquos leaders] acknowledgement of the need for arenaissance in Africa and of the concepts of democracy accountabilitytransparency and peer review should account for more than the pessimis-tic criticism and call for dismissal of the [NEPAD] document being calledfor by some scholarsrdquo (AnyangrsquoNyongrsquoo Ghirmazion and Lamba 3ndash4)This would seem to constitute an enlightened conclusion and particularlyso given that the critics and Afro-pessimists have offered no alternativedevelopment framework and that some of them are in fact guilty ofchampioning discredited and abandoned ideas from the past Moreoverit ought to be accepted by all critics and Afro-pessimistsmdashin the spirit ofthe good governance that they presumably seek for Africamdashthat theweight responsibility and accountability for leadership on the continentultimately rests with those who sought election and were democraticallyelected by the majority of their fellow citizens

THE PEER REVIEW CONCEPT AND THE AFRICAN PEER REVIEW MECHANISM

The APRM is an African-led innovation representing a bold approach toreform for building capable states with enduring good governance andsustainable development The APRM is designed to monitor and assessthe progress made by African countries in meeting their commitmenttoward achieving good governance social reforms and sustainabledevelopment It will also provide a platform for countries to share expe-riences with a view to fostering good governance and democratic pro-cesses But before going further on the APRM it is useful to set the stagefor the rest of the discussion to follow by first examining the concept ofpeer review

What Is Peer Review

Peer reviews were pioneered by the OECD Since its creation as an insti-tution four decades ago the OECD has successfully used this method ofassessment of the performance of its member states In addition several

290 KEMPE RONALD HOPE SR

other intergovernmental and international organizations such as theEuropean Union (EU) UN bodies and the IMF use peer review tomonitor and assess national policies and performance in several sectors(OECD)

Peer review refers to the systematic examination and assessment of theperformance of a state by other states (peers) by designated institutionsor by a combination of states and designated institutions (OECD UNECA2002b 2002c) The ultimate goal is to assist the reviewed state to improveits policy making adopt best practices and comply with establishedstandards principles codes and other agreed commitments Peer reviewexaminations and assessments are conducted in a nonadversarial mannerand they rely heavily on the mutual trust and understanding between thestate being reviewed and the reviewers as well as their shared confidencein the process (OECD UNECA 2002b)

The international experience shows peer reviews can be conductedbased on subject areas or themes For example an individual country peerreview could relate to economics governance education health the envi-ronment or other policies and practices Within one or more of thesesubject areas a state may be examined against a wide range of codes andstandards for compliance for example (OECD UNECA 2002b) Similarlyseveral countries can be examined at the same time with respect to aparticular theme for instance ldquoCombating Corruption for SustainableDevelopmentrdquo (UNECA 2002b) However whether based on subject areasor themes individual country peer reviews are typically undertaken ona regular basis with each review exercise resulting in a report thatassesses accomplishments indicates shortcomings and makes recom-mendations They usually do not entail sanctions or a punitive decisionbut they can lead to embarrassment and negative market reactions suchas lower levels of investment or exchange rate fluctuations biased againstthe national currency

Nonetheless related to the concept of peer review is the concept of peerpressure According to the OECD and Takatoshi Ito the effectiveness ofpeer review relies on the influence of peer pressure that is the persuasionexercised by the peers The peer review process can give rise to peerpressure through for example a mix of formal recommendations andinformal consultations by peer countries public scrutiny comparisonsand ranking among countries and the impact of the foregoing on publicopinion policy makers and other stakeholders The lessons of peerreviews conducted in the developed countries suggest that the greatestimpact is derived when the outcomes of peer reviews are put in the publicdomain It is that public scrutiny that is most likely to influence changeand bring about corrective actions In addition the East Asian experiencesuggests that peer pressure provides an effective incentive to commitmember countries to perform the required activities and take the neces-sary actions for common policy objectives (Wang and Yoon)

THE AFRICAN PEER REVIEW MECHANISM 291

The APRM

UNECA originally developed the APRM in response to a request by theNEPAD HSGIC Its (the APRMrsquos) mandate ensures that the policies andpractices of participating states conform to the agreed political economicand corporate governance codes and standards contained in the

Declara-tion on Democracy Political Economic and Corporate Governance

that wasapproved by the African Union (AU) Summit in July 2002 (NEPAD Sec-retariat 2002a) The APRM is a mutually agreed instrument for self-mon-itoring by the participating member states It is voluntarily acceded to bymember states of the AU (NEPAD Secretariat 2003a)

The primary purpose of the APRM is to foster the adoption of policiesstandards and practices that lead to political stability high economicgrowth sustainable development and accelerated integration throughthe sharing of experiences and the reinforcement of successful and bestpractice including identifying deficiencies and assessing the needs forcapacity building This is to be accomplished by using the relevant indi-cators contained in the APRM to measure and determine the progress ofpeer-reviewed countries in meeting the goals of achieving good gover-nance and sustainable development The overarching goal of the APRMis for all participating countries to accelerate their progress toward adopt-ing and implementing the priorities and programs of the NEPAD achiev-ing the mutually agreed objectives and compliance with best practice inrespect to each of the areas of good governance and sustainable develop-ment (NEPAD Secretariat 2003a) As articulated by Chris Stalsmdasha memberof the APR Panel which is discussed belowmdashthe application of theAPRM and the resultant ldquorecommendations are not meant to punish orexclude countries the main objective is to help each country to identifyits own weaknesses and to find ways and means for addressing theshortcomingsrdquo (Stals 5)

Every peer review exercise undertaken under the authority of theAPRM must be technically competent and free of political manipulationIt must comply with the mandate of the APRM referred to above Thesestipulations together constitute the core guiding principles of the mecha-nism And with respect to the process and procedures for the applicationof the APRM the NEPAD HSGIC has approved four distinct organiza-tional components and five stages (NEPAD Secretariat 2003b) The firstorganizational component is the Committee of Participating Heads ofState and Government (the APR Heads of State Forum) which is thehighest decision-making authority in the APRM with overall responsibil-ity for the said APRM The APR Heads of State Forum will consist ofHeads of State and Government of the member states of the AU who havevoluntarily chosen to accede to the APRM The next organizational com-ponent is the Panel of Eminent Persons (APR Panel) This is an indepen-dent body that will oversee the day-to-day functioning of the peer review

292 KEMPE RONALD HOPE SR

process and ensure the credibility and integrity of that process The thirdorganizational component is the APR Secretariat which will provide thesecretarial coordinating and administrative support services for theAPRM through the APR Panel The final organizational component isthe APR Teams which will be conducting the actual technical assessmentsthat will constitute the country peer reviews

The functions of the APR Heads of State Forum include but are notlimited to (1) appointing the APR Panel and its chairperson (2) consider-ing adopting and taking ownership of country peer review reports (3)communicating the recommendations of the APR Heads of State Forumto the peer-reviewed countries (4) exercising peer pressure to effectchanges in country practice where recommended (5) persuading devel-opment partners to provide technical assistance to eliminate capacitygaps as recommended by the country peer review reports (6) transmit-ting peer review reports to the appropriate AU structures and (7) makingpublic through the APR Secretariat country peer review reports andpress releases pertaining thereto

The functions of the APR Panel include but are not limited to (1)exercising oversight of the APR process including providing leadershipto country review teams with a view to ensuring the independenceprofessionalism and credibility of that process (2) recommending appro-priate African institutions or individuals to conduct technical assess-ments (3) reviewing and adopting the country peer review reportsincluding the recommendations contained therein and (4) submitting tothe APR Heads of State Forum all country peer review reports withrecommendations on measures that could be taken to assist the reviewedcountries in the improvement of their governance and socio-developmentperformance By November 2003 the HSGIC had appointed seven mem-bers of the APR Panel More members may be appointed at a later datewith a probable final complement of ten two from each of the fivesubregions

The functions of the APR Secretariat include (1) providing secretarialand administrative support services to the APR Panel under the directsupervision of the Chairperson of that Panel (2) organizing regionalnetworks and workshops for the sharing of experience and best practicerelated to the goals of achieving good governance and sustainable devel-opment and (3) ensuring full documentation of the peer review processesat country subregional and continental levels to facilitate mutual learning

The APR Teams are responsible for conducting the technical countryassessments that will comprise the country peer reviews Credible andtechnically competent institutions such as the UNDP the UNECA andthe AfDB have been selected to assist with some of the peer reviewtechnical assessments The UNECA will assist with the technical assess-ments in economic governance and management while the AfDB willassist with banking and financial standards for example The APR Panelwill select other credible and technically competent institutions or indi-

THE AFRICAN PEER REVIEW MECHANISM 293

viduals to undertake the peer review assessments in the areas of politicalgovernance corporate governance and socioeconomic development

As mentioned before there are five stages to the peer review processStage One entails a careful analysis of the governance and developmentenvironment in the country being reviewed Key governance and devel-opment issues will be analyzed to provide background information withrespect to political representativeness and rights institutional effective-ness and economic management and governance Political representa-tiveness and rights will cover issues of political systems and electoralprocesses representation and participation of various stakeholders indecision making Institutional effectiveness will include issues related tothe nature and workings of the legislative judiciary and executivebranches of government as well as the state of the nongovernmentalsector Economic management and governance will address issues ofmacroeconomic management public financial accountability monetaryand financial transparency accounting and auditing systems and regula-tory oversight bodies as well as issues of capacity effectiveness andaccountability of the economic decision making and service deliverysystems

Stage two constitutes the country visits by the peer review technicalassessment teams This stage is informed by the analysis prepared inStage One The technical assessment teams will consult and extensivelyinterview relevant government officials parliamentarians oppositionparty members not in parliament private sector representatives repre-sentatives of civil society groups (including the media academia tradeunions and nongovernmental organizations) and officials of residentmissions of regional and international organizations

Stage Three involves the preparation of the peer review reports basedon the technical assessments conducted in Stage Two A draft of eachreport will be discussed with the government concerned prior to submis-sion to the APR Panel Those discussions will be designed to ensure theaccuracy of the information and to provide the government an opportu-nity to react to the findings and recommendations of the assessment teamThese responses of the government will be appended to the final draft ofthe report However each report will remain independent and its find-ings will not be altered or vetted by the government concerned

Stage Four entails discussion and adoption of the peer review reportsby the APR Panel first followed by the APR Heads of State Forum Thisstage terminates when the Chairperson of the latter communicates thedecisions and recommendations to the government of the country beingpeer reviewed Stage Five is the formal and public tabling of the peerreview reports in key regional and subregional structures and in partic-ular the AU structures These reports will also be put in the publicdomain

The NEPAD HSGIC has also approved a number of indicators basedon key objectives that will be used to assess and measure performance

294 KEMPE RONALD HOPE SR

in the four peer review areas of (1) democracy and political governance(2) economic governance and management (3) corporate governance and(4) socioeconomic development (NEPAD Secretariat 2003a) The keyobjectives for democracy and political governance include (1) to preventand reduce intra- and intercountry conflicts (2) the consolidation of con-stitutional democracy including periodic political competition andopportunity for choice the rule of law a Bill of Rights and the supremacyof the constitution being firmly established (3) promotion and protectionof economic social cultural civil and political rights as enshrined in allAfrican and international human rights instruments (4) upholding theseparation of powers including the protection of the independence of thejudiciary and of an effective parliament (5) ensuring accountable effi-cient and effective public office holders and civil servants (6) fightingcorruption in the political arena (7) promotion and protection of therights of women (8) promotion and protection of the rights of the childand young persons and (9) promotion and protection of the rights ofvulnerable groups including displaced persons

The key objectives for economic governance and management are (1)promoting macroeconomic policies that support sustainable develop-ment (2) implementing transparent predictable and credible governmenteconomic policies (3) promoting sound public finance management (4)fighting corruption and money laundering and (5) accelerating regionalintegration by participating in the harmonization of monetary trade andinvestment policies among participating states

The key corporate governance objectives are (1) providing an enablingenvironment and effective regulatory framework for economic activities(2) ensuring that corporations act as good corporate citizens with regardto human rights social responsibility and environmental sustainability(3) promoting the adoption of codes of good business ethics in achievingthe objectives of the organization (4) ensuring that corporations treat alltheir stakeholders in a fair and just manner and (5) providing for account-ability of corporations and directors

The key objectives for socioeconomic development are to (1) promoteself-reliance in development and build capacity for self-sustaining devel-opment (2) accelerate socioeconomic development to achieve sustainabledevelopment and poverty eradication (3) strengthen policies deliverymechanisms and outputs in key social development areas such as edu-cation for all and the combating of HIVAIDS and other communicablediseases (4) ensure affordable access to water energy finance marketsand information and communication technologies to all citizens (5) makeprogress toward gender equality particularly equal access to educationfor girls at all levels and (6) encourage broad-based participation indevelopment by all stakeholders at all levels

The 2002 AU Summit also approved the frequency of peer reviewsSpecifically there will be four types of peer reviews The first countryreview being the base review will be undertaken within 18 months of acountryrsquos becoming a member of the APRM The second type is the

THE AFRICAN PEER REVIEW MECHANISM 295

periodic review that should take place every two years The next type isa requested review where a member country can for its own reasons askfor a review that is not part of the periodically mandated reviews Thefinal type amounts to an imposed review and may be resorted to by theHSGIC if there is sufficient cause to conclude that there are early signs ofimpending political andor economic crises in a member country

Despite the fact that participation in the APRM is open to all memberstates of the AU on a voluntary basis there is now a somewhat morebureaucratic and unnecessarily cumbersome process that countries haveto contend with The APRM has evolved from its original technicallystraightforward framework to become a somewhat more burdensomeadministrative process Nonetheless this eventuality does not seem tohave particularly influenced the desire and decision by the member statesto seek participation in the process This is probably not surprising asundoubtedly countries that are actually peer reviewed stand to reap anumber of benefits as discussed in the next section It should be notedhere that in November 2002 a total of 12 of the 53 African countries hadoriginally declared their intent to be peer reviewed Those countries wereAlgeria Republic of Congo Egypt Ethiopia Gabon Ghana Mali Mau-ritius Mozambique Nigeria Rwanda and South Africa As of August2004 a total of 23 countriesmdashincluding the additional 11 of Angola BeninBurkina Faso Cameroon Kenya Lesotho Malawi Senegal Sierra LeoneTanzania and Ugandamdashhad signed the Memorandum of Understandingthat represents the basic framework for formal accession to the APRM(NEPAD Secretariat 2002b 2003c 2003d 2003e 2004) Other countries areexpected to accede in time However Ghana will be noted in Africarsquoseconomic and political history as the first country on the continent to bereviewed under the APRM The country inaugurated the APRM processin May 2004 By August 2004 four countriesmdashGhana Kenya Mauritiusand Rwandamdashhad been visited by peer review support mission teamsand were at various stages in the process

BENEFITS OF THE APRM AN ANALYTICAL ASSESSMENT

Given the international experience with peer reviews the APRMmdashas amechanism for measuring and monitoring progress toward good gover-nance and sustainable development in Africamdashhas the potential to pro-vide a number of benefits to those African countries that subjectthemselves to it and through multiplier effects to the continent as awhole Peer reviews have been demonstrated to have a number of bene-ficial effects as applied across the world As African countries seek toimprove their governance and march toward sustainable developmentpeer reviews can provide the basis for policy changes to meet commit-ments and to observe the agreed standards and codes

Indeed peer reviews will facilitate the monitoring of compliance withthe agreements entered into upon accession to the APRM States are muchmore inclined to comply when they know their implementation is moni-

296 KEMPE RONALD HOPE SR

tored and when the implementation of their peers is being monitored aswell (Henning) Given the history and resultant disastrous effects of badgovernance in Africa with a lack of openness and rampant corruptionacceding to peer review represents a sea change in the thinking of Africanleaders and a major milestone in the political development and history ofthe continent Below we concentrate on six key areas where peer reviewswill add value and enhance the prospects for African states to achievegood governance and sustainable development

Greater Transparency

Following Seiichi Kondo transparency is taken here to mean that reliablerelevant and timely information about the activities of government isavailable to the public Associated with transparency is the concept ofopenness whereby public participation in shaping and implementinggovernment policy is encouraged and guaranteed Transparency in gov-ernment is a good thing for governments in Africa have the most poten-tial for going awry given their monopoly on force and power and the easewith which they use and abuse that force and power Where there istransparency government officials will be prevented from exercising dis-cretionary powers Transparency therefore complements and reinforcespredictability reduces uncertainty and inhibits and reduces the scope ofcorruption among public officials (Siegle Weinstein and Halperin)

The APRM will be particularly applied to democracy and politicalgovernance issues and economic and corporate governance issues Inboth cases transparency looms large The openness of the political spaceis a critical barometer of the nature of democracy in a given countrySimilarly in the economic sphere the extent of fiscal transparencyprovides a very solid indication of the manner in which budgets (expen-ditures and revenues) for example are crafted reconciled and imple-mented Determining the nature of transparency in governmentoperations and functioning in Africa will expose the shortcomings andany deliberate secrecy or misreporting of government operations

Transparency in government operations particularly in Africa hasseveral dimensions (Kopits and Craig) The first dimension consists ofmainly behavioral aspects such as clearly established conflict-of-interestrules for elected and appointed officials a transparent regulatory frame-work open public procurement and employment practices a code ofconduct for public officials and freedom-of-information requirementsThe next is the provision of reliable information on the governmentrsquoseconomic policy intentions and forecasts The third is the requirement fordetailed data and information on government operations including thepublication of comprehensive budget and other planning and policy doc-uments In all three dimensions transparency is closely associated withthe successful implementation of good governance and the achievementof sustainable development

THE AFRICAN PEER REVIEW MECHANISM 297

The APRM to the extent that it enhances transparency in Africancountries will acknowledge democratic progress and scorn antidemo-cratic measures Consequently it can confer or withhold internationalrecognition and raise or lower the domestic legitimacy of governments(Henning) Moreover transparency increases the political risk of unsus-tainable policies whereas the lack thereof means that such policies cango undetected longer than they otherwise would Generally countriescharacterized by a relatively high degree of transparency have exhibitedgreater political and economic discipline and in many instances havebeen able to achieve a more robust political and economic performancecompared to countries with less transparent policies even within a sameregion (Henning)

This positive correlation between transparency and good governancehas also been empirically demonstrated across the spectrum of bothdeveloped and developing countries R Islam for instance has shownthat governments that are more transparent govern better as measuredby a wide number of governance indicators such as government effective-ness regulatory burden corruption voice and accountability the rule oflaw bureaucratic efficiency contract repudiation and expropriation riskAnd as better governance has also been empirically demonstrated to becorrelated with higher growth rates it can be extrapolated that there is aclose relationship between greater transparency and how fast economiesgrow (Islam) Botswana for example is internationally recognized for itssubstantial degree of transparency with a liberal democratic political sys-tem and a prudent and open budgetary process (Hope 2002a Kopits andCraig) As a result Botswana continues to experience political and mac-roeconomic stability with strong growth The country has consistentlybeen one of the fastest growing in the world with an annual averagegrowth rate of per capita gross domestic product (GDP) of 51 percentduring the period 1975ndash2002 compared with an annual average of

minus

08percent for sub-Saharan Africa during the same period (UNDP 2004)

That relationship between transparency good governance and growthin Botswana is further reflected in the growth competitiveness index(GCI) of the World Economic Forum The GCI is composed of threesubindexes identified as pillars in the evolution of growth in a country(1) the quality of the macroeconomic environment (2) the state of publicinstitutions and (3) the level of technological readiness The GCI uses acombination of hard data such as inflation rates budget deficits the levelof Internet access in schools and survey data in areas such as judicialindependence the prevalence of institutionalized corruption and theextent of inefficient government intervention in the economy (Lopez-Claros) Botswana has consistently ranked in first place among all Africancountries in the overall GCI as well as in the macroeconomic environmentand public institutions subindexes For the 2003 GCI computationsBotswana was ranked at 36 just behind Greece on the worldwide com-parisons (World Economic Forum)

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

REFERENCES

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Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

290 KEMPE RONALD HOPE SR

other intergovernmental and international organizations such as theEuropean Union (EU) UN bodies and the IMF use peer review tomonitor and assess national policies and performance in several sectors(OECD)

Peer review refers to the systematic examination and assessment of theperformance of a state by other states (peers) by designated institutionsor by a combination of states and designated institutions (OECD UNECA2002b 2002c) The ultimate goal is to assist the reviewed state to improveits policy making adopt best practices and comply with establishedstandards principles codes and other agreed commitments Peer reviewexaminations and assessments are conducted in a nonadversarial mannerand they rely heavily on the mutual trust and understanding between thestate being reviewed and the reviewers as well as their shared confidencein the process (OECD UNECA 2002b)

The international experience shows peer reviews can be conductedbased on subject areas or themes For example an individual country peerreview could relate to economics governance education health the envi-ronment or other policies and practices Within one or more of thesesubject areas a state may be examined against a wide range of codes andstandards for compliance for example (OECD UNECA 2002b) Similarlyseveral countries can be examined at the same time with respect to aparticular theme for instance ldquoCombating Corruption for SustainableDevelopmentrdquo (UNECA 2002b) However whether based on subject areasor themes individual country peer reviews are typically undertaken ona regular basis with each review exercise resulting in a report thatassesses accomplishments indicates shortcomings and makes recom-mendations They usually do not entail sanctions or a punitive decisionbut they can lead to embarrassment and negative market reactions suchas lower levels of investment or exchange rate fluctuations biased againstthe national currency

Nonetheless related to the concept of peer review is the concept of peerpressure According to the OECD and Takatoshi Ito the effectiveness ofpeer review relies on the influence of peer pressure that is the persuasionexercised by the peers The peer review process can give rise to peerpressure through for example a mix of formal recommendations andinformal consultations by peer countries public scrutiny comparisonsand ranking among countries and the impact of the foregoing on publicopinion policy makers and other stakeholders The lessons of peerreviews conducted in the developed countries suggest that the greatestimpact is derived when the outcomes of peer reviews are put in the publicdomain It is that public scrutiny that is most likely to influence changeand bring about corrective actions In addition the East Asian experiencesuggests that peer pressure provides an effective incentive to commitmember countries to perform the required activities and take the neces-sary actions for common policy objectives (Wang and Yoon)

THE AFRICAN PEER REVIEW MECHANISM 291

The APRM

UNECA originally developed the APRM in response to a request by theNEPAD HSGIC Its (the APRMrsquos) mandate ensures that the policies andpractices of participating states conform to the agreed political economicand corporate governance codes and standards contained in the

Declara-tion on Democracy Political Economic and Corporate Governance

that wasapproved by the African Union (AU) Summit in July 2002 (NEPAD Sec-retariat 2002a) The APRM is a mutually agreed instrument for self-mon-itoring by the participating member states It is voluntarily acceded to bymember states of the AU (NEPAD Secretariat 2003a)

The primary purpose of the APRM is to foster the adoption of policiesstandards and practices that lead to political stability high economicgrowth sustainable development and accelerated integration throughthe sharing of experiences and the reinforcement of successful and bestpractice including identifying deficiencies and assessing the needs forcapacity building This is to be accomplished by using the relevant indi-cators contained in the APRM to measure and determine the progress ofpeer-reviewed countries in meeting the goals of achieving good gover-nance and sustainable development The overarching goal of the APRMis for all participating countries to accelerate their progress toward adopt-ing and implementing the priorities and programs of the NEPAD achiev-ing the mutually agreed objectives and compliance with best practice inrespect to each of the areas of good governance and sustainable develop-ment (NEPAD Secretariat 2003a) As articulated by Chris Stalsmdasha memberof the APR Panel which is discussed belowmdashthe application of theAPRM and the resultant ldquorecommendations are not meant to punish orexclude countries the main objective is to help each country to identifyits own weaknesses and to find ways and means for addressing theshortcomingsrdquo (Stals 5)

Every peer review exercise undertaken under the authority of theAPRM must be technically competent and free of political manipulationIt must comply with the mandate of the APRM referred to above Thesestipulations together constitute the core guiding principles of the mecha-nism And with respect to the process and procedures for the applicationof the APRM the NEPAD HSGIC has approved four distinct organiza-tional components and five stages (NEPAD Secretariat 2003b) The firstorganizational component is the Committee of Participating Heads ofState and Government (the APR Heads of State Forum) which is thehighest decision-making authority in the APRM with overall responsibil-ity for the said APRM The APR Heads of State Forum will consist ofHeads of State and Government of the member states of the AU who havevoluntarily chosen to accede to the APRM The next organizational com-ponent is the Panel of Eminent Persons (APR Panel) This is an indepen-dent body that will oversee the day-to-day functioning of the peer review

292 KEMPE RONALD HOPE SR

process and ensure the credibility and integrity of that process The thirdorganizational component is the APR Secretariat which will provide thesecretarial coordinating and administrative support services for theAPRM through the APR Panel The final organizational component isthe APR Teams which will be conducting the actual technical assessmentsthat will constitute the country peer reviews

The functions of the APR Heads of State Forum include but are notlimited to (1) appointing the APR Panel and its chairperson (2) consider-ing adopting and taking ownership of country peer review reports (3)communicating the recommendations of the APR Heads of State Forumto the peer-reviewed countries (4) exercising peer pressure to effectchanges in country practice where recommended (5) persuading devel-opment partners to provide technical assistance to eliminate capacitygaps as recommended by the country peer review reports (6) transmit-ting peer review reports to the appropriate AU structures and (7) makingpublic through the APR Secretariat country peer review reports andpress releases pertaining thereto

The functions of the APR Panel include but are not limited to (1)exercising oversight of the APR process including providing leadershipto country review teams with a view to ensuring the independenceprofessionalism and credibility of that process (2) recommending appro-priate African institutions or individuals to conduct technical assess-ments (3) reviewing and adopting the country peer review reportsincluding the recommendations contained therein and (4) submitting tothe APR Heads of State Forum all country peer review reports withrecommendations on measures that could be taken to assist the reviewedcountries in the improvement of their governance and socio-developmentperformance By November 2003 the HSGIC had appointed seven mem-bers of the APR Panel More members may be appointed at a later datewith a probable final complement of ten two from each of the fivesubregions

The functions of the APR Secretariat include (1) providing secretarialand administrative support services to the APR Panel under the directsupervision of the Chairperson of that Panel (2) organizing regionalnetworks and workshops for the sharing of experience and best practicerelated to the goals of achieving good governance and sustainable devel-opment and (3) ensuring full documentation of the peer review processesat country subregional and continental levels to facilitate mutual learning

The APR Teams are responsible for conducting the technical countryassessments that will comprise the country peer reviews Credible andtechnically competent institutions such as the UNDP the UNECA andthe AfDB have been selected to assist with some of the peer reviewtechnical assessments The UNECA will assist with the technical assess-ments in economic governance and management while the AfDB willassist with banking and financial standards for example The APR Panelwill select other credible and technically competent institutions or indi-

THE AFRICAN PEER REVIEW MECHANISM 293

viduals to undertake the peer review assessments in the areas of politicalgovernance corporate governance and socioeconomic development

As mentioned before there are five stages to the peer review processStage One entails a careful analysis of the governance and developmentenvironment in the country being reviewed Key governance and devel-opment issues will be analyzed to provide background information withrespect to political representativeness and rights institutional effective-ness and economic management and governance Political representa-tiveness and rights will cover issues of political systems and electoralprocesses representation and participation of various stakeholders indecision making Institutional effectiveness will include issues related tothe nature and workings of the legislative judiciary and executivebranches of government as well as the state of the nongovernmentalsector Economic management and governance will address issues ofmacroeconomic management public financial accountability monetaryand financial transparency accounting and auditing systems and regula-tory oversight bodies as well as issues of capacity effectiveness andaccountability of the economic decision making and service deliverysystems

Stage two constitutes the country visits by the peer review technicalassessment teams This stage is informed by the analysis prepared inStage One The technical assessment teams will consult and extensivelyinterview relevant government officials parliamentarians oppositionparty members not in parliament private sector representatives repre-sentatives of civil society groups (including the media academia tradeunions and nongovernmental organizations) and officials of residentmissions of regional and international organizations

Stage Three involves the preparation of the peer review reports basedon the technical assessments conducted in Stage Two A draft of eachreport will be discussed with the government concerned prior to submis-sion to the APR Panel Those discussions will be designed to ensure theaccuracy of the information and to provide the government an opportu-nity to react to the findings and recommendations of the assessment teamThese responses of the government will be appended to the final draft ofthe report However each report will remain independent and its find-ings will not be altered or vetted by the government concerned

Stage Four entails discussion and adoption of the peer review reportsby the APR Panel first followed by the APR Heads of State Forum Thisstage terminates when the Chairperson of the latter communicates thedecisions and recommendations to the government of the country beingpeer reviewed Stage Five is the formal and public tabling of the peerreview reports in key regional and subregional structures and in partic-ular the AU structures These reports will also be put in the publicdomain

The NEPAD HSGIC has also approved a number of indicators basedon key objectives that will be used to assess and measure performance

294 KEMPE RONALD HOPE SR

in the four peer review areas of (1) democracy and political governance(2) economic governance and management (3) corporate governance and(4) socioeconomic development (NEPAD Secretariat 2003a) The keyobjectives for democracy and political governance include (1) to preventand reduce intra- and intercountry conflicts (2) the consolidation of con-stitutional democracy including periodic political competition andopportunity for choice the rule of law a Bill of Rights and the supremacyof the constitution being firmly established (3) promotion and protectionof economic social cultural civil and political rights as enshrined in allAfrican and international human rights instruments (4) upholding theseparation of powers including the protection of the independence of thejudiciary and of an effective parliament (5) ensuring accountable effi-cient and effective public office holders and civil servants (6) fightingcorruption in the political arena (7) promotion and protection of therights of women (8) promotion and protection of the rights of the childand young persons and (9) promotion and protection of the rights ofvulnerable groups including displaced persons

The key objectives for economic governance and management are (1)promoting macroeconomic policies that support sustainable develop-ment (2) implementing transparent predictable and credible governmenteconomic policies (3) promoting sound public finance management (4)fighting corruption and money laundering and (5) accelerating regionalintegration by participating in the harmonization of monetary trade andinvestment policies among participating states

The key corporate governance objectives are (1) providing an enablingenvironment and effective regulatory framework for economic activities(2) ensuring that corporations act as good corporate citizens with regardto human rights social responsibility and environmental sustainability(3) promoting the adoption of codes of good business ethics in achievingthe objectives of the organization (4) ensuring that corporations treat alltheir stakeholders in a fair and just manner and (5) providing for account-ability of corporations and directors

The key objectives for socioeconomic development are to (1) promoteself-reliance in development and build capacity for self-sustaining devel-opment (2) accelerate socioeconomic development to achieve sustainabledevelopment and poverty eradication (3) strengthen policies deliverymechanisms and outputs in key social development areas such as edu-cation for all and the combating of HIVAIDS and other communicablediseases (4) ensure affordable access to water energy finance marketsand information and communication technologies to all citizens (5) makeprogress toward gender equality particularly equal access to educationfor girls at all levels and (6) encourage broad-based participation indevelopment by all stakeholders at all levels

The 2002 AU Summit also approved the frequency of peer reviewsSpecifically there will be four types of peer reviews The first countryreview being the base review will be undertaken within 18 months of acountryrsquos becoming a member of the APRM The second type is the

THE AFRICAN PEER REVIEW MECHANISM 295

periodic review that should take place every two years The next type isa requested review where a member country can for its own reasons askfor a review that is not part of the periodically mandated reviews Thefinal type amounts to an imposed review and may be resorted to by theHSGIC if there is sufficient cause to conclude that there are early signs ofimpending political andor economic crises in a member country

Despite the fact that participation in the APRM is open to all memberstates of the AU on a voluntary basis there is now a somewhat morebureaucratic and unnecessarily cumbersome process that countries haveto contend with The APRM has evolved from its original technicallystraightforward framework to become a somewhat more burdensomeadministrative process Nonetheless this eventuality does not seem tohave particularly influenced the desire and decision by the member statesto seek participation in the process This is probably not surprising asundoubtedly countries that are actually peer reviewed stand to reap anumber of benefits as discussed in the next section It should be notedhere that in November 2002 a total of 12 of the 53 African countries hadoriginally declared their intent to be peer reviewed Those countries wereAlgeria Republic of Congo Egypt Ethiopia Gabon Ghana Mali Mau-ritius Mozambique Nigeria Rwanda and South Africa As of August2004 a total of 23 countriesmdashincluding the additional 11 of Angola BeninBurkina Faso Cameroon Kenya Lesotho Malawi Senegal Sierra LeoneTanzania and Ugandamdashhad signed the Memorandum of Understandingthat represents the basic framework for formal accession to the APRM(NEPAD Secretariat 2002b 2003c 2003d 2003e 2004) Other countries areexpected to accede in time However Ghana will be noted in Africarsquoseconomic and political history as the first country on the continent to bereviewed under the APRM The country inaugurated the APRM processin May 2004 By August 2004 four countriesmdashGhana Kenya Mauritiusand Rwandamdashhad been visited by peer review support mission teamsand were at various stages in the process

BENEFITS OF THE APRM AN ANALYTICAL ASSESSMENT

Given the international experience with peer reviews the APRMmdashas amechanism for measuring and monitoring progress toward good gover-nance and sustainable development in Africamdashhas the potential to pro-vide a number of benefits to those African countries that subjectthemselves to it and through multiplier effects to the continent as awhole Peer reviews have been demonstrated to have a number of bene-ficial effects as applied across the world As African countries seek toimprove their governance and march toward sustainable developmentpeer reviews can provide the basis for policy changes to meet commit-ments and to observe the agreed standards and codes

Indeed peer reviews will facilitate the monitoring of compliance withthe agreements entered into upon accession to the APRM States are muchmore inclined to comply when they know their implementation is moni-

296 KEMPE RONALD HOPE SR

tored and when the implementation of their peers is being monitored aswell (Henning) Given the history and resultant disastrous effects of badgovernance in Africa with a lack of openness and rampant corruptionacceding to peer review represents a sea change in the thinking of Africanleaders and a major milestone in the political development and history ofthe continent Below we concentrate on six key areas where peer reviewswill add value and enhance the prospects for African states to achievegood governance and sustainable development

Greater Transparency

Following Seiichi Kondo transparency is taken here to mean that reliablerelevant and timely information about the activities of government isavailable to the public Associated with transparency is the concept ofopenness whereby public participation in shaping and implementinggovernment policy is encouraged and guaranteed Transparency in gov-ernment is a good thing for governments in Africa have the most poten-tial for going awry given their monopoly on force and power and the easewith which they use and abuse that force and power Where there istransparency government officials will be prevented from exercising dis-cretionary powers Transparency therefore complements and reinforcespredictability reduces uncertainty and inhibits and reduces the scope ofcorruption among public officials (Siegle Weinstein and Halperin)

The APRM will be particularly applied to democracy and politicalgovernance issues and economic and corporate governance issues Inboth cases transparency looms large The openness of the political spaceis a critical barometer of the nature of democracy in a given countrySimilarly in the economic sphere the extent of fiscal transparencyprovides a very solid indication of the manner in which budgets (expen-ditures and revenues) for example are crafted reconciled and imple-mented Determining the nature of transparency in governmentoperations and functioning in Africa will expose the shortcomings andany deliberate secrecy or misreporting of government operations

Transparency in government operations particularly in Africa hasseveral dimensions (Kopits and Craig) The first dimension consists ofmainly behavioral aspects such as clearly established conflict-of-interestrules for elected and appointed officials a transparent regulatory frame-work open public procurement and employment practices a code ofconduct for public officials and freedom-of-information requirementsThe next is the provision of reliable information on the governmentrsquoseconomic policy intentions and forecasts The third is the requirement fordetailed data and information on government operations including thepublication of comprehensive budget and other planning and policy doc-uments In all three dimensions transparency is closely associated withthe successful implementation of good governance and the achievementof sustainable development

THE AFRICAN PEER REVIEW MECHANISM 297

The APRM to the extent that it enhances transparency in Africancountries will acknowledge democratic progress and scorn antidemo-cratic measures Consequently it can confer or withhold internationalrecognition and raise or lower the domestic legitimacy of governments(Henning) Moreover transparency increases the political risk of unsus-tainable policies whereas the lack thereof means that such policies cango undetected longer than they otherwise would Generally countriescharacterized by a relatively high degree of transparency have exhibitedgreater political and economic discipline and in many instances havebeen able to achieve a more robust political and economic performancecompared to countries with less transparent policies even within a sameregion (Henning)

This positive correlation between transparency and good governancehas also been empirically demonstrated across the spectrum of bothdeveloped and developing countries R Islam for instance has shownthat governments that are more transparent govern better as measuredby a wide number of governance indicators such as government effective-ness regulatory burden corruption voice and accountability the rule oflaw bureaucratic efficiency contract repudiation and expropriation riskAnd as better governance has also been empirically demonstrated to becorrelated with higher growth rates it can be extrapolated that there is aclose relationship between greater transparency and how fast economiesgrow (Islam) Botswana for example is internationally recognized for itssubstantial degree of transparency with a liberal democratic political sys-tem and a prudent and open budgetary process (Hope 2002a Kopits andCraig) As a result Botswana continues to experience political and mac-roeconomic stability with strong growth The country has consistentlybeen one of the fastest growing in the world with an annual averagegrowth rate of per capita gross domestic product (GDP) of 51 percentduring the period 1975ndash2002 compared with an annual average of

minus

08percent for sub-Saharan Africa during the same period (UNDP 2004)

That relationship between transparency good governance and growthin Botswana is further reflected in the growth competitiveness index(GCI) of the World Economic Forum The GCI is composed of threesubindexes identified as pillars in the evolution of growth in a country(1) the quality of the macroeconomic environment (2) the state of publicinstitutions and (3) the level of technological readiness The GCI uses acombination of hard data such as inflation rates budget deficits the levelof Internet access in schools and survey data in areas such as judicialindependence the prevalence of institutionalized corruption and theextent of inefficient government intervention in the economy (Lopez-Claros) Botswana has consistently ranked in first place among all Africancountries in the overall GCI as well as in the macroeconomic environmentand public institutions subindexes For the 2003 GCI computationsBotswana was ranked at 36 just behind Greece on the worldwide com-parisons (World Economic Forum)

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

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Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

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Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

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Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

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Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

THE AFRICAN PEER REVIEW MECHANISM 291

The APRM

UNECA originally developed the APRM in response to a request by theNEPAD HSGIC Its (the APRMrsquos) mandate ensures that the policies andpractices of participating states conform to the agreed political economicand corporate governance codes and standards contained in the

Declara-tion on Democracy Political Economic and Corporate Governance

that wasapproved by the African Union (AU) Summit in July 2002 (NEPAD Sec-retariat 2002a) The APRM is a mutually agreed instrument for self-mon-itoring by the participating member states It is voluntarily acceded to bymember states of the AU (NEPAD Secretariat 2003a)

The primary purpose of the APRM is to foster the adoption of policiesstandards and practices that lead to political stability high economicgrowth sustainable development and accelerated integration throughthe sharing of experiences and the reinforcement of successful and bestpractice including identifying deficiencies and assessing the needs forcapacity building This is to be accomplished by using the relevant indi-cators contained in the APRM to measure and determine the progress ofpeer-reviewed countries in meeting the goals of achieving good gover-nance and sustainable development The overarching goal of the APRMis for all participating countries to accelerate their progress toward adopt-ing and implementing the priorities and programs of the NEPAD achiev-ing the mutually agreed objectives and compliance with best practice inrespect to each of the areas of good governance and sustainable develop-ment (NEPAD Secretariat 2003a) As articulated by Chris Stalsmdasha memberof the APR Panel which is discussed belowmdashthe application of theAPRM and the resultant ldquorecommendations are not meant to punish orexclude countries the main objective is to help each country to identifyits own weaknesses and to find ways and means for addressing theshortcomingsrdquo (Stals 5)

Every peer review exercise undertaken under the authority of theAPRM must be technically competent and free of political manipulationIt must comply with the mandate of the APRM referred to above Thesestipulations together constitute the core guiding principles of the mecha-nism And with respect to the process and procedures for the applicationof the APRM the NEPAD HSGIC has approved four distinct organiza-tional components and five stages (NEPAD Secretariat 2003b) The firstorganizational component is the Committee of Participating Heads ofState and Government (the APR Heads of State Forum) which is thehighest decision-making authority in the APRM with overall responsibil-ity for the said APRM The APR Heads of State Forum will consist ofHeads of State and Government of the member states of the AU who havevoluntarily chosen to accede to the APRM The next organizational com-ponent is the Panel of Eminent Persons (APR Panel) This is an indepen-dent body that will oversee the day-to-day functioning of the peer review

292 KEMPE RONALD HOPE SR

process and ensure the credibility and integrity of that process The thirdorganizational component is the APR Secretariat which will provide thesecretarial coordinating and administrative support services for theAPRM through the APR Panel The final organizational component isthe APR Teams which will be conducting the actual technical assessmentsthat will constitute the country peer reviews

The functions of the APR Heads of State Forum include but are notlimited to (1) appointing the APR Panel and its chairperson (2) consider-ing adopting and taking ownership of country peer review reports (3)communicating the recommendations of the APR Heads of State Forumto the peer-reviewed countries (4) exercising peer pressure to effectchanges in country practice where recommended (5) persuading devel-opment partners to provide technical assistance to eliminate capacitygaps as recommended by the country peer review reports (6) transmit-ting peer review reports to the appropriate AU structures and (7) makingpublic through the APR Secretariat country peer review reports andpress releases pertaining thereto

The functions of the APR Panel include but are not limited to (1)exercising oversight of the APR process including providing leadershipto country review teams with a view to ensuring the independenceprofessionalism and credibility of that process (2) recommending appro-priate African institutions or individuals to conduct technical assess-ments (3) reviewing and adopting the country peer review reportsincluding the recommendations contained therein and (4) submitting tothe APR Heads of State Forum all country peer review reports withrecommendations on measures that could be taken to assist the reviewedcountries in the improvement of their governance and socio-developmentperformance By November 2003 the HSGIC had appointed seven mem-bers of the APR Panel More members may be appointed at a later datewith a probable final complement of ten two from each of the fivesubregions

The functions of the APR Secretariat include (1) providing secretarialand administrative support services to the APR Panel under the directsupervision of the Chairperson of that Panel (2) organizing regionalnetworks and workshops for the sharing of experience and best practicerelated to the goals of achieving good governance and sustainable devel-opment and (3) ensuring full documentation of the peer review processesat country subregional and continental levels to facilitate mutual learning

The APR Teams are responsible for conducting the technical countryassessments that will comprise the country peer reviews Credible andtechnically competent institutions such as the UNDP the UNECA andthe AfDB have been selected to assist with some of the peer reviewtechnical assessments The UNECA will assist with the technical assess-ments in economic governance and management while the AfDB willassist with banking and financial standards for example The APR Panelwill select other credible and technically competent institutions or indi-

THE AFRICAN PEER REVIEW MECHANISM 293

viduals to undertake the peer review assessments in the areas of politicalgovernance corporate governance and socioeconomic development

As mentioned before there are five stages to the peer review processStage One entails a careful analysis of the governance and developmentenvironment in the country being reviewed Key governance and devel-opment issues will be analyzed to provide background information withrespect to political representativeness and rights institutional effective-ness and economic management and governance Political representa-tiveness and rights will cover issues of political systems and electoralprocesses representation and participation of various stakeholders indecision making Institutional effectiveness will include issues related tothe nature and workings of the legislative judiciary and executivebranches of government as well as the state of the nongovernmentalsector Economic management and governance will address issues ofmacroeconomic management public financial accountability monetaryand financial transparency accounting and auditing systems and regula-tory oversight bodies as well as issues of capacity effectiveness andaccountability of the economic decision making and service deliverysystems

Stage two constitutes the country visits by the peer review technicalassessment teams This stage is informed by the analysis prepared inStage One The technical assessment teams will consult and extensivelyinterview relevant government officials parliamentarians oppositionparty members not in parliament private sector representatives repre-sentatives of civil society groups (including the media academia tradeunions and nongovernmental organizations) and officials of residentmissions of regional and international organizations

Stage Three involves the preparation of the peer review reports basedon the technical assessments conducted in Stage Two A draft of eachreport will be discussed with the government concerned prior to submis-sion to the APR Panel Those discussions will be designed to ensure theaccuracy of the information and to provide the government an opportu-nity to react to the findings and recommendations of the assessment teamThese responses of the government will be appended to the final draft ofthe report However each report will remain independent and its find-ings will not be altered or vetted by the government concerned

Stage Four entails discussion and adoption of the peer review reportsby the APR Panel first followed by the APR Heads of State Forum Thisstage terminates when the Chairperson of the latter communicates thedecisions and recommendations to the government of the country beingpeer reviewed Stage Five is the formal and public tabling of the peerreview reports in key regional and subregional structures and in partic-ular the AU structures These reports will also be put in the publicdomain

The NEPAD HSGIC has also approved a number of indicators basedon key objectives that will be used to assess and measure performance

294 KEMPE RONALD HOPE SR

in the four peer review areas of (1) democracy and political governance(2) economic governance and management (3) corporate governance and(4) socioeconomic development (NEPAD Secretariat 2003a) The keyobjectives for democracy and political governance include (1) to preventand reduce intra- and intercountry conflicts (2) the consolidation of con-stitutional democracy including periodic political competition andopportunity for choice the rule of law a Bill of Rights and the supremacyof the constitution being firmly established (3) promotion and protectionof economic social cultural civil and political rights as enshrined in allAfrican and international human rights instruments (4) upholding theseparation of powers including the protection of the independence of thejudiciary and of an effective parliament (5) ensuring accountable effi-cient and effective public office holders and civil servants (6) fightingcorruption in the political arena (7) promotion and protection of therights of women (8) promotion and protection of the rights of the childand young persons and (9) promotion and protection of the rights ofvulnerable groups including displaced persons

The key objectives for economic governance and management are (1)promoting macroeconomic policies that support sustainable develop-ment (2) implementing transparent predictable and credible governmenteconomic policies (3) promoting sound public finance management (4)fighting corruption and money laundering and (5) accelerating regionalintegration by participating in the harmonization of monetary trade andinvestment policies among participating states

The key corporate governance objectives are (1) providing an enablingenvironment and effective regulatory framework for economic activities(2) ensuring that corporations act as good corporate citizens with regardto human rights social responsibility and environmental sustainability(3) promoting the adoption of codes of good business ethics in achievingthe objectives of the organization (4) ensuring that corporations treat alltheir stakeholders in a fair and just manner and (5) providing for account-ability of corporations and directors

The key objectives for socioeconomic development are to (1) promoteself-reliance in development and build capacity for self-sustaining devel-opment (2) accelerate socioeconomic development to achieve sustainabledevelopment and poverty eradication (3) strengthen policies deliverymechanisms and outputs in key social development areas such as edu-cation for all and the combating of HIVAIDS and other communicablediseases (4) ensure affordable access to water energy finance marketsand information and communication technologies to all citizens (5) makeprogress toward gender equality particularly equal access to educationfor girls at all levels and (6) encourage broad-based participation indevelopment by all stakeholders at all levels

The 2002 AU Summit also approved the frequency of peer reviewsSpecifically there will be four types of peer reviews The first countryreview being the base review will be undertaken within 18 months of acountryrsquos becoming a member of the APRM The second type is the

THE AFRICAN PEER REVIEW MECHANISM 295

periodic review that should take place every two years The next type isa requested review where a member country can for its own reasons askfor a review that is not part of the periodically mandated reviews Thefinal type amounts to an imposed review and may be resorted to by theHSGIC if there is sufficient cause to conclude that there are early signs ofimpending political andor economic crises in a member country

Despite the fact that participation in the APRM is open to all memberstates of the AU on a voluntary basis there is now a somewhat morebureaucratic and unnecessarily cumbersome process that countries haveto contend with The APRM has evolved from its original technicallystraightforward framework to become a somewhat more burdensomeadministrative process Nonetheless this eventuality does not seem tohave particularly influenced the desire and decision by the member statesto seek participation in the process This is probably not surprising asundoubtedly countries that are actually peer reviewed stand to reap anumber of benefits as discussed in the next section It should be notedhere that in November 2002 a total of 12 of the 53 African countries hadoriginally declared their intent to be peer reviewed Those countries wereAlgeria Republic of Congo Egypt Ethiopia Gabon Ghana Mali Mau-ritius Mozambique Nigeria Rwanda and South Africa As of August2004 a total of 23 countriesmdashincluding the additional 11 of Angola BeninBurkina Faso Cameroon Kenya Lesotho Malawi Senegal Sierra LeoneTanzania and Ugandamdashhad signed the Memorandum of Understandingthat represents the basic framework for formal accession to the APRM(NEPAD Secretariat 2002b 2003c 2003d 2003e 2004) Other countries areexpected to accede in time However Ghana will be noted in Africarsquoseconomic and political history as the first country on the continent to bereviewed under the APRM The country inaugurated the APRM processin May 2004 By August 2004 four countriesmdashGhana Kenya Mauritiusand Rwandamdashhad been visited by peer review support mission teamsand were at various stages in the process

BENEFITS OF THE APRM AN ANALYTICAL ASSESSMENT

Given the international experience with peer reviews the APRMmdashas amechanism for measuring and monitoring progress toward good gover-nance and sustainable development in Africamdashhas the potential to pro-vide a number of benefits to those African countries that subjectthemselves to it and through multiplier effects to the continent as awhole Peer reviews have been demonstrated to have a number of bene-ficial effects as applied across the world As African countries seek toimprove their governance and march toward sustainable developmentpeer reviews can provide the basis for policy changes to meet commit-ments and to observe the agreed standards and codes

Indeed peer reviews will facilitate the monitoring of compliance withthe agreements entered into upon accession to the APRM States are muchmore inclined to comply when they know their implementation is moni-

296 KEMPE RONALD HOPE SR

tored and when the implementation of their peers is being monitored aswell (Henning) Given the history and resultant disastrous effects of badgovernance in Africa with a lack of openness and rampant corruptionacceding to peer review represents a sea change in the thinking of Africanleaders and a major milestone in the political development and history ofthe continent Below we concentrate on six key areas where peer reviewswill add value and enhance the prospects for African states to achievegood governance and sustainable development

Greater Transparency

Following Seiichi Kondo transparency is taken here to mean that reliablerelevant and timely information about the activities of government isavailable to the public Associated with transparency is the concept ofopenness whereby public participation in shaping and implementinggovernment policy is encouraged and guaranteed Transparency in gov-ernment is a good thing for governments in Africa have the most poten-tial for going awry given their monopoly on force and power and the easewith which they use and abuse that force and power Where there istransparency government officials will be prevented from exercising dis-cretionary powers Transparency therefore complements and reinforcespredictability reduces uncertainty and inhibits and reduces the scope ofcorruption among public officials (Siegle Weinstein and Halperin)

The APRM will be particularly applied to democracy and politicalgovernance issues and economic and corporate governance issues Inboth cases transparency looms large The openness of the political spaceis a critical barometer of the nature of democracy in a given countrySimilarly in the economic sphere the extent of fiscal transparencyprovides a very solid indication of the manner in which budgets (expen-ditures and revenues) for example are crafted reconciled and imple-mented Determining the nature of transparency in governmentoperations and functioning in Africa will expose the shortcomings andany deliberate secrecy or misreporting of government operations

Transparency in government operations particularly in Africa hasseveral dimensions (Kopits and Craig) The first dimension consists ofmainly behavioral aspects such as clearly established conflict-of-interestrules for elected and appointed officials a transparent regulatory frame-work open public procurement and employment practices a code ofconduct for public officials and freedom-of-information requirementsThe next is the provision of reliable information on the governmentrsquoseconomic policy intentions and forecasts The third is the requirement fordetailed data and information on government operations including thepublication of comprehensive budget and other planning and policy doc-uments In all three dimensions transparency is closely associated withthe successful implementation of good governance and the achievementof sustainable development

THE AFRICAN PEER REVIEW MECHANISM 297

The APRM to the extent that it enhances transparency in Africancountries will acknowledge democratic progress and scorn antidemo-cratic measures Consequently it can confer or withhold internationalrecognition and raise or lower the domestic legitimacy of governments(Henning) Moreover transparency increases the political risk of unsus-tainable policies whereas the lack thereof means that such policies cango undetected longer than they otherwise would Generally countriescharacterized by a relatively high degree of transparency have exhibitedgreater political and economic discipline and in many instances havebeen able to achieve a more robust political and economic performancecompared to countries with less transparent policies even within a sameregion (Henning)

This positive correlation between transparency and good governancehas also been empirically demonstrated across the spectrum of bothdeveloped and developing countries R Islam for instance has shownthat governments that are more transparent govern better as measuredby a wide number of governance indicators such as government effective-ness regulatory burden corruption voice and accountability the rule oflaw bureaucratic efficiency contract repudiation and expropriation riskAnd as better governance has also been empirically demonstrated to becorrelated with higher growth rates it can be extrapolated that there is aclose relationship between greater transparency and how fast economiesgrow (Islam) Botswana for example is internationally recognized for itssubstantial degree of transparency with a liberal democratic political sys-tem and a prudent and open budgetary process (Hope 2002a Kopits andCraig) As a result Botswana continues to experience political and mac-roeconomic stability with strong growth The country has consistentlybeen one of the fastest growing in the world with an annual averagegrowth rate of per capita gross domestic product (GDP) of 51 percentduring the period 1975ndash2002 compared with an annual average of

minus

08percent for sub-Saharan Africa during the same period (UNDP 2004)

That relationship between transparency good governance and growthin Botswana is further reflected in the growth competitiveness index(GCI) of the World Economic Forum The GCI is composed of threesubindexes identified as pillars in the evolution of growth in a country(1) the quality of the macroeconomic environment (2) the state of publicinstitutions and (3) the level of technological readiness The GCI uses acombination of hard data such as inflation rates budget deficits the levelof Internet access in schools and survey data in areas such as judicialindependence the prevalence of institutionalized corruption and theextent of inefficient government intervention in the economy (Lopez-Claros) Botswana has consistently ranked in first place among all Africancountries in the overall GCI as well as in the macroeconomic environmentand public institutions subindexes For the 2003 GCI computationsBotswana was ranked at 36 just behind Greece on the worldwide com-parisons (World Economic Forum)

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

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Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

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Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

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Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

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G-7 Finance Working Paper Aid Effectiveness

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Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

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Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

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Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

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WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

292 KEMPE RONALD HOPE SR

process and ensure the credibility and integrity of that process The thirdorganizational component is the APR Secretariat which will provide thesecretarial coordinating and administrative support services for theAPRM through the APR Panel The final organizational component isthe APR Teams which will be conducting the actual technical assessmentsthat will constitute the country peer reviews

The functions of the APR Heads of State Forum include but are notlimited to (1) appointing the APR Panel and its chairperson (2) consider-ing adopting and taking ownership of country peer review reports (3)communicating the recommendations of the APR Heads of State Forumto the peer-reviewed countries (4) exercising peer pressure to effectchanges in country practice where recommended (5) persuading devel-opment partners to provide technical assistance to eliminate capacitygaps as recommended by the country peer review reports (6) transmit-ting peer review reports to the appropriate AU structures and (7) makingpublic through the APR Secretariat country peer review reports andpress releases pertaining thereto

The functions of the APR Panel include but are not limited to (1)exercising oversight of the APR process including providing leadershipto country review teams with a view to ensuring the independenceprofessionalism and credibility of that process (2) recommending appro-priate African institutions or individuals to conduct technical assess-ments (3) reviewing and adopting the country peer review reportsincluding the recommendations contained therein and (4) submitting tothe APR Heads of State Forum all country peer review reports withrecommendations on measures that could be taken to assist the reviewedcountries in the improvement of their governance and socio-developmentperformance By November 2003 the HSGIC had appointed seven mem-bers of the APR Panel More members may be appointed at a later datewith a probable final complement of ten two from each of the fivesubregions

The functions of the APR Secretariat include (1) providing secretarialand administrative support services to the APR Panel under the directsupervision of the Chairperson of that Panel (2) organizing regionalnetworks and workshops for the sharing of experience and best practicerelated to the goals of achieving good governance and sustainable devel-opment and (3) ensuring full documentation of the peer review processesat country subregional and continental levels to facilitate mutual learning

The APR Teams are responsible for conducting the technical countryassessments that will comprise the country peer reviews Credible andtechnically competent institutions such as the UNDP the UNECA andthe AfDB have been selected to assist with some of the peer reviewtechnical assessments The UNECA will assist with the technical assess-ments in economic governance and management while the AfDB willassist with banking and financial standards for example The APR Panelwill select other credible and technically competent institutions or indi-

THE AFRICAN PEER REVIEW MECHANISM 293

viduals to undertake the peer review assessments in the areas of politicalgovernance corporate governance and socioeconomic development

As mentioned before there are five stages to the peer review processStage One entails a careful analysis of the governance and developmentenvironment in the country being reviewed Key governance and devel-opment issues will be analyzed to provide background information withrespect to political representativeness and rights institutional effective-ness and economic management and governance Political representa-tiveness and rights will cover issues of political systems and electoralprocesses representation and participation of various stakeholders indecision making Institutional effectiveness will include issues related tothe nature and workings of the legislative judiciary and executivebranches of government as well as the state of the nongovernmentalsector Economic management and governance will address issues ofmacroeconomic management public financial accountability monetaryand financial transparency accounting and auditing systems and regula-tory oversight bodies as well as issues of capacity effectiveness andaccountability of the economic decision making and service deliverysystems

Stage two constitutes the country visits by the peer review technicalassessment teams This stage is informed by the analysis prepared inStage One The technical assessment teams will consult and extensivelyinterview relevant government officials parliamentarians oppositionparty members not in parliament private sector representatives repre-sentatives of civil society groups (including the media academia tradeunions and nongovernmental organizations) and officials of residentmissions of regional and international organizations

Stage Three involves the preparation of the peer review reports basedon the technical assessments conducted in Stage Two A draft of eachreport will be discussed with the government concerned prior to submis-sion to the APR Panel Those discussions will be designed to ensure theaccuracy of the information and to provide the government an opportu-nity to react to the findings and recommendations of the assessment teamThese responses of the government will be appended to the final draft ofthe report However each report will remain independent and its find-ings will not be altered or vetted by the government concerned

Stage Four entails discussion and adoption of the peer review reportsby the APR Panel first followed by the APR Heads of State Forum Thisstage terminates when the Chairperson of the latter communicates thedecisions and recommendations to the government of the country beingpeer reviewed Stage Five is the formal and public tabling of the peerreview reports in key regional and subregional structures and in partic-ular the AU structures These reports will also be put in the publicdomain

The NEPAD HSGIC has also approved a number of indicators basedon key objectives that will be used to assess and measure performance

294 KEMPE RONALD HOPE SR

in the four peer review areas of (1) democracy and political governance(2) economic governance and management (3) corporate governance and(4) socioeconomic development (NEPAD Secretariat 2003a) The keyobjectives for democracy and political governance include (1) to preventand reduce intra- and intercountry conflicts (2) the consolidation of con-stitutional democracy including periodic political competition andopportunity for choice the rule of law a Bill of Rights and the supremacyof the constitution being firmly established (3) promotion and protectionof economic social cultural civil and political rights as enshrined in allAfrican and international human rights instruments (4) upholding theseparation of powers including the protection of the independence of thejudiciary and of an effective parliament (5) ensuring accountable effi-cient and effective public office holders and civil servants (6) fightingcorruption in the political arena (7) promotion and protection of therights of women (8) promotion and protection of the rights of the childand young persons and (9) promotion and protection of the rights ofvulnerable groups including displaced persons

The key objectives for economic governance and management are (1)promoting macroeconomic policies that support sustainable develop-ment (2) implementing transparent predictable and credible governmenteconomic policies (3) promoting sound public finance management (4)fighting corruption and money laundering and (5) accelerating regionalintegration by participating in the harmonization of monetary trade andinvestment policies among participating states

The key corporate governance objectives are (1) providing an enablingenvironment and effective regulatory framework for economic activities(2) ensuring that corporations act as good corporate citizens with regardto human rights social responsibility and environmental sustainability(3) promoting the adoption of codes of good business ethics in achievingthe objectives of the organization (4) ensuring that corporations treat alltheir stakeholders in a fair and just manner and (5) providing for account-ability of corporations and directors

The key objectives for socioeconomic development are to (1) promoteself-reliance in development and build capacity for self-sustaining devel-opment (2) accelerate socioeconomic development to achieve sustainabledevelopment and poverty eradication (3) strengthen policies deliverymechanisms and outputs in key social development areas such as edu-cation for all and the combating of HIVAIDS and other communicablediseases (4) ensure affordable access to water energy finance marketsand information and communication technologies to all citizens (5) makeprogress toward gender equality particularly equal access to educationfor girls at all levels and (6) encourage broad-based participation indevelopment by all stakeholders at all levels

The 2002 AU Summit also approved the frequency of peer reviewsSpecifically there will be four types of peer reviews The first countryreview being the base review will be undertaken within 18 months of acountryrsquos becoming a member of the APRM The second type is the

THE AFRICAN PEER REVIEW MECHANISM 295

periodic review that should take place every two years The next type isa requested review where a member country can for its own reasons askfor a review that is not part of the periodically mandated reviews Thefinal type amounts to an imposed review and may be resorted to by theHSGIC if there is sufficient cause to conclude that there are early signs ofimpending political andor economic crises in a member country

Despite the fact that participation in the APRM is open to all memberstates of the AU on a voluntary basis there is now a somewhat morebureaucratic and unnecessarily cumbersome process that countries haveto contend with The APRM has evolved from its original technicallystraightforward framework to become a somewhat more burdensomeadministrative process Nonetheless this eventuality does not seem tohave particularly influenced the desire and decision by the member statesto seek participation in the process This is probably not surprising asundoubtedly countries that are actually peer reviewed stand to reap anumber of benefits as discussed in the next section It should be notedhere that in November 2002 a total of 12 of the 53 African countries hadoriginally declared their intent to be peer reviewed Those countries wereAlgeria Republic of Congo Egypt Ethiopia Gabon Ghana Mali Mau-ritius Mozambique Nigeria Rwanda and South Africa As of August2004 a total of 23 countriesmdashincluding the additional 11 of Angola BeninBurkina Faso Cameroon Kenya Lesotho Malawi Senegal Sierra LeoneTanzania and Ugandamdashhad signed the Memorandum of Understandingthat represents the basic framework for formal accession to the APRM(NEPAD Secretariat 2002b 2003c 2003d 2003e 2004) Other countries areexpected to accede in time However Ghana will be noted in Africarsquoseconomic and political history as the first country on the continent to bereviewed under the APRM The country inaugurated the APRM processin May 2004 By August 2004 four countriesmdashGhana Kenya Mauritiusand Rwandamdashhad been visited by peer review support mission teamsand were at various stages in the process

BENEFITS OF THE APRM AN ANALYTICAL ASSESSMENT

Given the international experience with peer reviews the APRMmdashas amechanism for measuring and monitoring progress toward good gover-nance and sustainable development in Africamdashhas the potential to pro-vide a number of benefits to those African countries that subjectthemselves to it and through multiplier effects to the continent as awhole Peer reviews have been demonstrated to have a number of bene-ficial effects as applied across the world As African countries seek toimprove their governance and march toward sustainable developmentpeer reviews can provide the basis for policy changes to meet commit-ments and to observe the agreed standards and codes

Indeed peer reviews will facilitate the monitoring of compliance withthe agreements entered into upon accession to the APRM States are muchmore inclined to comply when they know their implementation is moni-

296 KEMPE RONALD HOPE SR

tored and when the implementation of their peers is being monitored aswell (Henning) Given the history and resultant disastrous effects of badgovernance in Africa with a lack of openness and rampant corruptionacceding to peer review represents a sea change in the thinking of Africanleaders and a major milestone in the political development and history ofthe continent Below we concentrate on six key areas where peer reviewswill add value and enhance the prospects for African states to achievegood governance and sustainable development

Greater Transparency

Following Seiichi Kondo transparency is taken here to mean that reliablerelevant and timely information about the activities of government isavailable to the public Associated with transparency is the concept ofopenness whereby public participation in shaping and implementinggovernment policy is encouraged and guaranteed Transparency in gov-ernment is a good thing for governments in Africa have the most poten-tial for going awry given their monopoly on force and power and the easewith which they use and abuse that force and power Where there istransparency government officials will be prevented from exercising dis-cretionary powers Transparency therefore complements and reinforcespredictability reduces uncertainty and inhibits and reduces the scope ofcorruption among public officials (Siegle Weinstein and Halperin)

The APRM will be particularly applied to democracy and politicalgovernance issues and economic and corporate governance issues Inboth cases transparency looms large The openness of the political spaceis a critical barometer of the nature of democracy in a given countrySimilarly in the economic sphere the extent of fiscal transparencyprovides a very solid indication of the manner in which budgets (expen-ditures and revenues) for example are crafted reconciled and imple-mented Determining the nature of transparency in governmentoperations and functioning in Africa will expose the shortcomings andany deliberate secrecy or misreporting of government operations

Transparency in government operations particularly in Africa hasseveral dimensions (Kopits and Craig) The first dimension consists ofmainly behavioral aspects such as clearly established conflict-of-interestrules for elected and appointed officials a transparent regulatory frame-work open public procurement and employment practices a code ofconduct for public officials and freedom-of-information requirementsThe next is the provision of reliable information on the governmentrsquoseconomic policy intentions and forecasts The third is the requirement fordetailed data and information on government operations including thepublication of comprehensive budget and other planning and policy doc-uments In all three dimensions transparency is closely associated withthe successful implementation of good governance and the achievementof sustainable development

THE AFRICAN PEER REVIEW MECHANISM 297

The APRM to the extent that it enhances transparency in Africancountries will acknowledge democratic progress and scorn antidemo-cratic measures Consequently it can confer or withhold internationalrecognition and raise or lower the domestic legitimacy of governments(Henning) Moreover transparency increases the political risk of unsus-tainable policies whereas the lack thereof means that such policies cango undetected longer than they otherwise would Generally countriescharacterized by a relatively high degree of transparency have exhibitedgreater political and economic discipline and in many instances havebeen able to achieve a more robust political and economic performancecompared to countries with less transparent policies even within a sameregion (Henning)

This positive correlation between transparency and good governancehas also been empirically demonstrated across the spectrum of bothdeveloped and developing countries R Islam for instance has shownthat governments that are more transparent govern better as measuredby a wide number of governance indicators such as government effective-ness regulatory burden corruption voice and accountability the rule oflaw bureaucratic efficiency contract repudiation and expropriation riskAnd as better governance has also been empirically demonstrated to becorrelated with higher growth rates it can be extrapolated that there is aclose relationship between greater transparency and how fast economiesgrow (Islam) Botswana for example is internationally recognized for itssubstantial degree of transparency with a liberal democratic political sys-tem and a prudent and open budgetary process (Hope 2002a Kopits andCraig) As a result Botswana continues to experience political and mac-roeconomic stability with strong growth The country has consistentlybeen one of the fastest growing in the world with an annual averagegrowth rate of per capita gross domestic product (GDP) of 51 percentduring the period 1975ndash2002 compared with an annual average of

minus

08percent for sub-Saharan Africa during the same period (UNDP 2004)

That relationship between transparency good governance and growthin Botswana is further reflected in the growth competitiveness index(GCI) of the World Economic Forum The GCI is composed of threesubindexes identified as pillars in the evolution of growth in a country(1) the quality of the macroeconomic environment (2) the state of publicinstitutions and (3) the level of technological readiness The GCI uses acombination of hard data such as inflation rates budget deficits the levelof Internet access in schools and survey data in areas such as judicialindependence the prevalence of institutionalized corruption and theextent of inefficient government intervention in the economy (Lopez-Claros) Botswana has consistently ranked in first place among all Africancountries in the overall GCI as well as in the macroeconomic environmentand public institutions subindexes For the 2003 GCI computationsBotswana was ranked at 36 just behind Greece on the worldwide com-parisons (World Economic Forum)

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

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Abed G T 2001 The Changing Role of the State Governance and New CapacityRequirements In M A Dessart and R E Ubogu eds

Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

THE AFRICAN PEER REVIEW MECHANISM 293

viduals to undertake the peer review assessments in the areas of politicalgovernance corporate governance and socioeconomic development

As mentioned before there are five stages to the peer review processStage One entails a careful analysis of the governance and developmentenvironment in the country being reviewed Key governance and devel-opment issues will be analyzed to provide background information withrespect to political representativeness and rights institutional effective-ness and economic management and governance Political representa-tiveness and rights will cover issues of political systems and electoralprocesses representation and participation of various stakeholders indecision making Institutional effectiveness will include issues related tothe nature and workings of the legislative judiciary and executivebranches of government as well as the state of the nongovernmentalsector Economic management and governance will address issues ofmacroeconomic management public financial accountability monetaryand financial transparency accounting and auditing systems and regula-tory oversight bodies as well as issues of capacity effectiveness andaccountability of the economic decision making and service deliverysystems

Stage two constitutes the country visits by the peer review technicalassessment teams This stage is informed by the analysis prepared inStage One The technical assessment teams will consult and extensivelyinterview relevant government officials parliamentarians oppositionparty members not in parliament private sector representatives repre-sentatives of civil society groups (including the media academia tradeunions and nongovernmental organizations) and officials of residentmissions of regional and international organizations

Stage Three involves the preparation of the peer review reports basedon the technical assessments conducted in Stage Two A draft of eachreport will be discussed with the government concerned prior to submis-sion to the APR Panel Those discussions will be designed to ensure theaccuracy of the information and to provide the government an opportu-nity to react to the findings and recommendations of the assessment teamThese responses of the government will be appended to the final draft ofthe report However each report will remain independent and its find-ings will not be altered or vetted by the government concerned

Stage Four entails discussion and adoption of the peer review reportsby the APR Panel first followed by the APR Heads of State Forum Thisstage terminates when the Chairperson of the latter communicates thedecisions and recommendations to the government of the country beingpeer reviewed Stage Five is the formal and public tabling of the peerreview reports in key regional and subregional structures and in partic-ular the AU structures These reports will also be put in the publicdomain

The NEPAD HSGIC has also approved a number of indicators basedon key objectives that will be used to assess and measure performance

294 KEMPE RONALD HOPE SR

in the four peer review areas of (1) democracy and political governance(2) economic governance and management (3) corporate governance and(4) socioeconomic development (NEPAD Secretariat 2003a) The keyobjectives for democracy and political governance include (1) to preventand reduce intra- and intercountry conflicts (2) the consolidation of con-stitutional democracy including periodic political competition andopportunity for choice the rule of law a Bill of Rights and the supremacyof the constitution being firmly established (3) promotion and protectionof economic social cultural civil and political rights as enshrined in allAfrican and international human rights instruments (4) upholding theseparation of powers including the protection of the independence of thejudiciary and of an effective parliament (5) ensuring accountable effi-cient and effective public office holders and civil servants (6) fightingcorruption in the political arena (7) promotion and protection of therights of women (8) promotion and protection of the rights of the childand young persons and (9) promotion and protection of the rights ofvulnerable groups including displaced persons

The key objectives for economic governance and management are (1)promoting macroeconomic policies that support sustainable develop-ment (2) implementing transparent predictable and credible governmenteconomic policies (3) promoting sound public finance management (4)fighting corruption and money laundering and (5) accelerating regionalintegration by participating in the harmonization of monetary trade andinvestment policies among participating states

The key corporate governance objectives are (1) providing an enablingenvironment and effective regulatory framework for economic activities(2) ensuring that corporations act as good corporate citizens with regardto human rights social responsibility and environmental sustainability(3) promoting the adoption of codes of good business ethics in achievingthe objectives of the organization (4) ensuring that corporations treat alltheir stakeholders in a fair and just manner and (5) providing for account-ability of corporations and directors

The key objectives for socioeconomic development are to (1) promoteself-reliance in development and build capacity for self-sustaining devel-opment (2) accelerate socioeconomic development to achieve sustainabledevelopment and poverty eradication (3) strengthen policies deliverymechanisms and outputs in key social development areas such as edu-cation for all and the combating of HIVAIDS and other communicablediseases (4) ensure affordable access to water energy finance marketsand information and communication technologies to all citizens (5) makeprogress toward gender equality particularly equal access to educationfor girls at all levels and (6) encourage broad-based participation indevelopment by all stakeholders at all levels

The 2002 AU Summit also approved the frequency of peer reviewsSpecifically there will be four types of peer reviews The first countryreview being the base review will be undertaken within 18 months of acountryrsquos becoming a member of the APRM The second type is the

THE AFRICAN PEER REVIEW MECHANISM 295

periodic review that should take place every two years The next type isa requested review where a member country can for its own reasons askfor a review that is not part of the periodically mandated reviews Thefinal type amounts to an imposed review and may be resorted to by theHSGIC if there is sufficient cause to conclude that there are early signs ofimpending political andor economic crises in a member country

Despite the fact that participation in the APRM is open to all memberstates of the AU on a voluntary basis there is now a somewhat morebureaucratic and unnecessarily cumbersome process that countries haveto contend with The APRM has evolved from its original technicallystraightforward framework to become a somewhat more burdensomeadministrative process Nonetheless this eventuality does not seem tohave particularly influenced the desire and decision by the member statesto seek participation in the process This is probably not surprising asundoubtedly countries that are actually peer reviewed stand to reap anumber of benefits as discussed in the next section It should be notedhere that in November 2002 a total of 12 of the 53 African countries hadoriginally declared their intent to be peer reviewed Those countries wereAlgeria Republic of Congo Egypt Ethiopia Gabon Ghana Mali Mau-ritius Mozambique Nigeria Rwanda and South Africa As of August2004 a total of 23 countriesmdashincluding the additional 11 of Angola BeninBurkina Faso Cameroon Kenya Lesotho Malawi Senegal Sierra LeoneTanzania and Ugandamdashhad signed the Memorandum of Understandingthat represents the basic framework for formal accession to the APRM(NEPAD Secretariat 2002b 2003c 2003d 2003e 2004) Other countries areexpected to accede in time However Ghana will be noted in Africarsquoseconomic and political history as the first country on the continent to bereviewed under the APRM The country inaugurated the APRM processin May 2004 By August 2004 four countriesmdashGhana Kenya Mauritiusand Rwandamdashhad been visited by peer review support mission teamsand were at various stages in the process

BENEFITS OF THE APRM AN ANALYTICAL ASSESSMENT

Given the international experience with peer reviews the APRMmdashas amechanism for measuring and monitoring progress toward good gover-nance and sustainable development in Africamdashhas the potential to pro-vide a number of benefits to those African countries that subjectthemselves to it and through multiplier effects to the continent as awhole Peer reviews have been demonstrated to have a number of bene-ficial effects as applied across the world As African countries seek toimprove their governance and march toward sustainable developmentpeer reviews can provide the basis for policy changes to meet commit-ments and to observe the agreed standards and codes

Indeed peer reviews will facilitate the monitoring of compliance withthe agreements entered into upon accession to the APRM States are muchmore inclined to comply when they know their implementation is moni-

296 KEMPE RONALD HOPE SR

tored and when the implementation of their peers is being monitored aswell (Henning) Given the history and resultant disastrous effects of badgovernance in Africa with a lack of openness and rampant corruptionacceding to peer review represents a sea change in the thinking of Africanleaders and a major milestone in the political development and history ofthe continent Below we concentrate on six key areas where peer reviewswill add value and enhance the prospects for African states to achievegood governance and sustainable development

Greater Transparency

Following Seiichi Kondo transparency is taken here to mean that reliablerelevant and timely information about the activities of government isavailable to the public Associated with transparency is the concept ofopenness whereby public participation in shaping and implementinggovernment policy is encouraged and guaranteed Transparency in gov-ernment is a good thing for governments in Africa have the most poten-tial for going awry given their monopoly on force and power and the easewith which they use and abuse that force and power Where there istransparency government officials will be prevented from exercising dis-cretionary powers Transparency therefore complements and reinforcespredictability reduces uncertainty and inhibits and reduces the scope ofcorruption among public officials (Siegle Weinstein and Halperin)

The APRM will be particularly applied to democracy and politicalgovernance issues and economic and corporate governance issues Inboth cases transparency looms large The openness of the political spaceis a critical barometer of the nature of democracy in a given countrySimilarly in the economic sphere the extent of fiscal transparencyprovides a very solid indication of the manner in which budgets (expen-ditures and revenues) for example are crafted reconciled and imple-mented Determining the nature of transparency in governmentoperations and functioning in Africa will expose the shortcomings andany deliberate secrecy or misreporting of government operations

Transparency in government operations particularly in Africa hasseveral dimensions (Kopits and Craig) The first dimension consists ofmainly behavioral aspects such as clearly established conflict-of-interestrules for elected and appointed officials a transparent regulatory frame-work open public procurement and employment practices a code ofconduct for public officials and freedom-of-information requirementsThe next is the provision of reliable information on the governmentrsquoseconomic policy intentions and forecasts The third is the requirement fordetailed data and information on government operations including thepublication of comprehensive budget and other planning and policy doc-uments In all three dimensions transparency is closely associated withthe successful implementation of good governance and the achievementof sustainable development

THE AFRICAN PEER REVIEW MECHANISM 297

The APRM to the extent that it enhances transparency in Africancountries will acknowledge democratic progress and scorn antidemo-cratic measures Consequently it can confer or withhold internationalrecognition and raise or lower the domestic legitimacy of governments(Henning) Moreover transparency increases the political risk of unsus-tainable policies whereas the lack thereof means that such policies cango undetected longer than they otherwise would Generally countriescharacterized by a relatively high degree of transparency have exhibitedgreater political and economic discipline and in many instances havebeen able to achieve a more robust political and economic performancecompared to countries with less transparent policies even within a sameregion (Henning)

This positive correlation between transparency and good governancehas also been empirically demonstrated across the spectrum of bothdeveloped and developing countries R Islam for instance has shownthat governments that are more transparent govern better as measuredby a wide number of governance indicators such as government effective-ness regulatory burden corruption voice and accountability the rule oflaw bureaucratic efficiency contract repudiation and expropriation riskAnd as better governance has also been empirically demonstrated to becorrelated with higher growth rates it can be extrapolated that there is aclose relationship between greater transparency and how fast economiesgrow (Islam) Botswana for example is internationally recognized for itssubstantial degree of transparency with a liberal democratic political sys-tem and a prudent and open budgetary process (Hope 2002a Kopits andCraig) As a result Botswana continues to experience political and mac-roeconomic stability with strong growth The country has consistentlybeen one of the fastest growing in the world with an annual averagegrowth rate of per capita gross domestic product (GDP) of 51 percentduring the period 1975ndash2002 compared with an annual average of

minus

08percent for sub-Saharan Africa during the same period (UNDP 2004)

That relationship between transparency good governance and growthin Botswana is further reflected in the growth competitiveness index(GCI) of the World Economic Forum The GCI is composed of threesubindexes identified as pillars in the evolution of growth in a country(1) the quality of the macroeconomic environment (2) the state of publicinstitutions and (3) the level of technological readiness The GCI uses acombination of hard data such as inflation rates budget deficits the levelof Internet access in schools and survey data in areas such as judicialindependence the prevalence of institutionalized corruption and theextent of inefficient government intervention in the economy (Lopez-Claros) Botswana has consistently ranked in first place among all Africancountries in the overall GCI as well as in the macroeconomic environmentand public institutions subindexes For the 2003 GCI computationsBotswana was ranked at 36 just behind Greece on the worldwide com-parisons (World Economic Forum)

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

REFERENCES

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Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

294 KEMPE RONALD HOPE SR

in the four peer review areas of (1) democracy and political governance(2) economic governance and management (3) corporate governance and(4) socioeconomic development (NEPAD Secretariat 2003a) The keyobjectives for democracy and political governance include (1) to preventand reduce intra- and intercountry conflicts (2) the consolidation of con-stitutional democracy including periodic political competition andopportunity for choice the rule of law a Bill of Rights and the supremacyof the constitution being firmly established (3) promotion and protectionof economic social cultural civil and political rights as enshrined in allAfrican and international human rights instruments (4) upholding theseparation of powers including the protection of the independence of thejudiciary and of an effective parliament (5) ensuring accountable effi-cient and effective public office holders and civil servants (6) fightingcorruption in the political arena (7) promotion and protection of therights of women (8) promotion and protection of the rights of the childand young persons and (9) promotion and protection of the rights ofvulnerable groups including displaced persons

The key objectives for economic governance and management are (1)promoting macroeconomic policies that support sustainable develop-ment (2) implementing transparent predictable and credible governmenteconomic policies (3) promoting sound public finance management (4)fighting corruption and money laundering and (5) accelerating regionalintegration by participating in the harmonization of monetary trade andinvestment policies among participating states

The key corporate governance objectives are (1) providing an enablingenvironment and effective regulatory framework for economic activities(2) ensuring that corporations act as good corporate citizens with regardto human rights social responsibility and environmental sustainability(3) promoting the adoption of codes of good business ethics in achievingthe objectives of the organization (4) ensuring that corporations treat alltheir stakeholders in a fair and just manner and (5) providing for account-ability of corporations and directors

The key objectives for socioeconomic development are to (1) promoteself-reliance in development and build capacity for self-sustaining devel-opment (2) accelerate socioeconomic development to achieve sustainabledevelopment and poverty eradication (3) strengthen policies deliverymechanisms and outputs in key social development areas such as edu-cation for all and the combating of HIVAIDS and other communicablediseases (4) ensure affordable access to water energy finance marketsand information and communication technologies to all citizens (5) makeprogress toward gender equality particularly equal access to educationfor girls at all levels and (6) encourage broad-based participation indevelopment by all stakeholders at all levels

The 2002 AU Summit also approved the frequency of peer reviewsSpecifically there will be four types of peer reviews The first countryreview being the base review will be undertaken within 18 months of acountryrsquos becoming a member of the APRM The second type is the

THE AFRICAN PEER REVIEW MECHANISM 295

periodic review that should take place every two years The next type isa requested review where a member country can for its own reasons askfor a review that is not part of the periodically mandated reviews Thefinal type amounts to an imposed review and may be resorted to by theHSGIC if there is sufficient cause to conclude that there are early signs ofimpending political andor economic crises in a member country

Despite the fact that participation in the APRM is open to all memberstates of the AU on a voluntary basis there is now a somewhat morebureaucratic and unnecessarily cumbersome process that countries haveto contend with The APRM has evolved from its original technicallystraightforward framework to become a somewhat more burdensomeadministrative process Nonetheless this eventuality does not seem tohave particularly influenced the desire and decision by the member statesto seek participation in the process This is probably not surprising asundoubtedly countries that are actually peer reviewed stand to reap anumber of benefits as discussed in the next section It should be notedhere that in November 2002 a total of 12 of the 53 African countries hadoriginally declared their intent to be peer reviewed Those countries wereAlgeria Republic of Congo Egypt Ethiopia Gabon Ghana Mali Mau-ritius Mozambique Nigeria Rwanda and South Africa As of August2004 a total of 23 countriesmdashincluding the additional 11 of Angola BeninBurkina Faso Cameroon Kenya Lesotho Malawi Senegal Sierra LeoneTanzania and Ugandamdashhad signed the Memorandum of Understandingthat represents the basic framework for formal accession to the APRM(NEPAD Secretariat 2002b 2003c 2003d 2003e 2004) Other countries areexpected to accede in time However Ghana will be noted in Africarsquoseconomic and political history as the first country on the continent to bereviewed under the APRM The country inaugurated the APRM processin May 2004 By August 2004 four countriesmdashGhana Kenya Mauritiusand Rwandamdashhad been visited by peer review support mission teamsand were at various stages in the process

BENEFITS OF THE APRM AN ANALYTICAL ASSESSMENT

Given the international experience with peer reviews the APRMmdashas amechanism for measuring and monitoring progress toward good gover-nance and sustainable development in Africamdashhas the potential to pro-vide a number of benefits to those African countries that subjectthemselves to it and through multiplier effects to the continent as awhole Peer reviews have been demonstrated to have a number of bene-ficial effects as applied across the world As African countries seek toimprove their governance and march toward sustainable developmentpeer reviews can provide the basis for policy changes to meet commit-ments and to observe the agreed standards and codes

Indeed peer reviews will facilitate the monitoring of compliance withthe agreements entered into upon accession to the APRM States are muchmore inclined to comply when they know their implementation is moni-

296 KEMPE RONALD HOPE SR

tored and when the implementation of their peers is being monitored aswell (Henning) Given the history and resultant disastrous effects of badgovernance in Africa with a lack of openness and rampant corruptionacceding to peer review represents a sea change in the thinking of Africanleaders and a major milestone in the political development and history ofthe continent Below we concentrate on six key areas where peer reviewswill add value and enhance the prospects for African states to achievegood governance and sustainable development

Greater Transparency

Following Seiichi Kondo transparency is taken here to mean that reliablerelevant and timely information about the activities of government isavailable to the public Associated with transparency is the concept ofopenness whereby public participation in shaping and implementinggovernment policy is encouraged and guaranteed Transparency in gov-ernment is a good thing for governments in Africa have the most poten-tial for going awry given their monopoly on force and power and the easewith which they use and abuse that force and power Where there istransparency government officials will be prevented from exercising dis-cretionary powers Transparency therefore complements and reinforcespredictability reduces uncertainty and inhibits and reduces the scope ofcorruption among public officials (Siegle Weinstein and Halperin)

The APRM will be particularly applied to democracy and politicalgovernance issues and economic and corporate governance issues Inboth cases transparency looms large The openness of the political spaceis a critical barometer of the nature of democracy in a given countrySimilarly in the economic sphere the extent of fiscal transparencyprovides a very solid indication of the manner in which budgets (expen-ditures and revenues) for example are crafted reconciled and imple-mented Determining the nature of transparency in governmentoperations and functioning in Africa will expose the shortcomings andany deliberate secrecy or misreporting of government operations

Transparency in government operations particularly in Africa hasseveral dimensions (Kopits and Craig) The first dimension consists ofmainly behavioral aspects such as clearly established conflict-of-interestrules for elected and appointed officials a transparent regulatory frame-work open public procurement and employment practices a code ofconduct for public officials and freedom-of-information requirementsThe next is the provision of reliable information on the governmentrsquoseconomic policy intentions and forecasts The third is the requirement fordetailed data and information on government operations including thepublication of comprehensive budget and other planning and policy doc-uments In all three dimensions transparency is closely associated withthe successful implementation of good governance and the achievementof sustainable development

THE AFRICAN PEER REVIEW MECHANISM 297

The APRM to the extent that it enhances transparency in Africancountries will acknowledge democratic progress and scorn antidemo-cratic measures Consequently it can confer or withhold internationalrecognition and raise or lower the domestic legitimacy of governments(Henning) Moreover transparency increases the political risk of unsus-tainable policies whereas the lack thereof means that such policies cango undetected longer than they otherwise would Generally countriescharacterized by a relatively high degree of transparency have exhibitedgreater political and economic discipline and in many instances havebeen able to achieve a more robust political and economic performancecompared to countries with less transparent policies even within a sameregion (Henning)

This positive correlation between transparency and good governancehas also been empirically demonstrated across the spectrum of bothdeveloped and developing countries R Islam for instance has shownthat governments that are more transparent govern better as measuredby a wide number of governance indicators such as government effective-ness regulatory burden corruption voice and accountability the rule oflaw bureaucratic efficiency contract repudiation and expropriation riskAnd as better governance has also been empirically demonstrated to becorrelated with higher growth rates it can be extrapolated that there is aclose relationship between greater transparency and how fast economiesgrow (Islam) Botswana for example is internationally recognized for itssubstantial degree of transparency with a liberal democratic political sys-tem and a prudent and open budgetary process (Hope 2002a Kopits andCraig) As a result Botswana continues to experience political and mac-roeconomic stability with strong growth The country has consistentlybeen one of the fastest growing in the world with an annual averagegrowth rate of per capita gross domestic product (GDP) of 51 percentduring the period 1975ndash2002 compared with an annual average of

minus

08percent for sub-Saharan Africa during the same period (UNDP 2004)

That relationship between transparency good governance and growthin Botswana is further reflected in the growth competitiveness index(GCI) of the World Economic Forum The GCI is composed of threesubindexes identified as pillars in the evolution of growth in a country(1) the quality of the macroeconomic environment (2) the state of publicinstitutions and (3) the level of technological readiness The GCI uses acombination of hard data such as inflation rates budget deficits the levelof Internet access in schools and survey data in areas such as judicialindependence the prevalence of institutionalized corruption and theextent of inefficient government intervention in the economy (Lopez-Claros) Botswana has consistently ranked in first place among all Africancountries in the overall GCI as well as in the macroeconomic environmentand public institutions subindexes For the 2003 GCI computationsBotswana was ranked at 36 just behind Greece on the worldwide com-parisons (World Economic Forum)

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

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NEPAD A NewPath

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Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

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Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

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G8 Africa Action Plan

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Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

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Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

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Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

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Public Management and Administration

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Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

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Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

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Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

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Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

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Kopits G and J Craig 1998

Transparency in Government Operations

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Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

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NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

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Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

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African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

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Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

THE AFRICAN PEER REVIEW MECHANISM 295

periodic review that should take place every two years The next type isa requested review where a member country can for its own reasons askfor a review that is not part of the periodically mandated reviews Thefinal type amounts to an imposed review and may be resorted to by theHSGIC if there is sufficient cause to conclude that there are early signs ofimpending political andor economic crises in a member country

Despite the fact that participation in the APRM is open to all memberstates of the AU on a voluntary basis there is now a somewhat morebureaucratic and unnecessarily cumbersome process that countries haveto contend with The APRM has evolved from its original technicallystraightforward framework to become a somewhat more burdensomeadministrative process Nonetheless this eventuality does not seem tohave particularly influenced the desire and decision by the member statesto seek participation in the process This is probably not surprising asundoubtedly countries that are actually peer reviewed stand to reap anumber of benefits as discussed in the next section It should be notedhere that in November 2002 a total of 12 of the 53 African countries hadoriginally declared their intent to be peer reviewed Those countries wereAlgeria Republic of Congo Egypt Ethiopia Gabon Ghana Mali Mau-ritius Mozambique Nigeria Rwanda and South Africa As of August2004 a total of 23 countriesmdashincluding the additional 11 of Angola BeninBurkina Faso Cameroon Kenya Lesotho Malawi Senegal Sierra LeoneTanzania and Ugandamdashhad signed the Memorandum of Understandingthat represents the basic framework for formal accession to the APRM(NEPAD Secretariat 2002b 2003c 2003d 2003e 2004) Other countries areexpected to accede in time However Ghana will be noted in Africarsquoseconomic and political history as the first country on the continent to bereviewed under the APRM The country inaugurated the APRM processin May 2004 By August 2004 four countriesmdashGhana Kenya Mauritiusand Rwandamdashhad been visited by peer review support mission teamsand were at various stages in the process

BENEFITS OF THE APRM AN ANALYTICAL ASSESSMENT

Given the international experience with peer reviews the APRMmdashas amechanism for measuring and monitoring progress toward good gover-nance and sustainable development in Africamdashhas the potential to pro-vide a number of benefits to those African countries that subjectthemselves to it and through multiplier effects to the continent as awhole Peer reviews have been demonstrated to have a number of bene-ficial effects as applied across the world As African countries seek toimprove their governance and march toward sustainable developmentpeer reviews can provide the basis for policy changes to meet commit-ments and to observe the agreed standards and codes

Indeed peer reviews will facilitate the monitoring of compliance withthe agreements entered into upon accession to the APRM States are muchmore inclined to comply when they know their implementation is moni-

296 KEMPE RONALD HOPE SR

tored and when the implementation of their peers is being monitored aswell (Henning) Given the history and resultant disastrous effects of badgovernance in Africa with a lack of openness and rampant corruptionacceding to peer review represents a sea change in the thinking of Africanleaders and a major milestone in the political development and history ofthe continent Below we concentrate on six key areas where peer reviewswill add value and enhance the prospects for African states to achievegood governance and sustainable development

Greater Transparency

Following Seiichi Kondo transparency is taken here to mean that reliablerelevant and timely information about the activities of government isavailable to the public Associated with transparency is the concept ofopenness whereby public participation in shaping and implementinggovernment policy is encouraged and guaranteed Transparency in gov-ernment is a good thing for governments in Africa have the most poten-tial for going awry given their monopoly on force and power and the easewith which they use and abuse that force and power Where there istransparency government officials will be prevented from exercising dis-cretionary powers Transparency therefore complements and reinforcespredictability reduces uncertainty and inhibits and reduces the scope ofcorruption among public officials (Siegle Weinstein and Halperin)

The APRM will be particularly applied to democracy and politicalgovernance issues and economic and corporate governance issues Inboth cases transparency looms large The openness of the political spaceis a critical barometer of the nature of democracy in a given countrySimilarly in the economic sphere the extent of fiscal transparencyprovides a very solid indication of the manner in which budgets (expen-ditures and revenues) for example are crafted reconciled and imple-mented Determining the nature of transparency in governmentoperations and functioning in Africa will expose the shortcomings andany deliberate secrecy or misreporting of government operations

Transparency in government operations particularly in Africa hasseveral dimensions (Kopits and Craig) The first dimension consists ofmainly behavioral aspects such as clearly established conflict-of-interestrules for elected and appointed officials a transparent regulatory frame-work open public procurement and employment practices a code ofconduct for public officials and freedom-of-information requirementsThe next is the provision of reliable information on the governmentrsquoseconomic policy intentions and forecasts The third is the requirement fordetailed data and information on government operations including thepublication of comprehensive budget and other planning and policy doc-uments In all three dimensions transparency is closely associated withthe successful implementation of good governance and the achievementof sustainable development

THE AFRICAN PEER REVIEW MECHANISM 297

The APRM to the extent that it enhances transparency in Africancountries will acknowledge democratic progress and scorn antidemo-cratic measures Consequently it can confer or withhold internationalrecognition and raise or lower the domestic legitimacy of governments(Henning) Moreover transparency increases the political risk of unsus-tainable policies whereas the lack thereof means that such policies cango undetected longer than they otherwise would Generally countriescharacterized by a relatively high degree of transparency have exhibitedgreater political and economic discipline and in many instances havebeen able to achieve a more robust political and economic performancecompared to countries with less transparent policies even within a sameregion (Henning)

This positive correlation between transparency and good governancehas also been empirically demonstrated across the spectrum of bothdeveloped and developing countries R Islam for instance has shownthat governments that are more transparent govern better as measuredby a wide number of governance indicators such as government effective-ness regulatory burden corruption voice and accountability the rule oflaw bureaucratic efficiency contract repudiation and expropriation riskAnd as better governance has also been empirically demonstrated to becorrelated with higher growth rates it can be extrapolated that there is aclose relationship between greater transparency and how fast economiesgrow (Islam) Botswana for example is internationally recognized for itssubstantial degree of transparency with a liberal democratic political sys-tem and a prudent and open budgetary process (Hope 2002a Kopits andCraig) As a result Botswana continues to experience political and mac-roeconomic stability with strong growth The country has consistentlybeen one of the fastest growing in the world with an annual averagegrowth rate of per capita gross domestic product (GDP) of 51 percentduring the period 1975ndash2002 compared with an annual average of

minus

08percent for sub-Saharan Africa during the same period (UNDP 2004)

That relationship between transparency good governance and growthin Botswana is further reflected in the growth competitiveness index(GCI) of the World Economic Forum The GCI is composed of threesubindexes identified as pillars in the evolution of growth in a country(1) the quality of the macroeconomic environment (2) the state of publicinstitutions and (3) the level of technological readiness The GCI uses acombination of hard data such as inflation rates budget deficits the levelof Internet access in schools and survey data in areas such as judicialindependence the prevalence of institutionalized corruption and theextent of inefficient government intervention in the economy (Lopez-Claros) Botswana has consistently ranked in first place among all Africancountries in the overall GCI as well as in the macroeconomic environmentand public institutions subindexes For the 2003 GCI computationsBotswana was ranked at 36 just behind Greece on the worldwide com-parisons (World Economic Forum)

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

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Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

296 KEMPE RONALD HOPE SR

tored and when the implementation of their peers is being monitored aswell (Henning) Given the history and resultant disastrous effects of badgovernance in Africa with a lack of openness and rampant corruptionacceding to peer review represents a sea change in the thinking of Africanleaders and a major milestone in the political development and history ofthe continent Below we concentrate on six key areas where peer reviewswill add value and enhance the prospects for African states to achievegood governance and sustainable development

Greater Transparency

Following Seiichi Kondo transparency is taken here to mean that reliablerelevant and timely information about the activities of government isavailable to the public Associated with transparency is the concept ofopenness whereby public participation in shaping and implementinggovernment policy is encouraged and guaranteed Transparency in gov-ernment is a good thing for governments in Africa have the most poten-tial for going awry given their monopoly on force and power and the easewith which they use and abuse that force and power Where there istransparency government officials will be prevented from exercising dis-cretionary powers Transparency therefore complements and reinforcespredictability reduces uncertainty and inhibits and reduces the scope ofcorruption among public officials (Siegle Weinstein and Halperin)

The APRM will be particularly applied to democracy and politicalgovernance issues and economic and corporate governance issues Inboth cases transparency looms large The openness of the political spaceis a critical barometer of the nature of democracy in a given countrySimilarly in the economic sphere the extent of fiscal transparencyprovides a very solid indication of the manner in which budgets (expen-ditures and revenues) for example are crafted reconciled and imple-mented Determining the nature of transparency in governmentoperations and functioning in Africa will expose the shortcomings andany deliberate secrecy or misreporting of government operations

Transparency in government operations particularly in Africa hasseveral dimensions (Kopits and Craig) The first dimension consists ofmainly behavioral aspects such as clearly established conflict-of-interestrules for elected and appointed officials a transparent regulatory frame-work open public procurement and employment practices a code ofconduct for public officials and freedom-of-information requirementsThe next is the provision of reliable information on the governmentrsquoseconomic policy intentions and forecasts The third is the requirement fordetailed data and information on government operations including thepublication of comprehensive budget and other planning and policy doc-uments In all three dimensions transparency is closely associated withthe successful implementation of good governance and the achievementof sustainable development

THE AFRICAN PEER REVIEW MECHANISM 297

The APRM to the extent that it enhances transparency in Africancountries will acknowledge democratic progress and scorn antidemo-cratic measures Consequently it can confer or withhold internationalrecognition and raise or lower the domestic legitimacy of governments(Henning) Moreover transparency increases the political risk of unsus-tainable policies whereas the lack thereof means that such policies cango undetected longer than they otherwise would Generally countriescharacterized by a relatively high degree of transparency have exhibitedgreater political and economic discipline and in many instances havebeen able to achieve a more robust political and economic performancecompared to countries with less transparent policies even within a sameregion (Henning)

This positive correlation between transparency and good governancehas also been empirically demonstrated across the spectrum of bothdeveloped and developing countries R Islam for instance has shownthat governments that are more transparent govern better as measuredby a wide number of governance indicators such as government effective-ness regulatory burden corruption voice and accountability the rule oflaw bureaucratic efficiency contract repudiation and expropriation riskAnd as better governance has also been empirically demonstrated to becorrelated with higher growth rates it can be extrapolated that there is aclose relationship between greater transparency and how fast economiesgrow (Islam) Botswana for example is internationally recognized for itssubstantial degree of transparency with a liberal democratic political sys-tem and a prudent and open budgetary process (Hope 2002a Kopits andCraig) As a result Botswana continues to experience political and mac-roeconomic stability with strong growth The country has consistentlybeen one of the fastest growing in the world with an annual averagegrowth rate of per capita gross domestic product (GDP) of 51 percentduring the period 1975ndash2002 compared with an annual average of

minus

08percent for sub-Saharan Africa during the same period (UNDP 2004)

That relationship between transparency good governance and growthin Botswana is further reflected in the growth competitiveness index(GCI) of the World Economic Forum The GCI is composed of threesubindexes identified as pillars in the evolution of growth in a country(1) the quality of the macroeconomic environment (2) the state of publicinstitutions and (3) the level of technological readiness The GCI uses acombination of hard data such as inflation rates budget deficits the levelof Internet access in schools and survey data in areas such as judicialindependence the prevalence of institutionalized corruption and theextent of inefficient government intervention in the economy (Lopez-Claros) Botswana has consistently ranked in first place among all Africancountries in the overall GCI as well as in the macroeconomic environmentand public institutions subindexes For the 2003 GCI computationsBotswana was ranked at 36 just behind Greece on the worldwide com-parisons (World Economic Forum)

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

REFERENCES

Abed G T 2001 The Changing Role of the State Governance and New CapacityRequirements In M A Dessart and R E Ubogu eds

Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

THE AFRICAN PEER REVIEW MECHANISM 297

The APRM to the extent that it enhances transparency in Africancountries will acknowledge democratic progress and scorn antidemo-cratic measures Consequently it can confer or withhold internationalrecognition and raise or lower the domestic legitimacy of governments(Henning) Moreover transparency increases the political risk of unsus-tainable policies whereas the lack thereof means that such policies cango undetected longer than they otherwise would Generally countriescharacterized by a relatively high degree of transparency have exhibitedgreater political and economic discipline and in many instances havebeen able to achieve a more robust political and economic performancecompared to countries with less transparent policies even within a sameregion (Henning)

This positive correlation between transparency and good governancehas also been empirically demonstrated across the spectrum of bothdeveloped and developing countries R Islam for instance has shownthat governments that are more transparent govern better as measuredby a wide number of governance indicators such as government effective-ness regulatory burden corruption voice and accountability the rule oflaw bureaucratic efficiency contract repudiation and expropriation riskAnd as better governance has also been empirically demonstrated to becorrelated with higher growth rates it can be extrapolated that there is aclose relationship between greater transparency and how fast economiesgrow (Islam) Botswana for example is internationally recognized for itssubstantial degree of transparency with a liberal democratic political sys-tem and a prudent and open budgetary process (Hope 2002a Kopits andCraig) As a result Botswana continues to experience political and mac-roeconomic stability with strong growth The country has consistentlybeen one of the fastest growing in the world with an annual averagegrowth rate of per capita gross domestic product (GDP) of 51 percentduring the period 1975ndash2002 compared with an annual average of

minus

08percent for sub-Saharan Africa during the same period (UNDP 2004)

That relationship between transparency good governance and growthin Botswana is further reflected in the growth competitiveness index(GCI) of the World Economic Forum The GCI is composed of threesubindexes identified as pillars in the evolution of growth in a country(1) the quality of the macroeconomic environment (2) the state of publicinstitutions and (3) the level of technological readiness The GCI uses acombination of hard data such as inflation rates budget deficits the levelof Internet access in schools and survey data in areas such as judicialindependence the prevalence of institutionalized corruption and theextent of inefficient government intervention in the economy (Lopez-Claros) Botswana has consistently ranked in first place among all Africancountries in the overall GCI as well as in the macroeconomic environmentand public institutions subindexes For the 2003 GCI computationsBotswana was ranked at 36 just behind Greece on the worldwide com-parisons (World Economic Forum)

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

REFERENCES

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Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

298 KEMPE RONALD HOPE SR

Improved Public Accountability

Transparency is also vital for accountability In fact a system of govern-ment that is transparent is also likely to be accountable Accountabilitymeans that systems are in place and are facilitated by public institutionsto hold public officials to account for their behavior actions and deci-sions Public accountability is needed to guarantee political as well aseconomic and financial freedom Where governments or corporationsare corrupt resources will be misallocated The scarcer those resources(as they are in Africa) the greater the cost to the economy and the moreharm done to the development process (Braga de Macedo Foy andOman)

A system of public accountability is required so that public officialsand governments act in ways that are broadly approved by societyAccountability is fundamental to any society with pretensions to beingdemocratic Put in another stronger way being democratic requires asuitable system of accountability Public institutions are created by thepublic for the public and need to be accountable to it (Hughes) Theconcern with public accountability expresses the continuing need forchecks oversight surveillance and institutional constraints on the exer-cise of power The guiding idea of public accountability is to control theabuse of power not to eliminate the exercise of power where legitimate(Schedler 1999) Related to public accountability is the notion of respon-sibility Responsibility refers to those rules that influence the behavior ofpublic officials in ways that encourage them to be responsive to publicdemands and act in the interest and welfare of citizens (Hyden)

The APRM will expose any deficiencies in accountability by publicofficials in African countries The governance record in Africa indicatesthat public accountability is in serious need of improvement The short-comings with respect to public accountability in Africa are directly attrib-utable to the fact that neopatrimonial rule is a core feature of politics anddevelopment management in most of Africa Whereas personal authorityand relationships occur on the margins of all bureaucratic systems theyrepresent the very foundation and superstructure of political institutionsin Africa Consequently although neopatrimonial tendencies can befound in all polities it is practiced with flair on the African continent(Bratton and van de Walle Hope 2002a)

Neopatrimonial rule entails individual rule by virtue of personal pres-tige and power personalized authority determined by the preferences ofthe ruler rather than the laws of the land attempts to ensure the politicalstability of the regime and personal political survival by providing a zoneof security in an unstable or uncertain environment and the selectivedistribution of favors and material benefits to loyal followers who areregarded and treated as clients (Bratton and van de Walle Callaghy) Thepatrimonial nature of African public officials has considerably under-mined good governance in the region and continues to do so despite the

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

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Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

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Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

THE AFRICAN PEER REVIEW MECHANISM 299

gains made in political liberalization and democratic consolidation dur-ing the 1980s and 1990s Personalistic rule is characterized for exampleby incumbents using national resources which of course they control topurchase loyalty and thus maintain a monopoly on power Absolutely nodistinction is made between personal and public property

The application of the APRM will determine where public accountabil-ity is faulty and what should be done to improve it Improved publicaccountability will improve the democratic political order in Africa aswell as the prospects for achieving sustainable development The mannerin which public accountability has been handled in Africa in the pastunder patronage regimes has stalled the development of the continent(Hyden) Peer reviews will result in greater public debate on many issuesof governance including public accountability Public scrutiny and peerpressure will then provide the impetus for conscious efforts at improvingpublic accountability

Enhanced Policy Coherence

Coherent policy for sustainable development is derived from good gov-ernance Those African countries that have pursued market-led policyreforms have made better development management choices andimproved their economic performance Africa has a history of policydevelopment and policy implementation that have not favored growthand development Indeed these distorted policies continue to benefitcertain influential groups

Developing and implementing coherent policies is a requirement ofgood governance and sustainable development By the 1980s the primacyof policy as the basis for encouraging and sustaining development hadcome to be widely accepted among those concerned about promotingdevelopment (Grindle and Thomas) Nowhere was policy reform andcoherence more needed than in Africa a region that muddled alongthrough ad hoc and incoherent policy implementation that led to the1980s and 1990s being referred to as its lost decades of developmentBecause citizens lose confidence in a government that is unable to developand implement coherent policies for improving well-being and sustainingdevelopment the degree to which a government is able to carry out thesefunctions can be a key determinant of a countryrsquos ability to sustain goodgovernance (Brinkerhoff and Crosby)

By subjecting themselves to peer review African countries will havetheir policy decisions and their application scrutinized Consequentlypeer review can tip the domestic political scales in favor of progressiveoutward-looking policy and against retrograde choices The result can bea substantial positive bearing on policy outcomes (Henning) Peerreviews will therefore stimulate better policy choices and lead to policychange When such change occurs relationships at various levels andamong stakeholders are shifted A new array of policy winners and losers

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

REFERENCES

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Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

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Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

300 KEMPE RONALD HOPE SR

emerges (Brinkerhoff and Crosby) However with better policy choicessociety wins and the prospects for achieving good governance and sus-tainable development are improved

Smarter Partnerships

ldquoThe need for partnership is most obvious in the daunting challenge ofachieving sustainable development which is predicated on the equallydaunting challenge of maintaining good governancerdquo (Brinkerhoff 3)Among other things partnerships in international development posi-tively enhance the effectiveness and efficiency of development effortsprovide a means of developing strategic coordination and implementa-tion create access to crucial resources and rationalize their use engenderstability and potential government legitimacy provide technologicaladvantages and cost savings bring about goodwill within the citizenryupon whose support both external development partners and gov-ernments rely and promote deeper and wider public participationand representation in the decision making for development outcomes(Brinkerhoff Hope 2002b) Therefore partnerships not only enhancedevelopment outcomes whether qualitatively or quantitatively but alsoproduce synergies where those outcomes as a whole are greater than thesum of what individual partners contribute (Brinkerhoff) As a matter offact these partnerships and cooperative arrangements have now becomea significant aspect of the emerging system of global governance provid-ing collective capacity to identify and solve problems on a global scale(Slaughter)

An important aspect of the NEPAD is its emphasis on the developmentof smarter partnerships between Africa and its bilateral and multilateralpartners The overall objective is to improve effectiveness in developmentcooperation primarily through better practice in the aid relationshipdelivery and reporting systems Partnerships are also being soughtthrough private sector entities in such areas as agro-industries tourismhuman resource development and in addressing the challenges of urbanrenewal and rural development (NEPAD Secretariat 2001)

Through the peer review assessments African countries have agreedto fight corruption strengthen their institutions adopt market-orientedpolicies respect human rights and the rule of law and spend more onthe needs of the poor By so doing they also expect to get the support ofthe rich countries with trade aid investment and debt relief Indeed theAPRM has generated a positive echo among Africarsquos major externaldevelopment partners who have pledged to honor their side of the bar-gain by providing enhanced financial assistance and greater facilitationof trade and investments (Joseph)

In particular the G8 countries at their 2002 Summit released a

G8Africa Action Plan

as an initial response to the NEPAD and the APRM Theplan is designed to encourage the imaginative effort that underlies the

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

REFERENCES

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Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

THE AFRICAN PEER REVIEW MECHANISM 301

NEPAD and to lay a solid foundation for future cooperation It welcomesthe commitment made by Africarsquos leaders in emphasizing good gover-nance and human rights as necessary preconditions for Africarsquos recoveryas well as the focus on investment-driven economic growth and economicgovernance as the engine for poverty reduction (G8 Summit)

In support of those objectives the G8 has undertaken in their individ-ual and collective capacities to establish enhanced partnerships withthose African countries whose performance reflects the NEPAD commit-ments Their African partners will be selected on the basis of measuredresults with a focus on those countries that demonstrate a political andfinancial commitment to good governance and the rule of law investingin their people and pursuing polices that spur economic growth andalleviate poverty The G8 will match the commitment of the African coun-tries with their own commitment to promote peace and security in Africato boost expertise and capacity to encourage trade and direct growth-oriented investment and to provide more effective official developmentassistance

Furthermore the APRM process will be used by the G8 countries toinform their considerations of eligibility for enhanced partnerships (G8Summit) This approach was again confirmed in a press release followingthe February 2003 meeting of G7 finance ministers and central bankgovernors (Russia not being present) which stated that ldquoConsistent withthe G8 Africa Action Plan we are ready to provide substantial support toAfrican countries that implement [the] New Partnership for AfricarsquosDevelopment (NEPAD) principles and are committed to improving gov-ernance and demonstrate solid policy performancerdquo (Government of Can-ada 2003a 2) In addition at their meeting in May 2003 the same financeministers and central bank governors issued a Working Paper on aideffectiveness in which they proclaimed that ldquoWith respect to Africa werenew our support to the NEPAD process and look forward to progressin the implementation of the African Peer Review Mechanism includingits governance aspects We will ask the IFIs [International FinancialInstitutions] to look for opportunities to coordinate their monitoringand surveillance mechanisms with NEPADrsquos own workrdquo (Government ofCanada 2003b 5)

In that same spirit but preceding the June 2002 G8 Summit USPresident George W Bush announced in March 2002 the creation of aMillennium Challenge Account (MCA) devoted to projects in nations thatgovern justly by upholding the rule of law rooting out corruption pro-tecting human rights and political freedoms that invest in their peoplethrough investment in education and health and that encourage eco-nomic freedom through open markets sound fiscal and monetary poli-cies appropriate regulatory environments and strong support for privateenterprise The MCA is being funded by a 50 percent increase in the coredevelopment assistance budget of the US over three years resulting inan annual increase of US$1 billion by fiscal year (FY) 2006 The goal of

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

REFERENCES

Abed G T 2001 The Changing Role of the State Governance and New CapacityRequirements In M A Dessart and R E Ubogu eds

Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

302 KEMPE RONALD HOPE SR

the MCA initiative is to reduce poverty by significantly increasing eco-nomic growth in recipient countries through a variety of targeted invest-ments (USAID)

The MCA also signals a new relationship between donors and recipi-ents Implementation will be based on a genuine partnership between theUS and the recipient country If fully implemented the initiative wouldrepresent one of the largest increases in foreign aid spending in half acentury outpaced only by the Marshall Plan following World War II andthe Latin American-focused Alliance for Progress in the early 1960s(Nowels) However some analysts had suggested that only four Africancountries are likely to qualify for the MCA in the first year and anotherfive would miss eligibility by only one criterion (Radelet Sperling andHart) Others on the other hand contend that higher income countrieswith stronger institutions and better capacity such as Botswana andSouth Africa should also be included (Pasicolan and Fitzgerald) None-theless for FY 2004 one-half of the 16 countries selected as qualifying inthe first group of MCA nations were AfricanmdashBenin Cape Verde GhanaLesotho Madagascar Mali Mozambique and Senegal (MCC) It isexpected that the majority of the African countries will eventually beeligible for participation in the MCA and like the application of theAPRM some of the same performance indicators will be used Specifi-cally 16 indicators in the three categories have been chosen for measuringperformance under the MCA They are (1) Governing Justlymdashto includecontrol of corruption voice and accountability government effectivenessrule of law civil liberties and political freedom (2) Investing in Peoplemdashto include public primary education spending as a percent of GDP pri-mary education completion rate public expenditure on health as a per-cent of GDP immunization rates for diphtheria pertussis and tetanusand measles and (3) Promoting Economic Freedommdashto include countrycredit rating inflation three-year budget deficit trade policy regulatorypolicy and days to start a business (Nowels)

Smarter partnerships for African countries are therefore on the hori-zon The APRM and the MCA complement each other and offer a newcompact for development by tying increased assistance to performanceand creating a results-based process in which African countries willderive benefits based on performance and measurable achievements thatimpact favorably on governance and sustainable development Countriesthat have embraced good governance as required by acceding to theARPM provide a much more conducive environment for smarterpartnerships

The APRM has also received very favorable responses from the EUEuropean employersrsquo associations (which hope for more publicndashprivatepartnerships in Africa) the OECD the World Bank the IMF and the UN(European Parliament) The UN not only endorsed the NEPAD and itsAPRM but also validated their principles to a very high degree Forexample in September 2002 the UN General Assembly decided that the

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

REFERENCES

Abed G T 2001 The Changing Role of the State Governance and New CapacityRequirements In M A Dessart and R E Ubogu eds

Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

THE AFRICAN PEER REVIEW MECHANISM 303

UNrsquos own policies for Africa will henceforth be based on the NEPADgoals

Deeper Private Capital Flows

Private capital flows are widely recognized as a powerful motor andmajor catalyst for sustainable development poverty-reducing growthand integration into the global marketplace Countries with betterpolicies including good governance attract the largest increases inprivate capital flows Good governance is now recognized as a crucialprerequisite for well-functioning markets and hence for attractinginvestment and a sustainable allocation of investment capital (OumlguumltccediluumlUNECA 2002a) It means therefore that predictable rules of the game arerequired to attract both domestic and foreign long-term private invest-ment Private investment in turn is a necessary ingredient for employ-ment generation and spurring economic growth During the period 1990ndash2000 gross domestic investment in sub-Saharan Africa averaged about 17percent of GDP and fell far short of investment in other parts of the worldIn addition sub-Saharan Africarsquos share of the global inward stock offoreign direct investment has more than halved since 1980 from 4 percentto 17 percent by 2002 (UNCTAD UNECA 2002a UNIDO) Of that sharealmost 60 percent is concentrated in three countries onlymdashAngola Nige-ria and South Africa (European Parliament UNIDO)

The disappointing performance of Africa with respect to attractingprivate capital flows can be placed squarely on the general internationalperception that most countries in Africa are risky places for investmentThis perception is derived without a doubt from the fact that governancein Africa although improving in some states is generally considered tobe bad (Hope 2002c) Consequently effective governments and efficientmarkets are both essential if African countries are to reap the benefits ofglobalization and to make that process work for the poor Private capitalfor example is highly mobile and will go where business can be con-ducted safely and where it can make the best return Weak and ineffectiveAfrican states with problems of corruption inadequate infrastructureand cumbersome bureaucratic procedures for business start-ups are notan attractive destination for those flows (UNECA 2002a)

Reaping the gains from globalization is the antithesis of economicmarginalization to which Africa has been subjected for decades Muchhas been written about the economic marginalization of Africa Howeverthe research findings on the benefits of globalization are now beginningto emerge Those findings are indicating that globalization is a powerfulengine of world prosperity and more importantly it is here to stay SurjitBhalla for example has empirically demonstrated that living standardsof poor people have increased during the past two decades at a pace fasterthan average living standards that globalization has been a force forhigher growth and prosperity for most and in particular for those at the

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

REFERENCES

Abed G T 2001 The Changing Role of the State Governance and New CapacityRequirements In M A Dessart and R E Ubogu eds

Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

304 KEMPE RONALD HOPE SR

bottom economic half of the worldrsquos population and that inequality inseveral regionsmdashas well as in the world itselfmdashdecreased in the 1980s and1990s with world inequality today at its lowest ever or at least since 1910Nonetheless most African countries have not been able to benefit fromglobalization to the extent they could because of bad governance asmanifested in their development policies in the 1970s and 1980s whichsought to achieve economic and social progress through governmentcontrols on prices interest rates and exchange rates as well as restrictionson various aspects of production distribution and trade (UNECA 2002a)

Through peer review Africa is hoping to reverse its status as a mar-ginalized continent Indeed it is contended in this work that peer reviewprovides the opportunity for African countries to demonstrate their com-mitment to good governance and policy reform that will make themattractive places for private capital flows While the empirical relationshipbetween robust peer review mechanisms and private capital flows needsmore study it can be expected that peer review to the extent that itenhances transparency and fosters market-consistent policy reformwould positively affect investment decisions and capital flows (Henning)In fact Jeffrey Sachs argues that by being peer reviewed and improvingtheir governance systems rather than perpetuating corruption and mis-rule African countries will be able to benefit from specific and well-targeted investments that would provide the foundation for self-sus-tained growth Private capital flows have to be won Demonstrating thatan enabling environment exists or is being created to accomplish thatwould be facilitated through the application of the APRM to cover reformin such areas as corporate law contract law labor law bankruptcy andproperty rights (UNIDO)

The Commission on Capital Flows to Africa (CCFA) for example hasnoted that the APRMrsquos inclusion of review indicators such as autonomyof the central bank effectiveness and enforcement of competition regula-tion enactment and enforcement of effective anticorruption and anti-money laundering laws and protection of property rights among othersldquowill enhance Africarsquos ability to attract the private capital that is crucialto long-term sustainable development and to Africarsquos full participation inglobalizationrdquo (CCFA 21)

Strengthened Capacity

Maintaining good governance and sustaining development requires acapable state with the requisite capacity to consistently improve on policyoutcomes Following Hope (2004) we define capacity as the competencyof individuals public sector institutions private sector entities civil soci-ety organizations and local communities to engage in activities in asustainable manner that permit the achievement of beneficial goals suchas poverty reduction efficient service delivery good governance eco-nomic growth effectively facing the challenges of globalization and

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

REFERENCES

Abed G T 2001 The Changing Role of the State Governance and New CapacityRequirements In M A Dessart and R E Ubogu eds

Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

THE AFRICAN PEER REVIEW MECHANISM 305

deriving the greatest possible benefits from such trends as rapid changesin information technologies and science As noted by the World Bank(1996) it also engenders the self-reliance that comes with the ability ofpeople to make policy choices and take actions to achieve the objectivesthey set for themselves including the ability to identify and analyzeproblems formulate solutions and implement them

Capacity in Africa is weak With such weak capacity both the publicand private sectors on the continent lack the requisite ability to developand implement the appropriate policies for poverty reduction sustainabledevelopment and the maintenance of good governance Institutions forexample lack the capability to meet the fundamental requirements forenforcing rules and ensuring accountability (Hope 2002a) Under suchcircumstances capacity development or building becomes imperative

Capacity development entails the enhancement of the competency ofindividuals public sector institutions private sector entities civil societyorganizations and local communities to engage in activities in a sustain-able manner for positive development impacts such as poverty reductionimprovement in governance and generally meeting the millenniumdevelopment goals (Hope 2004) The necessity for capacity developmentin Africa had been recognized by the World Bank in the 1980s and thatinstitution launched the African Capacity Building Initiative in 1989which then resulted in the creation of the African Capacity BuildingFoundation (ACBF) in 1991 with additional sponsorship from the AfricanDevelopment Bank and the United Nations Development ProgrammeLocated in Harare Zimbabwe the ACBF has contributed to a number ofprojects and programs designed to strengthen Africarsquos capacity for devel-opment management and economic analysis However much more needsto be done in a focused manner and the ACBF along with its partners isproceeding in that direction

Through the peer review process capacity constraints will be identifiedand recommendations offered on how to develop indigenous capacity tosustain development and improve governance In that regard much tech-nical assistance will be required If African governments are to be success-ful in keeping ownership and leading the development agenda of theircountries then they must make serious efforts at capacity developmentincluding the need to mount institutional reforms that focus on theadministrative and civil services legislative bodies electoral systemslocal governments justice systems and civil society organizations andprivate enterprises

The administrative and civil services require reforms to fill existinggaps in capacity that are adversely affecting the implementation of gov-ernment policies and the delivery of public services the legislative bodiesneed to improve their capacity to exert their oversight and control func-tions the electoral systems need to gain capacity to deliver credible andtransparent election services and elections to voters candidates andpolitical parties the local governments need to develop capacity to better

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

REFERENCES

Abed G T 2001 The Changing Role of the State Governance and New CapacityRequirements In M A Dessart and R E Ubogu eds

Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

306 KEMPE RONALD HOPE SR

respond to the benefits of decentralization the justice systems needgreater capacity to address burdensome judicial procedures managementmethods and issues of judicial independence and the civil society orga-nizations and private enterprises need to develop capacity to improvetheir analytical strategic service delivery policy advocacy and partner-ship capabilities

CONCLUSION

The APRM is the most innovativemdashand critically significantmdashaspect ofthe NEPAD It constitutes a bold and imaginative attempt to launcha total war on the endemic problems of bad governance unsustainabledevelopment and overwhelming poverty that have been confrontingAfrica for several decades The APRM will be used as a means foropenly and honestly assessing strengths and weaknesses for monitoringprogress toward building capable states with strong institutions forsustainable development and improved governance structures for peerlearning and for the sharing of best practices It ldquoutilizes a strong com-parative advantage of NEPAD its democratic roots and aspirations toprovide a forum that speaks with an African voice to African nationsrdquo(Kanbur 10)

The development and application of the APRM represents a sea changein the thinking of African leaders the majority of whom heretofore wereprone to inward-looking perspectives and exhibited a lack of concernwith good governance As demonstrated in this paper peer review willconfer many benefits on African countries and the continent as a wholethereby leading to better governance and improvement in developmentperformance The APRM is an idea whose time has come Ideally it wouldalso allow for the interests of external development partners and Africancountries to converge Indeed this is the case with respect to both the

G8African Action Plan

and the Millennium Challenge Account of the USMoreover as Rod Alence brilliantly observed the end of the Cold Warhas driven an environment in which democracies are much more likelyto be rewarded with resources and legitimacy while governments thatare nondemocratic are finding the international community to be morehostile toward them For Africa ldquothe New Partnership for Africarsquos Devel-opment with its emphasis on democracy and good governance reflectsan emerging inclination among some African governments to embracethose [former] tendenciesrdquo (Alence 178ndash179)

Africa is the most aid-dependent most indebted as well as the mostmarginalized region of the world Through the APRM African leadersare determined to convince the skeptics and Afro-pessimists that they (theAfrican leaders) have indeed become the architects of their own destinyoffering African solutions which are universally embraced to Africanproblems Undoubtedly the link between the APRM and the sustainabil-ity of the continentrsquos development is an important one as Africarsquos access

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

REFERENCES

Abed G T 2001 The Changing Role of the State Governance and New CapacityRequirements In M A Dessart and R E Ubogu eds

Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

THE AFRICAN PEER REVIEW MECHANISM 307

to development assistance and investment is increasingly dependent onrequirements such as good governance

However the success in the application of the APRM will be dependenton the extent to which it (the APRM) remains free from political andbureaucratic manipulation As noted in this work the insertion of aheavily bureaucratic hierarchy into the conduct of the peer reviews threat-ens to dilute both the impact as well as the general acceptance (regionallyand internationally) of those peer reviews It is therefore imperative thatthe technical institutions charged with assisting in conducting the peerreview assessments use their expertise and reputations to influence themanner in which the reviews are ultimately done to ensure that all of thepeer reviews are indeed credible and internationally acceptable

In that regard it should be kept in mind that accession to the APRMis voluntary Consequently only those African countries that volunteer tobe peer reviewed will in fact be peer reviewed Those countries that havenot acceded to the APRM however faulty their governance structures andpractices may be will continue to function in a manner inconsistent withthe ideals of the NEPAD And that in turn may unfortunately lead somecynics to view the APRM as simply a marketing ploy by some Africangovernments to convince Western donors to increase their aid to theregion Nonetheless as a critical element of NEPAD the APRM has thepotential to limit the number of failed states in Africa while contributingto the creation of much more capable states through its ability to improvethe quality of governance and economic performance in participatingstates (Maass and Mepham) Among other things failed states exhibitflawed institutions neopatrimonialism deteriorating or destroyed infra-structure flourishing corruption declining national income and loss oflegitimacy (Rotberg 2004) Such states require the application of remedialmeasures of the type entailed in the APRM

ACKNOWLEDGMENTS

Appreciation is expressed to my colleagues at the UN and elsewhereand the anonymous referees for their helpful comments on an earlierdraft

REFERENCES

Abed G T 2001 The Changing Role of the State Governance and New CapacityRequirements In M A Dessart and R E Ubogu eds

Capacity Building Gov-ernance and Economic Reform in Africa

pp 38ndash47 Washington DC IMFAlence R 2004 Political Institutions and Developmental Governance in Sub-

Saharan Africa

Journal of Modern African Studies

42163ndash187Amoako K Y 2000

Perspectives on Africarsquos Development

New York UnitedNations

AnyangrsquoNyongrsquoo P A Ghirmazion and D Lamba eds 2002

NEPAD A NewPath

Nairobi Kenya Heinrich Boumlll Foundation

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

308 KEMPE RONALD HOPE SR

Artadi E V and X Sala-i-Martin 2004 The Economic Tragedy of the TwentiethCentury Growth in Africa In E Hernaacutendez-Cataacute ed

The Africa Competitive-ness Report 2004

pp 1ndash17 Geneva World Economic ForumBhalla S S 2002

Imagine Therersquos No Country Poverty Inequality and Growth in theEra of Globalization

Washington DC Institute for International EconomicsBraga de Macedo J C Foy and C P Oman 2002 The Development Challenge

In J Braga de Macedo C Foy and C P Oman eds

Development Is Back

pp211ndash225 Paris OECD

Bratton M and N van de Walle 1997

Democratic Experiments in Africa RegimeTransitions in Comparative Perspective

Cambridge UK Cambridge UniversityPress

Brinkerhoff D W and B L Crosby 2002

Managing Policy Reform Concepts andTools for Decision-Makers in Developing and Transitioning Countries

BloomfieldCT Kumarian Press

Brinkerhoff J M 2002

Partnership for International Development Rhetoric or Results

Boulder CO Lynne RiennerCallaghy T M 1986 Politics and Vision in Africa The Interplay of Domination

Equality and Liberty In P Chabal ed

Political Domination in Africa Reflec-tions on the Limits of Power

pp 30ndash51 Cambridge UK Cambridge UniversityPress

Commission on Capital Flows to Africa (CCFA) 2003

A Ten-Year Strategy forIncreasing Capital Flows to Africa

Washington DC CCFAEuropean Parliament 2003

Report on the New Partnership for Africarsquos Development(NEPAD)

Luxembourg European ParliamentFeng Y 2003

Democracy Governance and Economic Performance Theory and Evi-dence

Cambridge MA MIT PressG8 Summit 2002

G8 Africa Action Plan

Available online at httpwwwg8gcca2002_summitmenu-enasp (last accessed 4 August 2002)

Government of Canada 2003a Statement of G-7 Finance Ministers and CentralBank Governors Paris February Available online at httpwwwg8gccamenu-enasp (last accessed 6 February 2003)

mdashmdashmdash2003b

G-7 Finance Working Paper Aid Effectiveness

Available online athttpwwwg8gccaworking_paper_aid_effectiveness-enasp (last accessed8 August 2003)

Grindle M S and J W Thomas 1991

Public Choices and Policy Change ThePolitical Economy of Reform in Developing Countries

Baltimore MD Johns Hop-kins University Press

Henning C R 2003 Peer Review Paper Prepared for the Meeting of the Com-mission on Capital Flows to Africa Washington DC February 21

Hope K R 2002a

From Crisis to Renewal Development Policy and Management inAfrica

Leiden the Netherlands Brillmdashmdashmdash 2002b From Crisis to Renewal Towards a Successful Implementation of

the New Partnership for Africarsquos Development

African Affairs

101387ndash402mdashmdashmdash 2002c Shaping the Enabling Environment for Private Capital Flows in

Africa A Governance Perspective In OECD ed

Official Development Assistanceand Private Finance Attracting Finance and Investment to Developing Countries

pp29ndash37 Paris OECD

mdashmdashmdash 2004 Capacity Development for Good Governance MimeoHughes O E 1994

Public Management and Administration

New York St MartinrsquosPress

Hyden G 1998 Sovereignty Responsibility and Accountability Challenges at theNational Level in Africa In F M Deng and T Lyons eds

African ReckoningA Quest for Good Governance

pp 37ndash66 Washington DC Brookings InstitutionInter-Parliamentary Union (IPU) 1997

Universal Declaration on Democracy

Geneva IPU

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

THE AFRICAN PEER REVIEW MECHANISM 309

Islam R 2003

Do More Transparent Governments Govern Better

Policy ResearchWorking Paper 3077 Washington DC World Bank

Ito T 2002

Regional Surveillance Mechanisms in East Asia

Tokyo Kobe ResearchProject Institute for International Monetary Affairs

Joseph R 2002

Smart Partnerships for African Development A New Strategic Frame-work

Washington DC United States Institute of PeaceKabbaj O 2003

The Challenge of African Development

New York Oxford Univer-sity Press

Kanbur R 2004 The African Peer Review Mechanism (APRM) An Assessmentof Concept and Design Available online at httpwwwpeoplecornelledupagessk145 (last accessed 24 February 2004)

Kaufmann D and A Kraay 2002 Growth without Governance

Economia

3169ndash229

Kaufmann D A Kraay and P Zoido-Lobatoacuten 1999

Governance Matters

PolicyResearch Working Paper 2196 Washington DC World Bank

Kondo S 2002 Fostering Dialogue to Strengthen Good Governance In OECDed

Public Sector Transparency and Accountability Making It Happen

pp 7ndash11Paris OECD

Kopits G and J Craig 1998

Transparency in Government Operations

WashingtonDC IMF

Lopez-Claros A 2004 What Does the Growth Competitiveness Index Say aboutDevelopment in Africa In E Hernaacutendez-Cataacute ed

The Africa CompetitivenessReport 2004

pp 81ndash98 Geneva World Economic ForumMaass G and D Mepham 2004 Promoting Effective States A Progressive Policy

Response to Failed and Failing States Available online at httpwwwipprorguk (last accessed 18 August 2004)

Mbeki T 2002 Letter to the Right Honourable Jean Chreacutetien Prime Minister ofCanada November 8

Millennium Challenge Corporation (MCC) 2004

The Millennium CorporationNames MCA Eligible Countries

Press Release May 6 Available online athttpwwwmcagov (last accessed 11 June 2004)

NEPAD Secretariat 2001

The New Partnership for Africarsquos Development

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2002a

Declaration on Democracy Political Economic and Corporate Gover-nance

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2002b

Communiqueacute Issued at the End of the Fifth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday November 3mdashmdashmdash 2003a

Objectives Standards Criteria and Indicators for the African Peer Mech-anism (The APRM)

Midrand South Africa NEPAD Secretariatmdashmdashmdash 2003b

African Peer Review Mechanism Organization and Processes

MidrandSouth Africa NEPAD Secretariat

mdashmdashmdash 2003c

Communiqueacute Issued at the End of the Sixth Summit of the Heads of Stateand Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Sunday March 9mdashmdashmdash 2003d

Communiqueacute Issued at the End of the Seventh Summit of the Heads ofState and Government Implementation Committee of the New Partnership for AfricarsquosDevelopment

Abuja Wednesday May 28mdashmdashmdash 2003e

Report of the High-Level Working Session of the African Peer ReviewMechanism (APRM) Panel of Eminent Persons (APR Panel)

Cape Town July 25ndash27

mdashmdashmdash 2004 Countries Acceded to the APRM Available online at httpwwwnepadorgaprrm_countrieshtml (last accessed 5 January 2005)

Nowels L 2003

The Millennium Challenge Account Congressional Consideration ofa New Foreign Aid Initiative

Washington DC Congressional Research Service

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

310 KEMPE RONALD HOPE SR

Oumlguumltccediluuml M 2002 Good Governance and Best Practices for Investment Policy andPromotion Paper Prepared for the UNCTAD Workshop on Efficient and Trans-parent Investment Promotion Practices The Case of LDCs Geneva June 6ndash7

Organisation for Economic Co-operation and Development (OECD) 2003

PeerReview An OECD Tool for Cooperation and Change

Paris OECDPasicolan P and S J Fitzgerald 2002

The Millennium Challenge Account LinkingAid with Economic Freedom

Washington DC The Heritage FoundationRadelet S 2002

Qualifying for the Millennium Challenge Account

Washington DCCenter for Global Development

Rotberg R I 2004 The Failure and Collapse of Nation States Breakdown Pre-vention and Repair In R I Rotberg ed

When States Fail Causes and Conse-quences

pp 1ndash49 Princeton NJ Princeton University PressSachs J 2004 Doing the Sums on Africa

The Economist

May 2219ndash21Saitoti G 2002

The Challenges of Economic and Institutional Reforms in Africa

Alder-shot UK Ashgate

Schedler A 1999 Conceptualizing Accountability In A Schedler L Diamondand M F Plattner eds

The Self-Restraining State Power and Accountability inNew Democracies

pp 13ndash28 Boulder CO Lynne RiennerScientific Council for Government Policy 2001

Development Policy and Good Gov-ernance

The Hague Scientific Council for Government PolicySen A 2002

Development as Freedom

New York KnopfSiegle J T M M Weinstein and M H Halperin 2004 Why Democracies Excel

Foreign Affairs

8357ndash71Slaughter A-M 2003 Everyday Global Governance

Daedalus

13283ndash90Sperling G and T Hart 2003 A Better Way to Fight Global Poverty Broadening

the Millennium Challenge Account

Foreign Affairs

829ndash14Stals C 2004 Address at the Occasion of the Opening Ceremony of the National

Stakeholders Forum of the African Peer Review Mechanism (APRM) in GhanaInternational Conference Center Accra Ghana May 27

Tavares J and R Wacziarg 2001 How Democracy Affects Growth

EuropeanEconomic Review

451341ndash1378Taylor I 2002 Commentary The New Partnership for Africarsquos Development and

the Zimbabwe Elections Implications and Prospects for the Future

AfricanAffairs

101403ndash412United Nations 1998

Annual Report of the Secretary-General on the Work of theOrganization

Document A531 New York United Nationsmdashmdashmdash 2004 World and Regional Trends Available online at httpwww

unstatsunorgunsd (last accessed 15 May 2004)United Nations Conference on Trade and Development (UNCTAD) 2003

WorldInvestment Report 2003

Geneva United NationsUnited Nations Development Programme (UNDP) 2002

Human DevelopmentReport 2002 Deepening Democracy in a Fragmented World

New York OxfordUniversity Press

mdashmdashmdash 2004

Human Development Report 2004 Cultural Liberty in Todayrsquos DiverseWorld

New York Oxford University PressUnited Nations Economic Commission for Africa (UNECA) 2002a

Guidelines forEnhancing Good Economic and Corporate Governance in Africa

Addis AbabaUNECA

mdashmdashmdash 2002b The African Peer Review Mechanism Process and Procedures

African Security Review

11 7ndash13mdashmdashmdash 2002c

The African Peer Review Mechanism Some Frequently Asked Questions

Addis Ababa UNECA

United Nations Industrial Development Organization (UNIDO) 2004

IndustrialDevelopment Report 2004 Industrialization Environment and the MillenniumDevelopment Goals in Sub-Saharan Africa

Vienna UNIDO

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223

THE AFRICAN PEER REVIEW MECHANISM 311

United States Agency for International Development (USAID) 2002 The Millen-nium Challenge Account Fact Sheet Available online at httpwwwusaidgovmca (last accessed 4 August 2002)

Wang Y and D R Yoon 2002 Mechanisms of Regional Surveillance in East Asiaand Its Prospects Tokyo Kobe Research Project Institute for InternationalMonetary Affairs

World Bank 1996

Partnership for Capacity Building in Africa

Washington DCWorld Bank

mdashmdashmdash 2000

Reforming Public Institutions and Strengthening Governance

Washing-ton DC World Bank

mdashmdashmdash 2004

Global Monitoring Report 2004 Policies and Actions for Achieving theMillennium Development Goals and Related Outcomes

Washington DC WorldBank

World Economic Forum 2004 Overall Competitiveness Rankings Growth Com-petitiveness Index Rankings Available online at httpwwwweforumorg(last accessed 23 July 2004)

Zack-Williams A B 2001 No Democracy No Development Reflections onDemocracy and Development in Africa

Review of African Political Economy

28213ndash223