Transcript Connectivity Asian and African countries In Developing Public

Connectivity Asian and African countries
In Developing Public Sector Accounting Reform
Prof. Indra Bastian, Ph.D, MBA, CA, CMA, Mediator
ASIA - AFRICA
ASIA
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4.4 billion people (60% of the world
population)
Fastest growing economic region and
the largest continental economy by
GDP PPP in the world
China and India are currently the first
and third largest economies in the
world
GDP in the region will expand by 5.7%
in 2016
Most Asian economies benefit from
low international food and fuel prices
The regional rate eased from 3.0% in
2014 to 2.2% in 2015 as global oil
prices fell by 47% and average food
prices by 15%. Regional inflation will
revive to 2.5% in 2016 as domestic
demand strengthens and rise further
to 2.7% in 2017 as global commodity
prices recover
AFRICA
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one of the poorest continents in the world and the least
technologically advanced and developmental point of
view, however, it is considered as a mine of wealth,
metal, and opportunities.
African continent which its economy is growing at a rate
of 5.8 percent per year
have about 124 billion barrels of oil reserves / about 12
percent of the world's reserves
natural gas is about 10 percent of total world reserves /
about 500 trillion cubic meters
It is producing about 90 percent of the platinum in the
world, 40 percent of diamond production, 27 percent of
the total amount of cobalt and 9 percent of total
production of iron around the world. It holds 50 percent
of gold reserves, and 30 percent of uranium which has
an important role in the nuclear industries
Agriculture - about 20-60 percent of the national
product gross of each country
one of the largest sources of agricultural products such
as coffee, cotton, and cocoa
characterized by a lot of forests that produce large
quantities of timber; in addition to fisheries, which helps
to provide incomes to about 10 million Africans, since
the value of the fish that are exported is US $ 2.7 billion
Tokyo International Conference on the
African Development (TICAD) (1993)
• This conference aims to increase government
development aid, and encourage foreign
direct investment through enhancing the
importance of exchanges between Africa and
the developed countries.
• It stresses the need to continue the
cooperation between Asia and Africa,
especially in the sectors of trade. It has been
held six times till now. The previous fives were
in Japan but the last one held in Nairobi.
Forum on China-Africa
Cooperation (FOCAC) (2002)
• China has adopted to enter the continent with
mutual interest, respect, and equality without
interfering in the affairs of others, with the
adoption of different logic from Western
financial policy in dealing with African.
• According to FOCAC report, China has
established 3,300 km of roads, 30 hospitals, 50
schools, 100 power stations in more than 40
African countries.
Asian-African Business Summit
(AABS) 2015
• This summit aimed to realize the economic development
between the two continent, which was mutually beneficial
and had to be reinforced through trade and investment
cooperation.
• In this summit, numerous business and world leaders
brought some issues in trade, investment, infrastructure,
maritime and agribusiness. Development and improvement
about the economic wonders of the Asian and African, the
potential of business relationships between the countries
of these two world's promising powerhouses as well as
encouraging the trade volume were on the table of
discussing.
More African-Asian forums to
discuss any future opportunities
• In the recent Asian-African Business Summit
(AABS) 2015 which was held in Jakarta, the
businessmen from both continents have agreed
to form Asian-African Business Council (AABC).
• The AABC secretariat will be in Jakarta, and its
member will have a yearly meeting to reach a
concrete economic cooperation between Asian
and African countries.
Exchange the experience of both Asian and
African countries in the term of public sector
reform in order to have fruitful results
• In the last Forum on China-Africa Cooperation (FOCAC) which was
in Johannesburg 2015, Chinese and African leaders agreed to raise
the new strategic relationship to a comprehensive strategic
partnership of cooperation relations between China and Africa, in
order to achieve significant progress in improving the status of
these relationships, and helping to expand cooperation in broader
and more areas, and emphasizes that this summit distinctive
landmark in the history of cooperation between the parties
• China is the largest trading partner of Africa for six consecutive
years. Africa has become the fourth largest destination for
Chinese investment. Bilateral annual trade turnover also rose in
2014, twenty-two times, compared to what it was in 2000, and
increased the volume of mutual investments sixty times in the
same period, exceeding the annual growth rate is 30%.
Study of other countries trading
cooperation in Africa such as the USA
• The African-American Summit (AAS) in Washington,
subtitled "Partnership for Increased Financial and Technical
Investment in Africa" ​comes to consecrate the US strategy
toward Africa since the end of the nineties of the twentieth
century
• No one could ignore the accelerated development in Africa
the last decades. Despite of this fact many African countries
still below the poverty line. In many points of view, the
reason is the corruption of the public system in those
countries. Besides, most of the powers focus on their
benefits and they seek for investment facilities to run their
projects despite the public interest of the continent.
Creating a strategic, cooperative, as
well as comprehensive relationship
• To make this point clear, most of the powers deal with the
continent as divided units. They don’t make agreements
with the continent as a whole unit which will be safer for the
economic wheel to run successfully. That individual strategy
makes the risk of any investment higher because the
country that invest could easily withdrawal its offer and
leave the host country in Africa powerless.
• On the other side, if they deal with Africa as a one unit, the
risk will be less while the benefit will be comprehensive and
all countries will get an equal share of improvement.
Investments should be unconditional,
far away from any political logic
• This point is beyond the success that Asian
achieve in Africa despite the large number of
its competitor. Africa was under the
colonization for a long time, and that has a
bad impact on its countries. They don’t
accept any economic and trade investments
which cover with political tendency.
Unconditional offers of any investment will
make the country, especially the poor one
trust the other party so a solid partnership
could be.
Confirming the language of mutual
interest based on respect and equality
• No one ignores that despite the
enormous economic growth in the
continent, the quality of investments in
it still unfair. Africa is a mine of wealth
and opportunities, but unfortunately,
this wealth is exploited unfairly. Most of
the exports from Africa is raw material.
Offering facilitated loans
• Many African poor countries have the natural
sources, but they don’t have the financial
resources to make the projects. Money is the
important pier in any development process.
Offering facilitated loans will be so helpful in
order to have a win-win partnership that could
break the difficulties that these countries are
facing
Promoting a public sector accounting for
accountability and maintaining trust in
cooperation
• Reforms in the public sector accounting held
on the stages of planning, budgeting,
realization of the program, reporting to
accountability. In this reform is important to
generate accurate reports. The cooperation
occurs on the existence of a trust and an
accountable report will create confidence in
the cooperation that will be executed.
Financial statistics can control the various
economic and trade activities
Conclusion
• Investment plays a big role in the economic and
social development, security and stability. It
contributes to the production of service facilities,
projects, and other capital formations.
• The wise investment policies and fair strategic
partnerships that the relationship between Asia
and Africa is characterized by make successful
connection between them. The volume of trade
and investment between the two continents is so
remarkable. It really contributes in the developing
revolution in both.