By: Vijay S Makhan
African countries have experienced modest economic recovery during the 1990s. But these countries are caught in a vicious circle in which the existing economic structure cannot generate enough savings and export earnings needed to finance their development and mount a sustained assault on widespread poverty. Yet foreign aid has been cut back sharply and the continent receives only a trickle of foreign investment flows. New policy regimes are now in place, creating the right environment for external financing to make a major difference. Development finance is one of the foremost challenges facing African countries and the international community in the new century.
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