Critical to the new financial architecture is also the reform and strengthening of the financial sector in our own countries. Following the East Asian crisis of 1997-98, a number of proposals have been made and your views on these would be welcome. Such reforms have an important bearing on private foreign capital flows. Looking again at what is working rather than what is not, we will find that much of the FDI that is taking place in Africa is coming from non traditional sources- Malaysia and South Africa, for example. Before the Asian crisis, several African stock exchanges were becoming booming emerging markets, with portfolio investment a promising source of foreign private capital flows.
Capital markets are also a critical way of integrating Africa into the world economy.
But, with the exception of the Johannesburg Stock Exchange, African capital markets remain under capitalised and illiquid. An even more serious challenge than attracting capital to Africa is preventing capital from leaving. If Africa is to grow rather than beg its way out of poverty, there is simply no alternative to industrialising and diversifying its export base. How can we stand up to rich countries that continue to bar African goods from their markets through subsidies, and other protectionist measures. There can be no doubt that our ability to industrialise, diversify our export base, and talk with one voice in international forum would be enhanced by meaningful regional integration at home.