Department of International Relations on the Project funded under the African Renaissance Fund: briefing

Meeting report

African Renaissance Fund: Presentation by Department of International Relations and Cooperation
Mr Harvey Short, Director: New Partnership for Africa’s Development (NEPAD), African Peer Review Mechanism (APRM) and African Renaissance Fund (ARF), DIRCO, gave a presentation on the work of the ARF.

The key focus of the ARF was to provide technical assistance and humanitarian assistance where needed on the African continent. The ARF was a legislative means of fulfilling the African Renaissance dream with the ability to take on foreign funding for projects initiated across the continent. The ARF served to fulfill a part of DIRCO’s strategic mandate to advance South Africa’s national interests and values through bilateral and multilateral diplomatic relations. In keeping with that mandate, the Fund had spent money in 5 key areas in various parts of the continent, namely:

•Humanitarian projects
• Economic Development
•Infrastructure development
•Capacity Building
•Security Sector Reform (SSR)

The ARF was founded to originally supplement the former Department of Foreign Affairs’ Technical Assistance Fund (TAF), which did not provide room for third party foreign donor sponsorship for countries in need of funds. The ARF was also more proactive and multilateral in its approach to funding. The abolishment of the TAF in 2001 left the ARF as the stand-alone fund.

The ARF received appropriations from the Government. A breakdown was provided of the funding provided to the Fund on an annual basis from 2001 onwards. Thus far, the Fund had allocated R613.5 million for Zimbabwe, providing assistance in agricultural reform projects, the economic recovery program and the elections of 2008. The Fund had also provided R172 million for Guinea Conakry, R101 million for the Democratic Republic of Congo, R100 million for Lesotho, and R52 million for the Saharawi Arab Democratic Republic amongst other funding across the continent.

Problems affecting the Fund included a lack of capacity to monitor events and evaluate projects, additional criteria addition due to high demand for funding, and a strong need to improve the Fund's accounting practices.

Mr Short said that Cabinet had taken the decision to approve the conceptual approach to the establishment of the South African Development Partnership Agency (SADPA). Upon SADPA’s finalisation, funds in the ARF would transfer to SADPA. The new initiative would carry on the work initiated by the ARF with foreign contributions falling under the purview of SADPA.

Discussion
The Chairperson raised several questions. Firstly, he asked how the Department monitored the usage of the money provided for the funded countries. He highlighted the example of reported authoritarian practices by officials in the Democratic Republic of Congo, which the ARF was noted to have funded. Secondly, he questioned whether SADPA would have more spending constraints than the ARF. Thirdly, he queried whether the potential troop allocation to Somalia would have come out of the ARF. Finally, he examined why South Africa had not signed on to the protocol on governance and elections as proposed by the Pan African Parliament (PAP) and why the process of signing it had not been completed as yet.

Mr Short replied that he was responsible for managing the funds granted to the ARF by government. He had an advisory board, which gave direction about where to allocate the funds based on requests from government departments acting as implementers of the ARF. These implementing departments had direct interaction with the foreign governments that requested funding from ARF. SADPA was an initiative of the South African government and would fall under the direction and influence of the government despite foreign donors.

Mr Short noted the Somalia question was still pending and therefore could not respond at this stage. Equally, he indicated that he was unable to reply to the question on PAP but that a written response would be forthcoming from the Department.

Dr G Koornhof (ANC) commented that the ARF had done some good on the continent and the prognosis of its tenure should not solely focus on the bad aspects afflicting the continent. In addition, he asked whether the Department would officially present the closure of ARF to Parliament prior to the cessation of its projects in light of the fact that the ARF was formed by an Act of Parliament. He asked whether the Department would audit the expenditure of funds by the ARF before its closure and present the audits to parliament. Lastly, he asked how the Department would handle the transfer of funds from the ARF to SADPA.

Mr Short replied that the ARF would go through Parliament and all the proper procedures before ceasing operations and projects. Due process would be followed. Parliament would still have to enact SADPA and the ARF would continue to run until that had happened. On the question of audits, he stated that DIRCO audits were done on a regular basis and published alongside ARF audit reports. It was normal practice that a mandatory audit would be conducted at the end of a project.

Ms T Sunduza (ANC) asked how the Department monitored funds, which were allocated to countries for development. How often did the Department receive progress reports from the countries receiving funding? How often did the Department evaluate the progress of funded countries and how did the Department evaluate potential funding recipients? Finally, she asked who performed the financial audits on projects set for cessation.

Mr Short reiterated that individual government implementers were responsible for the monitoring aspect of the funding of foreign government departments or programmes but that the ARF did get reports on progress made by the funded governments. He reiterated that DIRCO audits were done on a regular basis and published alongside ARF audits.

Mr K Mubu (DA) examined two issues. Firstly, he expressed concern about the allocations awarded to Zimbabwe and Guinea Conakry and questioned whether the Department knew how the money was spent in Zimbabwe. Secondly, he asked why there was little communication to the public (from the Department) about its foreign programme expenditure.

Mr Short repeated that government implementers were responsible for the monitoring aspect of the funding of foreign government departments or programmes. He attributed the poor communication on the lack of effective branding and marketing for projects such as ARF.

Ms R Magau (ANC) asked how it was possible that South Africa had assisted in Guinea Conakry with rice production when the country did not have expertise in rice production. She asked about the noted expenditure on the Pan African Woman’s Organisation by the Department and what it had been used for.

Mr Short said that the government had a partnership with Vietnam and Guinea Conakry through the National Agricultural Research Forum (NARF), which led to an exchange of skills from Vietnam on rice production to Guinea Conakry, with South Africa funding the exchange. He said that the ARF had assisted with funding around the Pan African Woman’s Organisation hosted in South Africa.

Mr B Skosana (IFP) asked whether the Department would consider new projects submitted for request under the ARF. It appeared that the Department was not concerned with the farming agreements in Zimbabwe or the socio-economic implications affecting that country through its noted funding. He asked why there was no comment from the Department in its presentation on NEPAD seeing as that initiative was a key tenet for the creation of the ARF.

Mr Short clarified that until the ARF was discontinued through an Act of Parliament, its work would continue and requests would duly be processed and granted where criteria were met.

The Chairperson asked whether any criteria were used before funds were allocated to fund countries.

Mr Short replied that many factors were considered in determining whether a country was eligible for funding under the ARF. A thorough assessment about the viability of the projects was carried out.

Ms Sunduza suggested that the Committee should have a joint meeting with the Department and the implementers of the ARF to fully understand foreign funding. She reiterated her concern over the expenditure in countries like Zimbabwe and Guinea Conakry and argued that the money would be better spent in South Africa.

Mr Skosana said that he supported Dr Koornhof’s view that the ARF was being negatively characterised but had done a lot of good. He emphasised that foreign expenditure which genuinely assisted struggling people on the continent should be marketed better and should receive more publicity.

Dr Koornhof said that appropriating money to the implementers of the ARF was not sufficient and more should be done to monitor the spending of those funds and the results they yielded in the various countries that benefitted from it. He said that the implementers and the Department should be brought before the Committee to clarify how the money was spent and what results it yielded.

Mr Mubu asked whether he could gain access to the monitoring reports from the various implementing departments if he made a request.

Mr Short said that those reports would be made accessible upon Mr Mubu’s request.

The meeting was adjourned.