David Smith
David Smith

Thoughts in the wake of Africa Day

Monday was Africa Day. It’s a bit like Mother’s Day — once a year we remember somebody or something that is always part of our life, but far too often neglected.

Kaya FM played more African music than usual (apart from what Nicky Blumenfeld plays over the weekend) and a number of newspapers ran leaders on the subject.

One of the most interesting Africa stories I noticed was on the front cover of the weekend Financial Times — Zambian economist Dambisa Moyo is getting a lot of flack for her book Dead Aid. The executive summary of the book is this: development assistance is killing Africa; aid is stifling economic growth and making the corrupt even more so.

I read Dead Aid and found it inspirational, sort of in the way reading Denis Beckett’s latest book Magenta convinced me that the form of democracy we have in South Africa, as in many other parts of the world, can be improved dramatically.

Both authors are being called crazy and simple-minded by their opponents, who find their ideas too far away from mainstream thinking. I’ll stick with Moyo for the time being. American academic and avid supporter of international aid, Jeffrey Sachs calls her ideas “absolutely pernicious, and [which] could lead to the deaths of millions of people”. Bob Geldof’s followers have even organised an e-mail campaign urging African NGOs to stand up to her arguments. According to the FT, the campaign has backfired. I for one am pleased it has.

I’ve come across too many organisations, too many governments and too many heads of state who owe their existence to aid money. I’m not trying to say that all aid is bad, and neither is Moyo. There is a strong case for helping out during times of natural disasters, armed conflict or the rampant spread of disease.

But there is also the head of state that has been in power longer than free and fair elections would normally permit, who doesn’t worry about collecting taxes, because the money he needs to hold on to power and maintain an opulent lifestyle comes from elsewhere. As I write this Thought Leader, Omar Bongo of Gabon (in office since 1972), Denis Sassou-Nguesso of Congo-Brazzaville and Teodoro Obiang Nguema of Equatorial Guinea are all under investigation for embezzlement. These three and others have not had to concern themselves with building infrastructure for the people they are supposed to represent, simply because they don’t need them — development aid and a hefty windfall from oil production helps this particular trio.

The more battered the economy, the more the money rolls in from the usual suspects — the World Bank, IMF, EU, US, UK and a fairly long list of others. One trillion US dollars in development assistance has been sent to Africa over the last several decades. Moyo argues that not only has it not improved the lives of Africans, but that in many instances the standard of living has actually dropped — except for those few people who get hold of the money that is.

Anybody arguing that the economies of most African countries offer the opportunity for a better life for all thanks to development aid probably hasn’t spent much time exploring the continent. There are success stories, but, not surprising to me in any case, success is not determined by how much money is pledged at donor conferences. Rather, it is investment in the economy and infrastructure by the home government that usually makes the difference.

Moyo goes into great detail about how Botswana has generally managed to get things right. She also commends the Chinese for contributing to infrastructure development rather than sending the cash straight to the presidential palace. South Africa aside, China is probably responsible for more railway and road construction in Africa this decade than any other government.

There are so many directions in which I could take this blog, but I fear that both I and anybody kind enough to read this will get lost in the details. There is a big picture: put in place an economic plan and wean yourself off aid. Moyo challenges the donor community to gradually reduce the amount of aid given to governments over a five-year period, after which the recipients become responsible for running their own affairs at their own cost. I believe this will help persuade government to consider the hopes, needs and aspirations of the electorate which, once it realises accountability is taking over from chaos, will be motivated to invest in its future and its own communities. Once infrastructure is built subsistence farmers can become commercial farmers, small-scale manufacturers can become exporters and foreign currency earners and so on. Moyo frequently uses the example of a local manufacturer of mosquito nets who goes out of business when a foreign donor floods the market with products manufactured elsewhere. The intentions may have been noble, but the approach yielded yet another setback for business in Africa. Had the money for the donated nets been used to strengthen the existing local business, all concerned would have been winners, including the new people hired to handle the increased production.

This blog is simply an attempt to get people thinking about ways forward — ways of getting out of the swamp that has swallowed up so much of our potential. Moyo outlines the way forward far more eloquently than I have, and I strongly recommend reading her book. I don’t agree with everything she says, but I certainly agree when she says that the path to prosperity is already here; unfortunately it occasionally gets blocked by a layer of cash covering the presidential palace.