‘Value addition answer to Africa’s challenges’

Prof Nnadozie

Prof Nnadozie

Africa’s underdevelopment has largely been attributed to lack of capacity by those in power to make the most of the world’s most sought primary products the continent is endowed with. On the other hand, Asian countries like China, Japan and South Korea have been steadily developing while Africa remains the world’s poorest continent. Our Senior Reporter Lloyd Gumbo (LG) talks to African Capacity Building Foundation executive secretary Professor Emmanuel Nnadozie (EN), a Professor of Economics about the challenges and prospects of Africa’s development.

LG: The ACBF works closely with African governments and some development partners outside the continent, would you say your organisation is best placed to bridge the gap between Africa and the rest of the world in terms of development?
EN: Yes, I feel that we are in a very good position to bridge that gap in so far as the foundation is helping the continent to enhance its capacity to engage with the rest of the world. One of the problems that African countries are facing, which I consider to be very serious is the inability to effectively engage with the rest of the world whether it’s in terms of trade, international negotiations and so on and so forth.

It’s clear to everybody that Africa has a lot of partnerships with various countries like China, South Korea and Japan, but we often find out that in these engagements, the challenge for Africa is making the most of these partnerships. This is because African countries do not have the capacity to effectively negotiate in their own best interest.

One thing, we have done as ACBF is to try to enhance the capacity of African countries to maximise these engagements. For example, during the last US-Africa Leadership Summit, we did a comprehensive analysis of the historical fashion of Africa’s engagement with the US to see how it has evolved and how it has transformed over time. We were able to come up with a common position, which the AU championed when they went to Washington DC. We think this is the way Africa should be engaging because this works very well with the Sustainable Development Goals and climate agreements.

LG: Africa has largely remained an exporter of cheap primary products and an importer of expensive finished products. Why is this so considering that some of the countries have been independent for about 50 years?
EN: Thank you very much for this important question. If you ask me what has been the most nagging challenge of African economic policy in the past 25 to 30 years, I can tell you it is lack of transformation, lack of value addition, lack of beneficiation and the lack of making the most of Africa’s primary commodities.

It’s one thing to identify these problems, but you need to know exactly why the situation has happened.

First of all, I think African countries mistakenly believed or took on policies that were developed outside and thrust upon them. The reason I say that is before the 1970s, African countries were on their way to industrialise. Many countries had built industries, they were starting to process and transform some of their primary commodities and suddenly with the Structural Adjustment Programme and issues relating to the Washington Consensus, the governments were forced not to promote industrialisation but rather to leave it to the private sector. There is no country in the world where a government has not played an active role in promoting industrialisation whether it is in Britain, in the US or as recently as we see in China and South Korea.

Therefore, it was a great blunder for African countries to take hook, line, and sinker the policies that were promoted from outside.

That set back Africa’s initial industrialisation march. Recovery has become extremely difficult, especially when many countries began to discover oil and other kinds of mineral commodities.

Of course, the temptation is that you make quick revenue by just shipping it in raw form. And when you start engaging in that process, thinking about how to add value to it becomes more complicated than difficult.

But lately, the countries are paying serious attention to manufacturing. It’s not all hopeless as we speak now. There are countries where things are happening in a positive way because they have realised that when you talk about poverty and reducing massive youth unemployment, there is no way you can deal with those problems without industrialising, without adding value to your raw materials, without this massive economic transformation that has to take place.

The difference between countries where it is happening and where it is not happening, is just simply a matter of leadership because industrialisation is not only a technical issue, it is primarily a leadership issue.

As a visionary leader who says ‘we want to industrialise and we have to put the conditions necessary for industrialisation to take place and we have to build capacity, the technical skills, invest in Science, Technology, Engineering and Mathematics (STEM) to produce young people who are going to be the workforce that will make it happen and promoting entrepreneurship and create the kind of business environment that will enable the private sector to operate.

LG: But how can African governments industrialise when they have poor infrastructure, that is, electricity deficit and transportation?
EN: Precisely, that is why I am saying it is a matter of leadership. When I said conditions, obviously that is what I was talking about.

It is not only the regulatory conditions that will make business easy to do. There is massive investment in human capital and in physical capital, the physical capital being the infrastructure.

And investment in infrastructure, especially in energy is critical. Unfortunately, as you rightly observed, this has been neglected for quite a long time.

I think the issue now, everybody knows what to do. It’s no longer the case like in the 1960s and 1970s where people didn’t really know what to do. Now everybody knows what to do.

LG: Talking about engagement between Africa and the rest of the world, there is a school of thought that believes that for Africa to develop, it should disengage. Your thoughts?
EN: This is an absolutely dangerous idea that should never be peddled. It has been done before, if it was successful, it would continue to be done.

Now I am asking them what model are they following, which country has disengaged and succeeded? They just don’t have to come and talk about some things that are ideological.

Development is not about ideology nor is it about sentiments. It is a practical issue. You do not accidentally get developed and you cannot develop by simply becoming an enclosed space and decide not to engage the rest of the world.

Did China develop by doing that? The answer is no! China welcomed massive investments from everywhere in the world, Japan did the same and they were able to access markets everywhere in the world. Anybody who says Africa should disengage is talking nonsense.

They need to understand the history of economic development as well as the theory of economic development, what works and what doesn’t work. There is a mistake we make that if something does not work well for us, the best thing is to throw it away. This is the mistake Africa made with Economic Development Planning.

They were told by the 1970s that ‘you have been planning since independence, your plans are not working, you should do away with them. There is no need to continue Economic Development Planning’ and they believed that ‘this is a new way of doing things, do poverty reduction strategies, do medium-term expenditure frameworks and you will be just fine, the market will take care of business.’

Well, China and South Korea didn’t stop planning and look where they are now. African countries stopped planning and see where they are now. So, there are people who will come with an idea that stop engaging because engagement is not working for you. When a plan doesn’t work, you don’t stop planning, you find a way how to make it work.

For me, this idea of disengagement is repeating an old ideology that has failed elsewhere, the Soviet Union tried it, even China tried it, they failed and they had to open up. I think we should be very careful about this kind of thinking.

LG: But Africa has been very strong in coming up with plans or economic blueprints yet very poor in terms of implementing those plans. Will we be able to implement some of these plans such as Agenda 2063?
EN: Yes, it is entirely possible and this is where ACBF comes into the picture because our new strategy, the 2017-2021 five-year strategy focuses strongly on the issue of implementation capacity. We realised that this is a challenge for the continent. Even Agenda 2063 itself, puts a lot of emphasis on the implementation of the initiatives rather than simply having them. If you go country by country, you find that the issue is no longer about good strategies and plans, as you rightly pointed out, it is actually implementing them.

The issue of implementation, we have identified from our foundation that, it is primarily an issue of capacity although some people mistake and think it’s an issue of funding or lack of funding. But our studies have shown that lack of three kinds of capacity are at the centre of the implementation gap.

First is the human capacity, which is just the know-how and the skills and ability that people have to implement what has been agreed. Secondly, it is the institutional capacity, which we find have been weak or non-existent in many instances.

The third capacity problem is what we call soft capacities. This is where the issue of leadership comes into the picture, or weak leadership, non-visual leadership. It is not just about the Head of State, its leadership across the board. Mindset is also another issue.

The issue of mindset is critical. We found out that if we don’t work on changing the mindset of people, first of all for Africans to have self-belief to change from thinking that their own salvation and development will come from outside. They have to believe that they have the ability to develop just like everybody else. That is not an easy thing because once you are used to thinking in a certain way, changing that is not easy. You are right, implementation is a challenge. It is the one that we are tackling head-on.

LG: In 2008, Sadc passed the protocol on Science, Technology and Innovation to foster innovation and promote development of science and technology in the region. Nine years on, the region and Africa at large seems to be still lagging behind in terms of ICTs, yet in the 21st century, ICTs are considered major drivers of development. What are some of the constraints in that area?
EN: If you ask people who are involved in science and technology and in particular in information and communication technology, they will tell you right away that the challenge is lack of awareness and understanding on the part of those who are supposed to be leading or creating the environment.

You will find that it has taken some countries quite a while to even recognise that innovation is a critical component of economic progress and development. It is not resistant but they do not have this kind of awareness and understanding at the level of those who lead and those who make policy.

It means therefore that if you look at investment, part of the budget that goes to training or funding institutions and people in these areas is quite poor. If you look at the national policies that are necessary to promote this kind of thing, they are very weak. But there are no two ways about it, the continent has to pay attention to innovation. It means therefore there has to be the right policies, the right investments and the right partnerships that will really promote the growth in this area.

Any country that does not pay attention to developing its ICT, I am afraid it’s going to be left behind. I understand that there is also some downside to it because oftentimes there is some sort of political resistance to that.

We have to invest massively in Science, Technology, Engineering and Mathematics and we have to increase the budget that we put in supporting these areas in our universities and in our educational institutions and also ensure that we set the right tone to say this is something that has to be encouraged.

LG: Talking about human capital utilisation, you are on record saying the African youths can play a major role in Africa’s development. But how do you utilise the capacity when they are not employed? They are highly educated but unemployed.
EN: Youth unemployment is in my view, probably the most significant challenge facing all African countries without exception. Of course, the degree of the challenge differs from country to country and the nature of the problem also differs.

In North Africa, unemployment affects educated youth but in some other parts of Africa, it is the opposite that is large proportion of uneducated youths, so the solution is not the same even though the problem is the same. The issue therefore is, why is it we have this massive number of young people unemployed and what can we do about it? The reason is the creator of employment, which is the private sector and non-governmental sector is not well developed in many countries.

Governments can never be able to employ everybody to solve the problem of youth unemployment. This is why industrialisation and development of the private sector is extremely important, that is where jobs will come from. That is one dimension.

The second dimension is, I should have started by saying employment is a supply and demand issue. If you want to solve a problem you can solve it on the supply side or demand side or both sides. I have looked at the demand side, which is those who demand labour, which is the private sector that you have to boost. On the supply side, you have to ask yourself, even if there are job opportunities on the demand side, which is the case in some of the countries but at the same time, you have a massive number of educated unemployed young people and you go to the businesses and they say we are having hard time finding people to employ. It is because your education has not focused on what is needed in the job market.

LG: Why is that so when we have so many people graduating, is it the curriculum that is wrong?
EN: You continue to produce graduates who are neither employable nor self-employable. The educational curriculum is not matching the job market. That is one challenge. The second challenge is if you look at where we are focusing our efforts, 80-90 percent of institutions of higher learning in Africa focus on humanities, on law, on social sciences and arts. Only 10-15 percent will do STEM.

Are we paying attention for example make it mandatory that before you graduate, you must take a course in business development and how to be able to create your own business if you want to do that so that if you cannot find a job you can start your own business. There has to be an immediate attack on this problem. The long time solution is what I have been discussing so that we do not continue to have this massive problem. So we need to attack it by the roots. Many countries and many governments still have this anti-business posture, which is at the heart of the problem. You cannot continue to do that. I am not saying you should allow business to do whatever they want but you should promote business and industrialisation because that is where the jobs will come. It is time for us to call a spade, a spade and pay attention to the needs of our population.

LG: One cannot talk of development without looking at the gender dynamics. What role do African women have to play in the continent’s development?
EN: An extremely important role. I see this gender issue as a development issue. Some people think it’s an issue about women. But it’s an issue about your own survival and development. If you are smart and educated, you will understand that everybody should contribute positively. Therefore everybody should have the same opportunities, so there is no need for you to think you have to subjugate one group in order for you to advance. There is no society that can hope to move forward without addressing the issue of empowerment of women, making sure that women have equal access to education, equal access to economic opportunity, they are equally represented as men and they earn exactly the same amount for the same amount of work. Women have the unique ability to raise children and therefore what happens to women determines what happens to children and ultimately what happens to the society. So if you want society to move, then you must make sure women are given opportunities.

LG: Lastly, some people say African politics has been a deterrent to the continent’s development. It has been dirty to the extent of affecting the economy. What do you think should guide the other between politics and the economy?
EN: There is a saying that ‘good politics is good economics’. I don’t think this is a chicken and egg issue, which one comes first. Politics is essential, for the fact that it enables society to establish systems of government that will make it possible for the economy to function and for people to live peacefully in their societies. So to that extent, politics has a major impact on the economic trajectory and economic development. This is not the question of the nature of the politics having problems, I think this is oversimplification of the issue. The issue in my view is that economic analysts and I am one of them, who probably have been guilty of this in the past, that we have allowed ourselves to see economics as something that has nothing to do with politics. And therefore, we take politics as given but if politics is not right, economics will not be right. Let me give you an example, a country has elections and when they finish, a new political party comes into power, if you go and carefully look at that political power and ask yourself, these are the people who are going to be making economic politics for the next four to five years, what is their capacity to be able to make policies that will bring about development? More often than not, what you find is a weakness in that category. The reason is because economists have not been asking the question that how come we have all these good strategies but they do not lead to good results?

This is one particular example why it doesn’t happen because what is often economically desirable is not often politically feasible. In other words, you can have the best blueprint on the ground but the political tussles and fighting will make it impossible for it to happen.

African countries, remember, historically were created artificially, with just a few exceptions and were dominated for a long period of time. One of the reasons that is there is going to be always multifarious interests, so sometimes balancing these interests from a political stand point is a very difficult thing to do.

Article Source: The Herald