Infrastructure should be the cornerstone of Africa’s development partnership, according to the prime minister of Kenya. By The Rt Hon. Raila Amolo Odinga.
The paradox of abject poverty amid plenty continues to define Africa. Abundance of natural resources and a history of external development assistance have not translated into a better life for the majority of African people.
Instead, Africa remains mired in poverty, experiencing minimal net economic improvement year after year. While there is improvement in the areas of peace and security (as evidenced by fewer armed conflicts) and in democracy and governance (as evidenced by more democratically elected governments), considerable challenges remain.
Sustainable gains
The sustainability of the gains made so far continues to be undermined internally by stagnant economies, wide income disparities, negative ethnicity (especially in the practice of politics), severe food shortages and limited innovation in leadership. External challenges include an impermeable global trading regime and a preponderance of development-assistance approaches that promote ideological and value systems at the expense of quantitative development.
These approaches often ignore the role that infrastructure would play in promoting poverty alleviation through private sector-led growth, attracting foreign direct investment (FDI) and securing democracy and good governance.
It is time that discourse on Africa’s development placed less emphasis on the promotion of free market ideology and democratic value systems and tilted to the provision of infrastructure as a priority. The battle of ideologies and value systems has already been won in Africa.
The ideas of free markets and democratic rule are now the norm of political and economic beliefs in Africa. Their practice may not be perfect yet but there is no risk that they can be rolled back. Free and fair elections, constitutionalism and the rule of law, deregulated markets and comity of nations are concepts now fully embraced from the urban to rural areas across Africa.
Economic output
Africa will only generate significant economic output if it is able to compete favourably for FDI and export more than it imports. It must also develop, attract and retain sufficient labour, adequately trained for the knowledge economy. Its products must be competitive in the global market and of good quality.
To do so, it must have world-class infrastructure in terms of ports and airports, rail and roads, telecommunications and affordable industrial energy supplies. The development of infrastructure should be seen as a means to generate demand and not be demand driven.
Make it available and it will be used. For example, African nations should aim to provide sufficient, reliable and affordable electricity at a rate in excess of established demand. This will create an appetite for domestic consumption and be an incentive to attract investors.
Roads should be constructed to unlock the economic potential of undeveloped areas, and to connect the people in those areas with the rest of their country and the world at large. Infrastructure should not be built because a study has established demand and the ability of targeted consumers to pay (a market exists) but rather because there exists a population and economic potential that needs to be nurtured (a market to be created).
To secure democracy and good governance in Africa, emphasis should be placed on how to increase the free movement of people within and outside national boundaries, and the promotion of access to information and knowledge on a mass scale.
A knowledgeable and well-informed population with high mobility across ethnic and national boundaries, united by common political and economic beliefs, provide the most effective and sustainable effort in defence of democracy and good governance. They could be the middle class, the urban poor, the rural farmers and pastoralists, or the industrialists. The keystone to this ecosystem is a combination of infrastructural facilities especially information technology.
FDI and increased exports have been touted as the key drivers for Africa’s economic renaissance. It has not been easy for Africa to attract and sustain a critical mass of FDI that would have real impact on wealth creation for the many.
The returns on investments in Africa compare very favourably with the rest of the world but this has not translated into significant foreign investments. Less democratic regions in Asia have attracted more investments than democratic regions of Africa. Regulated economies in Asia and eastern Europe have fared better than African countries that have fully deregulated their economies. Those African countries that have offered adequate incentives have not fared any better. Liberalising an economy and establishing a democratic political system is no guarantee for attracting foreign investments into Africa.
Africa is unable to attract the levels of foreign capital necessary to develop adequate energy supplies and efficient transportation and communication networks. The absence of quality and widespread infrastructure presents an opportunity for investors but is also a disincentive to investors. It is a vicious cycle.
Towards innovation
Africa’s investment in education, particularly science and technology, has been consistently declining over the years. Fewer teachers are being trained and employed while the population growth rates remain steady. The international ranking of most African universities has drastically fallen in the past two decades.
These institutions of higher learning face serious financial constraints for them to act as effective producers of educated, mobile and competitive labour. Africa’s limited investment in science and technology is evidenced by the negligible number of global patents being generated out of the continent. Faced with limited opportunities at home, more and more talented Africans opt to apply their skills and raise families abroad.
It is often easy for private capital to follow public capital. If more public resources, internal and external, are committed to the development of infrastructure in Africa, then attracting foreign investments in other fields would be made much easier. Modern infrastructure would market Africa as a trade and investment destination more than the value system and ideological prescriptions that are still influencing development partnerships between Africa and the developed world.
Practical approach
It is time to do practical things for practical results. Give people electricity and they will plug an enterprise to it. Support it with a road or rail network and mobile telephony and they will create a market for the produce of their enterprise. With the income generated they will access media services and tune into the global village. They will espouse the values of free markets, democracy and good governance, and will become tax payers and have a voice in the affairs of their governments.
This new community will be above tribal groups as it will not depend on ethnicities and boundaries to thrive. The people will become too interconnected by infrastructure and commerce to carry the worries and aspirations of a village. Negative ethnicity will face an assault from a mobile population united by challenges of supply and demand, ready and competent to act in concert in defence of freedom.
Substantial portions of bilateral and multilateral development assistance must be dedicated to public-private partnerships for infrastructural development in Africa. Foreign corporations willing to develop infrastructure projects in Africa should be supported with a combination of grants and concessional funding as part of bilateral assistance programmes of their home governments. Multilateral institutions should dedicate at least 70% of their African portfolios to infrastructure development. The emphasis should be on transnational projects with regional impact.
Extra-territoriality
The concept of ‘extra-territoriality of common infrastructure projects’ should be developed to cover the funding and use of key projects. Under this concept, joint ventures between governments and the private sector will be formed to oversee projects on behalf of the member states concerned.
Governments involved in such projects will be required to commit to their international character and to refrain from any acts that may undermine their common use. Ports, airports, rail and road networks, power plants, fibre optic cables, and science colleges and universities are top priorities.
We need to design and implement a time-based global partnership for the development of infrastructure in Africa if we hope to achieve the Millennium Development Goals.
