Globalisation As The Key To Development – Mike Rotich



Africa’s real per capita income today is lower than in the 1970s leaving many African countries poorer than they were 40 years ago. Development that lacks a human face is as bad as democracy that disregards the minority. This is not only peculiar to African leadership but it cuts across the so called developed democracies. Thus as long as Africa does not take a holistic approach in its development model, we will always offer credible, denialist reasons for underdevelopment. Submitting ourselves to the whims of free markets policies, added to intelligently combining good politics of managing our natural and human resources, encouraging industrial and commercial education, shunning aid, participating in global trade and internet revolution are some key elements in the model of development.

One of the most visible causes of under-development in most African countries and especially in Sub-Saharan Africa is series of bad policy decisions in the past and present régimes. There has always been a contradiction of development. The colonial government was an ardent proponent of capitalist free markets, where the right –wing militancy co-existed with private ownership of factors of production. Most of these governments had intelligently opted for a policy of import substitution that made Africa by then self-sufficient. When independence regime came into place, it was more of a curse toil the African majority as far as economic empowerment is concerned. Socialist tendency where land and factories are publicly owned, either by the state or by large cooperatives and economic development is directed by plan. These policies that have denigrated private property rights will forever blight Africa’s development model. Taking charge of our own development without wholesome policy reversal and being part of global trade is a bridge too far. The market abuse has been the downfall in most of African revolution. In addition to stringent control of media, and civil society work, imposition of price control mechanisms has declined industrial productivity by up to 60% since this Africanization of States.

In every prospect for Africa’s future development, we do not want to get oversimplified, yet what we know is that Africa has to get the basics right. Uncontrolled expenditure on arms, ammunition and huge subsidies on education and health, a bloated civil service and unwieldy parliament are some of the variables that Africans need to address if they are to remain in charge of their development. I tend to agree with Johan Noberg that while it is noble to repay the debts, it is cruel to ‘’ask innocent citizens to pay a dictators debt.’ Most of African economies tend to be timid and closed. If it can embrace the fact that global market is now a reality and that the physical boundaries that were imposed to us by the colonial masters should never be a barrier in trade, the better it is for the sleeping giant. The only challenge is how to stimulate domestic productivity and demand for local goods in the face punishing cheap imports from the East. In more ways than one, Africa has reasons to protect her fledging industry from dumping, but that tends to nurture complacency and xenophobia. An example of this is South Africa which has a strong sense of exports, but whether or not that has alleviated unemployment is debatable, yet they are still considered economic powerhouse as far as SADC is concerned.

Comparative Advantage, Value Addition

A development model that ignores what one country can do best is worthless. Of late Africa has stumbled onto ‘Priceless’ diamond fields, but indigenous business groups are falling apart over who to do the mining, who to process and where to sell to. Africa’s development future lies in us being able to process primary commodities and export them as finished goods. The challenge though is how to deal with superior price and quality competition. The answer lies in technology transfer, free markets, labor laws and sound infrastructure – factors within our control and also unfair ‘anti-dumping tariffs’ imposed on African products by vindictive developed nations. Noberg made references to Harvard researcher Jeffrey Sachs and Andrew Warner who noticed a higher faster growth rate in free trade countries than protectionist ones. Fiscal accountability and financial prudence play another role in development resurgence. Africans are perpetually at conflict like in Somalia, Zimbabwe and Sudan. Development is as much physical as it is mental. This means that Africans have to be committed to putting growth plans in motion. Governments and states need to appreciate that its role is only limited to that of a policy maker and regulator. Africa’s left–wing movement is habitually livid about liberal structural adjustment prescription on what they term ‘neo-colonialist imperialist driven agenda’. Most of the countries that improved their policies have returned to positive rates of GDP per capita growth. An example of this is Kenya, which has had an improved GDP per capita since the change of regime and now the new constitution promulgation process that’s attracting investors from all over the globe.

As Africa is embracing the global opportunities, it is vital to recognize the need of collaboration among African scholars across the 54 African countries in solving the prevalent African challenges especially in fiscal, political and social domain. Africa remains a virgin in many development areas because of lack of an aerial eye that quickly identifies untapped opportunities within and without the continent. African scholars come in handy in the discovery and dissemination of information that can propel various governments and private sectors to economic advancement. It is quite unfortunate that the belief that the more information one has or withholds, the more the powerful they are, still persist in leadership styles especially among the older folks in African society. Another great challenge not only for Africa, but even among the global leadership is the issue of sub-optimization. Everyone wants only the best for themselves at the expense of the population. This has resulted in vices like corruption which has greatly inhibited growth in African economies.

Globalization on its own is never complete without proper use and advancement in Information and Communication Technology. The sooner African countries embraces the ICT the better their chances of winning in the global market. The emerging economies are as a result of revolutionary ICT driven ideas that are creating millions of Jobs hence sustaining the livelihood of the masses. ICT as a platform for development is the one very thing that brings about competitiveness and the ‘’global village’’ idea into being. The first versions of internet, Advanced Research Project Agency network (ARPAnet) was established as a result of research collaboration between scholars from different Universities in different nations. To date, this technology continues to revolutionalize the way of doing business and has greatly contributed to the economies through creation of online companies whose annual turn over is in billions of dollars. Several challenges have been identified over time that hinder Africans from attaining uppermost breakthrough in research and Information Technology driven project that could have otherwise contributed economic advancement in various countries. These include poor Cultural beliefs/practices, sub-optimization and poor project management skills.                


Unexploited Internal Opportunities In Africa   

Africa has enormous opportunities  ranging from human to natural resources. The continent encounters a range of external and internal constraints in its endeavor to develop.  The human capacity/resources, natural resources, tourism, internal trade, infrustructure, business friendly policies, good leadership, strong public-private partnership are some of the unexploited potentials that Africa has to offer. Globalization will bring out these opportunities in Africa and thus will give Africa a chance to be at par with the developed economies. Adam Smith (1723-90) observed that through voluntary interactions channels of development and opportunities for both parties involved are created and it is a matter of creating favorable policies that favour both parties are needed for equal growth. Enemies of free-market relationship tend to portray voluntary exchanges as a ‘’zero sum’’ that is a gain to one party can come only at a loss for the other. But trade that is based in mutual benefit, rather than conflict over fixed resources is what should be the basis of positive globalization. The true foundation of government rests in the consent of the people to the transfer   of certain powers to the government in order to protect their rights.   Globalization thus is the future of Africa.

Mike Rotich, Kenya

[photo: FHG]                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            

Options for development and the evolution of trade in Africa