AFRICAN ECONOMY: ONE GOAL, MANY VIEWS
'We must attract foreign investors to Africa,' African Development Bank (AfDB) President, Donald Kaberuka, said recently while participating in the World Economic Forum (WEF) on Africa in Dar es-Salaam, Tanzania. His view summarized the position of Africa at this year's meeting.
The organizers themselves had noted the relevance of this year's gathering, and more specifically, the fact that it had Tanzania as a venue.
'The World Economic Forum on Africa is an important opportunity to take the pulse each year of the most influential of Africa's stakeholders.
We look forward to holding the meeting in Tanzania at a time when the whole East Africa region is expected to experience stronger growth,' Andre Schneider, Managing Director, World Economic Forum, had earlier announced. The Forum headquartered in Davos, Switzerland, who are the organizers of the annual event, further stated that the meeting continues a long-standing tradition of uniting African and global leaders to shape the agenda for the continent.
The Forum's Global Redesign Initiative (GRI) played a prominent role in this year's debate which had the theme: Rethinking Africa's Growth Strategy. There was a Summit of Young Global Leaders and it held concurrently with the meeting in Dar es Salaam.
Of the over 200 of the world's top young leaders integrated in the meeting, five were Nigerians who had been contributing to development in local communities. In line with the theme, seesions that had more than a dozen of Africa's leaders in attendance, addressed how African nations manage relations with key economic partners. The continent's young population, natural resources and market potentials were discussed as catalysts for significant future growth and development. However, underlying blockages to social and economic progress were addressed as needed materials in order to harness these potentials. Key issues include access to education, healthcare and affordable capital. Other debates focused on new models of governance and a unified approach to ensuring peace and security in troubled areas.
Investment for the continent's economic growth was central in the mindset of many of the key speakers at this years gathering. Stronger growth needs foreign investment, and many of the leaders that came used the opportunity the Forum provided to appeal for it. This was underpinned by the unannounced arrival of Zimbabwe's President, Robert Mugabe, whose Prime Minister of Zimbabwe was the one on the list of speakers.
Investors who perceived and described Africa as a risky place to do business as people who were out of touch with reality. But such investors' perception ensures that Africa loses between US$200 billion and US$400 billion annually in capital flight alone. The challenges they confront, for which policy makers are often blamed, cannot be exonerated.
One of such challenges is physical infrastructure. Nigerian leadership, for instance, uses every opportunity it has to talk of its challenges in the area of power generation, good roads, good transportation and the rest. President Goodluck Jonathan mentioned it when he visited the U.S recently while he invited investors to come. But the problem is more than physical infrastructure. 'Give business reasonable certainty and predictability and we can [create more] partnerships', advised Pat Davies, Chief Executive, Sasol, South Africa, and Co-Chair of th meeting.
The voice of ArcelorMittal South Africa's Chief Executive Officer, Ms Nku Nyembezi-Heita, agreed with him, and she criticized Pretoria, for instance, for inconsistent fiscal policies. And left out is the endemic corrupt atmosphere at every stage of an investor's show of readiness. Cases of corrupt officials who had to be bribed before they awarded contracts are rife such as the America's Halliburton bribe-for-contract deal, as well as Germany's Siemens case both of which has the cream of Nigeria's political elites on the list.
And yet, there is the issue of political institutions over which President Jacob Zuma warned that democracy is not a simple matter of holding elections. Lack of strong democratic institutions, he pointed out, has been undermining democracy on the continent. He drew examples from a number of countries where elections have failed simply because of lack of strong institutions to manage them while stating that political parties, the media and civil societies are some of the institutions which could be used to strengthen democracy.
But then he would also regret that there are people who have been abusing such institutions. This observation is significant in the light of what a former OAU secretary general, Dr Salim Ahmed Salim said when he pointed out that at continental level, the African Union has managed to put control over undemocratic governments but has failed to control leaders who have been using their power to stay in power.
This is equally dangerous. It paves way for instability such as the growing trend of forming unity governments to contain election disputes, something Kenyan Prime Minister, Raila Odinga pointed out, from the experience in his country. While he stated that the trend should be discouraged, he noted however that Africa has moved towards constitutional order, political stability and democracy during the last 15 years.
There is no doubt that, many agreed, that as leaders across the continent strive to attract investors, much of the local situation can still to put investors off, and thus they need to be better managed. A local reality in which corrupt official themselves to be recipients of bribes from companies that bid for contracts such as the one that led to current bribe for contract scandal in Nigeria - Halibuton, Siemens and so on, cannot make a country investors-friendly. Such issues as this, as experts pointed out, have the potentials of making the continent unattractive to investors, unless there is a clean cut with the past, and a new direction is embarked upon.
Ajibade lives in Abuja