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Africa: what would real progress look like?

This is a special to woudhuysen.com, November 2017
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Progress in Africa. Foto: Axel Schmidt/ddp

After the faltering of Angela Merkel and the fall of Robert Mugabe, here are some principles of economic development that could form an alternative to Germany’s policy and practice in Africa

Donald Trump has one or two plans for Africa, mostly cribbed from Barack Obama. China too has plans. As for the EU, it will spend nearly €100m managing migration, borders and security in Libya and the important region of the Sahel – Niger, Mali, Mauritania, Burkina Faso and Chad. Meanwhile, Germany has its own, better-publicised plans. Gerd Müller, minister for economic cooperation and development, and Chancellor Angela Merkel have spoken about them.

But what about Africa’s plans for Africa? The spirit of cooperation is something nobody can easily quarrel with. So when Müller published Africa and Europe – a new partnership for development, peace and a better future in January 2017, the 34-page report’s subtitle, Cornerstones of a Marshall Plan for Africa, sounded attractive. And when Merkel successfully proposed, at the G20 summit in Hamburg in July, that the world’s 20 wealthiest nations form the G20 Africa Partnership, she went out of her way to congratulate the African Union for drawing up its first ever plan for development: the Union’s 2015 document, Agenda 2063: the Africa we want, she added, could ‘serve as a point of reference for our own efforts, so that we do not patronise Africa by proposing projects it does not even consider important’.

Germany’s government, then, says that Africans, like the G20, should plan for the future with the help of the Africa Union. Well: the AU was founded in 2001 by Libya’s Muammar Gaddafi, and was chaired over 2015-6 by Zimbabwe’s Robert Mugabe. With these dictators previously at the helm, the AU’s plans for Africa’s 1.25 billion people certainly deserve close inspection.

The African Union’s plans

In fact, Africans seeking real progress should not look to the African Union’s plans, for those plans bear, all too clearly, the stamp of reactionary Western policies for the continent. The West, not content with getting Africa to owe it vast debts in the realm of money, has now got its leaders to owe it a vast debt in the realm of ideas.

The first ‘aspiration’ of Agenda 2063 is ‘inclusive growth and sustainable development’. That is, the continent known for the corruption of Mugabe, South Africa’s Jacob Zuma and many other potentates should be magically ‘transformed to create shared growth’, while its wildlife and wild lands should be protected within ‘climate resilient economies’. The Africa Union’s vision for development is an Africa ‘with a strong cultural identity, common heritage, values and ethics’, which, by 2063 – give it time, lads! – is ‘People-centred and caring’ (the capital is the AU’s), and has empowered women to occupy ‘at least’ half of all elected and managerial positions, so that ‘the economic and political glass ceiling’ is ‘shattered’.

Terrific. Whether they’re despots or properly elected, Africa’s leaders, whose countries cannot easily get their manufactured exports into the EU, nevertheless import not just Western bling and Western manufactured goods, but also Western dogma, wholesale, about economic growth needing to ‘include’ wildlife and women. Not for nothing is the African Union’s embrace of Green ideas and identity politics Merkel’s diplomatic ‘point of reference’: Agenda 2063 got much of its thinking from her in the first place.

Germany’s plans

Berlin’s Marshall Plan 2017 is a sad document. It could have been written by the greenest, most leftish Non-Governmental Organisation you can think of – but that is where Germany’s old conservative party of government, the CDU, has got to nowadays.

First, there are more mea culpas. We learn that Europe divided up Africa ‘with a ruler’ at the Berlin conference of 1885. Even now, the wealth of industrialised countries ‘is, in part, based on the unchecked exploitation of the people and resources of the African continent’. Europe’s policy on Africa was ‘for decades often guided by short-term economic and trade interests’, there was no ‘consistent, targeted or “joined-up” policy’, and ‘the required structure for implementation’ was ‘not in place’.

In fact, of course, Europe’s policy toward Africa has for decades been remarkably consistent and structured. In Africa Europe’s policy has been military occupation, coups, the fomenting of divisions and the suppression of African exports and industries. Yet the new Marshall Plan is confident that what Africa now needs, from its northern neighbours, is merely a more long-term, more comprehensive and also a more pan-European policy.

So, second: what might that policy be? It’s easy to be baffled: we learn that Africa is rich in natural resources, but ‘must be more than the continent of raw materials’, although at the same time its natural resources ‘form the very basis of its future economic activity and prosperity’. Still, despite these clichés and confusions, the Plan is clear that EU-African relations must now be founded on mutual respect; Africa should be high on the EU agenda; there should be an EU Commissioner for Africa, and Africa should get a seat on the United Nations Security Council. Meanwhile, the African Union, which has its own Peace and Security Council, its own early warning systems about wars and its own military standby force, should in years to come aim to be ‘capable of resolving conflicts’ itself.

To arrive at such a noble end in the future, however, Germany should right now ‘develop proposals’ for security partnerships in Africa and ‘improve skills’ among local security forces. That is why German helicopters are already in Mali, where one crashed in July. The African Union resolving conflicts sometime in the 21st century means German military training camps in Burkina Faso today. It has meant Germany selling war matériel worth €1bn to Algeria, and supplying weapons, munitions and military vehicles to a joint force got up by the five well-regarded governments of the Sahel.

Germany’s still modest but already creeping militarisation of Africa is, of course, all done in the name of fighting terrorism there – that’s why German troops rub shoulders with French, British and American soldiers in Nigeria, for instance. But Germany’s agenda is much, much broader than fighting terrorism. It wants to lay down the law to Africans. In Africa, the Marshall Plan argues, Berlin must ‘talk straight with those opposed to reform rather than showing diplomatic restraint’.

This is Berlin’s spirit of diktat. It did not come from Donald Trump, but it could have.

Third, and in keeping with the Plan’s rank condescension, we find Africa indulged. Its cultural and religious diversity is upheld – even though that supposed virtue, whipped up by the West, has often led to bloody wars, which in turn, no doubt, is why Germany must ‘put pressure’ on governments that finance ‘religious extremism’ in Africa. Again, Africa’s youth, and their entrepreneurial spirit, are found to be its greatest asset – even though unemployment among those aged 15-24 lies at 10.8 per cent in Sub-Saharan Africa and 29.3 per cent in North Africa, figures that dwarf the number of youth-led entrepreneurial start-ups in these regions. Transfixed by IT, the Plan informs us that Africa ‘now has its innovation clusters, such as Kenya’s Silicon Savannah, which is at the heart of the continent’s high-tech boom’. It makes no mention that these have done little to dent general African unemployment, which will shortly rise to nearly 40 million people.

These hymns to African diversity, youth and technology hardly convince. They hint that Germany can help Africa do what Germany has failed to do – provide rivals to Amazon, Apple, Facebook, Google, not forgetting China’s Alibaba, Baidu and Tencent. In fact, though the feat will be difficult, it’s more likely that Africa can perform it on its own, without the benevolent assistance of bureaucrats in Berlin.

Fourth, Africa must take its Green medicine. For a start, its population growth is an ‘epochal challenge’: it will put pressure food, environmental protection and climate change, which is no doubt why the Plan wants to ensure early and comprehensive sex education, plus ‘training’ on family planning. Indeed, the most important question the Plan says needs answering in Africa is how to create, for young people, just 20 million jobs… ‘without destroying the environment’.

Similarly, the EU and North Africa should go about ‘promoting renewable energies [sic]’. Africa must share with Germany the stellar experience of its Energiewende. Overfishing and deforestation must cease; rural areas should make do with off-grid electricity. Subsidies for fossil fuels must also end, so raising the price of petrol for the millions of Africans who rely on it, while at the same time environmental taxes and pollution charges must be introduced. The inflation of energy prices – that’s what Germany believes will mean progress for Africa.

Last, and perhaps most interestingly, the Marshall Plan highlights the role that Berlin now wants German private investment to play in Africa. The document opens with the forthright view that the days of aid, donors and recipients must be ‘put behind us’. Later, it holds that German state funding, alongside multilateral development banks and Official Development Assistance, can mobilise the private sector by reducing its risks: ‘Every euro of tax revenue can leverage many more euros in private capital’. Germany should also create new funds and bonds for private investors.

It is all very well. Yet one report has it that Germany already has no fewer than 600 firms in Africa today, and that Merkel has vowed to invest some €280 million in Africa, focusing funds on Ivory Coast, Morocco, Rwanda and Tunisia. However, nobody should be fooled that Germany is in Africa simply for the old imperialist targets of local raw materials, local labour and local markets. In fact, compared with the political imperatives for Africa that the Plan lays down, private investment has a relatively minor role in the Marshall Plan.

It is politics – more than profit, more even than military force – that Germany now wants to impose on Africa. After all, in June, Gerd Müller himself said that if Germany did not act, there could soon be 100 million African refugees at Germany’s door. Neither ‘respect’ nor plain old profiteering motivates Germany’s policy in Africa, so much as the fear of hordes of African immigrants.

For Africa: not plans, but principles

It is for Africans, in a spirit of democracy and self-government, to draw up their own detailed plans for their 50+ very different countries. But, following the call for principles of innovation outlined in Big Potatoes: the London Manifesto for Innovation (2010), and the perspective of building new, hi-tech sectors of production with durable jobs (2017), here are six principles which go against the prevailing wisdom – the Western wisdom – about What To Do About Africa.

1. Scale is beautiful, not smallness

The one thing we always hear about Africa is how mobile phones are transforming it. McKinsey, the Jesuits of capitalism, hold that ‘digital technologies starting with a mobile phone’ can, through electronic money, remove hindrances to economic growth:

‘In Kenya, MKopa Solar utilizes a pay-as-you-go model with payment made over the MPesa mobile-money platform; through this, 375,000 homes across East Africa now have solar electricity.’

Well, there are no fewer than 88m households in East Africa. To celebrate this kind of advance among 0.4 per cent of East African households is to hold up a powerful miniaturised technology – electronics – as a way of giving a minuscule amount of African homes a minuscule amount of energy. It is the small is beautiful, Ernst Schumacher, low-tech, tractable, ‘low hanging fruit’, easy-does-it, don’t-rock-the-boat, act local, one-village-at-a-time approach, with all the glibness we have come to expect of Silicon Valley.

Mobile has ‘made a difference’ to many Africans, but it certainly has not brought the whole continent a fundamentally new path: the path of growth. IT alone can’t do that. Where are the other examples of IT really making more than a difference? There are indeed innumerable 3D print shops in Nairobi, Kenya, and drones are used in the delivery of medical supplies in Rwanda and Tanzania. But while IT can be classed as more than a simple enabler of modern wealth production, the sub-atomic domain of electrons is less than up to the task of developing Africa on its own.

Of course, pessimists speculate that the effect of IT-led automation on jobs could eventually be worse in developing economies such as Ethiopia and Angola than in the West. But in fact we should neither worship nor fear what IT will do to Africa. The principle at issue is rather that large, physical schemes in energy, agriculture and infrastructure, plus mass markets for products, houses and medicine, are together much more vital to Africa’s future than IT.

Dreams about IT won’t cut it; only much wider ambitions will. Progress in Africa is progress at scale, or it is nothing. The micro world of IT will play a part in that, but only a part.

2. Not just household ‘energy access’, but energy for organisations

The United Nations and the International Energy Agency share Sustainable Development Goal 7, which aims to ensure access to affordable, reliable, and sustainable and modern energy to all – by 2030. But this policy isn’t just small-minded, it’s wrong; its principles are wrong. It targets households, and forgets all about energy for wealth creation.

In Sub-Saharan Africa, it’s true, two in every three households – more than 620 million people – have no access to electricity, making that region the worst for household energy access in the world. Sub-Saharan Africa is the region least on track to meet SDG 7. But a bigger, logically prior task lies ahead of household power supply. While annual demand for residential electricity in Africa is somewhat above 100 terawatt hours, that for industrial and commercial power is already heading to 500 TW-h. The need for electricity is much larger in industry and commerce than it is in rural households. As Müller’s plan notes in a brief moment of honesty, reliable, 24-hour energy supply is ‘essential’ for businesses. Nearly half of all Sub-Saharan companies are forced to fall back on diesel electricity generators, so uncertain is power supply.

Without energy to power factories and office computers, African households can only look forward to enduring hardship. The need is to bring roughly 200 million Sub-Saharan African households out of poverty altogether. In that task, measures such as solar-powered lighting are purely cosmetic: they reinforce the status of Africans as people who are victims in need of Western help. By contrast, any serious African plan for Africa will acknowledge, much more than the West has ever done, the need for a whole lot more heat for the continent’s industry, plus a whole lot more electrical power for its machines in government and services, and for its handling of water. Private or public, African organisations – whether large, or just starting up – must have electric power, if Africans are ever to do more than merely survive.

The better management of water can help Africa’s energy sector; conversely, desalination, together with wastewater pumping, treatment and transfer, are highly energy-intensive processes. In North Africa, where water is scarce, the IEA projects that the water sector’s share of total electricity demand will rise from 10 per cent today to 14 per cent in 2040. For desalination alone, in both Africa and the Middle East, the IEA estimates that 250 TWh of new power will be needed by 2040. That’s about 10 times current consumption, and well over half Germany’s current electricity generation.

The UN’s SDG 7 on energy, like Müller’s plan for transforming Africa’s energy sector by ‘focusing it on renewable energies’, is wholly inadequate to the water needs of Africans, and especially those of African farmers. Africa deserves and will one day have better.

3. Automated mining

The most striking thing about Africa’s natural resources is not that they are plentiful, nor even that their quantity is thought to distort economies (the so called ‘resource curse’). It is that the mining of Africa for fossil fuels, metals and minerals is a dangerous business. That has to change.

In Australia, the mining firm Rio Tinto has improved the safety of its operations with driverless lorries. In America, horizontal drilling for shale oil and gas has turned into a high-productivity, IT-intensive industry, which, as part of general US oil and gas production (six fatalities in 2015), is overwhelmingly safe. These are examples that Africa can and should emulate.

4. New sectors of production

Africa needs to move from the export of commodities to the making of internationally competitive manufactures – both for export and for the home market. If it doesn’t do this, industrialised powers such as Germany will continue to dominate it. Partly because, over the past decade, manufacturing has stubbornly failed to rise above 10 per cent of African GDP, the International Monetary Fund flatly declares that ‘Sub-Saharan Africa will not be able to transform through manufacturing as East Asia did over the past two decades’. But there is no need to be so fatalistic. Yes, the share of manufactures in Sub-Saharan Africa’s hard-goods exports declined from 25.6 per cent in 2005 to 23.9 per cent last year. But between 2005 and 2014, African manufacturing output did in fact rise from €62 billion to €133 billion, growing 3.5 per cent a year in real terms. Again, between 2005 and 2015, Sub-Saharan manufactured exports almost tripled, to more than $140 billion. Wages in African manufacturing are higher than those in Bangladesh, but rosy prospects in African manufacturing cannot be limited just to Ethiopia, as many believe: as factories develop, even in Africa, wages form a diminishing share of overall investment and output.

IT can do much to raise the productivity of African manufacturing, just as it can make retailing, banking and other services more efficient. In the usual starry-eyed but also disdainful manner, the World Economic Forum, in which German corporations first hyped the idea of IT bringing about ‘Industry 4.0’, proclaims that Africa is ‘not equipped to transition to a Fourth Industrial Revolution economy’; but in fact that’s also true of the metropolitan powers, which are years away from implementing merely the industrial internet of things, and even further away from the all-singing-and-dancing I4.0 Western experts dream about.

So long as Western and Chinese firms hold untrammelled sway in Africa, it will remain glib to portray that continent as an awakening giant in manufacturing, or as the next factory of the world. But there is a more profound point. Africa shouldn’t just try to beat its competitors in established products; it needs to advance new sectors of production, in which its rivals have less of a head start. Here are four examples that contain possibilities:

In minuscule Lesotho, Chinese and Taiwanese firms do export Levi and Reebok apparel to the US. Yet what’s required, in and beyond Lesotho, are textile-based products that harness electronics. Mixed with IT, advanced clothing – complete with flexible graphene batteries – could cool human bodies in tropical climates such as Africa’s, warm people in colder export markets such as the US, form fashionable displays, and report on the medical condition of its wearers. Electronic clothes could also help in the indoor tracking of Africans in hospitals and major events.

Africa needs to make more, larger and cleverer pipes – to carry water, sewage, oil and gas, electricity cables and broadband links. And its pipes could incorporate the latest sensors to detect fluid flows, pressures, corrosion, cracks, leaks and contamination. In the Western Cape, South Africa, burst sewage pipes are a real problem: even though Cape Town has reduced their incidence, officials admit that bursts still occur, as a rough average, every 3km of pipe. Yet a Spanish company, Molecor, which already makes an appreciable 8000 tonnes of pipes a year in South Africa’s KwaZulu region, claims excellent ‘pipe-to-pipe’ quality at its pipe junctions. That kind of robustness, Africa cries out for.

A particular opportunity lies with the exploitation of subsea resources, alongside the automated mining processes already mentioned. Africa has a coastline that stretches over 30,000km. Marine aquaculture, the farming of fish in the sea, could do much to supplement land-based aquaculture, where Tanzania and Zambia have already made important strides in genetically improved tilapia. And there’s a great deal of subsea exploration that needs to be done: at the moment, it’s hard to guess just how much oil and gas, as well as minerals, are located off Africa’s shores.

Perhaps the biggest priority for Africa’s factories is mass-manufactured housing and other buildings. In North Africa, in 2014, 11 million people lived in slums; in Sub-Saharan Africa, more than 200 million did. This scale of misery will only be overcome, and young families decently accommodated, if construction on the continent adopts the most advanced techniques. That means making flats and whole houses in factories, at high volumes of output. In Ghana and especially South Africa, prefabricated houses and modules are already in small-scale production. Now the need is to make long, sophisticated production lines, and more comfortable products.

Prefab huts are not good enough. Classrooms of just 12 square metres, made of recycled shipping containers, are also not good enough. Africa’s masses need the very best places to live, learn and work in, and it’s time that was organised through high-tech manufacturing.

5. Farms: irrigated, mechanised and digitised

A full 65 per cent of Africa’s arable lands remains to be cultivated, which is one of the reasons why the continent actually imports food staples worth €$21 billion each year. It’s true that African soils are less fertile than those of Asia, and that both soils and crops are more varied; but cereal yields lie well below those of Asia. Meanwhile, some estimates have it that post-harvest losses in Sub-Saharan Africa average 30 per cent of total production. Yet the centrality of agriculture to Africa’s problems is matched only by the variety of techniques that are now available to solve them.

Because agriculture uses so much water, Africa needs more and better dams, desalination plants and, above all, modern irrigation. At present, only seven per cent of cultivated land in Africa is irrigated, with the figure falling to about half that in Sub-Saharan Africa; for the rest, Africa is forced to rely on rain to water its farms.

Yet in agriculture today there is everything to play for. Synthetic biology, genome editing and breakthroughs in microbiology could raise productivity. So could IT: not just in terms of digital finance and insurance, plus market data, for farmers, but in precision agriculture, where temperature, fertiliser, water, pesticide and soil conditions are sensed from tractors and the like, locational data collected through GPS, and the resulting big data, complete with weather forecasts, conveyed by satellite and made the subject of analytics (what and when to plant) and decision support. Less dramatically, precision agriculture could raise plant density on Africa’s farms.

On top of all this, different kinds of farming robots have already begun to assist African agriculture: driverless tractors, milking robots, automated harvesting machines and drones.

6. Continent-wide transport links, and inner-city delivery by driverless drone

Finally: in the 21st century it remains the case that there’s no simple way of getting goods or people from one side of Africa to the other. Indeed, Africa’s rail lines have contracted, from nearly 66,000km in the 1980s to less than 60,000km today:

Sub-Saharan Africa, rail lines, thousands of km
Sub-Saharan Africa rail lines
Source: The World Bank, https://data.worldbank.org/indicator/is.rrs.totl.km?locations=zg&view=chart

There is some progress in African rail. In Kenya a new, 470km, €2.7bn express line between the capital and the port city of Mombasa opened in May, 18 months early. Even though Chinese track-laying technology helped here, and Chinese money and management will call the shots with the line, economy tickets are cheaper than taking a bus, and the train cuts the nine hours for a bus journey down to 4.5.

Eventually, the hope is that, under China’s Belt and Road initiative, the line will link up South Sudan, the eastern part of Democratic Republic of Congo, Rwanda, Burundi and Ethiopia. This is creditable, but not nearly enough; and, in freight and passenger rail, the dependence of Kenya and these other nations on the whims of the Chinese Communist Party will not have a healthy outcome.

Africa will need more than rail. Only a third of the population has access to paved roads. Africa will need roads, tunnels, bridges, ports, airports and perhaps even Elon Musk’s hyperloop concept, which is already finding serious audiences in Dubai and India. Africa could also adopt that technology’s mooted Chinese ‘flying train’ competitor.

The tasks in African transport are not just long-distance in nature, but also relate to shorter trips in and around Africa’s burgeoning cities. Now, even in the West, we cannot expect a mass outbreak of driverless cars for many years. But in heavily congested cities such as the Nigerian capital of Lagos, technologies pioneered by China could do much to assist the safe distribution of food and other goods. There, JD.com Inc, China’s second-largest e-commerce firm, has begun to test small, driverless electric delivery vans equipped with radar and sensors. JD’s bigger rival, Alibaba, likewise plans to put no fewer than 1 million similar vehicles on to China’s roads.

This is the kind of big thinking that progress in Africa urgently requires.

Driverless electric delivery

Conclusion

From the African Union to Germany’s Marshall Plan, elites pick on the vulnerabilities of Africa – its nature, its women, its youth – and insist that helping these symbols of victimhood must come before all other goals. Animals, not Africans; women, not male Africans; youth, not adult Africans. This is the charitable perspective, and all the more noxious for that.

Africa needs better power stations, public lighting, drilling methods, machine tools, digital design modeling and agricultural machinery. Progress in Africa means major capital-intensive projects – projects that involve not just IT, but also energy, mechanical and civil engineering, raw materials and advanced agricultural and transport systems. The fact that such projects have failed in Africa in the 20th century, or that maintaining their operations in good order has often proved difficult, doesn’t mean that success isn’t possible in the 21st. After all, technology has improved, and Africa grown more confident, since 2000.

A critical task will be to build much stronger laboratories. At present, Africa spends less than 0.4 per cent of its GDP on R&D.

Africa will have to marshal its own resources and take a firm line with overseas powers. It will have to play off different predators against each other, not only in trade and debt, but also in inbound foreign investment. Playing off foreign powers in this way doesn’t just mean Germany and the EU, but also America (which boasts the largest number of greenfield projects in Africa) and, importantly, China, which now accounts for nearly 40 per cent of African inward investment in terms of capital expenditure.

No doubt, too, there will be many setbacks on the way to full implementation of the principles outlined above. But if these principles seem utopian, they are a lot less utopian than the idea that Germany’s Marshall Plan can equitably transform Africa for the better.

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