At 09:23 06/07/2005 -0400, you wrote when posting the Gee article:
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Interesting take on aid to Africa. It's also interesting that Jeffry Sachs has become "the academic guru of the End Poverty movement". Sachs was a very prominent adviser to the Yeltsin government in Russia in the early 1990s after the collapse of communism. He was instrumental in developing the privatization scheme that ultimately impoverished ordinary Russians and put state assets into the hands of the oligarchs. IMHO, his performance in Russia does not make me confident that he will do any better in Africa.
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Unless America and the European Union reduce or demolish the tariff walls against African-grown food, then the damage this does to millions of Africans far outweighs any conceivable level of international aid that Western governments could give them -- never mind will give them. The EU is worse than America in this regard.
Like you, I wouldn't give houseroom to Jeffry Sachs. He turned altogether too glibly and quickly from the fiasco in Russia to Africa. I don't blame him for misadvising on privatisation strategies for Russia -- God knows it was a difficult problem trying to unhitch the country from totalitarianism -- but anybody with any intellectual integrity at all should have stuck with the Russian problem even after the event and tried to make amends by understanding the Russian scene better and trying to prevent the country sinking once again into Kremlin control. Instead of which he now considers himself to be the Saviour of Africa.
And another Saviour of Africa, Bob Geldof, organises a grand jamboree, inviting all his band pals to perform -- but forgot to invite any African bands at all! (And, I'm afraid I don't agree with Marcus Gee. I think the Live8-G8 extravaganza will do more harm than good. Once again I don't blame Geldof for trying, but the net result -- when nothing significant happens -- which it won't -- will be even further alienation of the young in the political process.)
Here's an article about helping Africa which is by far the best I've read yet.
Keith
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TEN SIMPLE STEPS THAT WOULD HELP AFRICA TO HELP ITSELF
Michael Holman and Andrew Rugasira
Africa needs more financial aid like an alcoholic needs a stiff whisky. Instead of Tony Blair, the prime minister, and his Group of Eight colleagues providing more cash in Gleneagles, here are 10 ways to help Africa help itself that will cost little or nothing.
1. Encourage ideas. The high cost of books in Africa is a tax on ideas. Yet we live in a knowledge-driven world. So our first suggestion is encourage publishers in rich countries to allow African publishers to print a limited run of their books. Provided the authors forgo royalties and publishers co-operate, locally printed versions can be on sale at a fifth of the foreign price. It does not erode the market for the overseas edition -- rather this will create a new readership.
2. Charge for professionals' visas. There are more doctors from Malawi practising in Birmingham than in Malawi. It is unlikely that they can be persuaded to return to one of the world's poorest countries. But professionals who emigrate from Africa, whether doctors or dentists, engineers or lawyers, should have to pay a market rate for a visa that allows them to work abroad. The money raised should be used in the emigrants' countries of origin, spent in the sector from which they come and used to train replacements.
3. Require the use of more cocoa before chocolate can be called chocolate. Double the current minimum. World prices for the bean will be boosted, the economies of Ghana and Ivory Coast will benefit and chocolate will taste better.
4. Promote Africa's music. The continent's great export needs a professional base. Seek commercial backing for an African Nashville it would be a centre not only for the production of great music but would provide training for the managers of musicians.
5. Encourage better marketing and packaging of Africa's products. It has taken years for coffee producers in east Africa to use attractive, vacuum-sealed foil packets; in Congo a fine soap made from pure palm oil is sold wrapped in newspaper; in Uganda, mangoes rot on the ground because no one can dry and package them. The Marks and Spencers and Tescos of the world should share their expertise in technical partnerships with African traders.
6. Make foreign non-governmental organisations competitive. They have mushroomed since the 1960s and many are a menace, enjoying power without responsibility. They need to become competitive in the services they provide and work more closely with the private sector much of their development work should be put out to open tender. Companies bidding for large projects should be obliged to include a social component (such as a financial pledge to support primary education or healthcare) that the voluntary agencies would tender for and operate.
7. Enlist the private sector in build-operate-transfer infrastructure projects. In Kenya, for example, the pot-holed Nairobi-Mombasa road could become a model project rather than a national disgrace. It should be rebuilt under a build-operate-transfer scheme, in which the government ensures a transparent business environment and the construction company operates the project for an agreed period before handing it over to the state.
8. Make aid conditional on improving the business climate. One of the reasons there is little foreign direct investment in Africa - the oil and mining sectors apart - is set out in a recent World Bank report. Registering a business in Kenya takes ten times longer than in Hong Kong and involves five stages, compared with two. This picture is repeated across Africa, whether registering a business, selling property or recovering a debt. Every step eliminated in this inefficient process improves the investment climate and reduces the opportunity for corruption.
9. Abolish taxes on computer imports. Privatisation, deregulation, a strong private sector and democracy go hand in hand. Computers are critical to this development taxing them makes as much sense as taxing the wheel. In return African governments would end import levies on computers.
10. Introduce a fair tax on coffee and encourage a fair return to growers. Imported raw coffee is taxed at a third the rate of processed beans, the first stage in a trading system that ensures that less that 0.2 per cent of the value of processed coffee is retained by the growers themselves. Reforming this tax will benefit Africa's growers and their extended families in Africa -- about 60m people -- who depend on the bean.
Michael Holman is a former FT Africa editor. Andrew Rugasira is chairman of the Rwenzori Coffee Company of Uganda
Financial Times -- 6 July 2005
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At 09:23 06/07/2005 -0400, you wrote:
Interesting take on aid to Africa. It's also interesting that Jeffry Sachs has become "the academic guru of the End Poverty movement". Sachs was a very prominent adviser to the Yeltsin government in Russia in the early 1990s after the collapse of communism. He was instrumental in developing the privatization scheme that ultimately impoverished ordinary Russians and put state assets into the hands of the oligarchs. IMHO, his performance in Russia does not make me confident that he will do any better in Africa.
Ed
Marcus Gee
Africa needs more than money
Wednesday, July 6, 2005 Updated at 4:11 AM EDT
From Wednesday's Globe and Mail
It's easy to be cynical about Live 8 and the campaign to "make poverty history." It's even easier to be cynical about the fine words that will emanate from the Group of Eight leaders in Scotland this week. Grandstanding rock stars and pious politicians -- we have seen it all before, haven't we?
In fact, the Live 8/G8 extravaganza has already done a power of good. The rock concerts, celebrity TV spots and assorted other stunts orchestrated by Bono, Bob Geldof and crew have put the issue of world poverty at the top of the international agenda. Partly because of them, the world leaders gathering in Gleneagles will cough up billions of dollars in new money for debt relief and development aid.
But if cynicism is misplaced, skepticism is not. The taxpayers of the G8 countries whose leaders are pledging all those billions have every right to wonder whether the money will simply disappear down a rat hole as it often has in the past. The question is not whether rich countries really mean it when they say they want to help the poor. There is no lack of compassion and no shortage of money. Canada alone is doubling aid to Africa by 2008. The question is whether the recipients can make good use of it. As Freedom House, the U.S.-based human-rights group, points out, "aid, no matter how well intentioned, is only as effective as the governments receiving it."
Freedom House took a look at the quality of governance in 30 countries, including nine in sub-Saharan Africa. Many of these countries are the recipients of ramped-up development aid. What it found was disturbing. Though Third World governments almost all pay lip service to the need to fight corruption and operate effectively, few are following through. Because judges aren't independent enough or the media free enough to act as a check on government malfeasance, much of the money intended for the poor goes to waste.
Consider Ethiopia. Jeffrey Sachs, the Columbia University professor who is the academic guru of the End Poverty movement, has made that country a centrepiece for his argument that many poor nations are perfectly able to use aid effectively. He argues that, while a few countries (Zimbabwe, for example) are so corrupt or misgoverned that much aid is wasted, a large number are governed well enough to absorb a big infusion of aid and benefit enormously from it. But Freedom House reports that, in Ethiopia, "the opposition is harassed and intimidated, civil society suppressed, the media tightly controlled and independent voices stifled." On a scale of 1 to 7, it gives the country 1.88 for accountability, 2.83 for civil liberties, 2.06 for rule of law and 2.76 for anti-corruption and transparency. Can such a place really handle millions in new aid?
Ethiopia is not the only example. A World Bank study has shown that, in Guinea, Cameroon, Tanzania and Uganda, 30 per cent to 70 per cent of government medicines vanished into the black market instead of reaching patients.
Because of figures like that, donor countries have been demanding better governance from aid recipients. That was the thrust behind the New Partnership for Africa's Development, which came out of the G8 summit in Kananaskis, Alta., in 2002. Under NEPAD, African governments committed themselves to raising standards of human rights and governance if they were to receive rich-country aid. Better governance is also the notion behind the Millennium Challenge Account set up by the U.S. government. It rewards countries that respect the rule of law, rule democratically, invest in their citizens and allow economic freedom to flourish.
Yet, for pushing the MCA approach and expressing doubts about flooding poor countries with new foreign aid, George W. Bush is being painted as the skunk at the Gleneagles picnic. He shouldn't be. The idealism of the End Poverty campaign is inspiring, but it needs to come with a dose of realism. If the rich world is going to spend billions fighting Third World poverty, the least it can demand from the governments that get the money is honesty and good management.
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Keith Hudson, Bath, England, <www.evolutionary-economics.org>
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