"Participation Builds Unity"
"MADE IN AFRICA - FOR AFRICA"
"Participation Builds Unity"
"MADE IN AFRICA - FOR AFRICA"
PRESENTS
ONE SIZE FITS ALL WILL NOT FIT AFRICA
Greg MILLS
MAY 2006
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Business Day
One size fits all will not fit Africa
It is part-Nepad (New Partnership for Africa’s Development), where most development
financing is led by the Development Bank of Southern Africa (DBSA), while the treasury
promotes investment into Africa by SA-based companies through preferential foreign
exchange liberalisation.
Of course, the national defence force also plays its important role in peacekeeping missions.
At an organisation level, our Africa policy is multidisciplinary, cuts across a wide variety of
business sectors, and involves a multitude of government departments. Peace efforts are led
by the president, although Nkosazana Dlamini-Zuma’s foreign affairs is, at least on paper, the
lead department in formulating Africa policy.
Asgi-SA is itself an integrated programme. It focuses on what government can do in reducing
the “binding constraints” on faster, deeper and wider economic growth.
These include the volatility and value of the currency; infrastructure; a shortage of skills;
barriers to entry and competition in some sectors of the economy; weaknesses in the
regulatory environment and their effects, especially on small and medium business; and, in
government’s own words, “deficiencies in state organisation, capacity and strategies”.
Government’s answer is to address these areas through R372bn worth of infrastructure
spend, improving skills levels, realising more value from its “dead assets” (notably land,
livestock and housing), and through focused sectoral strategies where there is the greatest
advantage to be had not only in growth potential but also employment creation and
enterprise development.
For Asgi-SA to work, it has to be much more than just a “vision thing”, but rather a detailed
step of measurable, prioritised tactical steps. Its success will hinge ultimately on the capacity,
less financial than human, necessary for its roll-out.
In the same way, SA’s Africa policy has to be no less about vision than nuance. No one would disagree with the need for
broad strategic principles encompassing the promotion of security and stability, good
governance and the rule of law, and sound policy. But the African growth story is highly
differentiated, and Pretoria’s strategy has to have this reality as its undergirding principle.
Indeed, the scope for a meaningful African role by SA rests on understanding the degree of
differentiation between countries.
For the foundations of the African growth story vary from democracy to autocracy, in their
bases from the examples of commodity-centred successes of SA and Botswana to that of the
Mauritian service economy, and even within regions. Outside of the oil states, which may be
considered as a special case, the points of commonality of today’s high performers, inasmuch
as these are discernable, are of the relationship between good governance, democratic
government, economic freedoms, and the need to align a trade strategy to suit. Democracy
and its counterparts of transparency and accountability are a critical growth tool — perhaps
the critical growth tool — contrary to the early east Asian development model. It is the
absence of such Africa-wide commonalities that has made continental transformation
sporadic and confined to isolated examples, even though the situation is much better than it
was a decade ago.
Put differently, in the jargon of Asgi-SA, the binding constraints for Ghana are quite apart
from those of Guinea, or for Botswana compared with Benin, or Lesotho and Liberia. Their
comparative development advantages, and disadvantages, should be reflected in SA’s Africa
policy. This means developing country-specific tactics on, for example, trade policy, a
recognition of the reality for “variable geometry and varying speed” in continental integration.
Asgi-SA’s focus on public-private partnerships in infrastructure should conceivably be
replicated in Africa. An Africa policy based on more than just the “vision thing” will also
require polling South African businesses to understand their continental experience, expertise
and needs.
A successful strategy will require making hard choices about where to place scarce resources,
ranking African countries in terms of their importance and the dedication of time, effort and
money. This logic means, essentially, SA not being all things to all Africans.
Greg MILLS
A KEY aspect of the Accelerated and Shared Growth Initiative of SA (Asgi-SA) is the need for
a co-ordinated African development strategy. Currently, SA’s continental development
approach is piecemeal.
Brenthurst Foundation - Dedicated to strengthening African economic performance.
www.thebrenthurstfoundation.org
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