Achieving sustainable development in Africa: Why cities matter

Prominent economists and policymakers seek to catalyze an African green revolution that mimics East Asia’s rise in agricultural productivity in the 1970s. But over one-third of sub-Saharan Africans currently live in urban areas.  According to the UN Population Fund’s State of World Population 2007 report, that figure may swell to over half the continent’s population in the next thirty years.  My view is that if there is any hope for sustainable development in Africa, cities must play a crucial role.

 It is time to end the “urban bias”. This notion of the 1970s does not square with the reality of poverty in Africa.

 The urban concentration found in many developing countries does not have the same economic and institutional foundations that one observes in cities of developed economies. The rapid growth of cities in Africa is associated with absence of many of the benefits of accelerated growth in cities in the West. Many African cities cannot boast high levels of economic development or high standards of health, life expectancy or education.

 Poor agricultural performance, the lack of coherent national policy that integrates economic and spatial planning; poor municipal services and a fragile fiscal base are symptomatic of ‘urbanization without development’. Yet today, millions of Africans continue to be drawn to cities in pursuit of better job opportunities, education and health services.

 Cities in Africa suffer severe fiscal distress. The fiscal crisis of African cities is compounded by failure to solve the central government-local government jurisdictional tussle. Central governments have tended to institute and maintain significant governance, financial, legal and regulatory controls, leaving little room for innovation and entrepreneurship by local authorities.

 City authorities lack powers required for effective political and economic decision making, particularly in such critical areas as revenue generation, investment in urban infrastructure, and service delivery. Where central governments do not allow municipal authorities to collect tax revenue or borrow capital, and yet hold them responsible for provision of services, non-delivery is the end result.

 Many African governments view urbanization as a problem to be stopped rather than an inevitable trend that calls for policy changes. This view was bolstered by a 1999/2000 development report from the World Bank. The report concluded that African cities are part of the cause and a major symptom of Africa’s economic and social crisis.

 More recent academic research, including studies from the World Bank itself, debunk this assertion, concluding that many aspects of urban poverty are caused by limited political and institutional capacity.  Cities are centers of innovation by the very fact that they are home to the very forces that shape or drive productivity and growth -innovation, finance, manufacturing, marketing, information, and knowledge production.

Some of the specific issues for policy makers may include:

1.  What are the forces driving urbanization and how do they differ from one region to another?
2. What is the link between urban infrastructure, employment, service provision and poverty reduction?
3. What are the gender dimensions of urbanization and urban living?
4. How do urban spaces affect interaction between different ethnic, racial and religious groups? This question has significant implications for social cohesion and nation building especially for ethnically diverse countries.
5. Does demographic concentration exacerbate political conflict or promote engaged state-society relations?
6. Is our urban future to be characterized by poverty and “service apartheid”, fear and violence, or sustainable and prosperous urban spaces characterized by inclusiveness and cosmopolitanism?
7. How can urban planning and urban development strategies be integrated into and help inform national and rural development policy?

Americans and oil: Lifestyle, culture and politics

Evidently, the primary motivation for lifting the ban on offshore drilling is high gas prices at the pump. Do not be fooled. This has nothing to do with freeing the US from dependence on foreign oil. America’s appetite for oil will still continue to fund terrorist organizations. A strategy that would bring down gas prices fast and furious is to bring on stream part of the nation's strategic oil reserves. This is the most potent short-term leverage available to the US. The other option is to reduce consumption, especially at the individual car owner level. I am mindful that the vast majority of the low income segment of the society must drive long distances to work. Then there is the whole culture of suburbia and the SUV. But Americans can still demand, through tough legislation, better fuel efficiency standards from the automobile manufacturers. This is what Bush should be pushing right now. American household must now make some real hard lifestyle choices. Essentially it is a choice between taking a curative but awfully bitter pill versus the Bush-McCain “lift the ban” placebo. 20 years is a long time to wait before oil prices come down as a result of offshore drilling. But there are concrete and smart legislative steps that we can take now to bring relief at the gas pump in less than three years. America, what will you take, the Pill or the Placebo? 

Africa Arise

That Africa is lagging behind in all spheres of human endeavor is not due to lack of good ideas or smart people or policies or its water or soils or benign neglect on the part of the international community.

Africa’s problems are largely due to a fatal failure of leadership, a preponderance of a brand of politics that is visionless and uninspired by the desire to solve the myriad problems that continue to trap millions of Africans in an existence that is miserable, short and brutish.

The poet William Woodsworth wrote "the works of peace cannot flourish in a country governed by an intoxicated despot… commerce, manufacturing, agriculture, and all the peaceful arts, are of the nature of virtues or intellectual powers; they cannot be given; they cannot be stuck in here and there; they must spring up; they must grow of themselves; they thrive better with encouragement and delight in it."

Abuse and misuse of power and authority by Africa’s political elite is not due an inherent lack of capacity for good governance. African leaders have been tyrannical and ineffective not because they are incompetent or ignorant. Neither has the lack of administrative or intellectual expertise to formulate and properly execute growth enhancing policies been the major problem. Quite simply, African leaders have no intention or desire to govern for the collective good of their people.

Similarly, the wrong-headed economic policies and practices of African governments are not as a result of a lack of understanding of sound fiscal policies and management. Africa’s nobility has reaped bountifully from the economic plunder of their nations. They prefer to maintain the status quo as chaotic and desperate.

Poverty is not Africa's tragedy. Africa’s real tragedy is that it lacks political leadership that is committed to protecting fundamental rights and freedoms, solving practical problems and creating opportunities for its citizens to innovate and thrive in free enterprise.

South African writer Ruth First in her book The Barrel of a Gun published in 1970 wrote "There has been eloquent, inexhaustible talk in Africa about politics, side by side with the gaping poverty of political thought. Politicians are men who compete with each other for power, not men who use power to confront their country's problems."

The post-colonial nation-state has not been liberating and protective of its citizens: on the contrary, its gross effect has been to constrict innovation and exploit its citizens. In a large measure, the post-colonial state has simply failed to operate in any rational way at all.

I often ask myself two questions: How can I encourage people around me to think like problem solvers? How do I harness my own potential to catalyze the emergence of a “new age African leadership”?

It is time to turn the page. A new generation of leaders must now rise in Africa and take the mantle of leadership and deliver economic prosperity and social justice for all of Africa’s people.

See related article in TIME http://www.time.com/time/magazine/article/0,9171,1813508,00.html

The global food crisis could catalyze Africa's Green Revolution

The global food crises could trigger massive investment inflows into Africa's struggling agricultural sector.  A battery of big private investors plan to consolidate small plots of land into more productive large ones, to introduce new technology and to provide capital to modernize and maintain grain elevators and fertilizer supply depots. These new investments will accelerate the modernization, technology transfer and enhance the efficiency of Africa's agricultural production systems. This could herald a green revolution in Africa.

Perhaps the most ambitious plans are those of the london based Emergent Asset Management. Emergent is raising $450 million to $750 million to invest in farmland in sub-Saharan Africa, where it plans to consolidate small plots into more productive holdings and introduce better equipment. Emergent also plans to provide clinics and schools for local labor. The money will go into Emergent’s new African Land Fund (ALF), to be managed in a joint venture with South Africa-based Grainvest.

The fund's aim is initially to invest in 12 countries including South Africa, Namibia, Mozambique, Botswana, Zimbabwe, Angola, Tanzania, Zambia and Kenya and grow a variety of crops including wheat and maize. The fund also plans to invest in jatropha, an oil-seed plant useful for biofuels that is grown in sandy soil unsuitable for food production. This will be a source of fuel for farming operations.

See http://africa.reuters.com/business/news/usnBAN949887.html

BlackRock fund group in New York is also planning to invest hundreds of millions of dollars in agriculture, chiefly farmland, from sub-Saharan Africa to the English countryside. Last October, the London branch of BlackRock introduced the BlackRock Agriculture Fund, aiming to raise $200 million to invest in fertilizer production, timberland and biofuels. The fund currently stands at more than $450 million.

Why Africa? Land values in Africa are very low, compared to other agriculture-based economies. There’s accessible, cheap labour. Africa has a broad range of agro-ecologies. This provides a diverse range of microclimates which permit cultivating a large diversity of crops. Logistics will present some huge challenges. But there is opportunity here to improve and expand road and railway networks as well as modernize Africa’s sea ports.

These big investors could bolster food production at a time when the world needs more of it.

Barack Obama: A defining moment in history

 At the 2004 Democratic National Convention on July 27^th Obama said “Lets face it, my presence on this stage is pretty unlikely”. He went on to say “that in no other country on earth is my story even possible”. And with this speech Barack  Obama  erupted on the American political scene.

On October 19^th 2006, David Brooks wrote “It may not be personally convenient for him, but the times will never again so completely require the gifts that he possesses. Whether you’re liberal or conservative, you should hope Barack Obama runs for president”.

On February 10^th 2007 at the Illinois State Capital Senator Obama announced that he will be seeking the Democratic nomination for president. On this auspicious day he said “I recognize there is a certain presumptuousness in this -- a certain audacity -- to this announcement."

On June 3^rd in St. Paul Minnesota Senator Barack Obama said to his supporters and the American people “Because of you, tonight I can stand here and say that I will be the Democratic nominee for president of the United States of America”.

Few things leave me speechless. 

On August 28^th 2008 in Denver Colorado, Senator Obama  will address the DNC and accept the Democratic Party nomination. On this day 40 years ago, a young African American, a Baptist Minister stood at the steps of the Lincoln Memorial. Martin Luther King Jr. proclaimed his dream. “In the face of the difficulties of today and tomorrow I still have a dream. It is a dream deeply rooted in the American dream”. King went on to say “ I have a dream the my four little children will one day live in a nation where they will not be judged by the colour of their skin but by the content of their character”.

On the night of June 3^rd Obama said “So it has been for every generation that faced down the greatest challenges and the most improbable odds to leave their children a world that's better, and kinder, and more just. And so it must be for us.”

I was particularly moved by what he had to say about Hillary. “I am a better candidate for having had the honour to compete with Hillary Rodham Clinton." Senator Obama's words for John McCain, his Republican  rival were equally magnanimous. “I honour, we honour, the service of John McCain, and I respect his many accomplishments, even if he chooses to deny mine." In an interview with Charlie Rose, Obama referred to George W. Bush, as " a decent man." He also said he was a great admirer of President Clinton's ability to frame issues and thought George H. Bush executed an effective foreign policy.

While he extols magnanimously the virtues of his opponents, Senator Obama can be  amazingly self deprecating. On June 3^rd he said “I face this challenge with profound humility, and knowledge of my own limitations.” He once said of himself “Even if people find me disappointing, ultimately, they might gain something.”

I think Senator Obama is a remarkable, outstanding individual. He embodies what is the best in all of us, black white, Asian, Latino, Catholic, Protestants, Jew, Buddhist, and Moslem. David Brooks said “Obama has a mentality formed by globalization. With his multiethnic family and his globe-spanning childhood, there is a little piece of everything in Obama.”Thomas Friedman said. “It seems to me that the strongest case one could make for an Obama presidency right now is rarely articulated: it is his potential to repair the broken relationship between America and the world.”

Rising food prices and the poverty conundrum

This week world leaders gather in Rome for the United Nations food summit. U.N. Secretary General Ban Ki-moon will issue an urgent plea to world leaders at a food summit in Rome on Tuesday to immediately suspend trade restrictions, agricultural taxes and other price controls that have helped fuel the highest food prices in 30 years. The meeting is aimed at forging a common international response to the food crisis.But will rising food prices, on balance, help or hurt the poor? 

Robert Zoellick, the World Bank president asserts that the increases in food prices will drive an additional 100 million people below the poverty line. 

But a much cited World Bank publication by Hartel and Ivanic published in 2007 showed that although freer farm trade and higher prices may raise poverty rates in some countries, it will reduce them in more. The study concludes that since a large proportion of the poor depend on agriculture, national poverty falls in 13 out of 15 countries focus countries in the wake of rich country agricultural liberalization.

Evidently, there are two sides to the food crises. However, the nuance of Mr. Zoellick’s assertion seems to me rather one sided and at best a very broad generalization.  The danger is that such generalizations, especially from the World Bank, tend to bias public policy and opinion and may very likely obstruct structured analysis of the implications and opportunities presented by rising food prices, especially for poor countries.  The result is that the interventions and policy responses will be wrong-headed and at best sub-optimal. 

My view is that higher food prices could be a boon for the small scale rural agriculture. Higher farm incomes spur demand for rural labour, boosting wages for the rural landless. The surge in rural income could outweigh the initial price effect. More importantly, increasing revenues for the agricultural sector and rural economies could attract investments in infrastructure and human services. However, low income urban households, households in the non-agricultural sector, as well as households dependent on transfer payments or remittances from low income urban labourers, may wind up poorer before the benefits of higher food production lead to lower local food prices.

Shifts in national poverty outcomes as a direct consequence of rising food prices will therefore depend on the relative weights of rural versus low income urban populations in the national demographics. It will be helpful to know how these key groups are represented in the figures provided by Robert Zoellick. 

Maros Ivanic and Will Martin. 2008. Implications of Higher Global Food Prices for Poverty in Low-Income Countries.  World Bank Policy Research Working Paper No 4594, April 2008

Thomas Hertel, Roman Keeney, Maros Ivanic and Alan Winters.2007. Distributional Effects of WTO agricultural reforms in rich and poor countries.  Economic Policy, April 2007