Events in South Africa, whose sovereign debt has been reduced to junk status by President Jacob Zuma’s crony capitalist rule, are another reminder that when power is exerted abusively shortfalls in governance can be highly damaging for the wider economy. This is also apparent in Democratic Republic of Congo’s minerals and Nigeria’s oil kleptocracies, which are both under renewed scrutiny, with international judicial authorities contemplating action against President Joseph Kabila’s long-time business partner Dan Gertler (AE 341/19) and sifting through new evidence against former Nigerian oil ministers from Dan Etete to Diezani Allison-Madueke.
In many countries, there have clearly been improvements to the way judiciaries operate, administrations implement policy, security forces react to opposition and governments relate to their populations – in the process allowing business to thrive and much-needed jobs to be created. Improvements in governance were cited at Attijariwafabank’s late March Africa development forum in Morocco as being essential to launch an invigorated form of south-south co-operation. Speaking in Marrakech on 7 April, billionaire governance campaigner Mo Ibrahim lauded the many positive examples of good governance. “The problem with Africa is that you don’t know your heroes. You only know your bad leaders,” Ibrahim said.
But as South Africa’s recent Zuma-related woes suggest, too many bad leaders remain in office – reflected in the Mo Ibrahim Foundation’s decision not to award the 2016 Ibrahim Prize for Achievement in African Leadership. Questions of governance abuses and shortfalls still tend to predominate when stakeholders gather to debate Africa’s development. A spotty performance by governments, measured according to a range of benchmarks, was raised continually as the Ibrahim Foundation launched its 2017 Africa at a Tipping Point report in Marrakech on 7-9 April. This coupled governance shortfalls with the growing challenge from two other key themes, creating jobs for Africa’s youth and combating escalating violent extremism. At a debate during the weekend, former African Development Bank president Donald Kaberuka observed that, while sub-Saharan Africa has made big advances since 2000, “after 36 years of [post-independence] conflict”, economic growth remains too low to keep pace with population growth and is being undermined by the failings of the big two sub-Saharan economies, Nigeria and South Africa, “who are punching below their weight”. Mauritanian businessman turned political activist Mohamed Bouamatou directly linked continent-wide problems with water and electricity with pervasive corruption.
Grand corruption and ‘state capture’ by criminal-business elements make most headlines, but the need for clear, good governance is essential at a micro level too. Delegates at CbI Meetings’ 5-6 April Africa Investment Exchange: Gas event in London bemoaned the lack of consistency. The Azura-Edo independent power project was supposed to establish a template for developing IPPs across sub-Saharan Africa; but efforts to change the terms of subsequent schemes in Nigeria, Ghana and other jurisdictions have stalled projects that should have benefited from the costly and painstaking work carried out over six years to make the much-vaunted investment happen. South Africa’s renewables programme burgeoned despite the phase-one terms not being great for developers, one delegate observed, “but they didn’t change the docs and the market priced down the cost [in subsequent phases] as it had the certainty… Any small change can have enormous consequences”.
Business needs consistency to underpin investment. Populations need to feel more secure as they engage with administrations that are supposed to serve them. “Each country must do it their own way, there is no model fits all,” Ibrahim said, but across the continent populations “are asking for good governance and security for our people” to build a sustainable future in which Africa can fulfil its undoubted potential. But however the word is defined, governance remains an elusive concept. “Officials must stand up to politicians if things are wrong, but that is not easy,” a former East African official told AIX:Gas. He fought several such battles, but then left government to work with an international corporation.
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