For AfDB, African nations to achieve development goals they must first tackle graft

In 2016 the new president of the African Development Bank (AfDB), Akinwumi Adesina, sought to focus his attention on five priority areas that in his view were central to accelerating Africa’s economic transformation.

He coined the word “High 5s” to promote this important agenda: light up and power Africa; feed it; industrialise it; integrate it; and improve the quality of life of its people.
A closer look at these priority areas reveals that they are almost precisely the same as President Uhuru’s Big Four.

At a meeting last week with AfDB employees in Abidjan, it became clear that the five are now the bank’s mantra. Yet, there isn’t much evidence that member nations know how to utilise the resources from the bank to address their priorities.

Adesina acknowledges that “Africa’s annual food import bill of $35 billion, estimated to rise to $110 billion by 2025, weakens African economies, decimates its agriculture and exports jobs from the continent.”

This is a tragedy because nothing is changing. The farming methods remain subsistence, land subdivisions continue unabated, post-harvest losses still remain high as the number of tenderpreneurs keep rising.

TRADER MENTALITY

Let me expound this concept of tenderpreneurs a little. It emanates from the trader mentality facilitated by public-sector tendering processes.

It is some sort of disease where incubating an idea for the benefit of the majority – which public-sector objectives aim to achieve – does not feature.

It is a “me” first and to hell with everybody else. While some call this corruption, others refer to it as unethical behaviour, but in my view it is all the above and a lot more than the public gets to know.

For it is only a fraction of public tenders that pass without the hand of some invisible personalities.

These invisibles are so powerful that they can interfere with virtually every level of case-law management as well as media. If you stand in their way they have the means to make you the victim.

The worst is when they create headlines through legislatures and subvert judicial processes – read the recent cases of counterfeit sugar – as politicians fight to get their views dominant. They also seem to know the culprits, as they keep threatening to reveal others if the subject is not abandoned.

For President Uhuru and Adesina to make a dent in their priority areas, they have to fight this scourge first and build a new culture of self-sustenance.

FOOD SECURITY

Let me explain two of their common agenda items – industrialisation and food security. We have millions of Africans trooping into Guangzou, China, to purchase all forms of convenience items that they will supply to government and vendors in African city streets.

Ethiopian Airlines and Kenyan Airways, two of Africa’s largest airlines, are happy with these tragic practices – and you can’t blame them.

But let us appreciate the following home truths. First, we will never learn to create the items we import.

Second, in the absence of any exports to China, China will always have a huge trade surplus with Africa. In other words, we are not thinking about a sustainable future in the event we have nothing to bring in foreign currency.

But the more critical point is on food security. This sector has the tenderpreneur virus. A few people sit and decide what resonates well with the general public then they proceed to implement.

Fertiliser is one such quick deal. Agricultural economists should have warned about the dangers of subsidies for this commodity to subsistent farmers dispersed across the country, as it poses a logistics nightmare. Something the tenderpreneurs love to exploit.

When questions of fake fertiliser began to emerge, politicians were quick to politicise the issue. What they didn’t know is the extent of the damage they were doing to the country.

DEPENDENT CONTINENT

Kenya will find it difficult to attract serious large-scale investors, especially in maize, which in international lingo is now classified as a political crop. The annual dance-around with subsidies benefits only a few.

The government has no business interfering with the sector. We did well in maize before when there were no fertiliser subsidies or any other subsidies. It is the markets that bring down prices and never the government.

We sometimes wrongly make the case for local subsidies because Europe or some other continent has done the same thing. Europe’s subsidy programmes aren’t for competitiveness but for sustaining their capacity to produce.

No nation, including Japan, where it is expensive to produce any food, can abandon agriculture and depend on the outside world for food.

Africa, by shifting to importing food, is increasingly becoming a dependant continent. That is a spitting distance to an enslaved continent.

If I were Adesina, I would want daily data on food production in Africa. He doesn’t need the governments to get this data.

In most cases, governments have no clue about their data resources let alone analysing what they have.

Several start-ups will provide the data and state of farming, poverty and even rainfall patterns in every country.

DATA-DRIVEN POLICYMAKING

These start-ups include Grow Intelligence, based in Nairobi, offers business information and data analytics; World Data Lab’s World Poverty Clock, provides real-time estimates of poverty levels across the world; aWhere provides agronomic data globally; and the UN’s Global Pulse, based in Kampala, harnesses big data, artificial intelligence and other emerging technologies for sustainable development and humanitarian action.

My prayer is that we all develop the culture of leveraging data to make decisions.

Our analogue methods of monitoring and evaluation have failed and are deceptive given that there are far too many gatekeepers in the chain.

Who doesn’t know that funds transferred from AfDB to local banks for onward lending to especially SMEs are in most cases used to buy treasury bills while they monkey around with lending procedures.

AfDB doesn’t need to make such disbursements in this day and age when banks are struggling to fit into the emerging credit-scoring mechanisms.

Data on customers in any country should be in an AfDB blockchain database entailing national treasuries, central banks, the lending bank, the auditors, and the beneficiaries with clear instructions on what the lending bank will be paid.

AfDB doesn’t have to wait for tired reports on how many beneficiaries have taken up the loans and what is the status of their enterprises.

Once you have a digital infrastructure enabling you to see financing, production, consumption and the supply chains of locally produced goods, it becomes easier to lobby governments to buy their own production.

Without shifting into emerging digital technologies, we are sustaining tenderpreneurs rather than the people.

BUILDING PARTNERSHIPS

And the more we bury our heads in the sand, the worse it will become. Sample this news from the Brookings Institution.

On June 19, 2018, three of my Big Data collaborators – Homi Kharas, Kristofer Hamel, and Martin Hofer – wrote a piece titled “The start of a new poverty narrative” for Brookings.

Their article revealed that Nigeria has already overtaken India as the country with the largest number of extreme poor in early 2018, and the Democratic Republic of Congo could soon take over the number two spot.

This should never have happened if Nigeria had pursued the right policies of encouraging local production.

It was clear that China was losing the market of light electronic products to other destinations. India exploited the opportunity when we in Africa doubted our capacity to produce these products.

The only African country prepared for these global dynamics was Kenya, as it prioritised information and communications technologies in its Vision 2030.

We did well with many of the objectives, but when it came to building partnerships with others to start a manufacturing sector, we failed.

A new National Land Commission refused to give public land to investors who could build local capacity.

An attempt to rent the entire Samia Business Park was stopped in its tracks by tenderpreneurs. Without any options, our partners shifted to Ethiopia.

Today, according to the BBC, Ethiopia is set to become the leading manufacturing hub in Africa.

Ethiopia is the only country that, according to World Poverty Clock, will have less than three per cent of her people in extreme poverty by 2030.

To succeed in both food security and manufacturing, we must build agricultural parks and industrial parks to enable the free flow of ideas and build local capacity.

For example, the Galana-Kulalu project should have been the agricultural park, with 500,000 acres given to investors for free in return for helping locals (not proxies for locals) to develop large-scale farming capacity in the next 500,000 acres such that every year we must have at least 100 local people qualified to produce on a large scale.

The same can be replicated for a technology park where part of the requirement to be based there is technology transfer with tangible numbers.

ENABLING POLICIES

The assumption that Africans will one day invest in manufacturing is not tenable in the presence of the trader mentality that has instant results that do not contribute in any way to economic advancement.

I have said enough, but if Africa is to stop its young people from going into slavery and some dying in the Mediterranean Sea, let’s work on enabling policies.

India, as it celebrates its exit from number one in the category of people in extreme poverty, is looking to enjoy a one-trillion-dollar market in light electronic manufacturing.

Africans will soon change their flights to Indian cities to buy goods. We are already doing so in health.

Our narrative is changing from “Africa rising” to something I will leave you to craft.

We can achieve Adesina’s priority areas but only if he himself, policymakers and financiers of Africa’s development adopt and develop a new data-driven approach to development. That is where the legacy lies.

The writer is an associate professor at University of Nairobi’s School of Business.Twitter: @bantigito