Project Syndicate: Last month, you and Efosa Ojomo touted market-creating innovations as powerful means of boosting growth and reducing inequality in Africa. Because such innovations “focus on the needs of the majority,” they could give the continent’s poor access to critical resources and create local jobs. But, as we know from more developed economies, neither blue-collar jobs nor consumable goods are enough to ensure that the benefits of growth are shared widely. What steps should African policymakers take to encourage equitable and inclusive innovation-led growth?
Carl Manlan: The majority of Africans work in the informal economy. These workers are striving to improve their own lives, and to move Africa forward, with what they have – which is often very little. The objective is not to ensure that they “catch up” with the wealthier groups per se, but rather to transform the lives of the majority, who live in rural areas, with the resources that are available.
To that end, Africa’s policymakers will first need to pursue a date-driven approach to gain a better understanding of the women, men, and young people propelling their economies. They will have their work cut out for them. But doing so will improve their capacity to ensure that the transformation ahead, while taking advantage of technological leapfrogging, is appropriately incremental, unfolding at a pace that carries the majority along the development continuum.
PS: One prominent example of market-creating innovation in Africa that you cite is the Ghanaian health-care company mPharma, which has “served over one million Africans, created hundreds of jobs, and raised more than $50 million of venture-capital funding to expand its operations.” This seems to be exactly the kind of initiative you called for in May, when you highlighted the need for Africa to shift from donor- to investor-funded health-care programs. What has enabled mPharma and others to secure so much private investment, and how might their model be applied to address Africa’s other health-care needs, such as increasing the number of community health workers?
CM: mPharma stands at the intersection of capital, science, and human lives. In the absence of strong preventive health systems, Africans needs access to quality and affordable medicines. mPharma’s appeal – and investment potential – is thus very strong.
Of course, strong preventive systems remain an important goal. Overall, Africa’s health-care systems – including its supply of community health workers – have suffered significantly from structural-adjustment programs and a shift toward more specialized health provision.
Restoring – and strengthening – these systems will require a fundamentally new approach to health care, which integrates it with financial inclusion, social protection, and employment opportunities. Only by recognizing this, and innovating accordingly, can companies or governments hope to secure adequate private-sector support.
PS: The approach you advocate in your commentary focuses on channeling resources from the African diaspora toward “projects that can meet the needs of entire communities at any given moment,” rather than only to pay a sick relative’s medical bills or fund consumption. For this to work, those resources would have to be pooled and directed toward such projects “via trusted intermediaries.” How do you envision this working in practice? What types of systems would have to be established or repurposed? Perhaps most important, how could the diaspora be brought on board?
CM: The diaspora is on board. Their equity is their family living in Africa – the family they work so hard to support.
Useful intermediaries also exist. African platforms, such as Thundafund and The Future Africa Collective, are already leveraging investments in financial technology being made by fintech firms and traditional financial institutions alike. These initiatives already have significant public and private components; engagement with civil-society organizations, however, must be deepened.
As for the type of resources that will be required to make the needed community-oriented projects work, cash is Prince, and nonfinancial support is King. Without the latter, no amount of money will have the desired effect.
PS: In April, you and Henri-Michel Yéré suggested that the COVID-19 crisis “represents an historic opportunity for global-governance mechanisms to demonstrate their effectiveness and regain public confidence.” In the nearly six months since then, a globally coordinated response to the crisis remains nowhere to be found. How might multilateral development institutions best addressed this? What should be at the top of the agenda?
CM: Finance is a political instrument, so the World Bank and International Monetary Fund are, too. They cannot do much without the consent of their most powerful members.
But, if their members do hope to mount an effective COVID-19 response, they should focus on productivity, workers, and land. It is difficult to re-ignite productivity when people lose skills, health, and hope. But this is what leadership is about: finding answers to difficult questions, using the instruments at hand. One such instrument is Special Drawing Rights, of which the IMF should be making far greater use, in order to support struggling countries.
By the Way…
PS: In a recent commentary for The Cairo Review of Global Affairs, you wrote that the “push for the transition to a cashless society needs to be accelerated” in Africa, with the model placing women “at the center of the design.” Why are women so crucial to going cashless, and what would such a woman-centered model look like?
CM: Women in Africa play a central role in multiple areas of economic activity, but often find it tougher to access traditional financial institutions. For example, they are typically responsible for household spending, and thus financial management. And many run informal-sector businesses, so their adoption of financial tools can help to spur the same by peers and clients, increasing everyone’s market access.
Woman’s importance for development is no secret, and multiple programs aiming to make finance work for women have cropped up in recent years. But a truly effective woman-centered model would integrate a wide range of services, from health to skills development to financial tools.
PS: In another commentary, you, Javaid Iqbal, and Junaid Nabi argued that, by improving traceability in food supply chains and data transparency concerning distribution, blockchain technology can significantly improve food security in Africa. What would it take to implement such a system?
CM: First, farmers need the tools and skills to use technology to improve their yields and, in turn, their output. Second, countries must invest in the infrastructure needed to facilitate distribution, thereby improving access to African foods and reducing food-import costs. Third, technology must be applied to track and target stunting in Africa’s children. In fact, progress on stunting should be the yardstick by which we measure the value of technology in agriculture.
PS: You tweeted several insights from Yuen Yuen Ang’s book How China Escaped the Poverty Trap, which you call a “must-read.” What insights does Ang provide that can guide Africa’s development?
CM: The private sector does not have a monopoly on innovation. In China, it was a strong public sector that created incentives for subnational governments to innovate and nurture economic development. For example, in the 1980s, China’s Township and Village Enterprises – market-oriented public enterprises under the purview of local governments – leveraged partial property rights, among other things, to encourage rural industrialization.
PS: In 2017, you discussed you and your wife’s decision to raise your children in Africa, rather than in Geneva, where you started your family. What elements of an African childhood or upbringing did you not want your children to miss?
CM: The memories of our own childhoods spent close to our extended families are an essential part of our identities. And growing up among peers with a shared background is an experience that cannot be replicated. Of course, it is important to experience diversity, to engage with people of different backgrounds. But being grounded in one’s own identity is also essential, and we felt that raising our kids in Africa would help them to achieve this.
My wife and I also wanted our children to understand their home continent firsthand, rather than have their perspective distorted by foreign media or even our own descriptions and interpretations. And we wanted them truly to understand their own privilege, reflected in reliable access to education, food, and health services, whichmany in Africa still lack.
By Saaleha Idrees Bamjee
This poetry anthology forms an ode to the author’s Muslim identity in South Africa. One line, in particular, has stuck with me, and shaped my efforts to be a better parent: “Parents don’t have to be parents to hold things their children touch.”
The Lockdown Collection
By Melinda Ferguson
This collection of essays – which Ferguson published, compiled, and contributed to – features work by some of South Africa’s most celebrated writers, disruptors, and thinkers. While in South Africa, I was pleased to dive into these narratives of transformation, grief, societal challenges, hope, and sorrow, each coming from a different part of the country. Taken together, these narratives measure the pulse of the country, at a time when it is united, however uncertainly, by lockdown.
This Mournable Body
By Tsitsi Dangarembga
An evocative narrative that explores the challenges of a life lived in a constantly evolving environment. Much of the book is set in Harare, Zimbabwe. It brought me back to my time in that city, being welcomed to southern Africa and improving my English at Speciss College more than 20 years ago.