Africa’s challenges remain the same

By Rafiq Raji, PhD

Published by BusinessDay Nigeria Newspaper on 19 Jan 2016. See link viz. http://businessdayonline.com/2016/01/africas-challenges-remain-the-same-rafiq-raji/ 

The World Economic Forum Annual Meeting for 2016 takes place this week on 20-23 January. Compared to meetings of the last two years, it would be somewhat Africa lite. The Africa agenda then was positive and growth-focused. There was a lot of optimism. Not this time. Frankly, this year’s meeting is not likely to be as exciting. After the initial good cheer at the beginning of last year, 2015 turned out to be very poor for the continent. Lower commodity prices and China’s economic slowdown unraveled the Africa Rising narrative. While the long-term potentials of the continent remain, there has been a change in views – mostly to the downside – on how quickly the continent can overcome its challenges and emerge richer. Africa’s next challenge, the title of one of the scheduled sessions at the meeting this year, has President Zuma of South Africa and Ethiopia’s Prime Minister Hailemariam Desalegn as discussants. The notion of a next challenge for Africa is deep with meaning if not ironic. Insecurity, poverty, corruption, poor governance, and power shortages have been the topics of conferences on Africa for decades. Yet they persist. The recurring regression is certainly frustrating even for the continent’s ardent supporters.

Africa’s next challenge is how to overcome its current challenges. The old ones are the new ones. Only now, countries like South Africa hitherto seen as relatively better off seem to currently suffer almost all of the challenges of its poorer peers. Corruption, poor governance, and power shortages are now as problematic in South Africa as they are in Nigeria and the rest of the continent. In the South African case, negative perceptions about its leadership add to headwinds. President Zuma would be attending this year’s meeting tainted by corruption allegations and questions about his ability to govern amid student protests, imminent labour strife, a battered currency and the potential downgrade of his country’s credit ratings to junk status. Thus, Team SA would dearly hope that President Zuma engages in a charm offensive at Davos to avoid solidifying growing domestic and international investor antipathy towards his presidency. Sobriety might be the best approach. In recent media statements after his botched cabinet shake-up in December 2015, President Zuma did not seem sobered by the damage his actions have caused his country’s economy. It is certainly now very hard to persuade investors against worrying about the deep-rooted structural issues that require urgent resolution in South Africa. In the Ethiopian case, drought and political repression would be in focus. These issues were and still are the challenges facing modern Ethiopia. These recent and ongoing crises in the countries of the panelists would be hard to gloss over. They are real and typify the regression that supports the irony of a supposed next challenge for Africa.

Nigeria and Kenya do not feature prominently on the agenda at Davos this year, based on the published programme. With the countries planning Eurobonds in the first quarter of 2016, discussions around the costs of this type of financing – and how investors have wizened up to the risks involved – would not be so obscure. Nigeria, which featured prominently at the forum in 2014, may get little mention this time around as global investors still have doubts about the measures put in place by the country’s officials – and their capacity – to tackle the country’s current economic challenges. The panel on Securing a Vaccine for Ebola should feature Nigeria’s success in preventing the Ebola Virus Disease from becoming an epidemic in the country, however. In this regard, the real danger is complacency. On January 14, the World Health Organization (WHO) declared the Ebola outbreak was over in West Africa. Hours later, a new case sprung up in Sierra Leone, with even more exposed. The flare-up highlights the urgency of securing a vaccine. So while the affected countries are now much more able to deal with future epidemics, there is clearly a need for permanent vigilance. And not just for Ebola. Nigerian authorities are currently battling a Lassa fever outbreak, albeit much more easily contained than Ebola and less fatal. Africa’s ability to successfully handle future epidemics – if diligent and swift actions are taken – has certainly been established. Still, capacity and infrastructure remain constraints. Africa and the world should not wait for another epidemic before addressing them. So a discussion on a vaccine for Ebola should also involve how the continent’s healthcare capacity and infrastructure can be enhanced on a permanent basis.

Why have much remained the same on the continent? Drought is having the similar food supply effects of years back because governments did not prioritize weaning their countries of rain-fed agriculture. Ebola took so many lives because of a slow global response, inadequate investments in health infrastructure and limited capacity. Corruption continues largely because of little political will, compromised or poorly functioning legal systems and a complacent citizenry. Power deficits have soared because of poor or no planning, lack of investments, wasteful subsidies and sabotage. Conflicts and terrorism remain because of continuing political interference by world powers and domestic elite power schemes. There is still room for optimism, however. Kenyan and Nigerian authorities are decidedly fighting corruption. Though, the usual political motivations continue to be perceived as driving these initiatives – concerns have been raised about rule of law and witch-hunting in the Nigerian case and in Kenya, opposition figures continue to insist Eurobond proceeds were misappropriated. There is a renewed focus on reducing the power supply deficit on the continent, much of it focused on renewables. Social media is increasing citizen engagement in the political process and forcing increased accountability. Strained government finances have spurred scrutiny of public expenditure to block leakages. Circumstances have also pushed African authorities to seek means to diversify their economies. So while the Africa Rising narrative would be difficult to defend at Davos this year, current forced structural reforms – if sustained – may eventually vindicate the optimistic advocacy of the continent’s many fans.

Also published on my company’s website on 20 Jan 2016. See link viz. http://macroafricaintelligence.com/2016/01/20/thematic-africas-challenges-remain-the-same/

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