Author Archives: rafiqraji

About rafiqraji

Dr. Rafiq Raji is managing director & chief economist at Macroafricaintel Investment LLC, an Africa-focused macro research & investment consultancy based in Lagos, Nigeria. He is also an adjunct researcher at the NTU-SBF Centre for African Studies at Nanyang Business School, Singapore. Dr Raji is an avid writer, with his writings severally featured in prestigious publications like BusinessDay, Africa Investor, The Africa Report, African Business, New African and HowWeMadeItInAfrica. He was previously an Africa Economist at Standard Chartered Bank in London. Before joining the Global Research team at Standard Chartered, Dr. Raji worked with various teams at its Nigerian franchise; gaining experience in credit risk, asset & liability management, and capital markets. Rafiq was also previously Head, Advisory & Capital Markets for the securities brokerage arm of Nigeria's Standard Alliance Group. Prior to that, he had investment banking stints with FBN Capital Limited, Vetiva Capital Management Limited and Africapital Management Limited; all in Lagos, Nigeria. Dr. Raji holds an MBA from the Lagos Business School, Nigeria and a PhD in Financial Economics from Wits Business School at the University of the Witwatersrand, South Africa. His personal interests are travel, music, writing, finance & economics, international politics & relations, comparative religious studies, volunteering/philanthropy, film & photography and everything and anything about Africa! He hopes to learn how to play the guitar and speak, read and write Arabic, French and Mandarin. He is also an assiduous and lifetime student of history.

macroafricaintel Daily Brief | 18 Oct

By Rafiq Raji, PhD
Twitter: @DrRafiqRaji

Global Markets

  • Asian shares erase gains after weak China GDP, pound pulls back
  • MSCI Asia ex-Japan turns lower, -0.17%
  • China GDP grows 6.0% in third quarter, 3-decade low
  • Nikkei trims gains, up 0.18%
  • Sterling gives back gains after Brexit deal rally

Oil Markets

  • Oil prices steady, all eyes on data seen showing China GDP growth slowdown
  • US crude stocks rose by 9.3 mln bbls last week – EIA
  • Brent down 0.2% at $59.82 a barrel (0039GMT)
  • WTI up 0.1% at $53.97

Precious metals

  • Gold steady as Brexit deal lifts stocks, pressures dollar
  • Spot gold unchanged at $1,491.62/oz. (0057GMT)
  • US gold futures down 0.2% at $1,495.40/oz.

Grains

  • Wheat edges higher, set to finish the week up more than 3%
  • Wheat futures down 0.1% at $5.24-3/4 per bushel (0036GMT)
  • Corn futures up 0.1% at $3.95 per bushel
  • Soy futures up 0.2% at $9.33-1/2 per bushel
  • Rice futures unchanged at $11.99 per hundredweight

Key African events or data releases today
[Posts & comments at my Twitter handle @DrRafiqRaji]

  • Preliminary results of Mozambique elections expected
  • World Bank/IMF meetings in Washington D.C.; 15-10 Oct. [Link to schedule: https://meetings.imf.org/en/2019/Annual/Schedule]
  • South Africa’s Eskom stage 1 rotational loadshedding continues
  • South Africa’s Ramaphosa in KZN to launch district development model & projects

Key African events or data releases yesterday & early a.m today
[Posted & commented on some headlines below at my Twitter handle @DrRafiqRaji]

  • South Africa’s power cuts expected to end Friday as generators return online
  • Appointment of new Eskom CEO expected before end-October – acting CEO
  • Egypt to press ahead with sale of stakes in state companies – govt adviser
  • Desperate African refugees pay to get into Libyan jails – UNHCR
  • Gunmen raid cafes in Libya capital to curb social freedoms
  • EU criticizes ‘unlevel playing field’ in Mozambique election
  • Morocco’s BCP Bank buys 71% stake in Madagascars’ BMOI
  • Africa Oil – Angolan sells for cheap, held back for domestic refineries
  • South Africa’s rand firms as cabinet approves power plan
  • Libya estimates 2020 budget at less than $34 bln – GNA economy ministry
  • Angola hopes key reforms will aid efforts to sell oil assets
  • Burundi arrests dozens in currency market crackdown
  • Guinea bauxite operations back to normal after political protests
  • Ethiopia crash victims’ families to subpoena US operators of Boeing 737 MAX
  • African refugee women report surge of sex attacks in Egypt
  • Morocco govt expects growth to improve to 3.7% in 2020 – govt spokesman
  • Zimbabwe cancels deal with Transnet to recapitalise state rail firm
  • Africa FX – Ugandan shilling seen firmer, Tanzania’s to soften
  • Despite Tunisia’s vote of change, enduring miseries drive youth exodus
  • Barrick misses quarterly gold output estimates on Tanzanai curbs
  • Kenya’s president refuses to sign the budget over rate cap
  • Eyeing economic growth, South Africa seeks to renegotiate old renewables projects
  • South Africa’s cabinet approves power plan
  • South African mid-term budget may come a day early – finmin
  • Shell aims to operate Egypt concessions in H2, 2020
  • Zimbabwe cancels deal with Transnet JV to recapitalise state rail firm
  • South Africa’s Eskom forced to cut power for a second day
  • South Africa’s rand slides further as blackouts return

N.B. Full stories of above headlines are available on Reuters

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Hofstede’s Culture’s Consequences: A review in the Nigerian context (1)

By Rafiq Raji, PhD
Twitter: @DrRafiqRaji

The purpose of Geert Hofstede’s Culture’s Consequences: Comparing Values, Behaviours, Institutions and Organisations Across Nations is an ideal starting point. “A better understanding of invisible cultural differences is one of the main contributions the social sciences can make to practical policy makers in governments, organisations, and institutions – and to ordinary citizens.” I extract some of the expositions in the book to highlight certain cultural practices and behaviours in Nigeria, which to the ignorant, are accepted as “wisdoms.” Unfortunately, a lot of those who eventually see the “light” – many do not, only realise the false or flawed logic behind these “wisdoms” when they are aged, too late of course, sapped of strength, with little or no initiative left for enterprise. But for these suboptimal norms, we would probably be a nation of groundbreaking innovators and entrepreneurs of global reckoning. Yes, we do have some of those. But where are they? Most are in saner climes.

Shame vs guilt
Nigeria has unity in many spheres than most people realise. We have a commonality in at least one instance: all our ethnic groups have shame cultures. Ever wonder why most Nigerians make decisions around the frame of reference of “what will people say?” Shame cultures do not engender innovation. Shame cultures are collectivist while guilt cultures are individualist. Most of today’s advanced economies have individualist cultures while some of the poorest economies are collectivist. The motivation to do what is right in guilt cultures is intrinsic while that for shame cultures is extrinsic. I quote from several parts of the relevant sections of Hofstede’s book to establish the theory.

“US anthropologist Ruth Benedict (1946/1974) stressed the distinction between cultures that rely heavily on shame and those that rely heavily on guilt…True shame cultures rely on external sanctions for good behaviour, not, as true guilt cultures do, on an internalized conviction of sin. Shame requires an audience or at least a man’s fantasy of an audience. Guilt does not. In a nation where honor means living up to one’s own picture of oneself, a man may suffer from guilt though no man knows of his misdeed”

“The child in a collectivist society is seldom alone, either during the day or at night. In an individualist society, such a lack of privacy would be highly abnormal. In most collectivist cultures, direct confrontation of another person is considered rude and undesirable. The word “no” is seldom used because saying no is a confrontation. In individualist cultures, on the other hand, speaking one’s mind is a virtue. Telling the truth about how one feels is seen as a sincere and honest person. Confrontation can be salutary; a clash of opinions is believed to lead to a higher truth.”

“A child who repeatedly voices opinions that deviate from what is collectively felt is considered to have a bad character. In the individualist family, in contrast, children are expected and encouraged to develop opinions of their own, and a child who always only reflects the opinions of others is considered to have a weak character. Family life in collectivist societies can be oppressive and stultifying, with no escape for those suffering abuse, especially girls. Members of the collectivist family are partially kept in order by the threat of shame.”

“A child in individualist society who infringes upon a rule learns to feel guilty, ridden by an individually developed conscience that functions as a private inner pilot. Collectivist societies, in contrast, are shame cultures: Not only the culprit him- or herself but also his or her in-group mates are made to feel ashamed when a misdeed is committed. Shame is social in nature, whereas guilt is individual: whether a person feels shame or not depends on whether the infringement has become known by others. This becoming known is the source of the shame, more so than the infringement itself.”

Be your own audience
To feel shame requires that your actions and thinking are against the background of an audience; real or imagined. If your sense of purpose is otherwise, based on something genuine, like your own satisfaction, shame is an emotion you cannot feel; that is, with respect to failure, etc. Incidentally, it is also those with such emotional resilience and grit that succeed in our shame-based climes.

The reason most of our compatriots do not hesitate to roll up their sleeves when abroad is because suddenly there is no audience to impress or be wary of. It is shame that stops a lot of ideally industrious young Nigerians from letting go of their false pride and getting down to work. The fear of standing out also prevents a lot of young Nigerians from pulling above their weight. The consequence is that the poor remain poor and the wealthy remain wealthy or wealthier. For instance, the rich send their wards to “international schools” and thereafter abroad for further studies. Add to that some work experience in the “temperates”, they become well-placed to maintain the lofty positions of their parents.

Ever notice how the rich are stern with the children of the poor when they violate a cultural norm and laugh off the same “infractions” by their own kids? Much of what we call culture are mechanisms for discrimination and exclusion. Take another issue: corruption. It is retractable because our cultures tolerate some level of corruption. There are proverbs in our various languages with meanings like “live and let live”, “it is where we work we will eat from”, etc. Corruption is not considered a shameful act in most Nigerian cultures. Who are largely the practitioners and major beneficiaries of corruption in Nigeria? The rich. It is a vicious cycle.

e go learn” & “o ma gbon” fallacies
You would hear custodians of these shame cultures make remarks like “e go learn”, “o ma gbon”, etc. (They mean “he will learn”, “he will become wise”.) In the Yoruba culture (I am Yoruba), for instance, early marriage is encouraged, living by yourself (“on dagbe”) is discouraged, and so on. They are not the “wisdoms” they are oft-presented as. These are norms, that put together with others, ensure the tribe’s cultural institutions of rewards and sanctions, function effectively. They hinder social mobility. Put another way, they engender social statism. If you are not well-to-do and you marry early, with responsibilities hitting you right, left and centre, you cannot garner enough savings in time to change your circumstances for the better. With little or no privacy, being perennially in the company of others from birth, there is little chance of the kind of introspection and contemplation required to better your lot.

So when you hear these culture custodians make such remarks like “e go learn”, “a ma ko”, “o ma gbon”, etc., what they really mean, logically at least, is that you would learn to be mediocre, you would acculturate to aim low. Put simply, you will learn to know your place. From the slave trade, our forever potholed roads, power blackouts on end, to the continued pilferage of our commonwealth by the elite with impunity, the “e go learn”, “a ma ko”, “o ma gbon” pseudo-sages have little to show for their self-acclaimed wisdom. They do know one thing, though. Those who refuse to “gbon” (learn), the mavericks, the sometimes “olori olowos” are precisely destined as such because of their consistent defiance of convention. Flawed conservatism is not wisdom. Needless to say, our culture is holding us back.

macroafricaintel Daily Brief | 17 Oct

By Rafiq Raji, PhD
Twitter: @DrRafiqRaji

Global Markets

  • Asian shares pause after 5-day rally, Brexit in focus
  • US retail sales fall for first time in 7 months
  • Upbeat US earnings cushion blow from data
  • Sterling volatile as Brexit talks continue

Oil Markets

  • Oil prices fall as data points to huge build in US stocks
  • US crude stocks rose 10.5 mln bbls in week in Oct. 11 – API
  • Analysts had estimated increase would be 2.8 mln bbls
  • Brent down 0.7% at $59.02 a barrel (0110GMT)
  • WTI down 0.9% at $52.90

Precious metals

  • Gold steady as disappointing US retail sales weigh on risk appetite
  • Spot gold up 0.1% at $1,490.37/oz. (0044GMT)
  • US gold futures up 0.1% at $1,495.60/oz.

Grains

  • Soybeans firm after 2 days of falls, eyes on US-China
  • Wheat futures up 0.4% at $5.15-1/2 per bushel (0102GMT)
  • Corn futures up 0.1% at $3.92 per bushel
  • Soy futures up 0.1% at $9.28-3/4 per bushel
  • Rice futures unchanged at $11.98 per hundredweight

Key African events or data releases today
[Posts & comments at my Twitter handle @DrRafiqRaji]

  • Preliminary results of Mozambique elections expected
  • World Bank/IMF meetings in Washington D.C.; 15-10 Oct. [Link to schedule: https://meetings.imf.org/en/2019/Annual/Schedule]
  • South Africa’s Eskom rotational loadshedding; day 2
  • By-elections in some Kenya county assembly wards
  • South Africa’s Ramaphosa in KZN to launch district development model & projects
  • South Africa state capture inquiry continues

Key African events or data releases yesterday & early a.m today
[Posted & commented on some headlines below at my Twitter handle @DrRafiqRaji]

  • Libyan govt raises commercial price for kerosene as first step in reforms
  • Guinea govt confirms 9 people killed in political protests this week
  • Sudan – Key rebel group halts direct peace talks with Khartoum
  • Morocco king pardons journalist in abortion case
  • Nigeria govt can’t recover $62 bln sought from oil majors – minister
  • Police free hundreds of males, some chained and beaten, from Nigerian school in third raid this month
  • South Africa’s rand rattled by power cuts, stocks led higher by Sibanye
  • Africa Oil – Angolan exports set to rise, freight pain eases
  • Kenya opens $1.5 bln Chinese-built railway linking Rift Valley town and Nairobi
  • World Bank court orders Tanzania pay $185 mln to Standard Chartered
  • South Africa’s latest power cuts highlight Eskom challenge
  • South Africa’s retail sales up 1.1% y/y in August
  • Zimbabwe bread price jumps 60%, but shortages persist
  • National Express to double Morocco presence with Casablanca bust contract
  • South Africa’s Eskom says power cuts likely on Wednesday

N.B. Full stories of above headlines are available on Reuters

Insights & views on culture (1): Acemoglu & Robinson’s The Narrow Corridor

By Rafiq Raji, PhD
Twitter: @DrRafiqRaji, @macroafrica

The Narrow Corridor: States, Societies and the Fate of Liberty”, the latest book by Daron Acemoglu, a professor of economics at MIT, and James Robinson, a professor at the Harris School for Public Policy at the University of Chicago, is a goldmine of insights. What is state capacity? It is the ability of a state to achieve its objectives. That simple. Such simplicity is the recurring theme of the book. The suggestion is not that the authors avoid the complexities of the subject they explore, but rather that they have sufficient mastery of it to put their ideas forward in the most straightforward manner.

Their main idea is that for liberty to thrive, there must be a balance between the state and society. And they impressively show how a lot of the governance problems around the world stem from an imbalance between the two. The objectives of a state include law enforcement, conflict resolution, economic regulation, provision of infrastructure and public services. A state has capacity when it is able to achieve these objectives. When a state lacks capacity, however, society dominates. The dominance of either the state or society stifles liberty, which is the condition that underpins innovation and prosperity.

Society is culture; that is, “customs, traditions, rituals and patterns of acceptable and expected behaviour that have evolved over generations.” When culture dominates the governance of people’s lives, the influential custodians tend to get a better deal than the rest of society. And not until there is a state with capacity to balance the scales, culture becomes a cage that the elite beneficiaries use to stifle the progress of the rest.

Red queen
Thus, as society predates the state, “it is [the] state that creates liberty.” To sustain liberty, however, the state and society need to continually compete with each other, with “neither getting the upper hand.” The authors call this continued balanced competition between the state and society a “Red Queen” effect. And this is true in reality, isn’t it? Countries with state capacity and strong civil societies are the ones Africans are willing to brave the dangers of the seas to reach.

“Societal mobilization” or “the involvement of society at large (in particular non-elites) in politics” take the forms of “revolts, protests, petitons, and general pressure on elites via associations or the media”. It could also be via participation in elections to elect or be elected. A society’s power rests on its ability to “impose [its] wishes on major social and political decisions” through these means. When the state is too powerful and society is not able to exercise its power, liberty is similarly stifled.

The edge
Since state-building is essentially a countervailing force to cultural hegemony, “would-be state builders are more likely to succeed and emasculate the norms meant to restrain them if they have an ‘edge’.” That is, “something special, making it possible for them to overcome the barriers in their way.” This “edge” could be religious, organisational, technological or personality-related.

An African example of one such state-builder, whose edge was organisational, is King Shaka of Zululand in what is today’s KwaZulu-Natal province of South Africa. The Zulu’s dominance in today’s South Africa is a testimony to Shaka’s state-building legacy. But for Shaka to succeed, he “had to break parts of the cage of norms” in Zululand, especially “kin relations and supernatural beliefs, in order to weaken sources of competing power.”

“Restrictions based on norms, traditions and customs dull economic incentives and opportunities, and need to be loosened for economic growth to flourish.” This is because “innovation needs creativity and creativity needs liberty.” That is, individuals should be able to act and go about their affairs without fear and experiment with ideas, whether they are pleasant to others or not. Put another way, “prosperity and economic growth originate” from “incentives for people to invest, experiment, and innovate.”

A state is required to bring all these about. In the absence of one, norms or culture prop up their influential custodians at the expense of the rest. Because like the authors put it, “you need opportunities to be widely and fairly distributed in society, so that whoever has a good idea for an innovation or valuable investment gets a chance to carry it out.” Thus, “liberty in the economic domain necessitates the leveling of the playing field and the lifting of these restrictions.” Social mobility and prosperity for all would be elusive otherwise.

Mokyr’s A Culture of Growth: A review in the African context (2)

By Rafiq Raji, PhD
Twitter: @DrRafiqRaji

Convention is fluid
Remember when if you wore sneakers with a traditional attire, you would likely be thought a misfit? But today, it is consider quite cool, isn’t it? All it took was a few celebrities to wear the abnormal combination. This second example would resonate with Muslims. Some Muslims wear trousers that stop just before the ankle as a religious practice. It wasn’t considered a ‘cool’ thing to do. Have you noticed, however, that supposedly ‘cool’ suits nowadays come with trousers that stop just before the ankle? Celebrities are cultural entrepreneurs. They are cultural change agents. It is not always the case that they seek to change culture deliberately. For some, it is precisely their bold actions that throw them into the limelight. Others simply rode on popular culture and acquired fame in the process and thereafter are able to introduce new trends of their own. It is also the case that through them, people can be dissuaded from negative cultural practices.

“What is it precisely that cultural entrepreneurs do? Mokyr posits “they are persons who become sufficiently influential to change the cultural menus of enough people and who persuade many of them to adopt the cultural variants they are proposing.” To be sure, not all cultural entrepreneurs succeed. Those who do are “individuals who successfully contested and overthrew existing authorities in a specific area of culture and created a competing variant”. Two hugely successful cultural entrepeneurs of their time are Isaac Newton and Francis Bacon, whose legacies endure to this day. More relatively recent examples are prominent economist John Maynard Keynes and American civil rights leader Martin Luther King Jr.

If these examples do not resonate with you, maybe this would: an Oprah Winfrey qualifies as one. Put simply: “influential individuals affect the beliefs and preferences of others”. They are probably also the most effective channel through which culture can be changed today. Who are our celebrities? Are the beliefs they espouse progressive or retrogressive? Are the contents of our arts ones that spur innovation and new thinking or the entrenchment of old beliefs? Institutions can be created or remodeled to tune our cultural output towards progressive goals. For instance, what are the criteria by which our censor boards approve art, movies, music, etc.?

A warning. Cultural entrepreneurship is a hugely risk affair. In Europe, Mokyr recounts, “new people challenged the conventional wisdom in every area of knowledge and thought. To be sure, a variety of conservative bodies made serious attempts to suppress innovators and some of the most innovative cultural entrepreneurs paid with their lives.” But while during the European Enlightenment, “fragmentation, footlooseness, and the proliferation of printing presses meant that it became increasingly difficult for politically powerful incumbents to suppress subversive and heretic new beliefs generated by cultural entrepeneurs,” with the internet and technology, it is much easier today to be one with not as much risk or effort.

Modern man vs traditional man
I digress from Mokyr (2016) a little bit. Who is a modern man? And how does he defer from the traditional man. To the ignorant, the instinctive definition veers towards the ethnic, tribalistic or racist. It is no such thing. Geert Hofstede’s (2001) Culture’s Consequences: Comparing Values, Behaviours, Institutions, and Organizations Across Nations quotes now late Harry Triandis’ (1971) Some psychological dimensions of modernization, a paper he presented at the 17th Congress of Applied Psychology in Liege, Belgium on the differences between the two as follows:

A modern man “is open to new experiences; relatively independent of parental authority; concerned with time, planning, willing to defer gratification; he feels that man can be master over nature, and that he controls the reinforcements he receives from his environment; he believes in determinism and science; he has a wide, cosmopolitan perspective, he uses broad in-groups; he competes with standards of excellence, and he is optimistic about controlling his environment.”

The traditional man, however,has narrow in-groups, looks at the world with suspicion, believes that good is limited and one obtains a share of it by chance or pleasing the gods; he identifies with his parents and receives direction from them; he considers planning a waste of time, and does not defer gratification; he feels at the mercy of obscure environmental factors, and is prone to mysticism; he sees interpersonal relations as an end, rarely as means to an end; he does not believe that he can control his environment but rather sees himself under the influence of external, mystical powers.”

Modernise your philosophy of life
Being a modern man does not require that you give up your religion or your traditions. Instead, it is underpinned by the philosophy that there is a rational explanation for everything. In applying this ethos, you approach problems objectively, seek new and better solutions, and continually seek to improve your lot. The traditional man, however, seeks irrational and mystical explanations, and procures the services of its dubious practitioners when in doubt. The outcome is very well what underpins our problems as a country. Whether it is perennial traffic in a busy Nigerian city, power failure on end, lack of reliable potable water supply, and so on, the “traditional man” outlook of most of our compatriots is why we live relatively miserable lives. So, my questions to you are thus: Which of a modern or traditional man as described above is better? And which one are you? Become better. Better still, become best.

Mokyr’s A Culture of Growth: A review in the African context (1)

By Rafiq Raji, PhD
Twitter: @DrRafiqRaji, @macroafrica

In A Culture of Growth: The origins of the modern economy, Joel Mokyr, a professor of economics and history at Northwestern University in America, argues modern economic growth or “the Great Enrichment” or “the Great Divergence” emanated from a deliberate and revolutionary change in European beliefs, values and preferences. A radical change in culture. That change, “the European Enlightenment” or “The Enlightenment”, was incidentally propelled by just a few people. European elites decided to change the ways they saw the world. The result? Unprecedented prosperity that endures to this day. To make progress, a culture must encourage openness, progressivism, pluralism and competition.

Attitude & Aptitude
In the African context, especially as we continue to flounder economically, a key lesson is that the change that would alter the course of our history for the better and engender wealth creation would only be brought about when our elites decide to change their ways. But how can they do that in the current technological age with the West already so far ahead? To answer this question, it would certainly help to know how “in the two centuries between Columbus and Newton, European elite culture underwent radical intellectual change” that led to “the Enlightenment, the Industrial Revolution and the rise of useful knowledge as the main engine of economic [growth].”

My rebuttal against the European triumphalism tag that is often pinned on those who argue culture underpins the West’s economic success is that of change. There was a marked change in European culture. In other words, an elite looked at its ways and made a decision to change them with the view to achieving sustainable prosperity. In other words, they gave up their growth-inhibiting inherited values and created new ones. That is a human and universal phenonemon unrelated to race or heritage. And it is a change that any group of human beings can decide to make.

Evidence of the universality of this change can be seen in the similar success of other countries or regions of the world who decided to adopt similar principles with varied results. Today, we all know the earth is round-shaped. There was a time when those who thought so were publicly executed for defying dogma. How many more “the earth is flat” fallacious beliefs underpin our actions and approaches to life? Finding out the earth is round instead of flat is not what matters most. What does, is the deliberate questioning of beliefs and dogma with the singular purpose of discovering the truth. That deliberate and systematic curiosity is essentially what the Enlightenment was all about.

“Religious beliefs and metaphysical attitudes condition a society’s willingness to investigate the secrets of nature [and] alter its physical environment irreversibly”. Put in the African context, our religious beliefs and metaphysical attitudes weigh a great deal on our ability to innovate for economic success. When the Europeans decided to challenge these beliefs, they discovered truths that led to the development of the steam engine, aeroplane, and many more innovations that make us masters of our world today. Unsurprisingly, those who refused to be similarly irreverent are also some of the poorest today. After all, technological innovation, which underpins economic prosperity, is “a consequence of human willingness to investigate, manipulate, and exploit natural phenomena and regularities”. To a great extent, the openness of the West to new and foreign ideas, irrespective of its source, underpins its continued technological leadership.

“Vested interests of incumbents protecting the rents generated by status quo techniques and fear of the unknown and novel create strong incentives to resist innovation.” “What changed history was that in Europe, over the long term, the innovators defeated conservatism. This did not happen anywhere else.” Why? “Political fragmentation, coupled with an intellectual and cultural unity, an integrated market for ideas, allowed Europe to benefit from the obvious economies of scale associated with intellectual activity.”

Irreverence is key to progress
“The most direct link from culture and beliefs to technology runs through religion.” We, Africans, are a very religious people. We are also a very poor people. No one is suggesting we give up religion or tradition. But we must be ready to question our beliefs. And do not seek those answers from the clergy or elders in whose interest it is to jealously guard the advantages or “rents” religion or tradition offers them. Question everything. Question our traditions. Question our culture. Find your own answers. As a guide, you should ask whether a cultural or religious value or norm is backward-looking or forward-looking. The latter is the one that engenders progress and creates longlasting prosperity.

Be unconventional
How do you change a culture? Mokyr proceeds to answer this question by quoting George Bernard Shaw’s Maxim 124 in his “Maxims for Revolutionists”: “The reasonable man adapts himself to the world: the unreasonble one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.” You need unreasonable men and women to change a culture towards progress. Thus, it is no coincidence that it is the unreasonable and irreverent that create new wealth.

macroafricaintel Daily Brief | 16 Oct

By Rafiq Raji, PhD
Twitter: @DrRafiqRaji

Global Markets

  • Asian shares tick up, sterling off 5-mth peak as crunch Brexit talks eyed
  • MSCI ex-Japan, Nikkei jump on positive Brexit news
  • Sterling slips after hitting 5-mth peak
  • EU to determine whether to put deal before EU leaders’ summit

Oil Markets

  • Oil prices edge higher on potential Brexit deal; OPEC signals of possible cuts
  • OPEC, allies to seek market stability beyond 2020
  • Brent up about 0.2% at $58.85 per barrel (0103GMT)
  • WTI up 0.2% at $52.91

Precious metals

  • Gold edges higher as Brexit uncertainty spurs safe-haven bid
  • Spot gold up 0.2% at $1,484.49/oz. (0130GMT)
  • US gold futures up 0.3% at $1,488.10/oz.

Grains

  • Corn edges lower but USDA harvest report caps losses
  • Wheat futures down 0.2% at $5.06 per bushel (0008GMT)
  • Corn futures down 0.6% at $3.91 per bushel
  • Soy futures down 0.1% at $9.32-3/4 per bushel
  • Rice futures nearly unchanged at $11.88 per hundredweight

Key African events or data releases today
[Posts & comments at my Twitter handle @DrRafiqRaji]

  • Kenya’s Kenyatta to commission SGR phase 2A line & groundbreaking of Naivasha depot
  • Nigeria labour unions’ minimum wage negotiations with govt continue
  • Mozambique polls closed; vote counting ongoing, preliminary results on Thursday
  • South Africa retail sales Aug-19 [fcst. 1.1% yy, prev. 2.0%]
  • South Africa state capture inquiry resumes
  • Kenya’s ruling Jubilee party to meet members of Nairobi County Assembly over wrangling with Governor Sonko

Key African events or data releases yesterday & early a.m today
[Posted & commented on some headlines below at my Twitter handle @DrRafiqRaji]

  • Nigerian president vows crackdown on abusive Islamic schools after second raid
  • Nigeria’s land borders closed to all goods – customs chief
  • Ethiopia postpones autonomy referendum for ethnic Sidama – Fana news agency
  • Algeria court places journalist in custody
  • Mozambique president urges peace, opposition warns against fraud as votes counted
  • Young Africans face poor job prospects as education deteriorates – report
  • Africa Oil – Diffs continue to fall, Angola programme awaited
  • IMF cuts Kenya’s economic growth forecast for 2019 and 2020
  • South Africa’s rand steadies, Sasol leads stocks higher
  • IMF expects Egypt economy to grow 5.9% in year to end of June
  • Former Ivory Coast rebel leader Soro to run for president
  • 4 bodies pulled from Congo plane crash wreckage
  • Hundreds fled abusive Nigerian “school” before police raid
  • Nigeria inflation rises to 11.24% in September from near 4-yr low
  • Zimbabwe state employees say they cannot work as prices soar
  • 4 bodies found in Congo after crash of plane with president’s staff
  • South Africa’s Zuma to appeal decision he must face graft charges
  • Kenya shilling strengthens against the dollar
  • Kenya central bank to hold next rate-setting meeting on Nov. 25
  • Uganda shilling a touch stronger as liquidity mop-up helps
  • OPEC, allies to maintain oil market stability beyond 2020 – Barkindo
  • Takeda sells Mideast, Africa drug portfolio to Switzerland’s Acino
  • Mubadala sells Medgaz pipeline stake to Naturgy, Algeria’s Sonatrach
  • World Bank sees Egypt economy growing 5.8% in 2019/20
  • African masts operator Helios Towers prices IPO at low end of range

N.B. Full stories of above headlines are available on Reuters