ECOWAS and Other Upbeat News Out of Africa

Stephen DeAngelis

May 26, 2010

Although a lot of bad news continues to flow from countries in Africa (like the Congo, Nigeria, and Zimbabwe), there is also the occasional story of hope and progress. For example, there was the bad news/good news story that followed elections in Sudan [“Half horrid, half hopeful,” The Economist, 15 April 2010]. The article reported that although the election was “rigged in the north” it was “more or less fair in the south.” Not everyone, however, is happy with the results. Kevin Funk and Steven Fake, for example, lament the fact that “indicted war criminal Omar Hassan Ahmed Bashir has maintained his grip on the presidency with 68% of the national vote, and the Sudan People’s Liberation Movement will do the same in the south after obtaining 93% of votes in that region” [“How much does Washington care about African democracy?Los Angeles Times, 6 May 2010]. The Economist admits that “the elections will have endorsed the status quo”; but it also believes that “many voters saw the election as a dry run for next year’s promised referendum, especially after the SPLM pulled its candidate out of the race against Mr Bashir for Sudan’s national presidency. A huge majority of southerners seems likely to vote for secession, which offers them a merciful release from Mr Bashir’s rule.” To read more about South Sudan, read my post entitled Looking Forward to “New Sudan”.

Among the “good news” stories is one about the Economic Community of West African States (ECOWAS), which, according to The Economist, “has notched up some successes” even as other regional organizations have faltered [“Quietly impressive,” 25 March 2010]. The article reports:

“The Economic Community of West African States, better known as ECOWAS, has a notoriously tricky job. The 15-country club must, among other things, promote democracy in a region blighted by military coups and ‘big men’ who rarely wish to cede power. Four of its members have suffered civil wars in the past 20 years; only Cape Verde and Senegal have never had a coup since independence. Yet, especially compared with Africa’s other such clubs, ECOWAS is doing a pretty good job. Guinea and Niger, two resource-rich but coup-prone countries, have recently provided big tests. In the first case ECOWAS rose to the challenge. Last month Guinea’s junta finally handed over power to a transitional government after a concerted squeeze by ECOWAS, other African countries and the West. ECOWAS had taken the lead, holding talks with the soldiers and pro-democracy groups since October. It had also suspended Guinea from the club and had put sanctions on the regime of Captain Moussa Dadis Camara, who seized power in 2008 after the death of General Lansana Conté, a dictator who had run the show for 24 years. Meanwhile, last month Niger had its third coup in 14 years. The African Union (AU), the main continental body, promptly suspended the country from membership after soldiers ousted Mamadou Tandja, the president. But ECOWAS had suspended the impoverished desert state four months earlier, as Mr Tandja grew ever more tyrannical, seeing that his latest moves, if unchecked, would provoke the army to intervene. ECOWAS and the AU are now monitoring the soldiers’ promise to hold elections in the coming months.”

One of the reasons that ECOWAS has had some success is because its officials are realists. They concede the organization “can achieve little on its own. Its sanctions are largely symbolic.” The article explains that “to compensate for its lack of economic clout, ECOWAS has learnt to work in tandem with beefier bodies and countries, raising the alarm when it spots danger on the horizon.”

“The club’s Achilles heel is Nigeria, Africa’s most populous country. Its economy is twice as big as the other members’ combined. The club’s headquarters is in Nigeria, which, on some counts, provides a third of the cash for Ecowas and a big chunk of its peacekeeping troops. But this makes it hard for the other ECOWAS members to criticise Nigeria. … When it comes to dealing with Nigeria’s flaws, ‘Ecowas is strangely absent,’ says Alex Vines of Chatham House, a British think-tank.”

With so much of its funding coming from Nigeria, ECOWAS will probably remain reluctant to bite the hand that feeds it. It may nevertheless play some role in helping Nigeria move forward peacefully following the death of its ailing president. Another good news story from that part of the world is that West African states are proactively trying to prevent terrorist groups from getting established there [“Radical Islam meets a buffer in West Africa,” by Karin Brulliard, Washington Post, 21 December 2009]. Brulliard reports why West African nations are concerned:

“This past year has brought worrying signs that … a violent brand of Islam [is infiltrating] moderate parts of West Africa. An increase in attacks has included the killing of an American teacher and a suicide bombing in Mauritania, the kidnapping of two Canadian diplomats in Niger, and the executions of a British tourist and a Malian colonel in Mali. All were attributed to an al-Qaeda branch made up mostly of Algerians that has ranged southward to hit in urban Mauritania and establish a rear base in the Malian desert.”

Mali, Brulliard reports, is the test case for keeping extremists at bay. She explains:

“So far, the desert belt spanning black and Arab Africa has proved less a gateway for the southward spread of militant Islam than a bulwark against it, and some analysts call the threat overblown. In this secular nation, alcohol is served and gambling is common. Images of President Obama are ubiquitous, and anti-American sentiment is rare. Few women wear veils. ‘We don’t want an Islamic republic,’ said Mahmoud Dicko, head of the High Islamic Council, an umbrella group of religious organizations in Bamako, the capital. ‘We don’t want sharia, or to cut people’s hands off.’ A socially conservative but tolerant Sufi strain of Islam dominates, but the ranks of foreign imams are rising, and the government has little handle on what is being preached in mosques, Western diplomats said. A weak army has done little to challenge the extremists, who easily cross invisible desert borders, while frequent U.S. military-led training sessions meant to build up the Malian forces — part of a five-year, $500 million counterterrorism program in 10 countries of the region — have been ‘not very effective,’ one diplomat in Bamako said.”

The region’s states also fear that if terrorist groups get a foothold in the area they will become targets of western military activity. In order to prevent such interventions, they have established their own joint military headquarters. To learn more about that, read Tom Barnett’s post entitled North Africa plans on being ready. One concern in Mali is that a madrassa, or Islamic school, has been set up in Timbuktu that requires female teenagers and teachers to wear burqas. Schools can be a powerful influence for good and evil.

On the subject of schools, The Economist reported on Rwanda’s efforts to connect its students to the Internet [“Upgrading the children,” 3 December 2009].

“Tiny, landlocked Rwanda is sometimes touted as Africa’s high-tech economy. It is still a bit early for that, however. Neighbouring Uganda produces far more computer-science graduates. Countries such as Nigeria and Kenya are even further ahead. South Africa is out of sight. But technology is the core of Rwanda’s plan to transform its economy by 2020. The country seems ready to back its ambition with money and policies. By 2012, for instance, Rwanda wants every child in the country between the ages of nine and 12, 1.3m children in all, to have a laptop, each with an internet or intranet connection to download free educational software and electronic books. ‘We estimate the start-up cost will be $313m,’ says Richard Niyonkuru of Rwanda’s education ministry. … Rwanda’s austere president, Paul Kagame, believes the initial outlay will be worth it. How else, he says, to produce the 50,000 computer programmers the country wants by 2020? … If the scheme is to be profitable, software will eventually have to be written to link computers to omnipresent mobile phones. Money must also be found to keep updating the laptops. On the plus side, the project’s proposed scale means that small businesses will spring up to charge, repair and enhance the machines. Rwanda thinks it can also use laptops to improve government services. The laptops could then move the country seamlessly into electronic government. That, at any rate, is the hope.”

The scheme also complements Kagame’s desire for Rwanda to “develop its way” into the future without having to rely on official development aid [“A Supply-Sider in East Africa,” by Anne Jolis, Wall Street Journal, 24 April 2010]. Jolis reports:

“Sixteen years ago, the world watched in horror as 800,000 Rwandans were systematically murdered by their neighbors. In just 100 days, well over 10% of the country’s population—mostly Tutsis, the country’s minority group, and some politically moderate Hutus, the country’s majority—were slaughtered by an extremist Hutu government. Paul Kagame led the Rwandan Patriotic Front (RPF), the guerilla army made up largely of Tutsi refugees that ultimately overthrew the government and ended the bloodshed. Now he’s president. You might suppose that the leader of a country synonymous with genocide would be far more interested in scoring foreign aid than in talking about supply-side economics. But then you probably haven’t met Mr. Kagame. His agenda for improving the state of his country boils down to one goal: ‘spurring private investment.’ ‘We believe in private enterprise, free market, and competition. … So we have to make sure there is a conducive environment for people to be creative and innovative.'”

Jolis reports that Kagame remains a fighter at heart, but that his fight has moved from the battlefield to the boardroom. She continues:

“These days, the battle he is fighting is for national prosperity. Unlike many of his peers in the Third World, his focus is on how to create wealth—not on how to beg for charity. … ‘We can only have ourselves to blame for our failures,’ he says. ‘We don’t expect anyone to hand us any success or progress we hope to be making.’ That attitude makes Mr. Kagame a skeptic when it comes to foreign aid, which he faults for many of the world’s ills. ‘It has created dependency, it has distorted the markets, it has detached people from their leaders and their values, it has created conflicts in some cases.’ He notes that Rwanda has cut its dependence on aid by half in the past 15 years, and he speaks with undisguised pride that Rwanda has become self-sufficient in food for the first time in its history. Gradual improvements to property rights, along with government money for fertilizer to farmers (which the farmers have since repaid with the revenue from their produce), have even allowed Rwanda to begin exporting some of its crops. What the country needs now, Mr. Kagame says, is the freedom to market itself around the world. His key bugaboos include import tariffs and agricultural subsidies: ‘Trading fairly with developing countries would put more money in the hands of the developing countries than [donor countries] give through aid.’ … ‘We ask would-be investors what is it they’re really interested in when they come to Africa or when they come to Rwanda,’ Mr. Kagame explains. ‘We say, “What would you be interested in seeing happen in Rwanda that would facilitate your investment?” We put all this together and start seeing what we don’t have and put it in place—whether it’s about laws, institutions, or different aspects of relations, so on and so forth.’ Mr. Kagame says his approach has lured New York-based electric and heating utility group ContourGlobal. It is investing in Lake Kivu’s methane reserves for electricity generation, with an eye to producing enough power to export to Uganda. The president’s other major project is simplifying the country’s tax code. While the World Bank puts Rwanda’s total levies on profits at 31.3%, well below the OECD average of 44.5%, Mr. Kagame predicts that streamlining taxes to bring down administrative costs and cut incentives to cheat is probably the best way of ‘actually increasing the level of revenue you collect.’ … It’s hard not to like his message. And yet Mr. Kagame has strong critics. Lately their concern has focused on Rwanda’s upcoming presidential elections, in which Mr. Kagame remains unopposed in his run for a second seven-year term. His main would-be challenger, Victoire Ingabire—who returned to Rwanda in January after 16 years in the Netherlands—was arrested … on charges of associating with a terrorist group (the Democratic Liberation Forces of Rwanda, founded by perpetrators of Rwanda’s genocide) and advocating ethnic division. Ms. Ingabire was released on bail the day after her arrest. But unless she’s officially cleared of the charges she’s barred from registering her party in the elections.”

Kagame insists that he has no ambitions to become Rwanda’s “president-for-life.” His only ambition, he claims, is to help secure a more peaceful and prosperous future for all Rwandans. Time will tell. If more Africa had more leaders who, like Kagame, believed that development rather than foreign aid was the key to prosperity, there might be less corruption on the continent. With China providing so-called “rogue aid” to African nations, however, that’s not likely to happen anytime soon. As I have noted in past posts, China has moved aggressively to secure access to natural resources found within African nations and it has been joined by Brazil. Another emerging market country that has shown interest in Africa is Turkey [“Ottoman dreaming,” The Economist, 25 March 2010]. According to the article, “The Turks have new ambitions for trade and influence in Africa.” It explains:

“On March 17th, … Abdullah Gul became the first Turkish president to visit Cameroon and Congo. … Mr Gul’s African expedition was … about finding new markets, … which helps to explain the presence of some 140 Turkish businessmen in his entourage. The economic crisis has hit Turkey’s trade with the rest of Europe. So the ‘Anatolian tigers’—small-and medium-sized entrepreneurs from Turkey’s conservative heartland—are eyeing opportunities in Africa. And Africans are responding with enthusiasm. … The Turks … want to sell Africans a range of finished goods, from washing powder to jeans. Turkish contractors are angling to build airports, housing and dams. Turkish Airlines now has regular flights to Addis Ababa, Dakar, Johannesburg, Lagos and Nairobi. Mehmet Buyukeksi, president of Turkey’s exporters’ association, says that Turkish exports to Africa have leapt from $1.5 billion in 2001 to over $10 billion in 2009. ‘We believe in the future of Africa,’ he declares.”

The article notes that “Turkey cannot hope to match up to the likes of China or India. Yet Mr Gul believes it has a competitive edge.” That edge, according to the article, is the fact that Turkey was never a colonial power in sub-Saharan Africa (although “Egypt, Libya, Algeria and Sudan were all once part of the Ottoman empire) and it has embraced a moderate form of Islam. The article continues:

“Farther south Turkey is on virgin turf. Locals often have bitter memories of rapacious Western colonialists and Arab slave traders. This is another reason why Turkish Islam has such appeal—and can be so good for business. Ebubekir Keskin, a 37-year-old Turkish businessman who settled in Douala, Cameroon, three years ago, swaps Turkish-made pasta for local timber. He says his business model is based on alliances with local Muslims. ‘Being Muslim helps big time, soon we will overtake the Italians,’ he boasts. His ambitions are bolstered by members of Turkey’s largest Islamic fraternity, led by a moderate Muslim cleric, Fetullah Gulen, who lives in America. Gulenists now run 60 schools in 30 African countries. Staffed by locals and Turks alike, the schools are patronised by the offspring of elites lured by Western standards of education (if not mandatory Turkish-language classes).”

As Turkey’s economic influence grows, it hopes to leverage it into political influence as well. Turkey has already started playing a large diplomatic role in the Middle East and wants to extend its influence into Africa. The article notes that one reason that Turkey won a seat on the UN Security Council was because “all but one African country vot[ed] in its favour.” As a result, Turkey “opened or plans 12 new embassies in Africa.” One fly in the ointment, the article claims, is “Turkey’s desire to join the European Union.”

“Faced with EU howls, it had to withdraw a recent invitation to Sudan’s president, Omar al-Bashir, who has been indicted by the International Criminal Court for war crimes in Darfur. Widespread abuses in other African countries that Turkey is wooing could yet cause further headaches. Mr Gul is undaunted. ‘There are many people like us here, the Lebanese for example,’ he notes. He might have added Armenians and Greeks too. But many of these are descendants of Christians who were killed or deported as the Ottoman empire collapsed, and went on to be big traders in provincial African towns. Unlike their fellow Africans, their feelings for Turkey may not be warm.”

One last article that shows that things may be looking up for some African nations discusses how some companies are looking to make Africa the next region to which they outsource [“The world economy calls,” The Economist, 25 March 2010]. The first activity to be outsourced there could be call centers.

“The arrival of three international fibre-optic cables in Kenya in the past six months, … has sparked hopes of an information-technology boom. The Kenyan government reckons that business-process outsourcing (BPO) can provide work for the country’s many unemployed graduates. As established outsourcing companies in India take on ever more complex and lucrative work, firms elsewhere spy an opportunity at the lower end of the BPO market, in prosaic jobs such as operating call centres and keying in data. Can Kenya win some of that business? Four undersea cables will have made landfall in east Africa by the end of the year, enormously increasing the availability and reducing the cost of telecoms links with the rest of the world. Kenya also boasts a decent workforce: educated, hard-working, closer to customers in Europe and America than Asian call-centre workers, and, some say, more comprehensible too. High unemployment should help limit turnover of workers—a big headache for outsourcing firms elsewhere.”

Although improved connectivity opens up some real opportunities for East Africa, the article reports that “a smile and a cable are not enough in the cut-throat BPO business.” It explains:

“Margins are slim; customers are fickle. ‘It’s not plug and play. The operational costs and political risks are significant,’ says Andrea Bohnstedt, the editor of Ratio, a Nairobi business journal. ‘Connectivity is not a source of celebration just yet,’ agrees Bobby Varanasi, a consultant in the field. Would-be investors say Kenya’s tax code is unfriendly and, given the complete lack of public services, poor value. Crime is rife and electricity is patchy. The extra cost of paying for private security and backup generators can upend a business model. Some expect widespread violence in the run-up to elections next year. High costs and jammed roads make Nairobi an expensive place to build a giant call centre. Setting up further away from the capital would be cheaper, but a proposed high-tech city has stalled.”

As I have written a number of times during discussions about Development-in-a-Box™, having critical infrastructure in place is one of the most important things that a country can do to attract foreign direct investment. As Kenya is learning, a lack of such infrastructure (especially reliable electrical power) can be off-putting for most businesses. The article concludes:

“Other African countries have similar ambitions. Ghana has also identified BPO as a pillar of future development. It wants to create 40,000 jobs by 2015, with a longer-term goal of earning $1 billion a year from the industry. It, too, is talking of technology parks across the country. But as in Kenya, many Ghanaians complain that their government’s technocratic talk is not matched by action. If BPO does blossom in Africa, there could be many positive repercussions. Call centres could train lots of managers, who could then apply their experience to other industries. In this way, say boosters, call centres could serve as incubators of local business talent—provided, of course, that the power stays on.”

Although it is good to read positive stories about African nations, an underlying, if unstated, issue that runs through all of them is the need for good governance. For more on that subject, read my post entitled Leadership and Good Governance in Africa. With more and more countries looking for opportunities in Africa, it appears that the first glimpses of dawn are starting to appear on the Dark Continent’s horizon.