Africa’s en­tre­pre­neur­ial dilemma

Lesotho Times - - Opinion - Wil­liam G Mose­ley lwilliam G Mose­ley is pro­fes­sor of ge­og­ra­phy and African stud­ies at Ma­calester Col­lege in Saint Paul, Min­nesota.

UNITED States Pres­i­dent Barack Obama’s re­cent trip to Kenya and Ethiopia fea­tured an ap­pear­ance at the 6th Global Entrepreneurship Sum­mit, the first of such meet­ings to be held in sub-sa­ha­ran Africa.

This event was meant to shine a spotlight on Africa as a grow­ing cen­tre of in­no­va­tion .

While entrepreneurship is in­creas­ingly framed as a ve­hi­cle for poverty alle­vi­a­tion and de­vel­op­ment, it is not the path to pros­per­ity its pro­po­nents claim it to be.

Mr Obama pushed entrepreneurship to the top of the US’ en­gage­ment agenda dur­ing a his­toric speech to the Mus­lim World in Cairo in 2009.

The con­se­quence has been an ex­cep­tion­ally busi­ness-ori­ented US for­eign as­sis­tance ap­proach in the African con­text.

The en­tire gam­bit of for­eign as­sis­tance pro­grammes, from agri­cul­ture to healthcare, is in­creas­ingly framed in en­tre­pre­neur­ial lan­guage.

US com­pa­nies are now also seen as de­vel­op­ment part­ners who work in tan­dem with US in­ter­na­tional de­vel­op­ment pro­grammes to, for ex­am­ple, com­mer­cialise African agri­cul­ture.

The irony is that Mr Obama’s em­brace of the busi­ness com­mu­nity on the do­mes­tic front is much more cau­tious and nu­anced.

The im­ages of African de­vel­op­ment have also shifted in tan­dem with the evolv­ing for­eign as­sis­tance ethos, from farm­ers work­ing in fields to youth gath­ered around com­put­ers, or busi­ness peo­ple in smart suits.

Help­ing the elites While the change may seem sub­tle, it is sig­nif­i­cant be­cause the fo­cus has tran­si­tioned from the ru­ral poor and marginalised in African so­ci­eties to priv­i­leged, well-ed­u­cated ur­ban­ites.

While I ap­pre­ci­ate de­pic­tions of Africans as smart, ur­bane technophiles — be­cause it disrupts the tra­di­tional and tired poverty nar­ra­tive - I am also con­cerned that out­siders are deep­en­ing di­vides in African so­ci­eties by aid­ing those who least need as­sis­tance.

Ethiopia is a clas­sic case of an African coun­try that’s “open for busi­ness”. It has ex­pe­ri­enced a phe­nom­e­nal growth rate in re­cent years and been re­ferred to as an African lion, a corol­lary to Asia’s eco­nomic tigers.

The prob­lem is that out­siders largely deal with elites in the coun­try, lead­ing to, for ex­am­ple, com­mer­cial agri­cul­tural projects and land grabs that marginalise the poor .

It is as if trickle-down eco­nom­ics, made fa­mous by for­mer US Pres­i­dent Ron­ald Rea­gan in the 1980s, has made its way into the de­vel­op­ment arena.

The im­pli­ca­tion is that the poor are be­yond hope and, as such, our best shot at de­vel­op­ing African economies is to help those who are al­ready priv­i­leged.

Trickle-down growth? The de­vel­op­ment tar­get du jour is now the en­tre­pre­neur who will in­vest wisely, cre­ate jobs, and lift all African peo­ple.

I’m not buy­ing it. Trickle-down eco­nom­ics laid the foun­da­tion for a grow­ing eco­nomic di­vide in the Amer­i­can econ­omy, and I doubt it will fare any bet­ter in the African con­text.

Africans are some of the most en­tre­pre­neur­ial peo­ple I know. Go to any African mar­ket and you’ll re­alise that lo­cal mer­chants have their trade down to a science.

While it is true that lack of ac­cess to credit and in­vest­ment cap­i­tal are lim­i­ta­tions on the African en­tre­pre­neur­ial spirit, I am con­fi­dent that the pri­vate sec­tor will fill this void.

What I am less con­fi­dent about, as a long time scholar of African de­vel­op­ment, is that the ba­sic fun­da­men­tals are in place for en­vi­ron­men­tally and so­cially sus­tain­able de­vel­op­ment.

These foun­da­tional con­cepts in­clude peace and sta­bil­ity, sound gov­er­nance and rule of law, as well as eq­ui­table ac­cess to ba­sic healthcare and ed­u­ca­tion.

It is as if we have given up on these very chal­leng­ing, yet ba­sic, fun­da­men­tals of de­vel­op­ment in favour of the de­cep­tively low hang­ing fruit of glitzy, in­di­vid­u­al­is­tic en­trepreneuri­al­ism.

What good is a lively, in­no­va­tive mar­ket­place if a weak state can­not guar­an­tee the safety of its peo­ple or gov­ern in a fair and pre­dictable fash­ion?

Im­pacts of in­vest­ment Fur­ther­more, the de­vel­op­men­tal im­pacts of in­vest­ment and en­tre­pre­neur­ial ac­tiv­ity will al­ways be lim­ited if only a small seg­ment of the pop­u­la­tion has suf­fi­cient ed­u­ca­tion, skills and train­ing.

Mi­cro­cre­dit, for ex­am­ple, has been her­alded as a tool al­low­ing women and other marginalised groups to ac­cess loans to de­velop new busi­nesses and in­come flows.

While this ap­proach works well for mid­dle-in­come Africans who have the mar­gin of wealth nec­es­sary to take on fi­nan­cial risks, and the know-how to cap­i­talise on new tech­nol­ogy, it rarely works for the truly poor.

In fact, the poor­est re­cip­i­ents of these loans of­ten en­dure great hard­ship to sim­ply pay them back, yet see no mea­sur­able im­prove­ment in their eco­nomic sit­u­a­tion.

African lead­ers, jour­nal­ists, and public in­tel­lec­tu­als will be do­ing their peo­ple a con­sid­er­able ser­vice if they crit­i­cally and cau­tiously parse the latest de­vel­op­ment craze fo­cused on en­trepreneuri­al­ism.

By sim­ply look­ing at the US history they will learn that much of the suc­cess of the pri­vate sec­tor has been but­tressed by con­sid­er­able public in­vest­ment in ed­u­ca­tion, re­search, and in­fra­struc­ture.

The idea that the US was solely built by rugged, en­tre­pre­neur­ial in­di­vid­u­als is a myth. Obama him­self has ad­mit­ted this, and was se­verely cri­tiqued by Repub­li­cans for it in 2012, when he ar­gued that in­di­vid­ual suc­cess is a prod­uct of the ef­forts of many .

I whole heartily agree with Obama’s 2012 as­sess­ment of the re­la­tion­ship be­tween in­di­vid­ual suc­cess and public in­vest­ment.

Now, I would like to see a bit more of this col­lec­tive ethos re­flected in US for­eign as­sis­tance pol­icy to Africa.

US Pres­i­dent Barack Obama has pushed entrepreneurship to the top of the US’ global en­gage­ment agenda.

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