Democracy

Autocracy and Democracy in Africa: China’s Influence

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This article first appeared in my weekly column in the Business Daily on December 10, 2017

I’ve been thinking about China’s growing influence in Africa, and whether it is linked to growing autocracy on the continent, especially the East Africa region. However, it is not China alone that seems to be informing a move towards authoritarianism in the region. When Africa is given examples of countries that managed to catch up economically, the Asian bloc is often presented as the case study. Look at Singapore, Vietnam, China, Malaysia, Japan and South Korea, we’re told, they all managed to pull millions of out poverty and substantially improve the quality of life of their citizens in a relatively short period of time. What is not mentioned is that, for the most part, these countries were developed or are still developing under an autocratic state-led capitalism model where government drives and leads the articulation of capitalism and, to a greater or lesser extent, monitors and guides its evolution.

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(source: www4.pictures.zimbio.com/gi/Beijing+Municipal+Congress+Communist+Party+AYzoNUVRU8Al.jpg)

Africa is also not told that even Europe and North America made significant economic gains using models that were not democratic. The USA relied on the slave trade and slave labour to build wealth that was then used to drive industrialisation. Much of Europe relied not only on financial involvement in the slave trade to amass wealth, but also colonialism which played an important role in providing colonial powers with land and labour that generated immense profits that were then repatriated to European metropoles.  So some are asking: Why is Africa being told that the continent must develop under a democracy when so many others haven’t? And is this the most efficient path towards economic development?

In East Africa, we can see a move towards autocracy; indeed it can be argued that Kenya is the only viable democracy left. Ethiopia and Rwanda have made no secret of the fact that they are essentially autocratic states. Uganda has been under the hand of Museveni for well over 30 years and in Burundi President Nkurunziza seems bent on retaining control and extending his autocratic rule beyond constitutional provisions. In Tanzania, signs of autocracy are emerging given that the chief whip of the opposition party was shot, and President Magafuli shut down several newspapers.

China has been making aggressive inroads in Africa with mega project deals. FILE PHOTO | NMG

(source: http://www.businessdailyafrica.com/image/view/-/4222430/medRes/1832547/-/maxw/960/-/g7bbas/-/china.jpg)

Beyond philosophical questions as to why there seems to be growing autocracy in the region, international dynamics are also playing a role, specifically growing insularity in Europe and North America. The Trump Administration hasn’t even bothered to table a strategy for Africa and Europe seems preoccupied with Brexit, anti-immigration sentiment, and calls to use European money on Europe rather than on ‘others’. As a result, the voice from the global north that lectures Africa on the merits of democracy is receding and the power vacuum is intensifying the influence of autocratic China in Africa. Indeed, the autocracy that is emerging in Africa seems to be modelled more against the technocratic autocracies of Asia rather than the old African autocratic model exemplified by leaders such as Idi Amin, Mobutu, Mengistu and more recently, Mugabe.

It seems it is time for Africa to ask itself some tough questions: Should growing autocracy be encouraged? And if so, what will it cost Africans in terms of freedom of expression, human rights and political freedom? Or is democracy, despite all its problems, still the best way forward for the continent?

Anzetse Were is a development economist; anzetsew@gmail.com

TV Panel feature on the cost of living in Kenya

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On May 11, 2017 I was interviewed on cost of living issues in Kenya.

The effect of politics on the economy

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This article first appeared in my weekly column with the Business Daily on January 31, 2016


Politics in Kenya has a ripple effect on the economy. Due the post-election violence that followed 2007 election, the country’s GDP growth fell from a high of 7 per cent to a low of 3 percent. Earnings from tourism halved and according to The Economist, post-election violence led to financial losses in economy of approximately £145 million, around 1% of Kenya’s GDP. Further, studies estimate the post-election violence had long term effects and over the period 2007-2011 per capita GDP was reduced by an average of 86 USD per year, which is massive considering Kenya’s per capita averaged about $980 over that period. Another study suggests that in 2009, per capita GDP in the Kenya was estimated to be about 6 percent lower than if the instability had not happened in the first place.

(source: https://nothingbutmyemotions.files.wordpress.com/2013/02/kenya-pev.jpg)

The World Bank is of the view that political risks to economic growth are ranked equally to growth risks posed by shocks in the global economy such as the debt crisis in the European markets. So what happens in Kenya’s political arena has economic consequences. And the effects are not only related to GDP growth, other economic effects result from politics. The Eurobond debacle that started last year where government was accused of the mismanagement of the proceeds from the Eurobond is bound to make financing for the government more expensive. Yes there are other factors at work such as the recovery of the US economy which will make financing more expensive in general, but it would naïve to assume that the politicization of the Eurobond issue has not negatively affected perceptions of the credit worthiness of the government.

When one has a young economy juxtaposed with a young democracy, there are bound to have a relationship where activity in one affects the other. More mature economies tend to be more resilient to political instability and if politics does have effect it will tend to be more closely associated with changes in policy of economic import. In fact an analyst interviewed on Bloomberg stated that in the USA, the impact of politics on the economy, except when people really mess up, is overrated. This is partly due to the fact, that as studies have shown, economic institutions such as property rights, regulatory institutions, institutions for macroeconomic stabilization, institutions for social insurance, institutions for conflict management are more mature in older economies and these are major sources of economic growth across countries. A young economy has less mature economic institutions with practitioners still figuring out what institutions, regulations, rules, practices and standards can best bolster growth.

(source: http://www.dolfinwise.com.au/wordpress/wp-content/uploads/2013/06/Volatility-in-financial-markets-450×300.jpg)

In terms of democracy and politics, more mature democracies have a longer tradition of arbitration between political parties; they also tend to be defined by ideology which makes economic policy expectations more predictable. Compare this with Kenya which has a culture of personality and tribe driven politics where there is no clear idea of the economic ideology of political parties until that party comes into power. In addition, in Kenya it has often been informally observed that the tribes that constitute a certain political administration may have members that engage in opportunistic behaviour that favour their tribes while ostracizing others; there is bound to be economic fallout from such habits.

The effect on politics on economics is not unique to Kenya however; a study by the Brookings Institution found that political institutions matter greatly for incipient or young democracies, not for consolidated or mature democracies. Why? Well mature democracies have already internalized the effect of political institutions whereas new democracies need the felt presence of political institutions as part of the democratic experience. As a consequence, the impact of politics on economic performance is more visible. With this in mind, it is important that both government and opposition appreciate the import of their role and influence over the economic trajectory of the country.

Anzetse Were is a development economist; anzetsew@gmail.com