Rwanda, 20 Years On

Caution: This is not an apology for President Kagame and his autocratic tendencies that have resulted in carnage and death in the DRC, Rwanda and elsewhere.

At a conference last year a US State Department official told a group of us that Rwanda was so polarizing that even at the Consulate in Nairobi the DRC crowd did not get along well with the Rwanda crowd.

It is not surprising why that might have been the case, or why the present analysis on the commemoration of the 20th anniversary of the 1994 genocide remains polarized.

rwandainfantmort

If one just looks at the improvements made in advancing human welfare since President Paul Kagame and the RPF took power (see graph, data from the World Bank) it is hard not to arrive at the conclusion that ordinary Rwandese are unambiguously better off. The country is the least corrupt in the region and has also been consistently ranked top in the ease of doing business. But there is also the side of the Kigali government that most reasonable people love to hate: the murderous meddling in the DRC and the oppression and occasional murder of dissidents at home and abroad. Those who admire what President Kagame has done tend to emphasize the former, while his critics tend to emphasize his autocratic tendencies which have made Rwanda the least democratic country in East Africa (see below, data from Polity). Many wonder if the post-1994 achievements are sustainable enough to outlast President Kagame’s rule.

So is Mr. Kagame a state-builder or your run of the mill autocrat whose achievements will vanish as soon as he relinquishes power?

ImageIn my view, I think that Rwanda is the best success story of state-building in Africa in the last 20 years. I also think that this (state-building) should be the paramount consideration for those who care about the Rwandese people and want to help them achieve greater freedoms. The fundamental problem in states like CAR, Sierra Leone or Liberia has never been the insufficiency of democracy. Rather, it has been the problem of statelessness. The contrast between Rwanda and Burundi is instructive (see both graphs, the two are neighbors with similar ethno-political histories. Rwanda has historically had a stronger state, though. See here and here). Despite the latter being the second most democratic state in the region, it has consistently performed the worst on nearly all human development indicators. Part of the reason for this is that Burundi remains a classic papier mache state confined to Bujumbura and its environs.

May be I am too risk averse. But I am scared stiff of anything that could lead to a recurrence of the horrors of the early 1990s stretching from the Mano River region to the Horn. As a result I am always skeptical of activism that takes state capacity (including coercive capacity) for granted.

With this in mind, the fight against autocratic rule in Rwanda should not come at the expense of the state-building achievements of the last 20 years. The international community and those who genuinely care about Rwandese people should be careful not to turn Rwanda into “democratic” Burundi in the name of democracy promotion. Interventions will have to be smart enough to push President Kagame and the ruling elite in the right direction, but without gutting the foundations of political order in Rwanda.

Absent a strong state (even after Kagame), the security dilemmas that occasioned the 1994 “problem from hell” would ineluctably resurface.

Lastly, I think the level of discourse in the “Rwanda Debate” could be enhanced by the extension of the privilege of nuance to the case. For example, if all we focused on were drones killing entire families at weddings in Yemen or the horror that is the South Side of Chicago we would probably get mad enough to ask for regime change in Washington. But we don’t. Because people tolerate the “complications and nuance of American politics.” The same applies to less developed countries. Politics is complicated, everywhere. And those who approach it with priors of good-or-bad dichotomies are bound to arrive at the wrong conclusions. One need not be a Kagame apologist to realize the need for a delicate balance in attempts to effect political change in Kigali.

Before you hit the comment button, notice that this is neither an apology nor an endorsement of autocracy in Rwanda. It is a word of caution regarding the choices outsiders make to accelerate political change in Rwanda.

Tyranny is not the panacea to underdevelopment. But neither is stateless democracy.

For background reading on the 1994 genocide in Rwanda see Samantha Power’s Problems From Hell; Mahmood Mamdani’s When Victims Become Killers; and Philip Gourevitch’s We Wish to Inform You That Tomorrow We Will be Killed With Our Families.

Understanding Uganda’s Military Adventurism Under Museveni

On January 15th 2014 President Yoweri Museveni finally admitted that Uganda People’s Defence Force troops are engaging in combat operations within South Sudan. Right after the political fallout in Juba and escalation of hostilities between forces loyal to President Salva Kiir and those behind his former deputy Riek Machar, Mr. Museveni threatened Machar with military action if he did not come to the table to negotiate with Kiir. Museveni’s military involvement in the conflict has caused concern in Nairobi and other capitals in the region. For one, Uganda’s military intervention in the conflict may yet jeopardize the ceasefire agreement that was signed on January 23, 2014 in Addis Ababa. The regional body IGAD (Intergovernmental Authority on Development) is supposed to be a neutral arbiter and monitor in the conflict. Museveni’s clear leanings towards the government in Juba may bring to question IGAD’s neutrality in the mediation effort.

For historical reasons (see below) Khartoum fears Kampala’s military involvement in South Sudan. But this time the situation is slightly different, and a little more complex. Bashir has already shown his hand in support of Juba against Machar, possibly for two reasons: (i) Khartoum needs Juba’s help in weakening the rebellion by the rump SPLA (SPLA-North) that is still active in Blue Nile and South Kordofan, regions that border South Sudan; and (ii) Bashir needs to keep the oil flowing in order to ward off internal turmoil within Sudan due to rapidly deteriorating economic conditions (see here). Kiir’s willingness to throw SPLA-N under the bus comes as no surprise since it is an offshoot of the “Garang Boys” (mostly PhDs) who occupied a special place, unlike Kiir and others, in John Garang’s SPLA. SPLM-N’s leader Malik Aggar, shared Garang’s vision of one united reformed Sudan, as opposed to secession by the South. At the same time, however, Khartoum does not want a super strong South Sudan free of rebels. Total cessation of conflict in South Sudan would rob Khartoum of proxies to keep Juba in check. Uganda’s involvement could tip the balance in Juba’s favor vis-à-vis potential Bashir allies.

Meanwhile in Nairobi and Addis Ababa concern is growing over Uganda’s claim that the IGAD should foot the bill of UPDF’s adventures in South Sudan. Both Ethiopia and Kenya prefer settling the conflict at the negotiating table, partly because both have their security forces stretched by domestic armed groups and bandits and the war in Somalia. Kenya has said categorically that it will not send troops to South Sudan, even under IGAD. The wariness in Nairobi and Addis to send troops or cash for a military cause in South Sudan contrasts sharply with Kampala’s choice of military action from the moment the current flare up started in Juba. This despite the fact that Uganda also has troops serving in Somalia.

Which raises the question: What explains Uganda’s international military adventurism under Museveni? The answer lies in the confluence of history, international geopolitics, and Uganda’s internal politics.

Uganda is one of the more militarized states in Africa, with the military having direct representation in parliament (10 seats). It is also interventionist, with a history of combat engagement and support for rebel groups in six neighboring states – Burundi, the Central African Republic (CAR), the Democratic Republic of Congo (DRC), Rwanda, Somalia, and South Sudan. More recently, the nation has been a key advocate for greater integration within the East African Community (EAC). Indeed, Ugandan President Yoweri Museveni fancies himself as a possible head of an EAC political federation should it ever materialize. Uganda is also a key player in the African Capacity for Immediate Response to Crises (ACIRC), a proposed standby force with capacity to rapidly deploy troops to trouble spots in Africa (other key supporters include South Africa, Chad, and Tanzania).

Museveni and his kagogo (little) soldiers

Museveni and his kadogo (little) soldiers

President Yoweri Museveni’s military adventurism and internationalist outlook have deep roots. As a young student in Tanzania, Museveni was involved in exile organizations opposed to Iddi Amin. Indeed, Museveni’s National Resistance Army (NRA), started off as the Popular Resistance Army (PRA) in Tanzania (As testament to its Tanzanian roots, NRA borrowed the idea of political commissars from the Tanzanian military to educate civilians in “liberated” Luweero Triangle). In Tanzania and even after returning to Uganda Museveni made regional connections that he maintained even after he ascended to power in 1986 – including Rwanda’s Paul Kagame, Sudan’s John Garang’, and leaders of Mozambique’s FRELIMO. Before rebelling against Kigali, Kagame was Museveni’s Chief of Military Intelligence. Museveni supported Garang’s Sudan People’s Liberation Army (SPLA).

Once in power, Museveni styled himself as the guarantor of peace and stability in Uganda. Many (both at home and abroad) evaluated his performance relative to the disastrous years under Amin and the ensuing civil war. The resulting peace dividend (albeit restricted to the south of the country) was marked by relative macro-economic stability, with growth averaging about 6% for much of the 1990s. This made Museveni a darling of Western donors and international financial institutions. However, Museveni’s record with regard to democracy and human rights remained dubious. This put him in awkward position vis-à-vis the West, especially since the 1990s was the zenith of Western promotion of liberal democracy.

To this Museveni reacted cleverly, and worked hard to position Uganda as a strategic player in the wider region’s geopolitics. In order to maintain his international stature and secure his position domestically, Museveni labored to bolster Uganda’s relevance to the West.

Museveni enters Kampala (Source)

Museveni enters Kampala (Source)

Beginning in the early 1990s, Uganda got militarily involved in a number of neighboring states. Support for Garang’s SPLA drew the ire of Khartoum, which in turn supported the Lord’s Resistance Army (LRA) in northern Uganda. Subsequently, the Ugandan military conducted raids against LRA bases in Sudan while also offering combat assistance to the SPLA. For instance, the 1997 battle at Yei featured Ugandan soldiers alongside the SPLA against the Sudan Armed Forces (SAF). It is around this time that the seed was planted for future military involvement abroad at the turn of the century (this time in Somalia under the Western-funded AU mission, AMISOM, to help stabilize the country). After US President Bill Clinton designated Sudan as a state sponsor of terror, Uganda positioned itself as an ally in the frontline of “Global War on Terror.” Kampala served as an intermediary for US aid to SPLA, thereby further strengthening US-Uganda military ties. It is telling that in 2003 Uganda was among only a handful of African states that supported the US-led Iraq War. About 20,000 Ugandans worked in US military bases in Iraq (this was also an excellent job creation tool; and a way of earning Forex).

So far Uganda’s most complex military adventure was in the Democratic Republic of Congo (DRC). A mix of strategic geopolitical positioning, the need to secure markets for Ugandan goods, private greed and domestic politics drove Uganda’s invasion of the DRC. The first Congo War (1996-97) was swift, aimed at helping Laurent Kabila oust Mobutu Seseseko (Rwanda and Angola also helped). Soon after Uganda and Rwanda fell out with Kabila, occasioning the Second Congo war (1998-2003), which involved four other African states. It is then that the façade of intervention for regional stability completely broke down. Ugandan and Rwandan commanders exploited existing and new cross-border smuggling and semi-legitimate trade networks to orchestrate massive pillaging of natural resources in eastern DRC (Competition between the two militaries later intensified, resulting in the “Kisangani Wars.”)

For instance, in the year 2000 despite only producing 0.00441 tonnes of gold, Uganda exported 11 tonnes. A UN report indicates that well-connected generals (including Museveni’s half-brother) created entities headquartered in Kampala to facilitate the illicit trade. It’s important to note that Museveni’s tolerance of the semi-autonomous activities by his generals was strategic (it generated revenue through Kampala-based entities and kept the generals happy) and did not lead to fracturing within the military. Indeed, many of those involved were later promoted.

Museveni meets Somali President, Shayk Sharif Ahmed in Mogadishu in 2010

 

Incidentally, the present involvement in South Sudan also reflects the multifaceted logic of Ugandan international military adventurism. Historical alliances with the SPLA against the LRA and SAF make Kampala and Juba natural bedfellows. But the intervention is also about securing markets for Ugandan goods. According to figures from the Bank of Uganda, in 2012 the country’s exports to South Sudan totaled an estimated USD 1.3 billion. About 150,000 Ugandan traders operate across the border, not to mention countless more primary producers in agriculture who benefit from cross-border trade with their northern neighbor.

The above account explains Museveni’s efforts in the recent past to build an image as the regional powerbroker: heading peace talks between the DRC, Rwanda and eastern DRC rebels; intervening in Somalia to prop up the government in Mogadishu; and in the latest episode siding militarily with President Salva Kiir in South Sudan’s domestic political cum military conflict. Domestically, Museveni’s grip on power is as strong as ever. Recent reshuffles in the military removed powerful Historicals (the original “bush war heroes”) thereby leaving Museveni (and his son) firmly in control of Uganda’s armed forces. There is no end in sight for Uganda’s international military adventurism.

In many ways Uganda’s international adventurism has been a case of agency in tight corners. The country is a landlocked; has neighbors with sparsely governed borderlands that provide rear-bases for Ugandan armed groups; and Kampala needs Western aid to maintain the regime, a situation that necessitates acts of geopolitical positioning – especially with regard to the “Global War on Terror” and maintenance of regional peace and stability. Furthermore, oil discovery along the conflict-prone DRC border on Lake Albert and the need for pipelines to the sea to export Ugandan oil will necessitate even greater regional involvement. So while Uganda’s present outward adventurism is primarily because of Museveni’s peculiar personal history, it is correct to say that even after Museveni (still far into the future) the country will continue to be forced to look beyond its borders for economic opportunities, security, and regional stature.

Making sense of the Kenyan government’s reaction to UNSC vote on ICC deferral

The UN Security Council has rejected Kenya’s (and the African Union’s) request for a one year deferral of the case against President Uhuru Kenyatta and his deputy at the Hague. The two stand accused of crimes against humanity committed following the disputed elections in 2007. More than 1300 people died, and hundreds of thousands were displaced.

The US, UK, France, Australia, Guatemala, Luxembourg, South Korea and Argentina abstained to stop the deferral request. China, Russia, Togo, Morocco, Pakistan, Azerbaijan and Rwanda voted for a deferral. African leaders have in the last two years been on an ill-advised crusade against the ICC, terming it as a “race hunting” tool of “declining” Western powers.

Kenyatta and Ruto are innocent until proven otherwise, but their attempts to make their personal cases at the ICC a regional struggle of Africans against imagined neo-colonialists bent on usurping African sovereignty is a little misguided. The Kenyan case is different (Kenya is not Sudan or the DRC) and ought to have attracted special consideration from the court (see closing remarks below). However, despite its faults the ICC is all the continent has in the quest to hold its leaders accountable. I reiterate, murderous dictators in Africa and elsewhere should never be allowed to have internal affairs.

Here is the government’s total freak out response following the UNSC vote, with some comments from yours truly.

STATEMENT FROM THE FOREIGN AFFAIRS MINISTRY IN KENYA

Kenya takes note of the outcome of the United Nations Security Council meeting on peace and security in Africa, and specifically on the subject of the request for deferral of the Kenya ICC cases. Kenya wishes to thank China and Azerbaijan who, during their stewardship of the Security Council, have been professional and sensitive to the African Union agenda.

Wow, this is how bad things have become. That Kenya finds friends in states like Azerbaijan. Yes, this is the place in which the president recently announced the election results even before the polls opened. These are our new committed friends. We are going places. 

Kenya wishes to thank the seven members of the Security Council who voted for a deferral and is particularly grateful to Rwanda, Togo and Morocco – the three African members on the Security Council – for their exemplary leadership.

Again, the only country we should be associated with on this list is perhaps Rwanda. I wish we could do what they have done with their streets, and corruption, and ease of doing business. But by all means we should not borrow their human rights record. Oh, and please let’s stay away from their variety of democracy.

This result was not unexpected considering that consistently some of the members of the Security Council, who hold veto powers, had shown contempt for the African position. The same members and five others chose to abstain, showing clear cowardice in the face of a critical African matter, and a lack of appreciation of peace and security issues they purport to advocate.

Letting the trial go on does not threaten peace and stability in Kenya. This is an empty argument. There will not be any spontaneous violence. Furthermore, the president is not the operational commander of the KDF. He is the Commander in Chief. He gets to issue orders from some room somewhere. Orders can be issued from anywhere. And remind me again how this trial impacts security ALL OVER AFRICA, other than by raising the cost of genocidal activities by African presidents?

Oh, and did I mention that the African Union Mission in Somalia (AMISOM) is almost entirely paid for by the European Union?

Inevitably, it must be appreciated that the outcome of this vote demonstrates that the Security Council does not serve the interests of a majority of its members and is clearly in need of urgent reform. It cannot be that a few countries take decisions that go against reason and wisdom in a matter so important to nearly one billion Africans.

One billion Africans. Really? I had no idea our president was this important of a man. One billion Africans. Many of whom starve to death; or die of treatable illnesses; or never make it to their first or fifth birthday because their leaders steal all the money meant for medicine. These Africans? Why should their names be invoked to protect the same leaders that have confined them to degrading penury for the last half century? Why, I ask? 

Also, the claim that Africa is united against the ICC is false. We all know about the divisions that stalled the silly idea of a mass walkout from the ICC by African states.

The African Union, in one voice, took the unprecedented step of making a simple request to the Security Council, bearing in mind the security and stability it seeks to achieve on the continent. But the Security Council has failed to do this and humiliated the continent and its leadership.

Ahh. Now the truth comes out. It is not about the one billion Africans after all. This is about the humiliation of the African leadership. It is about protecting the sovereignty of a few inept rulers. Forget the one billion Africans. It is about their big men rulers who steal tax money and stash it away in bank accounts in the same Western countries they like to call names.

The Security Council has failed the African continent, which will have to make its own judgment in the coming days and weeks about how it wishes to engage with the Security Council, which obviously does not believe the voices of more than one quarter of its members is significant enough to warrant its serious and purposive attention.

The security council has failed African leaders. Not the African people en masse. Africans want to have elections without having to worry that voting one way or the other will result in their houses being torched or their mothers, sisters and brothers murdered or raped. They also want freedom from ignorance, disease and material want. Is that too much to ask?

The African Union’s request to the Security Council included its key resolutions at the Special Summit on the ICC. The important one for the Security Council to note was the one that categorically says that no sitting Heads of State or Government may appear before the ICC. Kenya regrets failure of important members of the UN Security Council to have due consideration of Kenya’s critical role in stabilizing the Horn of Africa and the Great Lakes regions, and their reckless abdication of global leadership.

Wait, are these important global leaders in the UNSC the same ones President Kenyatta termed as “declining powers”? What makes them important now? 

Just for the record, I am part of the 67% of Kenyans who in a recent poll were in favor of the president attending court at the Hague. Having both the president and his deputy on trial will serve a great symbolic task of demystifying the Kenyan political leadership. The demonstration effect to all politicians, voters and criminal gangs alike will be clear: You cannot kill innocent civilians and get away with it.

In my view, the best case scenario is having both men attend trial and then get a not guilty verdict.

Kenyans are nowhere near ready to discuss frankly what happened in 2007-08 or the deeper issues of ethnicity and economic disparities that often mirror ethnic lines and how to deal with these issues at the national level. A forced conversation, especially one that has a foreign touch in the form of a court verdict, may result in unpleasant consequences. This would be a less than ideal outcome, but one that would not necessarily be catastrophic for the country. The constitution is clear on succession should either one or both leaders be found guilty and jailed.

How Eastern Africa can avoid the resource curse

This post originally appeared on the African Development Bank’s Integrating Africa Blog, where yours truly is a regular contributor. 

Eastern Africa is the new fossil fuel frontier (for more check out this (pdf) Deloitte report). In the last few years Kenya, Uganda, Tanzania and Mozambique have discovered large quantities of commercially viable oil and gas deposits, with the potential for even more discoveries as more aggressive prospecting continues. There is reason to be upbeat about the region’s economic prospects over the next three decades, or at least before the oil runs out. But the optimism must be tempered by an acknowledgement of the dangers that come with the newfound resource wealth. Of particular concern are issues of governance and sound economic management.

We are all too aware of the dangers of the resource curse. This is when the discovery and exploitation of natural resources leads to a deterioration of governance, descent into autocracy and a fall in living standards. Associated with the resource curse is the problem of the Dutch disease, which occurs when natural resource exports (e.g. oil and gas) lead to an appreciation of the exchange rate, thereby hurting other export sectors and destroying the ability of a country to diversify its export basket. The new resource-rich Eastern African states face the risk of having both problems, and to avoid them they must cooperate.

In many ways Eastern African states are lucky to be late arrivals at the oil and gas game. Unlike their counterparts in Western and Central Africa, nearly all of them are now nominal electoral democracies with varying degrees of institutionalized systems to ensure transparency in the management of public resources. Across the region, the Big Man syndrome is on the decline. But challenges remain. Recent accusations of secrecy, corruption and bribery surrounding government deals with mining companies suggest that there is a lot of room for improvement as far as the strengthening of institutions that enforce transparency (such as parliaments) is concerned. It is on this front that there is opportunity for regional cooperation to improve transparency and resource management.

While it is easy for governments to ignore weak domestic oversight institutions and civil society organizations, it is much harder to renege on international agreements and treaties. A regional approach to setting standards of transparency and accountability could therefore help ensure that the ongoing oil and gas bonanza does not give way to sorrow and regret three decades down the road. In addition, such an approach would facilitate easier cross-border operations for the oil majors that are currently operational in multiple countries, not to mention drastically reduce the political risk of entering the region’s energy sector. It would also leave individual countries in a stronger bargaining position by limiting opportunities for multinational firms to engage in cross-border regulatory arbitrage.

The way to implement regional cooperation and oversight would be something akin to the African Peer Review Mechanism, but with a permanent regional body and secretariat (perhaps under the East African Community, EAC). Such a body would be mandated to ensure the harmonization of laws to meet global standards of transparency and protection of private property rights. The body would also be mandated to conduct audits of national governments’ use of revenue from resources. The aim of the effort would be to normalize best practices among states and to institute a global standard for states to aspire more – more like the way aspirations for membership in the European Union has been a catalyst for domestic reforms in the former Yugoslavia and Eastern Europe.

Regional cooperation would also provide political cover to politicians with regard to economically questionable fuel subsidies. The realities of democratic government are such that politicians often find themselves forced to concede to demands for fuel subsidies from voters. But history shows that more often that not subsidies come at an enormous cost to the economy and instead of benefitting the poor only benefit middlemen. In addition, as the case of Nigeria shows, once implemented such policies are never easy to roll back both due to politics and the power of entrenched interests. Regional agreements capping any fuel subsidies at reasonable levels would be an excellent way to tie politicians’ hands in a credible manner, while at the same time providing them with political cover against domestic criticism.

Beyond issues of governance, there is need for cooperation on regional infrastructure development in order to reap maximum value for investment and avoid unnecessary wastes and redundancies. Landlocked Uganda and South Sudan will require massive investments in infrastructure to be able to access global energy markets. The two countries’ oil fields are 1,300 km and 1,720 km from the sea through Kenya, respectively. One would hope that as these projects are being studied and implemented, there will be consideration for how to leverage the oil and gas inspired projects to cater to other exports sectors – such as agriculture, tourism and light manufacturing – as well. KPMG, the professional services firm, recently reported that transportation costs eat up as much as 20 per cent of Africa’s foreign exchange earnings.  There is clearly a need to ensure that the planned new roads and railways serve to reduce the cost of exports for all outward oriented sectors in the region. Embedding other exports sectors (such as agriculture, timber, domestic transport, etc.) in the process of developing new transportation infrastructure will minimize the likelihood of their being completely crowded out by the energy sector.

In isolation, each country’s resource sector policy is currently informed by domestic political economy considerations and regional geo-politics. There is an emerging sense of securitization of resources, with each country trying to ensure that the exploitation of its resources does not depend too much on its neighbours. Because of the relatively small size of the different countries’ economies, the risk of ending up with economically inefficient but expensive pipelines, roads and railways is real. South Sudan is currently deciding whether to build a pipeline through Kenya (most likely), through Ethiopia, or stick with the current export route for its oil through Sudan (least preferred due to testy relations). For national security and sovereignty reasons, Uganda is planning on a 30,000-barrel per day refinery in Hoima, despite warnings from industry players that the refinery may not be viable in the long run. Some have argued for the expansion of East Africa’s sole refinery in Mombasa to capture gains from economies of scale, an option that Uganda feels puts its energy security too much in Kenya’s hands.

In the meantime, Kenya and Tanzania are locked in competition over who will emerge as the “gateway to Eastern Africa,” with plans to construct mega-ports in Lamu and Tanga (Mwambani), respectively. While competition is healthy and therefore welcome, this is an area where there is more need for coordination than there is for competition among Eastern African governments. The costs involved are enormous, hence the need for cooperation to avoid any unnecessary redundancies and ensure that the ports realize sufficient returns to justify the investment. Kenya’s planned Lamu Port South Susan Ethiopia Transport Corridor (LAPSSET) project will cost US $24.7 billion. Tanzania’s Mwambani Port and Railway Corridor (Mwaporc) project will cost US $32 billion.

Chapter 15 of the EAC treaty has specific mandates for cooperation in infrastructure development. As far as transport infrastructure goes, so far cooperation has mostly been around Articles 90 (Roads), 91 (Railways) and 92 (Civil Aviation and Air Transport). There is a need to deepen cooperation in the implementation of Article 93 (Maritime Transport and Ports) that, among other things, mandates the establishment of a common regional maritime transport policy and a “harmonious traffic organization system for the optimal use of maritime transport services.”

The contribution of inefficient ports to transportation costs in the regional cannot be ignored. Presently, the EAC’s surface transportation costs, associated with logistics, are the highest of any region in the world. According to the African Development Bank’s State of Infrastructure in East Africa report, these costs are mainly due to administrative and customs delays at ports and delays at borders and on roads. Regional cooperation can help accelerate the process of reforming EAC’s ports, a process that so far has been stifled (at least in Kenya) by domestic political constituencies opposed to the liberalization of the management of ports. The move by the East African Legislative Assembly to pass bills establishing one-stop border posts (OSBPs) and harmonized maximum vehicle loads regulations is therefore a step in the right direction.

Going back to the issue of governance, more integrated regional cooperation in the planning and implementation of infrastructure development projects has the potential to insulate the projects from domestic politics and patronage networks that often limit transparency in the tendering process. Presently, Uganda is in the middle of a row with four different Chinese construction firms over confusion in the tendering process for a new rail link to South Sudan and port on Lake Victoria. The four firms signed different memoranda with different government departments in what appears to be at best a massive lapse in coordination of government activities or at worst a case of competition for rents by over-ambitious tenderpreneurs.  This does not inspire confidence in the future of the project. A possible remedy to these kinds of problems is to have a permanent and independent committee for regional infrastructure to oversee all projects that involve cross-border infrastructure development.

In conclusion, I would like to reiterate that Eastern Africa is lucky to have discovered oil and gas in the age of democracy, transparency and good governance. This will serve to ensure that the different states do not descend into the outright kleptocracy that defined Africa’s resource sector under the likes of Abacha and Mobutu in an earlier time. That said, a lot remains to be done to ensure that the region’s resources will be exploited to the benefit of its people. In this regard there is a lot to be gained from binding regional agreements and treaties to ensure transparency and sound economic management of public resources. Solely relying on weak domestic institutions and civil society organizations will not work.

Africa’s newfound love with creditors: Bond bubble in the making?

I know it is increasingly becoming not kosher to put a damper on the Africa Rising narrative (these guys missed the memo, H/T Vanessa) but here is a much needed caution from Joe Stiglitz and Hamid Rashid, over at Project Syndicate, on SSA’s emerging appetite for private market debt (Africa needs US $90b for infrastructure; it can only raise $60 through taxes, FDI and concessional loans):

To the extent that this new lending is based on Africa’s strengthening economic fundamentals, the recent spate of sovereign-bond issues is a welcome sign. But here, as elsewhere, the record of private-sector credit assessments should leave one wary. So, are shortsighted financial markets, working with shortsighted governments, laying the groundwork for the world’s next debt crisis?

…….Evidence of either irrational exuberance or market expectations of a bailout is already mounting. How else can one explain Zambia’s ability to lock in a rate that was lower than the yield on a Spanish bond issue, even though Spain’s [which is not Uganda…] credit rating is four grades higher? Indeed, except for Namibia, all of these Sub-Saharan sovereign-bond issuers have “speculative” credit ratings, putting their issues in the “junk bond” category and signaling significant default risk.

The risks are real, especially when you consider the exposure to global commodity prices among the ten African countries that have floated bonds so far – Ghana, Gabon, the Democratic Republic of the Congo, Côte d’Ivoire, Senegal, Angola, Nigeria, Namibia, Zambia, and Tanzania.

In order to justify the exposure to the relatively higher risk and lending rates on the bond market (average debt period 11.2 years at 6.2% compared to 28.7 years at 1.6% for concessional loans) African governments must ensure prudent investment in sectors that will yield the biggest bang for the buck. And that also means having elaborate plans for specific projects with adequate consideration of the risks involved.

Here in Zambia (which is heavily dependent on Copper prices), the Finance Minister recently had to come out to defend how the country is using the $750 million it raised last year on the bond market (2013-14 budget here). Apparently there was no comprehensive plan for the cash so some of the money is still in the bank awaiting allocation to projects (It better be earning net positive real interest).

“They are fighting each other. By the time they have projects to finance, they will have earned quite a lot of interest from the Eurobond money they deposited. So, all the money is being used properly,” he [Finance Minister] said.

Following the initial success the country’s public sector plans to absorb another $4.5b in debt that will raise debt/GDP ratio from current ~25% to 30%. One hopes that there will be better (prior) planning this time round.

Indeed, last month FT had a story on growing fears over an Emerging (and Frontier) Markets bond bubble which had the following opening paragraph:

As far as financial follies go, tulip mania takes some beating. But future economic historians may look back at the time when investors financed a convention centre in Rwanda as the moment that the rush into emerging market bonds became frothy.

The piece also highlights the fact that the new rush to lend to African governments is not entirely driven by fundamentals – It is also a result of excess liquidity occasioned by ongoing quantitative easing in the wake of the Great Recession.

I remain optimistic about the incentive system that private borrowing will create for African governments (profit motive of creditors demands for sound macro management) and the potential for this to result in a nice virtuous cycle (if there is one thing I learned in Prof. Shiller’s class, it is the power of positive feedback in the markets).

But I also hope that when the big three “global” central banks start mopping up the cash they have been throwing around we won’t have a repeat of the 1980s, or worse, a cross between the 1980s (largely sovereign defaults) and the 1990s (largely private sector defaults) if the African private sector manages to get in on the action.

African governments, please proceed with caution.

Museveni: UN missions stifling state capacity development in Africa

The Daily Nation reports:

Ugandan President Yoweri Museveni has said UN peacekeeping missions [especially in the DRC] are derailing efforts by African governments to end conflicts.

He criticised the UN system of peacekeeping saying: “External support by the UN makes governments lazy and they don’ t focus on internal reconciliation.”

“The mistake is internal actors with no correct vision and the UN which does not focus on internal capacity building but instead focusing on peace keeping all the time. Without the internal solutions, you can’t have peace, ” Mr Museveni said in a statement on Thursday.

Some Congolese and experts on the DRC may disagree with Museveni’s analysis but it has some truth to it. As I pointed out in an African Arguments post several months ago, there is no short cut to fixing the Congo. State capacity development must be THE overriding concern (for more on this see here and here).

Also, The International Crisis Group has a nice piece on the recent takeover of the mining town of Lubumbashi by Mai-Mai fighters. The writer notes:

Since President Joseph Kabila’s controversial election victory in November 2011, government control over DRC territory has been in drastic decline. Beyond the fall of Goma to the M23 rebellion, Kinshasa has failed to repel the activities of various other armed groups: the Mai-Mai Morgan in Province Orientale, the Ituri Resistance Patriotic Front (FRPI) and the Mai-Mai Yakutumba in South Kivu, Rayia Mutomboki in North and South Kivu, as well as the Mai-Mai Gédéon in Katanga. (On the eastern Congo armed groups, see the October 2012 briefing Eastern Congo: Why Stabilisation Failed. On the Katanga armed groups, see the report Katanga: The Congo’s Forgotten Crisis.)

Kerry or Rice? The View From Africa

The window is closing fast on the chances of having an Africanist as US Secretary of State (Minister of Foreign Affairs). Republicans in the US Congress, human rights activists and a section of Africanists have come out in opposition to Ambassador Susan Rice. Republicans insist that she lied to Americans about the real masterminds of the attack on the US embassy in Libya that resulted in the deaths of four Americans, including the ambassador. The Africanists and human rights activists are not enthused by Ms Rice’s cozy relationship with the regimes of Paul Kagame of Rwanda and the late Meles Zenawi of Ethiopia. A section of African elites (the elitist sovereignty crowd) may also be wary of her support for interventionism on humanitarian grounds.

Source: Wikipedia

Source: Wikipedia

As things stand Pres. Obama might be forced to choose Sen. John Kerry over Ms Rice in order to avoid an unnecessary war with a section of Congress at a time when everyone and their dogs and cats should be worrying about the fiscal cliff.

John Kerry would not be a terrible choice. His past focus on drug trafficking in Latin America, free trade agreements and climate change would make him useful to Africa.

As I have written before, Africa is increasingly becoming a transit point for drugs from Asia and Latin America destined for the European market. Africa also needs more trade with the US beyond AGOA. And climate change will probably affect Africans the most since the vast majority of them depend on rain-fed agriculture and live under conditions that can least withstand natural disasters. But Kerry is not an Africa expert and has done little on the region beyond his support for the South Sudanese cause. This makes it hard to see how he will connect his global focus on these important issues to the African context.

Susan Rice on the other hand has studied Africa and has in the past shown a pragmatism that you want in the top US diplomat. Plus it helps that Ms Rice would have Obama’s ear as she is reported to be very close to the president. She has had successes at the UNSC, the highlight of which was the intervention in Libya to stop Gaddafi from butchering civilians in Benghazi. Rice is a smart straight-talker whose undiplomatic streaks can be a plus in a region full of under-achieving strongmen.

For a very long time Foggy Bottom has seen Africa through a humanitarian lens. Even Hillary Clinton, with all her awesomeness, has done little in new initiatives for Africa beyond human rights issues and a campaign that involved providing cameras for rape victims in eastern DRC. These are not unimportant issues. I am not saying that human rights catastrophes in Africa should be ignored. Just that this should not be a secretary of state’s pet project for the entire the region.

In my opinion Ms Rice’s biggest plus is that she gets one of Africa’s biggest challenges: state incapacity.

It would be nice to have a US secretary of state who takes state capacity development in the region as her pet project (and has the guts to at times subordinate democracy promotion to this project). Her praise of Kagame and Zenawi (no doubt both rabid and at times murderous autocrats) was centred around this very same idea (and to be honest, the ghosts of Rwanda circa 1994). Democracy promotion is a noble cause. But it must be done with a sober mind. The last thing you want is a procrustean approach to the promotion of rights, freedoms and liberties like we have seen in the past.

(Just for the record, I am pro-democracy and have criticized the likes of Kagame here and here, among other forums).

Anyone who reads the development reports side by side with the human rights reports from Rwanda and Ethiopia must be conflicted. I have talked to a senior opposition figure from Ethiopia who told me that she thinks the biggest challenge to fighting Meles Zenawi (at the time) is that “people see the dams and the roads.” It is hard to ignore revealed competence. I would hazard to guess that most people would rather live in autocratic Singapore than democratic Malawi. Yes, it is not an either/or argument with these regimes. All I am saying is that interventionism has to be constructive and not lead to the rolling back of hard fought gains against disease, illiteracy and poverty in these states.

As I opined following Obama’s reelection, I think that security will be at the top of the US Africa policy, of course dressed up in rhetoric about democracy and human rights. John Kerry will handle that on auto pilot. His focus will be on the Middle East and South Asia. It would have been better to have an Africanist at the helm who understands more about the continent and could sneak in a few policy agendas here and there that could make a difference on the ground. An aggressive focus on state capacity development could have been one of those policies.

This is a missed opportunity for Africa. For the first time in history Africa had a chance to have the number one American diplomat be a person who is an expert on a section of the region (Ms Rice wrote a thesis on Zimbabwe). Her defense of a couple of African autocrats aside, I think Ms Rice would have been better for Africa than John Kerry – who in all likelihood will focus on the Middle East and South Asia and continue Sub-Saharan Africa’s designation to the “humanitarianism column.”

Governing on the cheap in Africa

What is striking and surprising here is just how easy it can be to take over some African states, or large parts of them.  The post-independence historical record provides numerous examples where dozens or a few hundred armed men have done it.  This is generally just assumed to be the way things are in Africa, but when you think about it it is actually really puzzling.  Being the president in African countries (and many others besides) can be an incredibly lucrative deal.  Why don’t these rulers, in their own self-interest, take some of that money and use it to build crack units, presidential guards, or strong and loyal army divisions that would protect their hold on power against two dozen putchists, or a hundred or a couple thousand rebels armed with rifles and maybe some mortars?

I don’t think we have really good explanations for this in the relevant Pol Sci literatures.  Maybe the most promising hypothesis is that African presidents are so afraid of coups and attacks from inside their regime that they don’t want to support the construction of any organization that would be competent at using force.  Keeping the military weak  may lower their coup risk somewhat, but effectively trades coup risk off against higher risks of rural rebellion, insurgency, and foreign depredations such as we are seeing in Eastern Congo.

That is Jim Fearon writing over at Monkey Cage. More on this here.

Jim’s concern extends beyond security matters. Much of Africa remains under-governed in other regards as well – tax collection, garbage collection, provision of public goods like water and sanitation, roads, etc etc.

One key driver of this phenomenon, I believe, is the manner in which sectional elites (and those that they purportedly represent) are incorporated into the national system.

You see, many African national governments tend to have a president surrounded by a coalition of ethnic/sectional elites representing specific geographic regions or communities. This sort of incorporation of elites and the regions/social groups that they represent allows African central governments to govern on the cheap since as long as ethnic chief from region X can bring his people and sort of make them feel represented in the centre then the government has no reason to establish a strong presence in the chief’s homeland region (unless that region is economically viable).

A keen observer may ask why co-ethnics of these “ethnic chiefs” never demand for more from their supposed representatives at the centre.

The answer lies in the nature of citizenship in most of Africa. In many countries citizenship (and the associated claims on the state) tends to be mediated through one’s ethnic group. Talk of “our people” is common across much of the region. Even educated people have internalized the fact that you can only get jobs if a co-ethnic is in a high position in government. Everyone therefore invests in having a powerful ethnic representative at the centre that can effectively bargain with whoever is president (or in the core of the governing coalition) to get enough jobs for the boys and girls from back home.

But having such a person obviates the need for the central government to establish its presence at the local level since it is much cheaper to give the ethnic chief his own fiefdom in the name of a cabinet ministry. Barriers to entry allow for very long tenures for these ethnic chiefs thus breeding incompetence of the worst possible kind – like the case of Kenyan police officers accepting bribes from al-Shabab operatives to allow for passage of explosives destined for Nairobi.

From the president’s/government’s perspective, all you have to do to prevent an all out rebellion is be on good terms with enough of these ethnic chiefs or make it beneficial for them to live under your rule.

Seen this way, under-government is not just for the sake of coup-proofing but also an unintended consequence of the manner in which the masses and their representative elites are incorporated into the national government/state.

The best book out there that I have read on this subject is Catherine Boone’s Political Topographies of the African State. Boone is best read with Jeffrey Herbst’s States and Power in Africa, although Herbst’s conclusions are too deterministic for my liking.

Foreign Aid for Institutional Development?

In a speech at the Clinton Global Initiative, U.S. Republican presidential candidate Mitt Romney urged that more of U.S. foreign assistance should have strings attached. Mr. Romney said that:

“Working with the private sector, the program will identify the barriers to investment and trade and entrepreneurialism in developing nations…………. In exchange for removing those barriers and opening their markets to U.S. investment and trade, developing nations will receive U.S. assistance packages focused on developing the institutions of liberty, the rule of law, and property rights.”

Romney also added that:

“The aim of a much larger share of our aid must be the promotion of work and the fostering of free enterprise. Nothing we can do as a nation will change lives and nations more effectively and permanently than sharing the insight that lies at the foundation of America’s own economy — and that is that free people pursuing happiness in their own ways build a strong and prosperous nation.”

I am of the opinion that an approach to foreign assistance embodying the spirit of the latter quote is more likely to succeed than the former.

The thing with institutions is that they often reflect already existing social equilibria. The courts, the police, the military, the legislature, the stock exchange, etc, all reflect established norms and moral claims that individual stakeholders have on the system and on each other. When Westerners foreigners come in (many of whom often have very little understanding of the social basis of the existing equilibria) they often tend to work at cross-purposes with the existing social compacts (a good example here is the phenomenon of mono-issue activism – think of Human Rights Watch fighting the World Bank at the expense of locals).

Granted in some parts of the world these very social compacts need to be changed (e.g. misogynous social systems). But even in such cases the changes have to be grounded in local political arrangements that are self-enforcing. Media pronouncements from Western ambassadors are not enough.

Many development academics and practitioners alike often neglect the fact that in European history (contemporary Western experience informs a lot of institutional proselytizing) political development (i.e. the creation of responsive and impartial bureaucratic institutions to manage the affairs of the state) was preceded by modernization and general economic development. In most of the developing world this relationship is reversed. Political development has become the independent variable charged with driving the process of modernization and economic growth and development.

As a result, the mantra seems to be that if only everyone could get governance right then everything would fall in place and we’d all be on the road to becoming Denmark.

May be this can be achieved. I remain skeptical.

Six Questions You Always Wanted to Ask About Africa….

Rohac and co-authors provide answers (from Rwanda) to six questions you always wanted to ask about Africa. The questions and answers revolve around issues of rule of law, police-making, institutions, development assistance, human capital and culture.

Check out the publication here.