Boris Johnson in his own words

This rather openly racist guy is now Prime Minister of the United Kingdom:

What a relief it must be for Blair to get out of England. It is said that the Queen has come to love the Commonwealth, partly because it supplies her with regular cheering crowds of flag-waving piccaninnies; and one can imagine that Blair, twice victor abroad but enmired at home, is similarly seduced by foreign politeness.

They say he is shortly off to the Congo.

No doubt the AK47s will fall silent, and the pangas will stop their hacking of human flesh, and the tribal warriors will all break out in watermelon smiles to see the big white chief touch down in his big white British taxpayer-funded bird. Like Zeus, back there in the Iliad, he has turned his shining eyes away, far over the lands of the Hippemolgoi, the drinkers of mares’ milk. He has forgotten domestic affairs, and here, as it happens, in this modest little country that elected him, hell has broken loose.

It’s hard to not conclude that the average quality of human capital at Number 10 declined a notch today.

We need to pay more attention to subnational variation

This is from Marshall Burke and Apoorva Lal:

Using these data across all African countries, we calculate that 43% of the overall variation in asset wealth is  countries, and nearly a quarter is  states within countries. This number is even higher if we focus on just sub-Saharan Africa — 65%. Similar numbers have been found for other outcomes, including child health. These within-country differences are starkly apparent in the corresponding map, which shows how wealth estimates change when country-level averages are disaggregated down to the state and then district level.subnational

 

How quickly can you regrow a forest?

Apparently, 20 years.

Here’s evidence from Brazil:

reforestation….. Salgado was to take over his family’s sprawling cattle ranch in Minas Gerais—a region he remembered as a lush and lively rainforest. Unfortunately, the area had undergone a drastic transformation; only about 0.5% was covered in trees, and all of the wildlife had disappeared. “The land,” he tells The Guardian, “was as sick as I was.”

Then, his wife Lélia had an idea: they should replant the forest. In order to support this seemingly impossible cause, the couple set up the Instituto Terra, an “environmental organization dedicated to the sustainable development of the Valley of the River Doce,” in 1998. Over the next several years, the Salgados and the Instituto Terra team slowly but surely rebuilt the 1,754-acre forest, transforming it from a barren plot of land to a tropical paradise.

Now a Private Natural Heritage Reserve, hundreds of species of flora and fauna call the former cattle ranch home. In addition to 293 species of trees, the land now teems with 172 species of birds, 33 species of mammals, and 15 species of amphibians and reptiles—many of which are endangered. As expected, this rejuvenation has also had a huge impact on the ecosystem and climate. On top of reintroducing plants and animals to the area, the project has rejuvenated several once dried-up springs in the drought-prone area, and has even positively affected local temperatures.

forestcover

Here is the Guardian story.

Perhaps there is hope for countries like Nigeria (see graph) to eventually reverse the deforestation trends across the Continent over the last five decades.

Urbanization might help in the medium-to-long term, although its effects will be moderated by what happens to agricultural productivity. Climate change will matter, too. Finally, Kenya and Ethiopia provide suggestive evidence that the Continent’s ongoing population explosion might not decimate its forests after all. On Nigeria, it would be interesting to determine if the decline in forest cover is due to population growth or climate change effects in its central and northern regions.

Here’s why African states value their economic and political ties with China

This is from an excellent essay by  in Foreign Policy:

…. when former U.S. Secretary of State Rex Tillerson raised a cautionary alarm for Africans to be wary of Chinese predatory investments just a few months ago, his lecturing tone did not go over well. Many African leaders reacted negatively to the underlying assumption that they were not qualified to figure out profitable from predatory investments on their own.

Sierra Leonean President Julius Maada Bio rebuked the warning as misguided, saying, “We are not fools in Africa. … At difficult times, when we needed help most, China was there for us.”

The expansion of Confucius Institutes across Africa is another part of the push worth engaging with. With more than 50 Confucius Institutes teaching Chinese language, as well as the Communist Party’s version of Chinese history and culture, more and more Africans have the chance to study Chinese and travel to China on cultural scholarships. In 2015, approximately 50,000 African students attended Chinese universities, compared with 40,000 in the United States and the United Kingdom. Elementary and middle schools in several African countries are now offering Mandarin as a foreign language.

I highly recommend that you read the whole thing.

H/T Judd Devermont

Are Metros Overrated?

This is from a story in The Guardian:

The ITDP bemoans Africa’s obsession with metros. Lagos in Nigeria – the largest city in the world without a functioning mass transit system – has been trying to build a metro since the 1980s. In the latest of many incarnations, the project was supposed to begin operations in 2012 at a cost of $2.4bn (£1.9bn). Six years after the supposed start date, construction is “nowhere near complete”, says Kost.

Abidjan, the economic capital of Ivory Coast, began construction of a metro last year. The French-financed and -built line is projected to carry 500,000 passengers a day at a cost of $1.7bn. Dar es Salaam’s bus system, by contrast, has capacity for 400,000 people and cost less than a 10th of that – about $150m.

Addis Ababa in Ethiopia opened a Chinese-built and -operated light rail line last year at a cost of $475m. Shenzhen Metro Group has a deal to run it for the first five years.screen shot 2019-01-09 at 4.03.54 pm“With a metro, an international firm will often just parachute in its own system,” says Kost. “Bus rapid transit allows existing stakeholders to get involved. That’s what we did in Dar es Salaam and what we’re planning in Nairobi, where the bus bodies will be built in the city and local operators will look after tickets, fare collection and IT. It’s good for the development of the local economy.”

Regular readers know that I have a bias for Kost’s argument. Read the whole thing here.

H/T Dina Pomeranz.

How can African governments increase their bargaining power vis-a-vis China?

Folashade Soule has answers.

First, a reminder that African governments are not uniformly bad at negotiating with China:

….when you look closely at what happens on the ground, some African countries are much better at negotiating with the Chinese than others. Railway projects in East Africa appear to be a good example. In Kenya, the Standard Gauge Railway is the largest infrastructure project since independence from Britain in 1963. China Eximbank provided most of the finance for the first phase – 472 kilometres of track between Nairobi and Mombasa – at a cost of US$3.2 billion.

In neighbouring Ethiopia, an electric train line from Addis Ababa to Djibouti, which is also Chinese-financed, opened two years ago. The cost for this more expensive type of railway was US$3.4 billion – for 756 kilometres. Kenya claims that its railway cost more for reasons like the terrain and the need to carry higher volumes of cargo. At the same time, however, many believe other issues to have been at play – including failures around the negotiation process.

Second, there are Soule’s suggested remedies:

Involve everyone: When all relevant government departments are involved in a negotiation, it does take longer. The process is more coherent, however, and the resulting project is less likely to breach national regulations.

Empower negotiators: The Chinese often adopt a take-it-or-leave-it approach. In many cases, Africans are not confrontational enough in return. They don’t appreciate that China has a surplus of domestically produced materials they are seeking to offload, for example. Wiser negotiators will play China off against other countries seeking to finance infrastructure projects on the continent, such as South Korea or the United Arab Emirates.

Keep the public onside: China tends to be popular in Africa – more so than the US in around 60% of countries on the continent. Yet the public also see negatives: many think Chinese products are poor quality, while there is a growing perception that dealing with China tends to favour Chinese labourers.

Increase knowledge: African governments are still relatively new to dealing with China; they should take every opportunity to share lessons with one another. There is a role for African universities here. They should set up more centres of Asian studies to close the gap in information and knowledge.

I fully agree.

While it is true that China has geopolitical ambitions in Africa, a lot of Chinese infrastructure plays in Africa are commercial in nature. It is in China’s interest that these projects succeed. That means that African governments could get better deals (in terms of value for money) by doing their homework (on Chinese politics and commercial and institutional architectures) before chasing the money. Similarly, public opinion presents a potential bargaining chip — (the threats of ) transparency and robust public participation should force Beijing’s hand in settling for better deals (from the perspective of African governments). 

All this, of course, is predicated on the assumption that African elites get loans from China to finance infrastructure projects; as opposed to dreaming up projects in order to get loans that then find their way into private bank accounts. 

Read the whole thing here.

H/T Zainab Usman.

Public Debt in African States

This is from the IMF:

Screen Shot 2018-11-23 at 10.27.45 AMCountries in sub-Saharan Africa accumulated external debt at a faster pace than low- and middle- income countries in other regions in 2017: the combined external debt stock rose 15.5 percent from the previous year to $535 billion. Much of this increase was driven by a sharp rise in borrowing by two of the region’s largest economies, Nigeria and South Africa, where the external debt stock rose 29 percent and 21 percent respectively.

Export growth is not keeping up with rising levels of external debt:

….In 2017, the ratio was largely unchanged from the prior year, at an average of 138 percent. However, this ratio was close to double the average of 70 percent in 2010. Moreover, the average ratio masks wide disparity between countries. At the end of 2017 54 percent of countries in the region had an external debt-to-export ratio over 150 percent, as compared to 28 percent of countries in 2010 and the number of countries where the ratio surpassed 200 percent more than doubled, from 6 countries to 14 countries, over the same period. Most of these countries are ones that benefitted from HIPC and MDRI relief, including Burundi, Ethiopia, Niger, Senegal and Tanzania.

Bond issuance is dominated by a handful of countries:

Bond issuance by sovereign governments and pub- lic-sector entities in the region rose to $27 billion in 2017, a more than fourfold increase over 2016, driven to a large extent by a surge in issuance in South Africa to $19 billion from $4 billion in 2016, 70 percent of bond issuance in the region last year. An important factor was non-resident purchase of bonds issued in the South African domestic market. Bond issuance by other countries in the region totaled $8 billion, a tenfold increase from 2016, reflecting continued investors’ confidence and search for yield. Issuing countries in 2017 were Nigeria ($4.8 billion), Cote d’Ivoire ($2 billion), Senegal ($1.1 billion), and Gabon ($0.2 billion). Nigeria’s $3 billion Eurobond issuance marked the country’s largest such operation to date, and at end 2017, bond issuance accounted for one third of the country’s outstanding external debt.

Overall, while the data suggests that things may not be as bad as they were over the lost long decade (1980-1995), the trends are not encouraging. Total reserves as a share of external debt peaked around 2010 and have been in decline since. Screen Shot 2018-11-23 at 10.54.37 AM

The wonder that is Chinese growth

Below is an amazing illustration of shifts in the sizes of leading global economies:

For more on China see here, here, here, and here. This reminded me of this graphic from Carlos Lopes, former head of the UNECA:Dr3w9PhW4AAnCGU

All that happened in just 36 years. Time is on Africa’s side. If (and that’s a big IFF) African elites can get their act together. As shown in the graph below, the lost long decade (1980-1995) was particularly brutal for African economies — but it was a temporal dip and not a permanent feature of African economies.income

It is also worth noting that in 1980 African states and China were not at the same level of institutional development. By that time China had already accumulated centuries of coherent stateness — which made it possible for elites to optimally allocate human and capital resources in ways that produced the growth miracle.

Here is a good nuanced take on trends in economic growth and development on the Continent.

Africa’s elusive green revolution

This is a great piece on the subject in The Economist:

Screen Shot 2018-11-01 at 2.04.41 PM.pngSomething akin to Asia’s rural development may, at last, be happening in parts of Africa. Since 2002 the proportion of African workers employed in agriculture has fallen from 66% to 57%. Yet the real value of agricultural production has grown at an average pace of 4.6% a year, double the rate between 1970 and 2000. Even so, the region is lagging behind. Most of the increase comes from using more land, rather than improved productivity.

A good deal of the divergence in agricultural productivity after the 1970s is driven by African states failure to increase the use of fertilizers.

fertilizerindex

More broadly, smart policy to increase agricultural productivity must focus on market reforms (to ensure most of the surplus in the sector goes to farmers and to intensify financialization), rationalization of farm subsidy regimes, addressing the question of farm size (increasing urbanization may reduce the political cost of land consolidation in the region), and investing in logistics to reduce wastage between farms and markets (including transportation and storage).

 

It pays to go to school

This is from The Economist:

WHICH has provided a better return in recent decades: America’s stockmarket or education? The latter, according to a research review by George Psacharopoulos and Harry Patrinos for the World Bank. The two economists looked at 1,120 studies, across 139 countries, and came up with an annual average “rate of return”—actually a pay premium, the increase in hourly earnings from an extra year of schooling—of 8.8%. The analogy is inexact, but for comparison America’s stockmarket returned an annual 5.6% over the past 50 years.

Their figure excludes social gains, such as lower mortality rates associated with greater education. The premium is higher for girls and for primary education. It is also higher in poor countries, presumably because the smaller the share of educated people, the higher the pay they can command. The same reasoning suggests that the return should have dwindled as educational attainment rose. Instead, it has stayed strong, especially for higher education.

More on this here.

Screen Shot 2018-05-05 at 5.45.31 PM.pngEducation attainment appears to be trending in the right direction across the globe (see image). However, the rate of improvement over the last three decades has been higher in some regions than in others. For example, while in 1992 Africa and South Asia had 42% and 38% of the out-of-school children of primary age, respectively, by 2014 the comparable figures were 57% and 19%. Clearly, African states need to do more.

The Bill & Melinda Gates Foundation has recently announced its foray into education. If done well, the Foundation’s involvement in the education secctor has the potential to nudge policy makers in the right direction, while also generating valuable data for cross-country comparisons.

Unrecognized States in Africa

Post-war juridical sovereignty has been hell of a drug. For a region with a lot of weak states and so-called “artificial borders” Africa has seen almost no substantial revision of state boundaries or the creation of new states (and not for lack of irredentist and secession movements…)

IMG_4584

Only South Sudan and Eritrea have managed to successfully secede and gain international recognition. Somaliland comes close. And while the Sahrawi Republic is recognized by the African Union, it still lacks robust international recognition. Apartheid South Africa stands out as the only state to voluntarily reorder its geographical integrity by creating new vassal statelets within its domain for its own racist ends.

H/T Paul D. Williams

Can African states eliminate malaria?

Southern Africa has an ambitious plan to eliminate malaria by 2030. According to the FT:

Under the Elimination8 plan, the idea is to end malaria by 2020 in four so-called frontline states where transmission levels are already low — below 10 per 1,000. These are Botswana, Namibia, South Africa and Swaziland. Four higher-transmission, “second line” countries — Angola, Mozambique, Zambia and Zimbabwe, where transmission rates can climb as high as 400 per thousand — have until 2030 to get the job done.

Kenya presents a less sanguine but still somewhat positive story. The country reported 8.3 million cases of malaria in 2018, a decline of 12% from 2012. And out of these cases, 16,000 fatalities were reported. Contrast this with China which in 2017 reported a grand total of 2,672 malaria cases, all of which were due to infections while abroad. China’s population is 1.4 billion. Kenya’s population is 49 million. 40 years ago China reported more than 24 million malaria cases annually.

So how did China do it?

Screen Shot 2018-04-24 at 9.08.41 PM.pngThrough a combination of vector control, human behavioral change (including use of treated bed nets), and treatment. All three approaches are important. For instance, while the malaria mortality rate of 0.09% in Kenya is not super high (thanks to treatment), it still means that each year millions of work hours are lost due to illness. It is also a significant drain on the healthcare system. In addition, while treated bed nets have been shown to save lots of lives, we should still work towards complete elimination of the disease.

And that will require an aggressive form of vector control, something that is glaringly missing from most malaria programs on the Continent.

Interestingly, the international community used to take vector control seriously, which resulted in some significant results (see map):

 In 1955, the UN committed to ending the scourge of malaria. It was optimistic because it thought there were effective tools. The pesticide DDT had been found to kill the mosquitoes that were spreading the disease in US army camps in the Pacific during the second world war. Widespread use of DDT and the drug chloroquine drove malaria out of many countries in the Americas, Europe and parts of Asia.

But it all fell apart. There was no real attempt to tackle malaria in sub-Saharan Africa because it was thought to be too difficult. Elsewhere, elimination fell foul of the problem that has bedevilled all malaria control efforts: resistance of the malaria parasite to drugs and of the mosquitoes to pesticides. Then in 1962, Rachel Carson’s blockbuster Silent Spring was published, alerting the world to the environmental devastation wreaked by DDT. The UN’s malaria eradication plan was officially scrapped in 1969.

The over-correction arising from Carson’s paradigm-shifting findings meant that much of the world was willing to sit on their hands as more than 400,000 people died each year of malaria. The WHO only dabbles in vector control through treated bed nets. Sadly, resistance to its choice of insecticides stood at 81% in 2016.

That translates to over 200 million people infected each year, over 400,000 of whom die.

Even Bill Gates agrees that complete eradication of malaria is the most sustainable solution:

“Eradication is the only sustainable solution to malaria,” Bill Gates said on the release of the report his foundation produced with the UN last September. “The alternative would be endless investment in the development of new drugs and insecticides just to stay one step ahead of resistance. The world can’t afford that approach.”

Is anyone out there investing in research on environmentally-safe insecticides?

 

 

What exactly is China up to in Africa?

Leading Afro-Chinese relations scholar Deborah Brautigam has a great piece over at the Washington Post:

On Chinese imported labor in Africa:

Surveys of employment on Chinese projects in Africa repeatedly find that three-quarters or more of the workers are, in fact, local. This makes business sense. In China, textile workers now earn about $500 a month — far more than workers in most African countries. Chinese investors flocking to set up factories in low-cost countries like Ethiopia are not thinking about importing Chinese workers. Like U.S. and European factory owners who moved their factories to China in past decades, Chinese firms are now outsourcing their own manufacturing to cheaper countries.

On Chinese loans to African states:

… In Africa, we found that China had lent at least $95.5 billion between 2000 and 2015. That’s a lot of debt. Yet by and large, the Chinese loans in our database were performing a useful service: financing Africa’s serious infrastructure gap. On a continent where over 600 million Africans have no access to electricity, 40 percent of the Chinese loans paid for power generation and transmission. Another 30 percent went to modernizing Africa’s crumbling transport infrastructure.

On alleged Chinese land grabs:

… the total amount of land actually acquired by Chinese firms was only about 240,000 hectares: 4 percent of the reported amount.

I like to remind my students of the qualitative difference of the “Chinese model” of resource exploitation in Africa.

Previously, Exxon, Elf and other Western resource sector firms would pay African leaders in cash, most of which wound up in Swiss banks, property in southern France, and various tax havens outside the Continent. This was, if you will, the “Western model” of resource exploitation in Africa.

afrobarometerEnter the Chinese. Their model is to pay for resources both in cash and in kind. African leaders still get cash that they can stash abroad. But they also get roads, railways, stadia, hospitals, water works, among other infrastructure investments. And more recently Chinese firms have begun to invest in actual factories — most notably in Ethiopia. It is no wonder that a majority of Africans have a favorable view of China (see image).

Some of these projects produced sub-standard structures (in the recent past the quality has gone up). And the level of indebtedness of African states as a result should concern every sane person. But this arrangement is orders of magnitude better than useless capacity building workshops and janus-faced democracy promotion on the back of rapacious pillaging with little public investments to show for it.

Finally, the inability of African states to negotiate reasonable deals with Beijing is on African political and economic elites. The Chinese have every right to rationally push for the best deals they can get. And if they are smart, they will also work to avoid future defaults by not overstepping their bounds.

To paraphrase a Mozambican diplomat at a recent event here on campus, Africans are too smart to allow themselves to be recolonized by the Chinese.

Rwanda’s Kagame on the Social Construction of Ethnicity

This is from an interesting interview with the FT:

During the interview, Mr Kagame says it matters little whether there are real physical differences between Hutus and Tutsis or whether these were arbitrary distinctions codified by race-obsessed imperialists. “We are trying to reconcile our society and talk people out of this nonsense of division,” he says. “Some are short, others are tall, others are thin, others are stocky. But we are all human beings. Can we not live together and happily within one border?” Mr Kagame has taken a DNA test that, he says, reveals him to be of particularly complex genetic mix. The implication, he says, is that he, the ultimate symbol of Tutsi authority, has some Hutu in his genetic make-up.

The transcript is available here. Read the whole thing.

Also, the average Rwandese lives a full six years longer than the average African.

Screen Shot 2017-08-28 at 11.13.48 AM.png

Ultimately, the sustainability of Kagame’s achievements will depend on his ability to solve an important optimal stopping problem:

The problem, he says of who might succeed him, is preventing someone from “bringing down what we have built”. Above all, he says, he wants to “avoid leaving behind a mess”.

The president insists it was never his intention to stay on, but the party and population insisted. “We are not saying, ‘We want you forever until you drop dead,’” he says, imitating the voice of the people. “We’re only saying, ‘Give us more time.’”

Just How Bad is Public Debt in Africa?

Well, public debt in African states is much higher if you take into account their revenue mobilization capacities. The bigger the informal sector, the lower the debt/revenues ratio.

Consider the case of Nigeria (from the FT):

Nigeria’s accumulated government debt is just 18.6 per cent of its annual economic output, one of the lowest levels in the world, implying that its debt burden is more than manageable. But is this a fair reflection of reality?

Using a different metric, the Nigerian government’s gross debt is 320 per cent of its annual revenues, according to figures from Fitch Ratings, one of the highest figures in the world and comfortably above the median of 196 per cent for countries in Africa and the Middle East that are rated by Fitch.

More on this here.