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.

Nairobi to Lusaka, Part II

Dar es Salaam is a pleasant town in late June. I had only been there once before, back in 2011 when I stayed for a day and a half to catch the Tazara. I didn’t like it then because of the heat and humidity (humidity is up there with cats – I am allergic – on the list of things I cannot stand). But this time round it was nice, I managed to walk around town marveling at the pillars of concrete and glass that are rising up in every corner of the city. The construction boom puts even Nairobi to shame, enough to make me think that the suggestions that Tanzania may soon eclipse Kenya as the place where all the action is in East Africa are not that far fetched after all (see image and this piece).  Image

My only complaint was that a prime section of the beach front still remains under-utilized, although this might be because of the presidential palace nearby. I hear you can’t drive there at certain times of the day (Stop channeling Mugabe, Bwana Kikwete. Also, let Chadema be). Oh, and I did manage to drive on the Kibaki road. I thought it was a new road, but it is not. Sections of it are actually pretty bad. Apparently, the Tanzanian government is planning an upgrade soon. I also drove past Mwalimu Nyerere’s home. It made me respect the man even more.

I arrived in Dar late on Tuesday night after many hours of travel by bus. On Thursday morning I was scheduled to continue with the second leg of the journey to Lusaka. I was at the bus stop by 5:45 AM, still sleepy. I had stayed up late the previous night, watching the Confederation Cup matches of the day, reading and writing my Saturday column. I fell asleep as soon as I got to my seat.

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Dar’s public housing units. For a moment I thought that the choice of color was meant to discourage applicants. Until I saw the pink public housing headquarters. Some of the units are in really nice parts of town.

The bus left the station promptly at 6:15 AM. Tanzania is huge. From Dar es Salaam to the Tunduma border is about 931 kilometres. The drive to the Zambian border took a total of 16 hours.

As I said in the previous post on this trip, I regretted taking the bus. If you want to travel overland between Dar and Lusaka, take the train. It is a million times more pleasant. There is a restaurant and a bar (that serves Tusker) on the train. There are bathrooms. And you have a bed. Plus the train is just slow enough that you can read and truly appreciate the empty Tanzanian countryside.

But the trip wasn’t all gloomy. The scenery was still enjoyable. Sections of Tanzania are quite hilly, with amazing views of cliffs and rivers and rock formations. At some point past Iringa I saw what seemed to be the biggest tree plantation in the world. For miles and miles all I could see were rows and rows of trees. And when there were no trees there were rows and rows of sisal. Someone is making bank off the land in that part of the country.

Also, western Tanzania is a lesson on how hard it is to achieve economic development in the context of a sparsely populated country. Such situations make it impossible to reach everyone with the grid and water pipes. Either the government has to wait for demographics to work its magic (again, see figure above – and be sure to check out this story on the Africa-driven demographic future of the world) or provide smart incentives to accelerate the process of urbanization.

For those who went to high school in Kenya, journeying by land through Tanzania reminded me of Ken Walibora’s Siku Njema. I felt like I was retracing the steps of Kongowea Mswahili. Some day I would like to go back and spend some time in Morogoro and Iringa. By the way, Siku Njema is by far the best Swahili novel I have ever read (which reminds me that it has been eight years since I read a Swahili novel. Suggestions are welcome, preferably by Tanzanian authors). It is about time someone translated it into English for a wider audience.

We reached Tunduma some minutes past 10 PM. The border crossing to Nakonde on the Zambian side was closed. Some passengers on the bus left to rent out rooms for the night. I decided to tough it out on the bus with the crew and a few other guys. Desperate for something warm to eat, I had chicken soup and plain rice for dinner. The “restaurant” reminded me of the place in Tamale, Ghana where Vanessa and I got food poisoning two months earlier. But I was desperate. I quickly ate my hot soup and rice and hoped for the best.

ImageI crossed the border early in the morning on foot. The bus had to wait in line for inspection and to pay duty for its cargo (It is at this point that I learned that the bus was actually going all the way to Harare in Zimbabwe). I am usually very careful with money changers, but perhaps because of my tiredness and lack of sleep the chaps in Nakonde got me.

If you ever cross to Nakonde on foot wait until you are on the Zambian side to exchange cash at the several legit forex stores that line the streets.

The bus finally got past customs at noon (on Friday). In Nakonde we waited for another two hours for more passengers and cargo.

I took the time to get some food supplies. Lusaka was another 1019 kilometres away. 

By this time I was dying to have a hot shower and be able to sleep in a warm bed. It was cold. Like serious cold. And Lusaka was still another 14 hours away.

I slept lightly through most of the 14 odd hours. In between I chatted with two Kenyan guys that were apparently immigrating to South Africa, with little more than their two bags. They said that this was their second attempt. The previous time they found work in Lusaka and decided to stay for a bit before going back to Nairobi. They were part of the bulk of passengers from Nakonde who were going all the way to Harare. Apparently, this is the route of choice for those who immigrate from eastern and central Africa into South Africa in search of greener pastures.

Before it got dark we saw several overturned trucks on the road. I slept very lightly, always waking up in a panic every time the driver braked or swerved while overtaking a truck just in time to avoid oncoming traffic. My only source of comfort was the fact that the driver was a middle aged man, most likely with a family to take care of and therefore with a modicum of risk aversion.

I arrived in Lusaka at around 4 AM, more than three days and 2871 kilometres since leaving Nairobi.

I said goodbye to my two Kenyan countrymen and rushed out of the bus as soon as I could. On the way to my hotel I couldn’t stop thinking how much I would like to read an ethnography of the crew of the bus companies (and their passengers and cargo) that do the Dar to Harare route.

At Lusaka Hotel that morning I had the best shower I had had in a very long time. And slept well past check out time. I had two months of fieldwork and travel in Zambia to look forward to.

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.

Nairobi-Lusaka by road, Part I

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The towering Uhuru Heights under construction in Dar es Salaam combines office space with residential apartments

Lusaka must be the only African capital (or major city) that is not a frenzied construction site. No new major roads are being constructed downtown. My quick look only found two new constructions of tall-ish buildings downtown. Lusaka feels really sleepy compared to the three other African capitals/major cities that I have been to in the last three months  – Dar es Salaam, Nairobi, Accra. Dar es Salaam, in particular, is impressive. The city is constructing a rapid bus transportation system with a dedicated lane. Citywide construction of “office space cum residential apartments” mark the landscape promising a rich experience of downtown living for city residents in the near future (I wish Nairobi did more of this….)

The guy who runs the place I am staying at in Lusaka tells me that the only construction going on in town is of shopping malls and expensive residential houses that no one will afford. President Michael Sata, he argues, is bent on turning Zambia into Zimbabwe.

Michael Sata (a.k.a King Cobra) may not go the way of uncle Bob in Zim but he is definitely not the hope for change that Zambians voted for back in 2011. The growth in the economy (6% on average in the last decade, 7.3% last year) is barely trickling down and the ruling PF seems too preoccupied with killing the opposition to care. The old duo of  Scott and Sata seem out of ideas on how to translate the country’s economic growth into wider socio-economic transformation.

Indeed the African Development Bank in its latest report on the Zambian economy noted that “Zambia has yet to achieve significant gains in social and human development. The poverty headcount remains high, with about 60% of the population still living below the poverty line.” The economy is imbalanced, heavily dependent of capital-intensive copper mining that it barely taxes (80% of exports, but paltry a 6% of revenue).

I was first here two years ago for reconnaissance research and have come back for more work. The pace is a nice change from Nairobi. It is also warmer than Nairobi at this time of the year (well at least before nightfall) – just after three years in California and seven months in Nairobi and I have become a little soft on cold weather (Moving to Chicago this fall will be fun!!)

This time round instead of doing air (Nairobi-Dar), rail (Dar-Kapiri) and road (Kapiri-Lusaka), I decided to do it all by road. This turned out to be a terrible idea.

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Sign post on the Tanzanian side of Namanga

Leaving Nairobi was itself an adventure. Despite Vanessa’s well-intentioned “alarm clock” calls to make sure I was up and ready by 5 AM, I missed my bus (I also missed my bus the first time, which is why I flew to Dar es Salaam). However, this time round it was my dad who was dropping me off and because he is a lot more daring that me and my brother, he decided to chase the bus (we were barely five minutes late, thank you very much Nairobi traffic at 5:45 AM). We did not catch my bus (Dar Express), but caught up with its competitor (name withheld for legal reasons, see below) after it had been stopped by the traffic police on Mombasa road for lack of a passenger license (it had a cargo license). Let’s just say that I was mightily impressed by my dad’s driving skills. I wish I were as daring.

So after the police got their cut (which I later found out was Kshs 5000, about US $60) we set off on the journey to Dar. The conductor on the new bus was kind enough to give me a free ride to Namanga (only Tanzanians can do this!!!) with hopes of catching up with Dar Express – in the end we did not, and I had to pay Kshs 2000 for the rest of the journey. The last time I was on the Nairobi-Arusha road was in 2009 when it was all no more than a dirt track that left you caked in thick red-brown dust. Now it is all paved. Nairobi-Namanga took a dizzying three hours. Just over an hour and a half after that we were in Arusha. After Arusha we sped to Moshi where we were caught up in the Prime Minister’s motorcade as he went to the city referral hospital to visit victims of the recent bombing at an opposition rally in Arusha (Arusha is the Chadema (Tanzania’s main opposition party) stronghold; but even in Dar the few people I spoke to about politics did not have nice things to say about the CCM government, especially with regard to rising inequality and corruption – yeah, I just totally Tom-Friedmanned that one).

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The 922 kilometer (573 miles) Nairobi-Dar road

I must say that the Nairobi-Dar road is impressive. Save for about one hour total of patches that were still being done about two hours outside of Moshi, most of the road is paved. Sometimes I forget how massive (and hence empty) Tanzania is. Namanga-Arusha is marked by flat plains, rolling hills and mountains. In the plains cattle rearing appeared to be the economic mainstay (unfortunately, with school age kids herding tens of cattle and sheep – wake up, Tanzania ministry of education). The hilly and mountainous areas mostly have maize and coffee. After the hills there are vast sisal plantations that stretch from horizon to horizon. Arusha and Moshi are the only big towns on the Namanga-Dar route. I particularly like Moshi (or may be I just don’t like touristy, expensive Arusha). It is a town with character, combining a provincial feeling with urban comforts. It also has some nice public monuments.

I rarely see weigh bridges on Kenyan roads (besides the infamous two in Gilgil and on Mombasa road) but in Tanzania they are plenty. And they are not just for the trucks, but also cater for passenger buses. Most of the trucks on the route were connecting Uganda, Rwanda, Burundi and the eastern DRC to the port in Dar. The passengers on the bus consisted of businesspeople (mostly Kenyans and Congolese), random travelers like myself, and tourists (most of who alighted at Arusha). On the Kenyan side, between Nairobi and Namanga we had a total of 5 police stops. On the Tanzanian side between Namanga and Dar there were 6 police stops and about 4-5 weigh bridge stops – the Tanzanians definitely police their roads more keenly. The police on the Tanzanian side were on the lookout for khat/miraa (illegal in Tanzania, and a beloved commodity of truckers) from Kenya and other contraband. True to EAC hospitality, I did not have any problems with immigration at Namanga (unlike in Nakonde, Zambia) or at any of the police check points (officers came on board to check passports). Talking to Tanzanians reminded me of just how bad Kenyan Swahili is – we must sound to Tanzanians like the Congolese sound to us whenever they speak whatever it is they call Swahili (*ducks and runs*).

The bus arrived in Dar es Salaam about 20 hours after leaving Nairobi (Not bad for a US $42 ticket), despite having been made to believe that the trip would take 13 hours. It didn’t help that I ignored Vanessa’s advice to pack food, hoping to buy stuff on the road – the first food stop was six hours into the trip, I had not had breakfast. Exhausted, hungry and mad at myself for taking the hard way to Dar I decided to get a room at the Peacock Hotel. It is not fancy (probably a 4 star?) but it has hot water, the rooms are spacious, and there’s fast internet. They also have a nice restaurant downstairs (Tausi) and are within walking distance to the port and other sites of interest in Dar – a Subway, Indian restaurant, the national library, banks, etc.

I had a day to burn in Dar reading, writing and walking around in readiness for the second leg of my trip to Lusaka, again by road.

Tribe, Nation or Literacy?

Tanzania’s founding president Julius Nyerere famously described Kenya as a vulgar, capitalist “man eat man society” – to which Kenya’s then Attorney General Charles Njonjo retorted that, in contrast, Tanzania was a “man eat nothing society.” At the time Tanzania had embarked on a program of African Socialism – Ujamaa – backed by a language policy that put a lot of emphasis on Kiswahili as the national language. As Ted Miguel has argued inTribe or Nation?(pdf)this was a great strategy in nation building. But was it economically beneficial in the long run?

For now the answer is probably no.

The legacy of Tanzania’s language policy has been that English language instruction only begins to be done seriously in high school. Obviously, four years are simply not enough to master a language, let alone sit a major national examination in that language. The result has been an astonishingly high failure-rate in the national end of high school exams in Tanzania. Earlier this year 60% of high school (Form Four) students failed, prompting jokes like “I’m a rocket scientist in Tz” on this side of the border. In reality even fewer made the cutoff to get a place in institutions of higher learning. In addition, a recent survey done by Twaweza, an education Think Tank, found that 72% of sampled primary school kids and 66% of high school students could not do second grade maths. English reading and comprehension was equally bad.

It goes without mention that the state of Tanzania’s education system has serious implications for human resource development in the country. The impending commodities boom in many parts of the country will certainly not benefit locals if workers have to be imported. Tanzania cannot effectively transform itself into a 21st century economy without a drastic improvement in its education system. Oddly enough, despite its obvious shortage of human capital, Tanzania is the most restrictive state with regard to labor mobility in the East Africa Community (EAC). Dodoma is especially hostile to Kenyan workers that it sees as a threat to local workers (Kenyans and their alleged aggressiveness rudeness have jokes about Tanzanians’ work ethic….. I should add though that Tanzanians tend to be stereotyped unfairly, both at Mang’u and in New Haven I went to school with some very smart and hardworking Tanzanians).

In the final analysis, although Kenya’s post-independence education and language policy left us with a ‘tribe eat tribe’ legacy, it allowed the country’s education system to focus on English language instruction from early on, and a chance to develop a relatively more globally competitive human resource base. Nation building may have taken a hit in the process but I would argue that internal economic ties – the result of man eat man competition – have now made it such that the Kenyan nation-state will only get stronger. The challenge for Tanzania is to ensure that nation building does not limit the development of a globally competitive human resource capacity.

Since the announcement of the high school exam results earlier this year the country (Tanzania) has been debating possible avenues of reform. Better teacher training, more books and equipment and more teachers have been cited as possible remedies. Strategic review of the country’s language policy should also be put on the table.

In my opinion the EAC should adopt a language policy in which our history, social and religious studies and civics are taught in Swahili while everything else is taught in English. This would not be a selling out to a foreign language (with due respect to Ngugi) but an investment in global competitiveness. Many decades down the road, once we have universal literacy in both English and Kiswahili, we can have a full switch to universal Kiswahili language instruction in all subjects.

Is our children learning? (Credit to Bushism)

The Guardian reports:

More than two out of every three pupils who have finished two years of primary school in east Africa fail to pass basic tests in English, Swahili or numeracy, according to a new report, Are our children learning?.

The differences in performance vary both across and within countries:

The report found large differences in average test scores between countries in east Africa. Kenyan pupils perform best in literacy and numeracy. Ugandan children perform worst in the lower school years, but slowly overtake Tanzanian children and outperform them after six years in school.

But it is the within-country differences that are cause for a rethink of education policy in east Africa. Kids in private schools appear to do much better than those in public schools (the gap is most stark in Tanzania, 28 percentage points). The Ugandan school system appears to be the worst, with barely half of EVEN the private school kids passing.

In a finding likely to fuel the debate on public versus private schools, the report said students in private schools perform better than pupils in state schools in all three countries – a difference particularly marked inTanzania, where the pass rate among 10 to 16-year-olds for numeracy and literacy tests was 47% in state schools, compared with 75% in private schools.

“In part, the difference between Tanzania and the other countries is likely to be driven by the much smaller share of pupils attending private schools, even among the non-poor, suggesting they must be particularly selective,” said the report. In Kenya, the pass rate in private schools was 83%, compared with 75% in government schools, while in Uganda the gap was 53% to 36%.

As a product of the Kenyan public school system (and a Wazimba for life), I believe that public schools are the way to go. With some thought and innovation, public schools can be made to work – and in the process serve as the best chance for inter-generational SES mobility. The debate should be about how to improve public schools, as opposed to over the false choice of quantity vs. quality.

A possible model could be something akin to the Kenyan National Schools concept in which select schools across the country get extra resources not only to boost performance but also to act as testing grounds for new learning tools – which can then inform policy to help “Provincial Schools” catch up. Of course this would ineluctably create a multi-tier school system at the beginning, but it is arguably better than a system in which most (if not nearly all, see Uganda and Tanzania) public schools are failing.

It is important to note that in Kenya the best high schools have historically been public. With investment and openness to experimentation and innovation this tradition can be maintained.

H/T @AAA_ipregroup 

TAZARA Pictures (Preview, see link to original post and more pictures below)

Richard White's Railroaded proved to be an appropriate reading for the trip

Leaving Dar es Salaam

Most of the two-day ride was across the empty countryside

Mbeya is the biggest station before Kapiri. We broke down here for almost 5 hours

Of course the picture collection wouldn't be complete without the African sunset

Just a reminder of who built the railway line

Kapiri Mposhi, final stop on the TAZARA line

The original post is here. More of the pictures are here.

THE TAZARA (TOTAL TIME: 2 DAYS 1 HOUR 26 MINUTES)

UPDATE: The photos to accompany this post can be found here.

Note: I will post some photos to accompany this post as soon as I get to a place with a faster internet connection. The post is from Friday, September 2nd.

Over the last two days I have been on the TAZARA from Dar es Salaam to Kapiri-Mposhi. The ride lived up to my expectations, despite the many unexplained delays along the way – the longest was a 4-hour wait in Mbeya (where we stopped either to have the engine serviced or wait for the other train from Zambia).

The train was rather old and showed years, if not decades, of disrepair. That said it was clean and livable. The sleeper coaches had two bunk beds each and were swept twice over the whole journey. They had pillows, a bed sheet and a blanket for the beds. The bathrooms were cleaned every few hours by the tireless crew. The train had lounge and restaurant cars. The lounge had a bar with an assortment of beers from Kenya and Tanzania (I had Tusker the whole way). The restaurant had a limited menu of rice or chips and beef or chicken. In the morning they served breakfast of egg, sausage and sliced bread with tea. Food is served both in the restaurant and in the passenger cars.

The view along the way was fantastic. The Tanzanian side was sparsely populated while the Zambian side was almost empty. We were unfortunate to pass through Selous Reserve (in Tanzania) during the night so we didn’t see any wild animals on the way. Perhaps the ride from Zambia back to Dar passes through the reserve whilst the sun is still up. But animals aren’t the only natural attraction on the Dar-Kapiri line.

The stunning beauty of the Tanzanian and Zambian countryside more than made up for not having seen any wildlife. The sunrise and sunsets were spectacles to behold. The mountains and rolling hills also provided great views. And then there are the smooth endless rides across the plains of northern Zambia between Mpika and Serenje and again onwards toward Kapiri-Mposhi. 

The ride also exposes the endemic poverty in rural Tanzania and Zambia. Quite frankly this was the low-point of the two days.

And it is not just the grass-thatched structures that betrayed their occupier’s meager incomes. At every stop kids with their whole bodies covered in dust would run along the tracks screaming “kopo kopo” (kopo is Swahili for bottle) in a rather bizarre re-enactment of The gods Must be Crazy. People on the train threw empty water bottles, sweets and other items at the kids. Some of them begged for money from the handful of passengers on first and second class cars in the rear of the train.

Day One (Tuesday-Wednesday): 



The departure from Dar was delayed.

The previous day I had missed my Akamba bus out of Nairobi in the morning (I overslept and even my older brother’s valiant attempt to get me there on time did not help) and so had to fly to Dar in order to not miss the Tuesday afternoon train. I arrived in Dar on Monday at around 2 PM in the afternoon. Traffic was terrible. I could not find accommodation at the first three places I checked. The fourth place looked rather sketchy – enough to spook even a true Nairobian like me.

So I settled for the pricier Rainbow Hotel close to downtown. The room was very nice – it had a hot shower, air-conditioning and satellite TV. It also had an over-priced restaurant on the second floor that served very well made Indian food. 

On arrival in Dar and before going on my hotel hunt I asked the Taxi driver to take me to the train station so I could book my ticket for the next day. The lady at the counter calmly told me that the train was fully booked (first class) until the following Tuesday.

I did not have a week to spend in Dar so I pleaded with her, to no avail. She directed me to the coach class counter with the option of upgrading to first class along the way. I was not wiling to risk sitting in coach for two days. So I bought a first class ticked for the 6th of September (a week later) but decided to try my luck anyway the following day (Tuesday) in case there were any cancellations.

The next day the same taxi driver drove me to TAZARA two hours before the 2 PM reporting time. He then asked one of the luggage handlers if there was any way we could get a ticked before the 2 PM departure time. The man directed us to the office of the stationmaster. It is in there that the lady in charge called the ticket office and asked the person on the other end of the line to sell one Ken Opalo a ticket in first class for the 2 o’clock train. She then took my other ticket. No questions asked.

Because of my desperation to take the TAZARA, I had just been robbed of US $80. Thanks very much TAZARA.

It turns out this is an elaborate scheme: The lady at the counter puts up a sign saying that tickets are sold out until the following weak at which point passengers must see the stationmaster and pay a premium for available tickets. This elaborate scheme has its glitches. For half the trip we had in my compartment a guy who had been sold a ticket in a women only compartment. He slept on the couches in the lounge car the first night.

Departure time was 4.30 PM. In just under two hours dusk was upon us and with it came the darkness that is the African countryside at night. I tried reading but promptly fell asleep. I was however woken up by the loud snoring for the guy on the top bunk and couldn’t go back to sleep for the better part of the long stop at a town called Mrimba.

Wednesday morning I was up by 6.30 AM. I read until the breakfast guy came to the compartment. Thereafter I continued reading until the 4-hour stop at Mbeya where I managed to get off the train and stretch my legs. After Mbeya I went to hang out in the lounge and read a bit more until it was dinner time. By the time the sun set I was so tired that I fell asleep as soon as I finished dinner.

Day Two (Thursday):

Thursday morning I woke up at 5.35 AM. One of the guys in my compartment was getting off at Kasama. He and I had build a sense of camaraderie since leaving Dar es Salaam several hours earlier. He is a globe-trotting businessman and evangelist from Kasama – the Capital of Zambia’s Northern Province. He passionately assured me that Michael Sata will win the Zambian presidential election in three weeks and that the opposition “will not accept anything but victory.” The opposition slogan is “Don’t Kubeba” or don’t say.

The main opposition party is urging its supporters to take all the government money being dished out but not say who they’ll vote for. We helped him offload his many bags and gifts for his family through the window of our compartment. The train then left for Mpika.

Northern Zambia is mostly empty. For hours upon hours we did not see much except trees and the occasional telephone masts and power lines. Human settlements were rare and far in between. The long monotonous ride offered me time to read Railroaded by Stanford’s Richard White. The book provides an excellent account of the political economy of the development of North America’s great transcontinental railroads – I believe that at its inception in the 1970s TAZARA had the same dreams of linking the continent of Africa from coast to coast.

Soon the lunch waiter came knocking. At this point the ware of being in a loud and shaky contraption for almost two whole days was beginning to show. People were quieter. The train was emptier. Everyone was dying to get to Kapiri-Mposhi. I had my last meal on the train – kuku na wali. I then went back to reading in anticipation of the last stop at Kapiri-Mposhi. Even the fact that I still had another leg of the journey to Lusaka (this time by bus) and that I had not yet confirmed my accommodation once I got there did not interfere with my sense of accomplishment. In a few hours I was about to have endured one of the longest train rides in the world.

We arrived at Kapiri-Mposhi at 4.56 PM. The whole journey had take exactly 2 days 1 hour and 26 minutes. The two days without a shower or change of clothes was definitely worth it.

Now I had to endure another one and a half hour bus ride to Lusaka.

As I mentioned above the train schedule was rather unpredictable. But I managed to note down the times on which we arrived at some of the main stations along the way. Here is the schedule for the August 30th train from Dar to Kapiri-Mposhi:

Dar es Salaam 4:30 PM

Nzenga 5:38 PM

Watu 6.00 PM

Kisaki 8.21 PM

Mrimba 11:30 PM

Makambako 8:30 AM

Kangaga 10.08 AM

Rujewa 10:30 AM

Inyala 1:28 PM
Yore 1:53 PM

Mbeya 2:14 PM (we stopped here for 4 hours!!)

Mabrizi 6:33 PM

Idiga 7:05 PM

Tanduma-Nakonde 10:00 PM (Tan-Zam border. We left at 11.15 PM)

Kasama 5.35 AM (Central African Time. The rest of the times below are also CAT)

Mpika 8.45 AM

Kalonje 10.23 AM

Serenje 1.03 PM

Kapiri-Mposhi 4.56 PM

TOTAL TIME: 2 DAYS 1 HOUR 26 MINUTES

Will be blogging sporadically for the next week

Dear readers, I have been away for a bit. Research/work and running the San Francisco half marathon (see images below) have kept me from blogging. I am back but will only be blogging sporadically for the next week or so.

In other news, next Thursday I head home to Kenya for a short vacation. My trip will also include brief visits to Uganda and Tanzania and an extended trip to Zambia (I will be there for the elections) before coming back to the Bay Area for year 3 of (hopefully) 5 of grad school.

Stay tuned.

Here are my marathon pictures.

The EAC needs a defense pact

UPDATE: The Government of South Sudan has barred people of Somali origin from entering the country by road for “security reasons.” This wrongheaded move has created an awkward situation since not all people of Somali origin are from Somalia. In Kenya, for instance, a good chunk of the long haul transport sector is run by Kenyans of Somali origin.

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The Ugandan government recently went on a $1 billion shopping spree for six fighter jets. The deal, which almost broke the bank, made a significant dent on Uganda’s forex reserves. Many, while acknowledging the risks that might have motivated the purchase, have questioned the wisdom of spending that much money on six jets.

For those not in the know, the key motivation for Museveni’s purchase was a desire to project military power in the region for two key reasons:

Firstly, in order to create a market for Ugandan light industries – cooking oil, soap, etc – Kampala has had to project military power to help in the pacification of pockets of eastern DRC and northern Uganda/South Sudan. These markets are crucial because they create jobs in Uganda, allowing Museveni some room as he continues to preside over Uganda’s decline into a dysfunctional police state.

The second reason was Museveni’s desire for military grandeur in the region. Kigali and Khartoum are not in the best of terms with Kampala. Museveni is probably suspicious of a potential Odinga presidency in Kenya. For these reasons, the Ugandan military establishment – the real rulers of Uganda – might have wanted to ensure that non of their neighbors are in a position to bully them in the near future.

While most of Museveni’s militarism is inspired by a mentality from a bygone era, I find Kampala’s fears against Khartoum as legitimate grounds for a regional defense pact. It is an open secret that Khartoum will try as much as it can to destabilize the new government of South Sudan (and by extension the wider region). And they have a few options:

  • They can foment civil war within South Sudan – there are a lot of disgruntled armed bands within South Sudan who might decide to take their chances with Khartoum; Remember that even Riek Machar, the current vice president of South Sudan, formed a Khartoum-backed splinter group (SPLA-Nasir) that fought Garang’ back in the early 1990s.
  • They can use armed groups in the wider central African region – including Kony’s LRA and the plethora of roving bandits in eastern DRC to engineer insecurity in South Sudan. Khartoum has used the LRA against SPLM in the past.
  • They can invade in an all out war. This option is the riskiest because of its potential to generate international opprobrium. But remember that Ethiopia and its secessionist former province Eritrea fought a bloody war that generated nothing but “stern” warnings from the UN and the wider international community. The US even armed Ethiopia because it needed Addis Ababa to fight its war in Somalia.
  • Lastly, they can use non-conventional tactics. Terrorism is slowly growing in the wider east African region. So far Eritrea has been the biggest state sponsor of terror in the region – mostly aimed at Ethiopia in the Ogaden, Oromo land and Somalia. The involvement of Ugandan and Burundian troops in Somalia has created even more enemies for these groups. There is no reason to believe that Khartoum would not use these same groups to destabilize South Sudan, if for nothing then as a survival tactic for a beleaguered Bashir administration that will forever be blamed for having lost the South’s oil.

Needless to say, an unstable South Sudan is bad for the region. Period.

The proliferation of small arms is already a major problem in the areas bordering the Ilemi triangle and eastern Uganda. That instead of sticks pastoralists have to roam around with AK-47’s says it all. More conflict in South Sudan will only make a really bad situation even worse. The potential for proxy wars within the region would also be an unnecessary drain on limited resources. Because of various interests in Juba, an aggression by Khartoum against South Sudan will definitely be met with reaction in one form or another from Kenya, Ethiopia and Uganda.The conflict will definitely be regionalized. Lastly, Eritrea’s bad habit of supporting terrorists should not be permitted to catch on. Khartoum must know that if it tries this dirty tactic it will be met by more than just resolutions from the AU, IGAD or the UN.

Which is why I think that the EAC should have a robust defense pact. War should have to be a last resort. But that does not mean that the East African Community should not prepare for such an eventuality, if it arise.

That way, no single country will be burdened with the task of buying all the necessary hardware needed to keep Khartoum deterred.

Such a plan would face significant challenges, of course – key among them the fact that the region’s armies are non-professionalized. A functional defense pact would require near total civilian control of the army. Only Kenya and Tanzania come close to this in the EAC. Rwanda, South Sudan and Uganda are dominated by their respective armies. Burundi can’t even win against rebels within its territory and remains a militarized tin pot dictatorship. And Ethiopia, if it were to join, is still dominated by the remnants of the rebellion that ousted Mengistu.

These challenges aside, it might be worth a try. Such a pact might even help professionalize and de-politicize the officer corp in the region’s armed forces.

And the biggest winner if this were to happen is MORE regional trade.

Mastermind of 1998 bombings in Nairobi and Dar killed in Mogadishu

The man behind the US embassy bombings in Nairobi and Dar es Salaam has been killed by Somali government forces at a roadblock in Mogadishu.

The Saturday Nation reports:

The mastermind of the 1998 twin bombings in Nairobi and Dar es Salaam Fazul Abdullah has been killed by Somalia government forces in Mogadishu.

Mr Abdullah, who holds a Kenyan passport, was wanted for the fatal bombing of US Embassies in Kenya and Tanzania that left at least 250 people dead and many injured.

He was reportedly killed by the Transitional Federal Government (TFG) forces on Wednesday at a roadblock.

The run-away terrorist, who was on the Federal Bureau of Investigations (FBI) watchlist of most wanted terrorists, is believed to have taken over the leadership of al Qaeda’s branch in Somalia, al-Shabaab from where he directed world attacks and African terror operations.

Confirming the reports, Kenya’s Police Commissioner Mathew Iteere said he was working with security officers in Somalia to get a comprehensive report.

Tanzania elections

There are no surprises expected from the general elections in Tanzania, held on Sunday. The electoral body has not declared the presidential results yet (leading to reported riots) but no one expects Jakaya Kikwete to lose to Chadema’s Willibrod Slaa. Chama Cha Mapinduzi (CCM), the hegemonic party that has ruled Tanzania since unification, is also expected to maintain its majority in parliament.

More on this as soon as the final official figures become available. Mr. Kikwete won 80% of the vote in 2005.

economic matters

The 20th World Economic Forum on Africa has been meeting in Dar es Salaam, Tanzania. Participants at the forum stressed the need for the Continent to move to the centre of the global economy. The emphasis on agriculture was particularly encouraging. Food, textiles and construction should dominate the Continent’s Planning Ministers’ agenda.

The need for urgency was best illustrated by one participant who described the modern African farmer as still being “the woman with a hoe, firewood on her head and child on her back.” The same participant also made note of the fact that 80% of food production on the Continent is done by such women.

More of this here.

Also, the Atlantic has this nice piece on Sino-African (or is it Afro-Chinese?) relations.