10 commandments for developing countries

Economic Focus Charles Chiponda
IMAGINE what our country would be like if God had given us $1 every time we spoke about what we should do to improve the country, maybe liquidity wouldn’t be the issue it is today. Since debating the “way forward” has always been a mainstay topic regardless of where you are in the world, for us Zimbabweans it has become increasingly popular and can almost be awarded the title of being a national pastime for many.

All the debate is the result of that eternal search for the elusive gem that is a thriving, inclusive of the economy.
One such set of theories and the subject of this article comes from an author of Asian descent who despite his ideas not being in depth with instruction, still managed to give the reader a guide to his analysis and school of thought.

Of his many books and journals, my focus is upon an interesting list authored by Kishore Mahbubani in his book Can Asians Think?
Mahbubani, a Singaporean, as part of his analysis theorised that conventional developmental theory that has been passed on to developing countries, had not lived up to expectation.

Closer to home one can immediately recall the heralding of Esap and it being a turning point. A turning point it certainly was, but unfortunately remembered by most Zimbabweans devoid of fond memory.

His book observes that after the immediate euphoria of independence from colonial rule, newly independent nations found the business of self-governance difficult with a few progressing but many regressing in the medium to long term.

Despite this trend being generally true, even today developing countries continue to dish out conventional wisdom that has not worked in practice.
The author cites that “This state of affairs was a motivator to the compilation of these commandments, intentionally unconventional in a bid to achieve the opposite of the status quo.”

The use of the word commandments suggests that the contents of the list are static, non-negotiable, and unaffected by time and or context. Such a list is therefore not open to interpretation, Or is it?

Number one states “Thou shalt blame only thyself for thy failures in development. Blaming imperialism and neo-imperialism is a convenient excuse to avoid self examination.” While containing elements of truth this is only partly true. In 2015 the world has become “smaller” in a sense, with data and information widely available on the interactions and the ensuing results of these interactions and relationships involving former colonies and their former colonisers.

Global markets and companies with bigger profits than a lot of countries’ GDP’s are testament to the power and influence both actual and potential of “Big Business.”
If, for the purpose of this analysis consider that Apple as a company posted profits of $18,04 billion in the first quarter of 2015, this figure when compared with the National Debt of our country (Circa $10 billion according to 2014 estimates) illustrates just what a force to be reckoned with the corporation has become.

Apple is an American company, subject to US law. With the stroke of a pen any investment that may have been under consideration to be earmarked for Zimbabwe by a handful of these large companies can be made illegal, as is the current state of affairs. So where in this instance does the blame lie?

Number two instructs “Thou shalt acknowledge that corruption in both private and public sector is the single most important cause of failures in development. Developed countries are not free from corruption but with their affluence they can afford to indulge in savings and loan scandals”. Number two is near impossible to disagree with, whichever end of the political or economic spectrum an individual is, corruption can and will only have adverse effects on an economy. The irony, however, is that despite all sectors of society being united in its condemnation, it is rampant and a way of life the world over. Whether through necessitation for survival which is commonly cited as a reason in developing countries or otherwise, the effect unfortunately is the same.

The third is a bit tricky, especially in sub-Saharan Africa where agricultural produce accounts for large percentages of National GDP and employment.
It states: “Thou shalt not subsidise any product nor punish the farmer in order to favour the city dweller”. This presents a paradox in that the prevailing norm is the exact opposite, with agricultural subsidies being a worldwide phenomenon. Expectedly I suppose, the richest economies’ agricultural subsidy budgets are the most generous. Even the staunchest supporters of the free market, seem to want to make an exception here. The US spends about $20 billion annually subsidising live American farmers. I say live in order to distinguish them from the dead. American farmers have received $410,6 million between 2008 and 2010.

Looking at these statistics, commandment number three is starting to sound like it should be incorporated into number two. However, even more to the point that the European Union spends about $67 billion on farm subsidies annually according to the European Commission for Agriculture and Rural Development.

Whether the reason is cited as helping ensure Europe can feed itself, or some other non-market related excuse, again the effects are the same. The subsidies mean that agricultural produce from other parts of the world such as ours have increased difficulty in competing pricewise.
This should not be the case due to the usually higher production cost of produce grown within that developed country or territory.

Number four commands: “Thou shalt abandon state control for free-markets, thou shalt have faith in thine own population, an alive and productive population naturally causes development”. Number four to a large extent is something that we have accepted, some more grudgingly than others. This commandment is not special in that it has tolerance to cheat. The difference with the other commandments being that with this one the cheating is less obvious. A Government may for example organise a “Buy Zimbabwe” campaign, which is likely to boost demand for local goods without having to increase import tariffs.

Borrowing is the subject of number five, which says: “Thou shalt borrow no more. Thou shalt get foreign investment that pays for itself. Thou shalt build only infrastructure that is needed and create neither white elephants nor railways that end in deserts. Thou shalt not accept no aid that is intended only to subsidise ailing industries in developed countries” With the UK’s National Debt at $1,4 trillion and Zimbabwe’s at about $10 billion, the temptation is to assume neither country has access to competent economists in their central banks. The truth, however, is that in both countries, Governments are formed through attaining the majority of seats in a Parliament, those seats in turn are dependent upon which candidates garner the most votes. Votes in themselves are indicators of popularity, gained or increased by making pledges to improve the lives of the electorate. Improving lives is a costly business, in addition to not wanting credit to go to political rivals, which can sometimes mean that essential projects go uncompleted due to their having been started by a rival. A mandate to govern also being a mandate to borrow means that number 5 is not impossible to abide by but a formidable challenge.

“Thou shalt not reinvent the wheel”, is plain and simple enough “Millions of people have gone through the path of development. Take the well-travelled roads, be not prisoners of dead ideology”. Number six is another one which is open to debate and can be argued to consist of little more than a matter of opinion. Yes, ideology can cost not just financially but also politically.

But then again after taking another look at it, cost is a relative term, with its influence on decision making depending on the aims and objectives of the person(s) making the choice.
The average voter who gained his right to participate in the political process due to racial divisions will be motivated by a different set of incentives, compared with one whose political divisions are based around social class in a mostly racially homogenous society.

Number seven reads “Thou shall scrutinise the ideas of Karl-Marx and the ideas of Adam Smith and come up with your own, the Germans made their choice, the Chinese made their choice — (Open Market, Socialism with Chinese Characteristic). Thou shalt follow suit”. It is certainly true that when forming an economic policy the exercise should always be done with the foresight of whom that plan is likely to benefit, and what will the ensuing externalities of its implementation bring, both positive and negative.

Socialism is the path that we have traditionally taken and some element of it features in the policies of most countries in the world. All we have to do now is decide what levels of the other philosophies is right for us.

Being spectators in our economy is not an option as the directors of any economy will inevitably ensure they benefit the most from it.
Reality and events from our country’s history suggest that capitalism, albeit with a large dose of socialism based on a transparent and evident foundation of nationalism may be a generally acceptable starting point.

According to number eight “Thou shalt be humble when developing and not lecture the developed world on their sins. They listened politely in the 1970s and 1980s, they no longer will in the 20th century”. In 2015 considering the problems we have as a continent, one activity we have little time for is lecturing the developed world. What we as Africans in this era should not stop doing however is voicing what is wrong with the world and what can be done about them. These wrongs include many of the topics that have helped stunt the growth of the continent as a whole. No case can be made for ignoring socio economic ills that have negative consequences. If anything it is through analysis that we become better equipped to navigate the treacherous highways of economic growth.

Number nine has the special feature of having three commandments compressed into one.
It first instructs that “Thou shalt abandon all North-South forums which encourage hypocritical speeches and token gestures” This first one is reminiscent of the issues surrounding attributing blame which, however, satisfying and therapeutic the exercise may be, in all honesty does not produce any useful outcomes or solutions. If anything the opposite is the result with the outcome being incurred financial costs which developing nations can ill afford. The money with vary difficulty can be replaced but in terms of thoroughly contemplating, debating and eventually mapping Africa’s future, the time precious as it is simply cannot.

The second part reads: “Thou shalt remember that the countries that have received the greatest amount of aid per capita have failed most spectacularly in development.” The aid debate is a notoriously difficult one with no side presenting a case to nullify the other’s. Most people would find it difficult to shrug their shoulders upon hearing that in a bid to support local farmers the Government has banned the import of free aid food, upon which 20 percent of the population who cannot afford to buy it depend, protecting our agricultural industry by controlling the supply.

The third part of nine states: “Thou shalt throw out all theories of development and come up with your own”. Of the suggestions in the list thus far this one is potentially the most challenging. Always easier said than done, the list of theories, ideas and initiatives of our own making is considerable, but in reality uncertainty is always an issue when we assess successes due to not always being certain about commitment and full implementation.

And last but certainly not least “Thou shalt not abandon hope” is number 10.
Saving the best for last is not a new tradition and continues with this being the last of the commandments.

One of the primary functions of Government is to provide a framework, within which the private sector can be productive and attract investment. Ours, similarly to others, does so through such actions as guaranteeing the rule of law, legislating to continually improve conditions, constructing and maintaining infrastructure, just to name a few. With technology facilitating the leaps and bounds of productivity, economic growth is a matter of time and preparation. Markets need consumers and consumers need a variety of goods in the market. As we establish more trade links and become better acquainted with the world, our comparative advantages will become even more apparent triggering demand and subsequently economic growth.

The commandments listed by Mahbubani are by no means a complete recipe for economic success, they do, however, prompt thought and self-analysis, which are always excellent starting points for solving problems. There is logic in looking at what can be done versus dwelling on what is beyond our control. What we have to focus on is making Zimbabwe ready to be awarded the title of the world’s number one destination for Foreign Direct Investment. Due to literacy rates and the generally optimistic attitude of Zimbabweans as a people this exercise can be undertaken in a time conscious and comprehensive manner, tapping into the ability and capacity of each and every participating citizen, right from the Government being bold and ambitious enough to make the changes necessary for improvement within their remits, to the seven-year-old children being taught that every piece of paper they discard belongs in a bin. Such a national agenda of improvement alone if sincerely embraced by the majority can be the start of the Zimbabwean economic renaissance we are so much hoping for.

Charles Chiponda is the past president of Zimbabwe National Chamber of Commerce (Matabeleland) and Zimbabwe Institute of Management. He can be contacted at [email protected]