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Africa’s Great Transformation?
Richard Sandbrook
Munk Centre for International Studies, Toronto, Canada
Journal of Development Studies 41(6), 2005, 1118-1125.
“With shoes, one can walk on thorns.” This African proverb opens the section on
“The Argument” in the European Commission for Africa’s Report. Yet the report’s major
problem is that the shoes it offers don’t fit. Hence, following the road to Africa’s
prosperity that the Commissioners survey will be more uncomfortable than they expect.
This report adheres to the Post-Washington Consensus. The Washington
Consensus, which held sway in the 1980s and early 1990s, focused narrowly on
achieving the goal of economic growth by means of macroeconomic stabilization,
economic liberalization, external opening, deregulation, privatization, and minor
institutional reform. This narrow neoliberal approach didn’t work, even according to
those employed by the World Bank [Easterly 2001; Stiglitz 2002; Milanovic 2003]. In
response, the World Bank under James Wolfensohn designed a less orthodox and more
complex strategy – designated by Wolfensohn a Comprehensive Development
Framework – that has become known as the Post-Washington Consensus. At a minimum,
this new consensus treats poverty reduction as a separate, or principal, goal of policy
interventions, acknowledges that freeing markets and shrinking states are insufficient to
trigger growth (let alone poverty reduction), but still holds that the best way forward
involves embracing the private sector as the engine of development, embedding the
market in a facilitative framework of reformed institutions, and providing safety nets to
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ensure that the losers from reform, together with the chronic poor, remain quiescent.
“Ownership” and “partnership” are further elements of the Post-Washington Consensus.
Recovery plans will fail unless African governments, in consultation with their civil
societies, are “in the driver’s seat”, fully committed to their road-maps. Yet, as good
partners, donor countries and the international financial institutions will expedite the
needed changes by offering tested knowledge and generous funding. The Commissioners
succinctly echo this approach by suggesting that “Africa’s entrepreneurial energies can
be released and that growth and poverty reduction will follow. The actions for release of
these energies must originate in Africa and must start with much better governance. But
everything will move so much faster if the developed world provides strong and
sustained support” [p.117].
Accepting these assumptions, the report mainly makes good economic sense.
Certainly, any worthwhile blueprint will tackle poverty (as this report proposes) not only
by promoting rapid growth (with a target of 7 percent per annum), but also by
augmenting the participation of poor people in this growth. If this accelerated growth is
to be achieved through a revitalized private sector, then this will surely require, as the
report suggests, improving the “investment climate.” Civil wars, insurgencies, and
political unrest must be prevented or, where present, resolved through peacebuilding and
post-conflict development. Poor governance must be rectified by enhancing
governmental capacity and accountability to the people. Then the state will play its
designated role as “enabling” an efficient and reliable market economy (rather than
sabotaging it). Physical and social infrastructure, especially healthcare and education,
will need to be supplied. Agricultural productivity will be raised. Growth will also entail
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more trade (in diversified products) and fairer trade (requiring the EU and the USA to
reduce their subsidies and import restrictions on African exports). Finally, donors must
act generously to propel this multi-faceted programme forward. They must be willing to
cancel (or is it just reduce?) the external debts of low-income countries, and double aid to
Africa during the next three to five years (an increase of US$25 billion), with good
performance precipitating a further US$25 billion increase.
To ensure that this growth benefits the poor, the latter must gain the capabilities to
participate productively in an economy premised on private property. The report itemizes
the principal avenues for achieving this goal (see chapter 7). It is necessary to enhance
the poor’s access to healthcare, skills, and education. They must also gain access to
credit. Since a denuded natural environment perpetuates poverty, environmental
protection will become a priority. Poor people without any assets will not thrive, so they
will need to be provided with physical capital, especially land. (This potentially radical
proposal is, unfortunately, not further elaborated.) To reduce the level of their risk and
vulnerability, people entering into market relations will have access to “social
protection.” This protection might include pensions, disability allowances, assistance in
finding work, and measures to enhance gender equity, in addition to free basic healthcare
and education. The programme does not lack ambition.
Although bold thinking is to be applauded, the critic must register certain
reservations. One reservation relates to the realism of the strategy. What is the likelihood
that we will witness a doubling of aid to Africa over three to five years, with potentially a
further increase of US$25 billion thereafter? The past experience of development
assistance does not lead one to be sanguine. Another reservation concerns the ambiguity
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surrounding some of the key proposals. What, for instance, does the report actually
propose to do about the heavy debt burdens of most sub-Saharan African countries? The
proposals vary from “100 per cent debt cancellation as soon as possible” [p.60] to
“cancellation of 100 per cent [of the debt] service falling due from [Heavily Indebted
Poor Countries] that have passed their HIPC completion point [until] 2015” [Annex 9,
Action 1, point 1(c)]. And what precisely is the report proposing when it mentions
providing the poor with physical capital in the form of land? This needs to be spelled out.
Thirdly, the report, to its detriment, focuses heavily upon absolute poverty, but has
relatively little to say about inequality or inequity. (In this respect, too, the report fits the
mould of the current Post-Washington Consensus.) Not only can relative deprivation be
as debilitating to its victims as absolute deprivation, but also the report’s goal of igniting
entrepreneurial spirits may lead to growing, new inequalities. These potentially
destabilizing trends deserve some reflection and response. It is unlikely that the proposed
social protection schemes will be sufficient to offset these trends, in light of the fact that
half or more of the population of these countries is poor. Finally, the technocratic cast of
the report, though inevitable in light of its status as an official document, sharply
diminishes its plausibility: what should be done, will be done. The report largely ignores
or underplays the socio-political realities that will shape the success of this ambitious
enterprise. Nor does it analyze several difficult dilemmas and trade-offs that will ensue.
Unleashing entrepreneurship in Africa -- extending the sway of market exchange,
in other words – involves nothing less than a Great Transformation in countries where,
for many people, economic behaviour is governed by the institutions of redistribution
and/or reciprocity rather than (or in addition to) market exchange.1 Whereas neoliberals
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regard markets as a natural or spontaneous outgrowth of human societies, Karl Polanyi
contended that the market is an “instituted process” - one that is imposed on society.
Market exchange involves a particular notion of rational behaviour, according to which
individuals seek to maximize their material gain, in a context of scarcity, by treating land,
labour and money as commodities. But in Africa, as in some other parts of the world, this
notion of rationality coexists with two other, contradictory rationalities. One is the
rationality of mutual support systems, in which economic activity is, in effect, embedded
in a community – an extended family, a clan, a village, or increasingly in contemporary
Africa, a religious association. Here, a complex set of mutual obligations governs
economic roles and the distribution of the product.2 Typically, neither land nor labour is
regarded as a commodity. The other rationality is that of redistribution, in which a surplus
is channeled to a political centre and then redistributed according to some religious or
political principle. In neopatrimonialism, a contemporary form of redistribution, a central
political elite captures resources from economic actors and redirects these to individuals
and groups on the basis of political allegiance.3 Insofar as all three rationalities – or
institutional matrixes – coexist in the same country in dynamic tension, we may speak of
a hybrid system. Any centralized attempt to displace reciprocity and redistribution in
favour of market exchange will generally involve considerable conflict and disruption.
Disruption arises for two reasons. First, institutions reflect configurations of
power and interests in a society; their attempted transformation, therefore, provokes
intense opposition from the affected groups. For this reason, resistance from patrimonial
rulers and communities to market reforms in hybrid societies sometimes converts the
reforms into caricatures [Hibou 1999]: “nothing is but what is not”. Secondly, institutions
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based on reciprocity and redistribution, though not ethically superior to market
behaviour, do serve crucial societal functions. Hence, the ascent of possessive
individualism may introduce unintended consequences as the integrative functions
formerly served by the principles of reciprocity and redistribution deteriorate.
Although the report recognizes the importance of mutual support networks (in
chapter 3: “Through African Eyes: Culture”), it fails to recognize that its goal of releasing
entrepreneurial energies clashes with their continued vitality. The report marvels at the
capacity of Africans “to operate through an apparent anarchy” [p.127], identifying “social
networks” that, though “invisible” to outsiders, are nonetheless crucial to the functioning
of many communities [p.128]. Indeed, the report acknowledges that “Africa’s strength
lies in these networks” (of family, clan, tribe, etc.). “Africans survive – and some prosper
– in the face of low incomes and few formal economy jobs. The networks create social
capital, which is crucial in [African] survival strategies” [p.127]. A study of Sahelian
cereal producers in Senegal succinctly notes the principle underpinning reciprocity: “I
receive, therefore I exist. I give, therefore I am respected.” The act of giving, a way of
redistributing the surplus, thus “confers respectability and prestige. What is determinant
is the social context which legitimizes the gift so that it is never an isolated act: the gift
creates or reinforces the social ties; it calls for a counter-gift which is never spelt out,
either for its content or for its expiry date”(N’dione, de Leener, Perier, Ndiaye and
Jacolin 1997: 371). This principle, however, contradicts that of market exchange, a
contractual relationship in which participants seek to maximize their personal gain. The
danger is that this ethic will erode the ties of traditional solidarity that provide social
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protection in an unpredictable world, especially in a context where the AIDS pandemic
has already imposed obligations that strain such ties. .
Consider the clash between the norms of reciprocity and those of market
exchange. Community solidarity may, for example, translate into nepotism and
corruption, to the detriment of efficiency criteria in public bureaucracies and private
firms. As well, norms of reciprocity often prescribe the expenditure of resources on
lavish funerals. One’s act of generosity reinforces social cohesion and enhances the
likelihood of support from one’s community in the event that one later encounters
adversity. Market rationality, however, perceives such expenditures as a waste of
resources that might otherwise have been directed into productivity-enhancing
investments. “It is not longer enough to be; to be more, it is necessary to have more and
more, on pain of merely subsisting”, as Senegalese peasants perceive it [N’Dione, de
Leener, Perier, Ndiaye, and Jacolin 1997: 372]. The allure of personal gain may thus
undermine norms of reciprocity. Land, too, is caught in this clash of rationalities. Market
logic defines land as a commodity, and therefore prescribes that private ownership should
override traditional land tenure arrangements. However, communal land tenure rules are
important not only in preserving a degree of equality in the countryside, but also in
underpinning reciprocal arrangements that tie peasant communities together, providing a
safely net in times of trouble [Mkandawire and Soludo, 1999: 112-114]. If mutual
support systems wither in the Great Transformation, will government-supported social
protection schemes, as advocated by the Commission on Africa, be able to fill the
breach? In light of the extensive poverty, one must be skeptical. This issue is one that the
report needs to address.
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Similar dilemmas surround the issue of neopatrimonialism, a form of
redistribution. Again, the report acknowledges some of this complexity (under the rubric
of culture). It notes that a “’big man’ culture” exists in which powerful individuals are
expected to offer patronage, and that “it is not enough to dismiss patron-client relations
simply as channels of corruption” [p.125]. Yet, again, the report does not reconcile this
observation with its strictures about good governance, which would seem to preclude
such practices. Neopatrimonialism presents a dilemma that the report fails to address: it
provides a basis of rule, albeit fragile, in weakly integrated peasant societies, but at a high
cost in terms of economic development. Undercutting this system of rule, even with the
best of intentions, can bring calamitous consequences. The only thing worse than a
poorly functioning neopatrimonial system is a collapsed state.
An elective affinity between neopatrimonialism and the social and material
conditions of many sub-Saharan countries accounts for the system’s prevalence. Rulers
face the challenge of governing poor, weakly integrated, and largely peasant societies.4
Land and labour in the rural areas and the urban informal sector have, as yet, been only
partially converted into commodities for sale on the market. Business classes and urban
middle classes tend to be politically weak, as they are small in numbers, dependent on
governmental largesse, and often poorly organized in representative associations.
Patrimonial traditions retain deep roots in certain cultures [Bayart 1993]. The normative
basis of central authority is weak or non-existent. Rulers, in these circumstances, confront
unpalatable options in maintaining their own positions and consolidating state power.
One option – that favoured by the Commission on Africa and every other similar report –
is that governments build their legitimacy by embracing economic development, the
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provision of improved services to all citizens, and democracy; but this strategy is long-
term and uncertain, while leaders face immediate and insistent demands for tangible
benefits on a personal, local, or ethnic basis. Hence, the imperatives of integrating a
heterogeneous and divided society, building a political base, and cementing personal
power and privilege push rulers toward subordinating market considerations (investment,
efficiency) to short-term political expediency.
Though providing a precarious basis for rule, neopatrimonialism exacts a high
price in missed opportunities. The resources channeled to political loyalists derive from
various sources: from taxes and royalties on agricultural producers, exporters of natural
resources, and importers; from foreign aid, loans and foreign investment; from the
operations of state-owned corporations; and from appointments to the public sector.
Officials feel under constant pressure to capture new resources to maintain the loyalty of
subalterns. Production suffers as rulers invest scarce resources to realize these non-
economic objectives. They divert resources from public investments in high-quality
roads, schools, and health facilities in order to favour cronies and their cronies’ clienteles.
As well, uncertainty and indiscipline, nurtured by patronage appointments to the civil
service, unpunished corruption and fraud, and the insider manipulation of public-resource
allocations, tax collection, licences, imports, and so on, further raise the risks to potential
investors (including the rent-seekers with disposable incomes). Many potential
entrepreneurs respond to these perverse incentives by pursuing state-derived rents or
speculative activities, rather than create new wealth through risky, long-term investments.
Hence, this political-economic system fosters economic stagnation or, at best, modest
growth.
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What to do under these circumstances? The report predictably argues for
reforming this system away through improved governance – creating more accountable,
effective, and transparent government monitored by a revitalized and vigilant civil
society (and by donors grimly holding on to their wallets). This refurbished public sector
will then provide the enabling environment in which entrepreneurial energies can
flourish. Were life so simple! In reality, the triumph of economic and political liberalism
in many countries represents, not mere reform, but revolutionary change: a Great
Transformation. The struggle between liberalism, on the one hand, and neopatrimonial
redistribution and reciprocity, on the other, is an unresolved and ongoing struggle over
basic institutions.
Will economic liberalism prevail, disembedding economy from society and
thereby sweeping away Africa’s hybrid systems? In a few countries, such as Mauritius,
the Great Transformation occurred long ago – in this case, the absence of an indigenous
population meant that the territory developed as a thoroughly capitalist society under
colonial auspices.5 Consequently, the structural adjustment programme that Mauritius
adopted in the early 1980s quickly succeeded in re-igniting growth (about 6 percent per
annum since 1983). But elsewhere, as in Ghana, liberalism and neopatrimonialism
coexist in uneasy tension, and a definitive defeat of the latter is neither imminent nor
certain.6 Structural adjustment, therefore, is a prolonged, halting process. The danger is
that, as in Sierra Leone in the early 1990s, zealous external reformers will use the power
of money to force neoliberal reforms on precarious neopatrimonial systems, thereby
kicking away the remaining pillars of a faltering state system. Desperate to obtain
external resources, Sierra Leone’s rulers accepted all the conditionalities imposed by the
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international financial institutions and donors in exchange for loans. However, the
policies designed to reduce waste, corruption and “mismanagement”, to shrink the state
bureaucracy, and to privatize money-losing state corporations undermined existing
clientele networks. Subaltern patrons, cut off from resource flows from the centre, turned
to free-lancing in their pursuit of resources to distribute.7 Both governmental leaders and
the emergent warlords then refashioned their clientele networks on the basis of external
loans and alliances with private firms with interests in diamonds or timber. The pattern
evolved into the deadly warlord politics that is only now, at tremendous cost, being
contained. Hence, donors will need to employ both patience and a subtle recognition of
underlying realities, if they are to help in Africa’s complex circumstances.
In sum, the report provides a useful compendium of information about Africa and
many positive proposals, but it lacks an acute sense of socio-political realities in that
region. It advocates, in effect, a Great Transformation, but without calculating the costs
and dangers of such a bold vision. It may well be that liberalism will prove to be a
progressive force in Africa; in the meantime, something of value is lost as neoliberalism
undermines mutual support systems and the precarious unity of neopatrimonial rule. It
would help if we all recognized that development or poverty reduction is a double-edged
sword, that history is fundamentally tragic.
NOTES
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1 The distinction among these three principles that govern the integration of the economy in society is drawn
from Karl Polanyi [2001].
2 Goran Hyden [1983: 8-22] deals at length with the nature and implications of this “economy of affection”.
3 For an extensive treatment, see Sandbrook [1985].
4 Peasants, in this context, refer not only to smallholding households on the land, but also to the “peasants in
the cities” – that mélange of petty producers, hawkers, pedlars, helpers, and apprentices that throng the burgeoning
informal sector.
5 For an analysis of the unusual historical origins of market society in Mauritius, see Sandbrook [2005].
6 For a dissection of this struggle in the 1990s, see Sandbrook [2000, chapter 5].
7 On this pattern in Sierra Leone, see Reno [1996]. For the pattern elsewhere in Africa, see Reno [1998].
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