Africans are as endowed with certain inalienable rights as any other global citizen and yet the frontiers of poverty have not significantly shifted for the better, notwithstanding the significant investment made in education over the last 53 years of Independence.
The majority of Africans remain in the valley with only a few successfully passing through the bottleneck of opportunity and progress. Even the few, who make it on the opportunity ladder by investing in education, have yet to demonstrate why it is the case that Africa continues to offer hope and opportunity to many born outside the continent.
Isn’t it true that the further one progresses in the education system the more one realises that there is a lot one doesn’t know? There is an awful lot that we do not know about what is required to make Africa advance its economic cause.
What kind of ideology is required to inspire African citizens to believe that they have a stake in the continent’s future? Is socialism the answer or is capitalism, as we know it, the best ideology to inspire hope?
When one looks at Africa’s post-colonial experience it is easy to assign blame to the few individuals who have assumed leadership positions for the failure of the continent to scale the heights of development. A leader can only be as good as the followers want him/her to be. We all expect leaders to be better than us and more significantly to do what we cannot do for ourselves.
Our first ignorance, therefore, is best exposed when we try to find answers for the lack of fast development in Africa. The easy answer is that leaders have let Africa down but rarely do we pause to think about the true nature of leadership and its role in the development chain. A leader is human after all and it would be naïve for anyone to expect another individual to do what one cannot do for himself/herself.
Many of our state actors hold the view that a key role of the state is to tax the rich so that the poor can have a better life underpinned by state intervention.
Accepting this view has its own consequences. A key source of state revenues has to be the taxes levied on income earned. If no income is earned or if the tax base diminishes because of misguided public policies, the state is the direct loser and the poor are the ultimate losers.
Any state that aspires to grow has to compete for human skills and capital. Money will not stay in oppressive environments and human beings are no different. If the tax burden on working people increases then one should expect an exodus of such resources in search of greener pastures.
Human beings sell time for cash in the same way business people convert resources into products and services that are in turn converted into cash.
If people feel that their time can fetch a better return in another environment they will gravitate towards that environment. No force can stop human beings from attempting to maximise return for the time they offer in a labour market.
Working people would not want their return to be controlled administratively and, therefore, they tend to favour a flexible and dynamic labour market.
The market system is founded on the “greater fool principle”, meaning that for an exchange of value to take place there must be a greater fool at the transaction point.
Such a fool must be a willing market participant. For instance, when one picks a product in a store one must anticipate a reduction in the cash asset available for the exchange to take place. The price of the goods has to be greater than the costs incurred in producing or purchasing the goods. If the buyer knows the real cost then such a buyer would not be the best candidate to make a trade at the transaction point.
Have you not noticed that when a buyer purchases a good at a certain price only to find out that the same good is selling at a lower price the buyer would feel cheated and yet there is little the buyer can do in many instances to reverse the transaction. The fool has to be the buyer. Only in politics do you see a fool being the voter who more often than not has any chance of recalling a bad politician once elected.
If someone becomes rich through the intermediation of the market then it is true that at the transaction point there must be a happy buyer and a happy seller, suggesting that the wealth created cannot be harmful in any progressive society.
If the market evaporates, will the profit and business success increase? Once one understands the manner in which a market system works then it becomes easier to craft policies that encourage supply response.
Any policies that scare producers will ultimately be counterproductive to the cause of the poor. Those who climb the opportunity ladder through the intermediation of the market system are comforted that such mobility is only possible through the support of willing market participants.
Is it not, therefore, strange that one often hears in many conversations, for instance, people talking of “white” banks to describe the financial institutions that dominate the financial system of contemporary Africa, forgetting that such institutions can only thrive because of the support of the majority “black” African citizens?
Why would one complain about the racial character of institutions when at the transaction point no hostile exchange is in evidence?
There are many of us who are highly educated but financially illiterate and ignorant.
How do we bridge the knowledge divide? It is critical that we begin to change the content of our conversations.
A supplier has to be guided by what the customers want in as much as a state actor’s actions have to be informed by the income earners. The more a country invests in producing income earners the easier it will be to reduce the frontiers of poverty.
At any transaction point in a progressive country it would be strange to find people fighting or a supplier forcing a buyer to purchase a product. A businessman has to accept that a failure to anticipate the needs of the customer has consequences.
Equally, the failure for any politician to anticipate the requirements of existing and future taxpayers can undermine the country’s cause.
In as much as we may despise the West one has to accept that human and physical capital requires less persuasion to be domiciled in such jurisdictions.
Is it not strange that many of Africa’s financial pop stars would rather keep their money in safe environments that are external to Africa?
Badly governed states will inevitably complain of externalisation when it is only their policies that have the effect of undermining confidence and stability.
Unless we can appreciate what is required to attract capital, including human capital, the prospects for Africa advancing its cause will always be qualified.
Mutumwa Mawere is a Zimbabwean-born South African businessman.
By Mutumwa Mawere