Economic
Take-Off is Possible in the Congo
By JONATHAN POWER
LONDON-- Let's imagine what post-Mobutu Congo could
become. It has diamonds, copper and gold. It has rain and
sunshine in abundance. It is not, given its immense size,
overpopulated. It has wise political leadership, a stable
democracy, economic and financial discipline and good
governance. It is the heart of Africa, not Conrad's "The
Heart of Darkness." In a word it is not the Congo it is
Botswana which, bar the rain (Botswana is a desert country),
could be the Congo's twin.
Botswana in the 1960s was one of the poorest African
countries, far poorer than the Congo. Today it is a
prosperous middle-income country. During the 1970s it grew
at a world record breaking 16% a year and in the 1980s a
handsome 11%. in the 1990s it suffered a few bumps when it
was blighted by the worst drought of the century and the
diamond market hit the floor. (Diamonds account for a third
of national income.) But it successfully changed gears and
poured its energy and resources into non-traditional
exports--vehicle assembly, textiles and food processing.
Again the economy is on the up, growing at a healthy 6-7% a
year.
Today, Botswana exudes well-being. Over 30 years, life
expectancy, school enrollment and health care have improved
nothing less than dramatically. It is cutting its tax rates,
privatizing even government departments, eliminating crop
subsidies and turning its attention, more seriously than it
has in the past, to the plight of rural and low-income urban
households.
Despite the setbacks of the early 1990s Botswana still
maintains a sizeable current account surplus. It has more
than $5 billion in official reserves. It maintains a
competitive and stable exchange rate that is stimulating
non-traditional exports.
This is the challenge for the new ruler of the Congo,
Laurent Kabila. The Congo has all of Botswana's material
resources--and more. There is no economic reason, albeit
plenty of political reasons, why the Congo shouldn't go in
the same direction as Botswana. Such beckoning possibilities
influenced Kabila's friend and patron, Yoweri Museveni,
president of Uganda. Uganda too was once a country laid low
by decades of civil war and corrupt dictatorial leadership.
In recent years it has been growing at "tiger" rates,
emulating the early days of South Korea which when it began
its economic take-off in the 1960s was just as poor as much
of Africa.
In truth, these days, there is a new economic mood
percolating through much of black Africa. Last month the
World Bank reported that half of the 48 sub-Saharan African
countries had economic growth of 5% over the last two years.
This is a quite remarkable transformation after so many
years of declining growth, economic derangement and a gross
misuse of opportunities. The World Bank/International
Monetary Fund prescriptions on privatization, trade
liberalization and the scrapping of capital restrictions, so
long derided and ignored, are now coming into their own.
Much of Africa is now ready to go forward and Mr Kabila has
the choice to join the march or remain in the swamps.
Some will argue, as do the authors of a recent study,
"Agenda for African Economic Renewal" published by the
Washington-based Overseas Development Council, that I'm
being over-sanguine about Africa's prospects. It rightly
points out that if economic growth does not accelerate
beyond 5% a year there will be no visible positive impact on
the living standards of a large majority of Africans until
well into the future.
Moreover, the hurdles still to be traversed are both
numerous and difficult, ranging from correct macro-economic
policies to secure property rights, effective legal systems,
better transport and the universal provision of basic health
and educational services. Also needed is an effective civil
service, not to mention the democratic political reform that
is absolutely necessary if over time there is to be improved
economic supervision, reduced corruption and increased
government accountability.
Then there is the sore subject of the legacy of decades
of mismanagement and bad western banking practices, a load
of "unpayable" debt whose interest payments are consuming
every spare penny of the budget of many African
countries.
But there is progress. Democracy and probity are
spreading. The industrialized, debt-lending, countries, as
now with Uganda, are starting to ease the squeeze. And there
are many African countries that could do more themselves to
find the money to pay off much of their debt, by a more
rapid rate of privatization.
Nevertheless, "slow but steady growth" is this study's
down-to-earth best prognosis for Africa, as if this is
anything to be ashamed of, since this is just what today's
industrialized countries did in the nineteenth century. What
is more, set against the last 20 years of African decline,
it would be a triumph of recovery.
But I find such modesty unbecoming. Botswana has shown
that "man's reach must exceed his grasp or what is heaven
for." And Uganda, Lesotho, Malawi, the Ivory Coast and
Angola, with growth rates at east Asian levels, have done a
pretty good job of walking in Botswana's tracks. If I were
Mr Kabila, with a country like the Congo in my hands, I
would reach for the sky and go for it.
May 28, 1997,
LONDON
Copyright © 1997 By JONATHAN POWER
Note: I can be reached by phone +44 385 351172
and e-mail: JonatPower@aol.com
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