Economist in the Yaradua government must be throwing fits right now. Soludo has the hardest job on earth, where you are supposed to fight the dragon with bare hands. Enjoy the article.
A few weeks ago, it was announced that those funds had risen to 54 billion. The latest story doing the rounds is that these monies are going to be mobilised and shared between the three tiers of government: Federal, States and Local Governments. (They may have already started). That sharing may be constitutional, but many people including this writer are worried about these monies ending up where they are not supposed to end up, especially now that that NIPSS course is about to begin.
The posed a few interesting questions at his blog. Anyone with a trace of Africa in their blood will find it irresistible to attempt answering them. Here I would like to add my two kobo to the discussion. Will Africans speak for themselves? Here I will mostly speak for Nigerians, my knowledge of other African countries does not qualify me to speak on their behalf in this subject? I have asked this question many times before. Initially i thought it was because of the poor penetration of the internet, but I now tend to believe it runs deeper. Here is the most prominent answer I have received, when Nigerians get online, they are looking for an escape they are not looking to complicate or add to the days rigours. There is a disincentive which is not immediately obvious to Africans in diaspora to keep away from 'serious stuff' and tend towards entertainment and news of the lighter shade. Thanks to for crystallizing this idea. Why give a laptop to kids dying of hunger and thirst? As Hash pointed out, there are many who aren't dying of hunger and thirst. I would have used an OLPC as a child growing up in Nigeria, and I am sure it would have been quite useful too. I would have learned about online collaboration and work flow. These laptops could also help bridge the differences between great school for the select few and mediocre school where teacher are hmm mediocre. A lesson downloaded online is pretty the same and save for the individual skill of every teacher the lessons learned will be pretty much similar. The OLPC and a juiced up version of the OLPC has a place in secondary schools too. My personal experience; in 1991 my dad brought home an IBM laptop those boxy types. I can say categorically that that gadget changed my life. There I learned basic word processing(word perfect), lotus(spread sheet) and almighty paradox. Once you had those down the almighty Office 2007 isn't that hard to grasp. That was a 1990 laptop with...(dunno the specs). For me OLPC rocks until we get a cheaper and more powerful replacement. There is an interesting question in the section about computers vs. laptops.
Much has been said about the gains and pains of foreign aid given to African countries by 'supportive' Western economies. The easy money, the resulting structural problems. The exchanges between the even brought some razzmatazz to the AID vs Trade debate, reducing the plight of the Africans to mere platonism in blogs and mainstream media. What can the West do for Africa? Here is something for starters. Help Africans fight corruption. Deterrence to thievery... Take the case of the , where the Americans and the Germans involved in the deal are either on their way or already in the slammer. I find it encouraging that this countries will even come this far. This will also signal to the multi-nationals that the rule of law does not stop at the Murtala (correction by Chxta) Muhammed Airport. Whether this signals will be enough to make a dent in the resolve of determined expats who are ready to do business in Africa at all cost, still remains open for debate. After all there are at least two parties involved in bribery, it would not hurt to have a two pronged approach to fighting corruption in Africa. The West can help African countries by being open and refuse to provide shelters for its citizens who have done Africa wrong. No Safe haven for Stolen Loot... This part will send chills through the spine of every Swiss man. Foreign banks are meant to protect their clients, and there is no point in asking them not to. They would not stop the cover up, because this will inadvertently weaken their systems. However here is what they can do for us. If the West truly care about Africa, declare Africa an endangered species/zone for the next 20 years. So that the funds transferred by African governments and governments officials will be treated different from the whole. This will enable the bankers to keep their reputations as iron-clad, tight- fisted, sealed-lip, bottom-line-driven folks, and yet allow the flow of funds from Africa remain relatively transparent. Africa remains an outlier in the global economy, and I think we are now mature enough to accept it. Looting will become less lucrative if the odds of enjoying the money, is greatly reduced. These will go a long way in fighting the anti-corruption war and more so, it will pave the way towards recovery since now we know, this war is not only about this corrupt Africans but also about some of us who continue to encourage them. Do not forget Sunday is the World Anti-Corruption Day...
I was reading the Nigerian Guardian newspaper recently and saw a report on the development of a Free Trade Zone in Kano State. I noticed that the Federal Government was to pour in approximately N5 billion into the project and learned that an undisclosed investor had already pumped in millions of dollars to complete the project.
For those of you that are unfamiliar with the term Free Trade Zone ("FTZ" and also known as Free Zone ("FZ")), these zones are simply a designated area created to attract foreign investment and business by offering no taxes, relaxed labor rules, relaxed rules on imports and exports of goods. This tool was used by Dubai to transform itself from a desert rest stop for Bedouin nomads to an economic gateway to the Middle East.
It is from this perspective that I consider the possibilities of a Free Trade Zone in Kano. The free trade zone, called Panisau, is located on 230 hectares of land, has an 11 KVA generator, access roads, internal roads and other facilities. By making it easier for investors to 'set up shop', Kano will quite possibly improve its economy and create jobs and much needed cash flow. There are apparently many plans to rejuvenate Kano - a new dry port at Zawaciki, a multi-billion Singer market, the re-construction and expansion of the Lagos-Kano railroad and the possible rehabilitation of the Mallam Aminu Kano international airport.
Kano is also gearing up to become an arbiter of oil. A pipeline from the Delta region will soon be re-routed from Katsina to Kano. This pipeline will provide the state and a few other West African nations with energy. These new projects in combination with the Free Trade Zone could transform Kano into a gateway to not just Northern Nigeria, but to various north African countries.
As early as the 13th and 14th century, Kano was an economic center and controlled commerce in gold, leather, ivory, salt and unfortunately, slaves. In the modern era, it had a rich history as a producer of groundnuts but eventually witnessed an economic decline in the 1990s which led to an increase in poverty. This FTZ at Panisau could afford Kano an opportunity to re-achieve the economic success of its glory days and it could potentially be of great benefit to the citizens. We shall have to wait and see. By . Migrated from AltNigeria.
Here I share my bookmarks over the past week with you. I hope you like. AfricanLoft tells us that we are may be sitting on the solution to our power problems in Africa. The World Changing team think I am cool, hey! I think they are cool too, I am so conceited. New electronic trading pits opens at Nigerian Stock Exchange. Yaradua is hinging the countries growth on the capital markets. The as pointed out by the Africorp group. They also gave us . Grab your tissues Ngozi regrets her early exit from OBJ's government. I no for sure that the story, as printed, is incomplete. More gist on that later. , and we wonder why PHCN would not work. I am tempted to throw in an African adage here, but I'd pass. What is a Nigerian roundup without the news of a corrupt official tucked in there somewhere. , I met this guy at the Muritala Airport in 1995 and he was gracious, and very warm. What can I say, dr. Jeckle... And no I would not leave you hanging like that, here is some good news about a Nigerian politician. .
Thanks to over at for linking to this article in the .
The temptation for taking short cuts on the road to riches has often been as great for entrepreneurs as it has for state officials. . Now, according to a former senior government official, with the state starting to relinquish control of the commanding heights of the economy, there is a greater rapprochement between the two, with money from both public and private sources blending together. Big business and some of the banks are heavily invested in the political system, just as politicians and government appointees are invested in the Nigerian banks and businesses making money, he says. There are significant changes, however, in the way Nigeria’s newly mega-rich are deploying their wealth. In the past, the wealth was hoarded in banks abroad. Today, it is mostly being poured into business enterprises within Nigeria.
This article draws mixed feelings from me, on one hand, I am glad that 'new money' gets it. This way they have done better than 'old money'. However the thieving still continues, leaving my people in stark poverty. It is true that Nigeria is a country in the middle of an enormous process of wealth creation, but the possibility of wealth being redistributed isn't in the horizon. Something has got to give pretty soon. I can feel it. Enjoy the article and hat-tip to Emeka.
An from the book written by at UC caught my attention. Often newspapers carry articles, indices and rankings that have no meaning behind them. As long as the the African countries lay at the bottom of the pile, all is well and good. This gives room for mainstream media and bloggers to trumpet the woes of the motherland. Data interpretation very much like beauty is often in the eye of the beholder. It takes a bold researcher (with no grant at stake) to admit that the data set does not quite interpret the realities on ground. Often we find researchers tweaking the models to fit the reality. Africa has suffered, unduly from indexes and rankings, because of a dearth in representation in qualitative research. The few researchers available are largely outnumbered by the group that insist on painting Africa black.
Available resarch o Africa's hot topics, such as AID, SME's, Microfinance, is relatively few. Many of the studies available seek to expain the African challenge ex-post. Personally I am not too concerned about academic research and the various interesting findings. I get worried when these findings make it into mainstream media and the hands of non-acedemic policy makers. This folks often aren't aware that many research findings in the social science ought to be interpreted with care and in man cases taken with a pinch of salt. Please enjoy this , which quite frankly is easy to read and isn't dense in economic jargon.
Here are few facts from the article;
Income per person in Sweden averaged $25,921 (2000 $ PPP) in 2000-2004. Income per person in Malawi in the same period averaged $784.
He took a swipe at the Index of Economic incentives;
Thus the Heritage Foundation, in an index constructed in conjunction with the Wall Street Journal, ranks Sweden as 21st in the world in its index of economic freedom (72.6% free), and Malawi as 104th (55.5% free) out of 157 countries.
And finds that something rather funky was amiss, so he asked a rather poignant question about the objectives of a rankings like this;
But the weightings of the components of the index are chosen with the result in mind. Had Heritage and the Wall Street Journal produced an index which ranked economic freedom higher systematically in poor countries, no-one would have liked the index. This is not a scientific enterprise, it is an ideological one.
Explaining why he thinks this ranking is erroneous, that is, punishing African countries for disincentives to doing business whereas turning a blind eye to similar negative factors in the case of European economies. Which results in an index that interprets perception rather than one which interprets data.
Yet frequently corruption in low income societies is a way of getting round burdensome bureaucratic requirements. Why should states like those of northern Europe which impose many arbitrary and vexatious requirements on their citizens and businesses be further rewarded in the index of economic freedom by the fact that their soulless bureaucrats are rigid in the enforcement of these regulations?
A case of double counting;
Similarly having assessed Malawi penalties for its legal systems failure to follow the formal rule of law (a whopping 50 points), the Freedom Index then penalizes Malawi a further 41 points under Business Freedom for having a formal set of requirements on business enterprises that are more onerous than in Sweden, even though given the weakness of the legal system we have no idea if any of these rules are applied in practice. The Chinese market traders so evident across countries like Malawi do not seem to have found the formal business requirements of the Malawian legal code too much of an obstacle.
And finally he concludes;
This was an index enterprise whose result was known before it was ever begun, and whose underpinning is an economic ideology that assumes that economic freedom must produce economic growth, so that the absence of growth must be found in a restriction of economic freedom.
Update A reader disagrees with my evaluation; As far as the logic in this paper, no it's not flawless:
if you check these: http://www.heritage.org/research/features/index/country.cfm?id=Malawi http://www.heritage.org/research/features/index/country.cfm?id=Sweden
- The truth is Malawi ranks higher than Sweden in Fiscal Freedom, Labour Freedom, Freedom from Government. So saying that the "flexibility" of the rules is not taken in consideration is quite false. And remember Sweden is not France or Italy, it's quite easy to fire someone there by European standards. - Clarck defines corruption as payment of bribes to avoid taxes/regulation etc.. Do you feel it's the case in general ? Was that the case when that government official fucked up with your project ? Clark decides to use a form of corruption that is far more benign than the reality. - his case for double accounting is weak. Is that the only thing a judicial system does ? enforcing government regulation ? What about settling disputes ? One important part in the Heritage index is Propriety Rights. And those need competent and secure courts to be enforced. Think the effect it has on growth.. - RIGIDITY in the enforcement of regulations IS A GOOD THING. AT least businesses and people are traded equally. No special treatment, no import permits, no wrote off debt, no "no interest" credit for the well-connected. Everybody pays taxes.
My Sino-Indian fascination is no secret, I am intrigued by the idea that countries can make plans and stick to those plans. I am even more fascinated when developng economies pull this feat off.
Singh talked to Nigeria's Economic Management Team which has been set up with the task of putting the country's finances in shape. According to minister of state for external affairs Anand Sharma, the PM focused on human resource and infrastructure development, stressing that the two needed to be aligned.
Singh who also loves teaching, gave a lecture to our planners. Many studies involving Nigeria have however shown that our issues aren't necessarily that of poor planning or a dearth of sound ideas. Our problems have been closely linked to poor implementation of theoretically sound ideas. Really Nigerian economists developed what was ailed as one of the world's best development plan in the late 70's. I recall this same plan deprived me of precious bonding time with Charlie. Now I can officially lay the blame of my mal-adjustements at Nigeria 's feet. Back to the gist, can the present crop of planners in Nigeria truly bang out a workable Nigerian National Development Plan? I dare to say Nope. Structure, Structure, structure. A round table of Keynes, Smith with a sprinkle of Solow can not save our country given its present state. In summary, Nigeria can not be saved by sound economic theory, in my opinion one Sociologist or one psychologist or one law enforcement officer is worth more than a team of economist, given the present state of decay in home country. I also dare to extend this further by saying a -esque intervention has no place in Nigeria.
In a totally unrelated gist, I just learned that Lucky Dube, the South African Raggae star was shot dead. Totally disheartening. I feel like I know Lucky. We bonded in 1995 (when I first dabbled into college life, need I say it did not go well), those were hard days, no water no electricity and buying hand-out(s) and for some folks outright purchase of grades. Lucky and I bonded you know what I mean wink wink. Bonded. R. I.P Lucky.
The growth in Africa can not, and should not rest solely in the service sector (mostly financial service). I fear that the markets may over heat prematurely, which in turn means that Africa will wait for the next wave. You know what they say about development being like surfing. Though this article clearly overstate the possibility of a turn down, the fears expressed are valid. Necessary steps to consciously develop infrastructure that will support the influx of investment ought to be developed, as fast as we can. Investment flows find its level like water, a thin vessel will over flow rather quickly, and in no time the party will be over. I am concerned at Nigeria’s capacity to absorb foreign investment, as it is right now a moderate injections of foreign money into the economy generates a rather uncomfortable aftershock (Re: MTN). With the shake ups being experienced in the Western economies we expect to see a spike in the flow of FDI into Africa. Is the Nigerian economy ready to receive? .While higher commodities prices were certainly the catalyst, other changes in the financial landscape might give Africa its best chance yet to become an investment destination. Many analyst believe the current run up in commodity prices is secular in nature, as the price increases are mostly attributable to long-term trends, and will continue as long as China, India, and other emerging markets continue to grow. If Africa is really going to avoid landing hard if commodities turn south, it will have to undertake difficult but necessary steps to remove the plague of corruption.The growth in the major emerging markets is feeding back into Africa in new ways as well. Investors from China, India, Russia, and the Middle East do not like to invest in credit default swaps and the other new-fangled financial tools touted by Western banks in recent years, according to a recent report (PDF) from RogersCasey. These “resource rationalizers” instead like to park their newfound riches in real assets, which Africa offers at a discount. Written a couple of months ago.
Thousands of African migrants defy the boats, planes standing guard off the coast of Africa. A barricade put up by the European Union Border Control Agency which patrol the shores of Senegal and Mauritania so as to deter potential immigrant from seeking the golden fleece. Every time an entreport is guarded, the migrants come with a more treacherous and longer route to get into the port towns of Ceuta and Milla. The once 3 meter fence now 6 meters have failed to deter the migrants. Upon completing this dangerous journey many migrants who often find themselves homeless, sleeping in the streets of Europe express relief. Because for them it does not matter what fate lay ahead of them. The only thing that that they have made it off the coast of the dark continent.
The new arrivals are obvious. Exhaustion written on their faces, many of them are still not up for speaking even after days in the holding center. Several sit motionless, faces propped up by their hands, on a worn-out sofa. Quiet sighs come from the wounded. They stare into empty space. In reality, though, the problem is not the height of the fence, but the failure to address the root causes of immigration.
via . This is Africa's story a people in desperate need of a solution. An enterprising people held down by socio-economic conditions on the continent who would not take this situation anymore. In 2006, over 6000 bodies of African migrants were picked up trying to make it across the Mediterranean to the Canaries Island. This figure is up by 600% from 2005. Even after the reinforcement of the razor sharp fence, set up to keep the would be assyllum seekers. " an Ivorien says "I want to work in Europe and send money back home," What makes a man leave his home, a land overflowing with natural resources, perfect weather and the distinctively cheerful rhythm of the African continent, and then move to the frigid clime where hopes of survival rest on the number of knock-off sunglasses he is able to hawk on the streets of Europe. What makes a man make these choices? Poverty in Africa do not make the headline of the evening news anymore. However the realities of poverty is stark and hope is grim in some parts of Africa. The immigrants feels the need to leave whatever memories they have of their dear homeland and move to another continent where there is a . I picked up blogging late 2005 when I saw pictures of African migrants left in the Sahara desert to die. For many they speak to, there's a palpable sadness -- even regret -- over the decision to come to Europe. The reality rarely lives up to the dream, and the sacrifices they made are rarely offset by their new life.
The new arrivals are obvious. Exhaustion written on their faces, many of them are still not up for speaking even after days in the holding center. Several sit motionless, faces propped up by their hands, on a worn-out sofa. Quiet sighs come from the wounded. They stare into empty space. In reality, though, the problem is not the height of the fence, but the failure to address the root causes of immigration.
via . Having an Afro-centered outlook does not exclude talking about the ills that our countries face. To me speaking out for change is the most patriotic act you can do today. Making change occur is the most patriotic thing you can do for Africa in the long run. An of this problem from the Oxford University.
Images via BBC. : A NY Times entry on this issue. Speak up, discuss immigration issues. You may be surprised at the number of Europeans and/or Americans who aren't aware of the atrocities committed by their home countries. Blog about this issues if you are a blogger. Send me an email if you aren't a blogger and would like to discuss this issues. In the short run we as Africans reduce the depth of the crisis, while we put our houses in order. Update...
In the report, "Unwelcome Responsibilities: Spain's Failure to Protect the Rights of Unaccompanied Migrant Children in the Canary Islands", Human Rights Watch says the children - mostly boys from Senegal and Morocco - are detained indefinitely in the migrant centers. Children held at four centers told Human Rights Watch they had seen staff violently abusing other children on several occasions. They also said staff ignored violence between detainees.
Recent updates of more immigrants dying on the high seas
A Random African is guest posting, he has some comments about my post The Changing Geography of Oppourtunities. He feels some of my assumption are probably naiive or maybe even untrue. Give it up for the Random African.
Re: Changing Geography of Oppourtunities... So here's a quick semi-drunk draft of the "wrong things":- the focus on India is quite interesting. As far as I know China is growing faster and other Asian countries are doing quite good. So why India ? (i have my bet but let me see what you say)- How Nigeria has easier than India ? now seriously, how ?
India is 10 times bigger, always has a more developed agriculture, a more advanced industrial sector, has an unequal but semi-efficient education system, a better judicial system and far clearer propriety rights. What Nigeria has, as a country to invest in than India hasn't ? Oil ?- What exactly happened in India over the past 20 years ? Well, it's fairly simple: liberalization. Tata which is still the biggest Indian company is more than a hundred years old. And has been owned and operated by that family since creation. There was no privatization to botch, just regulations to withdraw. That means two things: India has been having a local private industrial sector for a long while (yeah rural India is backwards but some sector have been advanced since the colonial period) in India the end of socialist/protectionist policies just meant "get rid of the laws". Nigeria has neither.Actually as a continuation of the "liberalization" vs "privatization" argument. You talk about planning. Long Term, Strategic Planning. Didn't India take off when they actually STOPPED planning ? How do you plan free markets ?- on the issue of low costs: Are low costs possible in an oil economy ? Forget the corruption, are low costs even possible in a country that gets such amounts of free money ? I mean be it through hiring, investing or dumbly spending, the government WILL spend. And that will create inflation. Unless you go Norway but I doubt that would happen (as i see a reference to public-private partnerships).- but here's the most important thing: there is all kind of economic theories about cheap labor and industrialization and they all start with an increase of productivity of the agriculture that makes the peasants move. India has/had it partly because of semi-feudal rural structure but mostly because of their green revolution. How high is the agricultural productivity in Nigeria (or anywhere in Africa north of the Zambeze) ? How is outsourcing services to a country with 70% of rural people, no industry, very low productivity (don't get me started on African productivity), a failed education system gonna work ? basically who is gonna work in call centers (or sweatshops).
Do you think Random African is right? I will be back my own observations.
By now you already heard Prof. Soludo's (ignore the rants of the reporter) I find it interesting how many commenters (fishy word) have turned into overnight monetary economists. Also there ought to be a mass education session organized for our journalists. Is this just pure hype for the sake of making the news or these journalist do not understand arithmetic. Whew, I have been on rantpage recently I still can't get over the U.S. economy's mood swings. Prof. Soludo's has one of the hardest jobs on this planet. What if the Naira was to recalibrate using some other factor like 97, the whole country would have shut down.
The only valid reason the Prof. gave was the referencing argument. Beside this all other adjustments are nuances. A writer mentioned the ease with which bribery in high places will be carried out. I do not think this is valid since only the N20 bill will be added to the existing set.
Thank God, Nigeria will not end up being the first country where a public official will be caught stealing a bajillionNaira.
Winner: The Kobo
Losers: The Nigerian Millionaire's ego.
Some other related blog entries;
: What is the exchange rate of one US dollar to Japanese Yen or Chinese Yuan?
My response: What is worth doing at all is worth doing well, believe me if the Chinese and the Japanese had their way to carry out a overhaul of their economy like the opportunity presented to us by our slow-to-wake up economy, they'd change the calibration of their currency too. But since the gains from carrying out this exercise is little and they are quite far gone in the scheme of things. They've allowed sleeping dogs lie. How would you like to receive the daily reports with the Yen as the reference currency. Same data double headache. As for the bankers talking about curbing inflation, yes the psychological part of inflation . Economist care very little about inflation (note not hyper-inflation) in the first place only politicians do.
What I am about to say will tick a few individuals off. Look at the picture above, do you see Umar? Inasmuch as we ought to protect our identity, tradition and the positive aspects of our culture. Does Umar's dress code fit snugly with the new global economy. I doubt that Nigerians are any more culturally conscious than the Japanese but we do not see Shinzo Abe rocking a . Do we? I am not necessarily advocating for Mr. Yaradua putting on a suit, but I'd like to see him in something in the line of a trimmed down Kaftan, or in the case of Obasanjo 2.0 version of Buba and Sokoto. I'd like to see smarter outfits adopted as the National attire. In the swift global economy image (packaging) is as important as the product which is offered.I find it hard to use technology and or in the same sentence. It projects an old school image which is no longer in tune with the socio-economic field in which we are hoping to become major players. If tearing our politicians from their robes is just too painful to bare, can an able Nigerian designer provide us with a Babariga 2.0. . Update: I hope i do not get fired soon oh.I am getting my Nigerian TV fix at Check out the
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I was reading the Nigerian Guardian newspaper recently and saw a report on the development of a Free Trade Zone in Kano State. I noticed that the Federal Government was to pour in approximately N5 billion into the project and learned that an undisclosed investor had already pumped in millions of dollars to complete the project. 
Thousands of African migrants defy the boats, planes standing guard off the coast of Africa. A barricade put up by the European Union Border Control Agency which patrol the shores of Senegal and Mauritania so as to deter potential immigrant from seeking the golden fleece. 
