LETTERS TO THE EDITOR

Spring 2010

by Renier Nijskens

EU efforts to help Africa to create a more investment-friendly business environment could be strengthened hugely were the EU to streamline its development assistance, including simplified access and better coordinated delivery.

Sir,
Quick fixes are all too familiar in the field of international development. But if Mo Ibrahim’s ‘square deal’ for Africa is to last, all partners must be guided by a common, genuine and long-term ‘win-win’ objective. Achieving this will demand change both in Europe and in Africa.

From an EU perspective, there is an avowed willingness to foster development, which is backed by substantial funds. Yet the European Union needs to look again at how best to take on board genuine African concerns about much-needed regional integration. The controversy surrounding the proposed Economic Partnership Agreements should not be allowed to put a strain on Africa in this regard.

EU efforts to help Africa to create a more investment-friendly business environment could be strengthened hugely were the EU to streamline its development assistance, including simplified access and better coordinated delivery. Progress on this front also requires much larger financial incentives, with fewer ties to EU conditions and more links to the sort of progress that is measured by home-grown (and truly effective) tools such as the African Peer Review Mechanism and the Ibrahim Index of African Governance.

On the African side, Ibrahim’s ‘square deal’ would benefit from a number of improvements which go beyond the greatly improved technical and regulatory aspects of dealing with foreign investments. One major unwritten constraint still present in most African countries is the shadow of unwanted political interference in successful businesses. Too often foreign investors face aggressive pressure from ruling elites to let them manage or deal with new capital and investments. A refusal is often the start of a severe and destructive backlash. Such practices substantially limit the flow of essential “A” Class investment into Africa. A clearer separation of the political sphere and the private economic environment – and an end to ‘pleasing’ and ‘greasing’ – could work wonders.

Public opinion within Africa could also become an extraordinary tool to help strengthen the continent and improve its stature. The African people deserve a greater say in the management of their public affairs and, thanks to the boom in communication technology and greater access to education, ordinary citizens now have a better chance than ever to make their voices heard.

There is today unprecedented potential for Africans to understand and challenge the “no questions asked” approach to investment which, while it might bring short-term advantages to some, cannot encourage good governance in the longer-term. And, as Ibrahim says, good governance is the cornerstone of solid and lasting development for all.