Category: Africa

Using a T-shirt to Tell the Story of Progress


Source of image: Amazon.com

The protests occurred on ”a cold day in February 1999.” Ms. Rivoli was watching as students gathered at the gothic centerpiece of Georgetown to demonstrate against the International Monetary Fund, the World Trade Organization, and other putative villains of international trade. The crowd, Ms. Rivoli noticed with characteristic acuity, had ”a moral certainty, a unity of purpose” that permitted it to distinguish black from white and good from evil ”with perfect clarity.” One woman seized the microphone and asked: ”Who made your T-shirt? Was it a child in Vietnam? Or a young girl from India earning 18 cents per hour? Did you know that she lives 12 to a room? That she shares her bed and has only gruel to eat?”
Ms. Rivoli did not know these things, and she wondered how the woman at the microphone knew. But she decided to find out. In the rest of her narrative, the author tells the story of ”her” T-shirt, which she purchased for $5.99 by the exit of a Walgreen’s in Fort Lauderdale, Fla. ”It was white and printed with a flamboyantly colored parrot, with the word ‘Florida’ scripted beneath.” A company in Miami had engraved the front, after buying the shirt from a factory in China. The Chinese manufacturer had purchased the cotton used to make the shirt from Texas. Eventually it will end up as part of a large but little-known market for used clothing destined for resale in East African ports.
. . .
By looking across history to the shifting center of textile manufacturing from Manchester, England, to Lowell, Mass., to South Carolina to Japan and, finally, the developing nations of Asia, Ms. Rivoli discovers a universal truth. Without making light of the horrors experienced by workers, she asserts that their jobs were a little better than other available options (usually farm work) and, what’s more, that textile factories led to advances in industrialization and, just as dependably, in living standards. It is not too much to say that she uses the T-shirt to tell the story of progress.

For the full commentary on Rivoli’s book, see:
ROGER LOWENSTEIN. “OFF THE SHELF; Travels With My Florida Parrot T-Shirt.” The New York Times, Section 3 (Sun., August 21, 2005): 7.
The book is:
Pietra Rivoli. The Travels of a T-Shirt in the Global Economy: An Economist Examines the Markets, Power, and Politics of World Trade. John Wiley & Sons, 2005. ISBN: 0471648493

“Sachs Aid Model Has Financed Tyranny”: More on Why Aftrica is Poor


Famine in Niger is no surprise — desert wastes, locusts and decades of Marxist rule keep it second-to-last on the world poverty list. Famine in the fertile climes of southern and eastern Africa, however, seems more shocking. But there’s a common thread: centralized state rule — incompetent at best — marked by corruption and sustained by aid. These are the shackles that keep Africans poor: It would be nice if EU and U.S. trade barriers were removed at trade talks in Hong Kong this week, but exports are a distant notion to the 75% of Africans who live off the land.
Niger is little-blessed by nature, but it has also spent its postcolonial era trying various forms of failed government, with Marxism reigning longest. A quarter of the population — 2.5 million people — faces starvation. Yet more temperate southern and eastern African countries are on the edge of famine, too, with 10 million affected in southern Africa alone. Again, we find the same economic profile: Zimbabwe, Malawi, Zambia, Mozambique, Swaziland and Lesotho all lack economic freedom and property rights; all have economies mismanaged by the state; all depend on aid. All these countries have a history of utopian schemes that failed to produce everlasting manna. State farms, marketing boards, land redistribution, price controls and huge regional tariffs left few incentives or opportunities for subsistence farmers to expand. Despite torrents of aid, these cruel social experiments could not turn sands verdant or prevent the granaries of southern and eastern Africa from rotting.
Ethiopia’s Prime Minister Meles Zenawi believes that allowing Ethiopians to own their land would make them sell out to multinationals. He seems to have overlooked a basic market principle: It demands a willing seller and a willing buyer at an agreed price. If that price is worth selling for, the farmer might have some money to reinvest elsewhere; if that price is worth buying for, the purchaser must have plans to make the land profitable. If there is no sale, owners might have an incentive to invest in their own land and future, having, at last, the collateral of the land on which to get a loan. After decades of socialism, Ethiopia’s agricultural sector — the mainstay of the economy — is less productive per capita than 20 years ago when Band Aid tried to defeat famine. Although 60% of the country is arable, only 10% has been cultivated. Ethiopia is entirely dependent on donations; but instead of grasping reality, Mr. Zenawi, a member of Tony Blair’s “Commission for Africa,” is forcing resettlement on 2.2 million people.
In Zimbabwe, the murderous kleptocrats of Robert Mugabe’s regime deny that land seizure has pushed their rich and fertile country into famine: Some three million people face starvation today.
. . .
African leaders must be pushed to reduce economic intervention, free financial markets, remove bureaucratic obstacles to setting up businesses, establish property rights and enforce contract law. These are the forces that release entrepreneurial energy. But the ruling cliques will do none of these unless forced to do so as a condition of aid. The Sachs aid model has financed tyranny and corruption for 40 years, leaving Africans destitute. The world trade meeting in Hong Kong will hear cries for “Trade Justice” for Africa, representing more protectionism and more state-run, aid-fueled schemes. What we really need is economic freedom and the rule of law at home: We are perfectly capable of improving our own lot if only allowed to do so.

For the full commentary, see:
FRANKLIN CUDJOE. “The Terms of Trade: Africa Needs Freer Markets — and Fewer Tyrants.” The Wall Street Journal (Weds., December 14, 2005): A20.
(Note: ellipses added.)
(Note: The WSJ identifies Mr. Cudjoe as “director of Imani, a policy think tank in Ghana.”)

Researchers Want PhDs, “We want development”: More on Why Africa is Poor


Researcher asks Kenyans their reaction to a Western men’s health magazine.   Image source: online version of article cited below.
(p. 1) LEWOGOSO LUKUMAI, Kenya – The rugged souls living in this remote desert enclave have been poked, pinched and plucked, all in the name of science.   It is not always easy, they say, to be the subject of a human experiment.
. . .
(p. 6) Over the years, the Ariaal have had hairs pulled not just from their heads, but also chins and chests.   They have spat into vials to provide saliva samples.  They have been quizzed about how often they urinate.  Sometimes the questioning has become even more intimate.
Mr. Garawale recalls a visiting anthropologist measuring his arms, back and stomach with an odd contraption and then asking him how often he got erections and whether his sex life was satisfactory. ”   It was so embarrassing,” recalled the father of three, breaking out in giggles even years later.
Not all African tribes are as welcoming to researchers, even those with the necessary permits from government bureaucrats.   But the Ariaal have a reputation for cooperating — in exchange, that is, for pocket money.
. . .
The Ariaal have no major gripes about the studies, although the local chief in Songa, Stephen Lesseren, who wore a Boston University T-shirt the other day, said he wished their work would lead to more tangible benefits for his people.
”We don’t mind helping people get their Ph.D.’s,” he said.  ”But once they get their Ph.D.’s, many of them go away. They don’t send us their reports.  What have we achieved from the plucking of our hair?  We want feedback.  We want development.”
For the full story, see:
MARC LACEY. “Remote and Poked, Anthropology’s Dream Tribe.” The New York Times, Section 1 (Sun., December 18, 2005): 1 & 6.

Ethiopian Comparative Advantage Squandered through Graft and Corruption: More on Why Africa is Poor

   The source for the image of the book is: http://nasw.org/users/markp/grounds.html

 

One theory of how countries acquire a comparative advantage in a commodity ties the comparative advantage to some natural resource, climate or other "endowment" advantage the country has. This partially ‘explains’ some comparative advantages, but leaves many others unexplained (like why Japan has a comparative advantage in cars).

But even on the endowment theory’s own terms, it would seem that an initial comparative advantage can be squandered. Consider Ethiopia, which is the country in which coffee beans were first discovered, many centuries ago.

(p. 153) . . . Ethiopia, the birthplace of coffee, now exported a negligible amount of the bean, largely due to graft and corruption extending from King Menelik down to the country’s customs agents, . . .

(King Menelek II ruled Ethiopia from 1889 until his death in 1911.)

 

The quotation is from:

Pendergrast, Mark. Uncommon Grounds: The History of Coffee and How It Transformed Our World. New York: Basic Books, 2000.

 

Economic Growth Achieved by Entrepreneurs Taking Prudent Risks

(p. 489) Nor should anyone feel guilty about taking prudent risks.This is a fundamental truth that I learned from Joseph Schumpeter, who believed that without entrepreneurs willing to bring new products and ideas to the market and investors ready to finance them, it would be impossible to achieve real economic growth.The alternative, as we have learned to our sorrow in the twentieth century, is government control of the factors of production with results that can be seen in the devastated landscapes and abandoned factories of Russia and Eastern Europe, and the scarred lives of billions of human beings throughout Asia. South America, and Africa.

Rockefeller, David. Memoirs. New York: Random House, 2002.

Good Eating for Experts: More on Why Africa is Poor

Michael Wines, writing from Malawi in Africa:

It makes one wonder why, with so many experts here to do good, the rest of the country not only isn’t thriving, but is slipping backward.
. . .
There is even a hilarious poem demonizing “the development set”:

We bring in consultants whose circumlocution
Raises difficulties for every solution
Thus guaranteeing continued good eating
By showing the need for another meeting.

MICHAEL WINES. “Letter From Malawi: Amid Squalor, an Aid Army Marches to No Drum at All.” The New York Times (Weds., December 7, 2005): A4.

Audacious Nigerian Kleptocrat Cross-dresses to Evade Justice: More on Why Africa is Poor


“Workers installing imported marble on a staircase at Mr. Alamieyeseigha’s official mansion.” Photo by Michael Kamber for The New York Times. Source of photo and caption: http://www.nytimes.com/2005/11/29/international/africa/29nigeria.html?pagewanted=1

YENAGOA, Nigeria, Nov. 22 – Precisely where in the rogue’s gallery of corrupt Nigerian leaders Diepreye Alamieyeseigha will fall is a matter for history to judge. Gen. Sani Abacha, the military dictator who helped himself to at least $3 billion and salted it away in foreign bank accounts, doubtless stole far more.
But General Abacha – who ruled the country from 1993 to 1998 – never fled money-laundering charges in a foreign land by donning a dress and a wig to match forged travel documents, as Mr. Alamieyeseigha, the governor of a small oil-producing state in the Niger Delta, did last week, government officials said.
For their sheer audacity, his antics are likely to earn him a prominent place among the leaders who in the past four decades are believed to have stolen or misspent $400 billion in government money, most of it the profits from Nigeria’s oil reserves.
“It is a new low,” said Gani Fawehinmi, one of Nigeria’s most prominent lawyers and a longtime campaigner for good governance. “And in Nigeria that is saying something.”
Mr. Alamieyeseigha is suspected of siphoning millions of dollars in cash and buying an oil refinery in Ecuador along with several houses in London, California and South Africa. He has denied stealing money from the state.
The sordid saga of the governor comes as the federal government has engaged in a broad effort to rehabilitate the country’s image around the world.
Long associated with rampant corruption and kleptocratic governments, Nigeria has year in and year out gotten one of the worst scores in Transparency International’s world corruption perception index, though this year its rating improved slightly.
Corruption touches virtually every aspect of Nigerian life, from the millions of sham e-mail messages sent each year by people claiming to be Nigerian officials seeking help with transferring large sums of money out of the country, to the police officers who routinely set up roadblocks, sometimes every few hundred yards, to extract bribes of 20 naira, about 15 cents, from drivers. (p. A1)

For the full article, see:
LYDIA POLGREEN. “As Nigeria Tries to Fight Graft, a New Sordid Tale.” The New York Times (Tues., November 29, 2005): A1 & A12.

World Bank’s Favorite New Book

Speaking of Paul Wolfowitz, the new World Bank President:

His favorite new source book is the World Bank’s “Doing Business” report, an annual guide to the obstacles that countries impose on their own entrepreneurs. The 2006 version is just out, and for the first time Mr. Wolfowitz had it rank countries, from 1 to 155, on the “ease of doing business.” New Zealand ranked first, and the U.S. third (after Singapore), but African nations held down 25 of the last 30 places.
Take Burkina Faso, a landlocked West African country that came in at . . . 154. “If you were in a food supply business,” Mr. Wolfowitz says, “registering a business would require minimum capital equal to nearly five times annual income. Fees alone cost 1½ times income per capita . . . to register your land, you have to pay fees, 16% of the value of the land. So the result is in a country of 12 million people, only 50,000 are in the formal” economy.
So why is he optimistic? Burkina has grown for the last decade, he says, and the country has political cohesion. “I had a great meeting with the president of Burkina” on a recent trip, and “I shouldn’t say this, but I want to find a way to communicate these results to him and say, do something about it, your country will grow even more.”

PAUL A. GIGOT. “Dr. Wolfowitz, I Presume.” Wall Street Journal (September 24, 2005): A10.
The “Doing Business” report is in its second or third annual version, and is described enthusiastically in Thomas Friedman’s new book The World is Flat. John Devereux suggested to me that one interpretation of the criteria used for the ranking, is that they are a step in the direction of measuring openness to creative destruction.

The Abuse of Power

FateOfAfricaBK.jpg
From a review of a promising book:

Most African countries have been atrociously governed in the past half-century. A lack of institutional checks has allowed an array of incompetent strongmen to rule as they pleased until the money ran out, at which point northern donors often tossed them an extra bundle of cash.
. . .
Kwame Nkrumah, for example, is widely revered. The founding father of independent Ghana, he was also an eloquent advocate of a united Africa. Africans tend to recall him as a man of great personal integrity who strove mightily to drag his country into the industrial age. Mr. Meredith lays out the facts. Nkrumah paid for his grand (and uniformly loss-making) industrial projects by squeezing money out of Ghana’s poorest citizens, the peasants, and by borrowing recklessly. He was utterly clueless about money. When his finance minister told him in 1963 that the national reserves were less than $1.4 million, he “sat in silence for fifteen minutes, then broke down and wept.”
He not only wrecked the Ghanaian economy; he also snuffed out such political freedoms as the country had enjoyed at independence. He had a law passed in 1958 allowing him to jail anyone suspected of subversive intentions. Twelve parliamentarians objected, on the ground that such a power was sure to be abused. Eleven of them were jailed, which rather proved their point.

ROBERT GUEST. “So Badly Misled.” The Wall Street Journal (Weds., August 31, 2005): D10. (A review of: Meredith, Martin. The Fate of Africa. PublicAffairs, 2005.)