Africa – Page 8 – artdiamondblog.com

How the Congo Government ‘Inspires’ Technology Entrepreneurs: More on Why Africa is Poor

"Micheline Kapinga of Kamponde, Congo, uses a cellphone on the only site in the village that is sometimes able to capture a signal." Source of caption and photo: online version of the NYT article cited below.

I AM just back from Tanzania in East Africa.

In the mornings, disregarding the protests of the armed guards at my lodge near Arusha, I jogged along muddy footpaths. After the heavy rains, and under a low, misty sky, the fields looked as ruined as a battlefield. Very poor farmers and their children stared curiously at me as I passed.

In the afternoons, I attended the TEDGlobal 2007 conference, held by the Technology, Entertainment and Design organization in the modern Ngurdoto Mountain Lodge. The contrast between the two experiences troubled me.

TED conferences, mostly held in Monterey, Calif., are invitation-only affairs, are attended by the aristocracy of Silicon Valley and are known for their adventurousness in drawing together wildly disparate trends in technology, business and the arts.

On this occasion, Bono, the Irish rock star and champion of African causes, had persuaded the conference’s organizer, Chris Anderson, to invite the usual crowd, as well as African entrepreneurs, activists, health care professionals and artists to this tropical, leafy region midway between the Serengeti Plain and Mount Kilimanjaro.

. . .

At least one of the African attendees of the conference was representative of the kind of technological entrepreneurialism that the show advocated.

Alieu Conteh, the chairman of Vodacom Congo, was born in Gambia, in West Africa, 55 years ago and moved to Congo in 1981. For years, he was a successful coffee buyer and exporter.

Congo is about the size of Western Europe and has an estimated population of 65 million people. It is one of the least-developed nations in the world, with less than 300 miles of roads, most of them in poor condition.

In 1997, Mr. Conteh recalled in an interview, he heard Laurent D. Kabila, then the country’s president, deliver a speech in which he called upon his countrymen to rebuild Congo’s infrastructure after the 30-year dictatorship of Mobutu Sese Seko. Mr. Conteh, who had no experience in telecommunications, said he was inspired. He decided to build the nation’s first GSM (Global System for Mobile communications) digital network.

At the time, according to Mr. Conteh, fewer than 10,000 people living in Congo — mainly business people, foreigners and government employees — had mobile handsets. They paid $7 to $10 a minute to make a call, using an older technology. Less than 15,000 homes had a telephone landline.

Mr. Conteh said he went, cap in hand, to the minister of communications to ask for the country’s first GSM license. In January 1998 he got it — but he first had to pay the government a license fee of $100,000. Over the years, and with little explanation, he said, the government, which is often terribly short of money, increased the license fee, first to $400,000, then $2 million.

For more of the commentary, see:

JASON PONTIN. "SLIPSTREAM; What Does Africa Need Most: Technology or Aid?" The New York Times, Section 3 (Sun., June 17, 2007): 3.

(Note: ellipsis added.)

Mugabe Driven by Quest for Power, More than from Paranoia, or Marxism: More on Why Africa is Poor

No one outside of Mr. Mugabe’s inner circle, of course, can say with certainty why he has pursued policies since 2000 that have produced economic and social bedlam. For his part, Mr. Mugabe says Zimbabwe’s chaos is the product of a Western plot to reassert colonial rule, while he is simply taking steps to fight that off.

Among many outside that circle, however, the growing conviction is that Zimbabwe’s descent is neither the result of paranoia nor the product of Mr. Mugabe’s longstanding belief in Marxist economic theory. Instead, they say, Zimbabwe is fast becoming a kleptocracy, and the government’s seemingly inexplicable policies are in fact preserving and expanding it.

. . .

Mr. Mugabe’s government declares currency trading illegal, but regularly dumps vast stacks of new bills on the black market, still wrapped in plastic, to raise foreign exchange for its own needs, business leaders and economists say.

The nation’s extraordinary hyperinflation, last pegged by analysts at 10,000 percent a year, is an economic disaster that, by all accounts, the government needs to address. Yet after it ordered merchants in July to slash their prices, cadres of policemen and soldiers moved into shops to enforce the new controls, scoop up bargains and give friends and political heavyweights preferential access to cheap goods.

. . .

Mr. Mugabe’s 25-bedroom mansion in Borrowdale, the gated high-end suburb of Harare, the capital, is the locus of a boomlet that has spawned luxury homes for government and party officials. (Mr. Mugabe said his mansion was built with goods and labor donated by foreign governments.)

Mr. Mugabe arrived to open Zimbabwe’s Parliament this month in a Rolls-Royce. Equally telling, the legislature’s parking lot was crammed with luxury cars.

Such riches have been accompanied by a steep decline in living standards for just about everyone else. The death rate for Zimbabweans under the age of 5 grew by 65 percent from 1990 to 2005, even as the rate for the world’s poorest nations dropped. Average life expectancy here is among the world’s lowest, according to the United Nations.

For the full commentary, see:

MICHAEL WINES. "News Analysis; Zimbabwe’s Chaos: The Powerful Thrive." The New York Times (Fri., August 3, 2007): A8.

(Note: ellipses added.)

Pyramids Can Take Many Forms: More on Why Africa is Poor

My Wabash economics prof Ben Rogge used to say that rulers have always liked to spend the people’s money to build pyramids intended to proclaim the glory of the ruler. But in modern times the rulers have to be a tad more subtle than the Egyptians, so, for instance, in Brazil they build Brazilia, instead of actual pyramids.

And according to the story below, summarized from the May 2007 IEEE Spectrum, in Africa, they build large dams.

Small dams could help deliver electricity to much of Africa’s population, but since they lack the prestige of larger-scale projects, few of them get built.

. . .

In Uganda, which has plenty of rivers and streams to supply power, Mr. Zachary describes how a small water-power generator, supplied by a small nearby dam, delivers 60 kilowatts of energy to a nearby hospital. The generator would barely be enough to run a single magnetic-resonance imaging machine, a staple in Western hospitals. But it does provide enough power to light the hospital and keep basic equipment running for the 100 nurses and doctors who work there. The entire generation system cost $15,000 to build.

Still, Africa’s leaders are unlikely to abandon their preference for big public works, says Mr. Zachary, since they create thousands of construction jobs and reinforce the political might of the central government.

For the full summary, see:

"Informed Reader; ENERGY; Small Dams Might Help to Electrify Africa." The Wall Street Journal (Tues., May 8, 2007): B10.

(Note: ellipsis added; the original article in IEEE Spectrum is by G. Pascal Zachary.)

Let There Be Light

One of Mark Bent’s solar flashlights stuck in a wall to illuminate a classroom in Africa. Source of the photo: http://bogolight.com/images/success6.jpg

What Africa most needs, to grow and prosper, is to eject kleptocratic war-lord governments, and to embrace property rights and the free market. But in the meantime, maybe handing out some solar powered flashlights can make some modest improvements in how some people live.

The story excerpted below is an example of private, entrepreneur-donor-involved, give-while-you-live philanthropy that holds a greater promise of actually doing some good in the world, than other sorts of philanthropy, or than government foreign aid.

FUGNIDO, Ethiopia — At 10 p.m. in a sweltering refugee camp here in western Ethiopia, a group of foreigners was making its way past thatch-roofed huts when a tall, rail-thin man approached a silver-haired American and took hold of his hands.

The man, a Sudanese refugee, announced that his wife had just given birth, and the boy would be honored with the visitor’s name. After several awkward translation attempts of “Mark Bent,” it was settled. “Mar,” he said, will grow up hearing stories of his namesake, the man who handed out flashlights powered by the sun.

Since August 2005, when visits to an Eritrean village prompted him to research global access to artificial light, Mr. Bent, 49, a former foreign service officer and Houston oilman, has spent $250,000 to develop and manufacture a solar-powered flashlight.

His invention gives up to seven hours of light on a daily solar recharge and can last nearly three years between replacements of three AA batteries costing 80 cents.

Over the last year, he said, he and corporate benefactors like Exxon Mobil have donated 10,500 flashlights to United Nations refugee camps and African aid charities.

Another 10,000 have been provided through a sales program, and 10,000 more have just arrived in Houston awaiting distribution by his company, SunNight Solar.

“I find it hard sometimes to explain the scope of the problems in these camps with no light,” Mr. Bent said. “If you’re an environmentalist you think about it in terms of discarded batteries and coal and wood burning and kerosene smoke; if you’re a feminist you think of it in terms of security for women and preventing sexual abuse and violence; if you’re an educator you think about it in terms of helping children and adults study at night.”

Here at Fugnido, at one of six camps housing more than 21,000 refugees 550 miles west of Addis Ababa, the Ethiopian capital, Peter Gatkuoth, a Sudanese refugee, wrote on “the importance of Solor.”

“In case of thief, we open our solor and the thief ran away,” he wrote. “If there is a sick person at night we will took him with the solor to health center.”

A shurta, or guard, who called himself just John, said, “I used the light to scare away wild animals.” Others said lights were hung above school desks for children and adults to study after the day’s work.

For the full story, see:

Will Connors and Ralph Blumenthal. "Letting Africa’s Sun Deliver the Luxury of Light to the Poor." The New York Times, Section 1 (Sun., May 20, 2007): 8.

(Note: the title of the article on line was: "Solar Flashlight Lets Africa’s Sun Deliver the Luxury of Light to the Poorest Villages.")

Source of map: online version of the NYT article cited above.

Easily Available Capital and Technology Lower Barriers to Entry in Oil Industry

"Cobalt scientists analyze data to help pinpoint oil deposits." Source of caption and photo: online version of the NYT article cited below.

(p. 1) HOUSTON. JOSEPH H. BRYANT, still boyish-looking at 51, jostles with glee among tens of thousands of people here at the Offshore Technology Conference, one of the energy industry’s biggest trade fairs. He is surrounded by newfangled technologies occupying more than half a million square feet of display space: drills stuffed with electronic sensors, underwater wells shaped like Christmas trees, mini-submarines and pipes, pumps, tubes, gauges, valves and gadgets galore.

“There is every little gizmo you need to make this business work,” Mr. Bryant says, joyously. He stops at a plastic model of an offshore oil rig, an exact replica of a huge platform he commissioned while running BP’s business in Angola a few years ago. “I love this stuff.”

Like the pieces of a giant puzzle, the parts showcased here could fit together and build an oil company — and that’s exactly what Mr. Bryant set out to do two years ago after a 30-year career directing energy projects for the likes of Amoco, Unocal and BP. With a team composed largely of retired energy executives, he wants to hunt for oil in the deep waters of the Gulf of Mexico or offshore West Africa, challenging Big Oil in its own backyard.

The American oil patch, once left to languish during an extended period of low oil prices, is on the rebound. Wildcatters like Mr. Bryant are ready to pounce. With oil prices now hovering around $60 a barrel — three times higher than they were throughout the 1990s — the industry is expanding at a pace last seen decades ago.

“The oil industry has changed dramatically in the last 20 years,” Mr. Bryant says. “Barriers to entry have dropped significantly. It doesn’t matter if you’ve been in the business 100 years or 100 days.”

Easily available capital and technology, once the preserve of traditional oil companies, are reordering the business. Investors are lining up to finance energy projects while leaps in computing power, imaging tech-(p. 7)nology and collaborative online networks now allow the smallest entities to compete on an equal footing with the biggest players.

“There’s a lot of money out there looking for opportunities,” said John Schaeffer, the head of the oil and gas unit at GE Energy Financial Services. “It seems like everyone wants to own an oil well now.”

Still, oil exploration remains a costly business fraught with peril. While the odds have improved, success is elusive; three-quarters of all exploration wells come up dry, either because there is no oil or because geologists miss its exact location. All of which means that Mr. Bryant’s start-up, Cobalt International Energy, which plans to begin drilling next year, faces formidable hurdles.

“There’s no sugar-coating this — at the end of the day, it’s a high risk venture,” Mr. Bryant says. “Financially, we’re definitely wildcatting. It’s either all or nothing.”

For the full story, see:

JAD MOUAWADA. "Wildcatter Pounces; Oil Riches Lure the Entrepreneurs." The New York Times, Section 3 (Sun., May 20, 2007): 1 & 7.

Wildcatter entrepreneur "Joseph H. Bryant started Cobalt." Source of caption and photo: online version of the NYT article cited above.

Mugabe Prints More Money and Beats Up Shopkeepers, as Inflation Soars: More on Why Africa is Poor

"Inflation made food cost a fortune in Harare this week. The government imposed controls that required vendors to sell some items below cost." Source of caption and photo: online version of the NYT article cited below.

JOHANNESBURG, July 3 — Zimbabwe’s week-old campaign to quell its rampant inflation by forcing merchants to lower prices is edging the nation close to chaos, some economists and merchants say.

As the police and a pro-government youth militia swept into shops and factories, threatening arrest and worse unless prices were rolled back, staple foods vanished from store shelves and some merchants reported huge losses. News reports said that some shopkeepers who had refused to lower prices had been beaten by the youth militia, known as the Green Bombers for the color of their fatigues.

In interviews, merchants said that crowds of people were following the police and militia from shop to shop to buy goods at the government-ordered prices.

“People are losing millions and millions and millions of dollars,” said one merchant in Bulawayo, referring to the Zimbabwean currency, which is becoming worthless given the nation’s inflation, the world’s highest. “Everyone is now running out of stock, and not being able to replace it.”

. . .

Gasoline was reported to be vanishing from stations as the going price, about 180,000 dollars per liter, was slashed by the government to something closer to the officially approved price of 450 dollars per liter. Mr. Mugabe’s government intends to cope with the shortages by subsidizing producers of basic goods. One of the few newspapers not under government control, The Zimbabwe Independent, reported last week that flour, which is controlled entirely by the state, will be sold to bakers for 10 million dollars a ton, half the market price. Similarly, many suppliers of basic goods have been told by the government that they will be allowed to buy gasoline at one tenth the going price, the newspaper reported. The government apparently plans to make up those losses by printing more money. Zimbabwe’s dollar has lost more than half its value in recent weeks because the government has constantly issued new bills to pay its mounting debts.

For the full story, see:

MICHAEL WINES. "Anti-Inflation Curbs on Prices Create Havoc for Zimbabwe." The New York Times (Weds., July 4, 2007): A8.

(Note: ellipsis added.)

CNN on 7/10/07 broadcast a great clip from ITN, that had been courageously recorded undercover by Martin Geissler. See "Desperation in Zimbabwe":

http://www.cnn.com/video/#/video/offbeat/2007/06/23/vo.mi.ugly.dogs.ap?DPFPR=true

(Note: ITN is sometimes also called ITV. "ITN" stands for the International Television Network.)

Postscript: According to an entry on the ITV web site entitled "Mugabe Battles Economic Crises," Mugabe "has warned he will not be restrained by "bookish economics"." (He makes a great case for cracking open the books, doesn’t he? Or at least for opening the window and looking at what is happening outside?)

For the Mugabe quote on bookish economics, see:

http://itn.co.uk/news/a1d7763de3c4778b619a72cbeab24d6d.html

Somaliland Works, Without Foreign Aid or Recognition: More on Why Much of Africa is Poor

In Hargeysa, the capital of Somaliland, there is sufficient public safety (in contrast to southern Somalia) for a money exchange to operate with large amounts of money on display. Source of photo: online version of the NYT article cited below.

HARGEYSA, Somalia, March 1 — When the sun rises over the craggy hills of Hargeysa, it sheds light on a different kind of Somalia.

Ice cream trucks selling bona fide soft serve hit the streets. Money changers, unarmed and unguarded, push cash through the market in wheelbarrows. Politicians from three distinct parties get ready for another day of debate, which recently included an animated discussion on registering nomadic voters.

It’s all part of a Somali puzzle: how one area of the country, the northwest, also known as Somaliland, can seem so peaceful and functional — so normal, in fact — while the rest continues to be such a violent, chaotic mess.

This tale of two Somalias is especially striking now, as thousands of African Union peacekeepers prepare to rescue Mogadishu, the nation’s bloodstained capital, from itself. The internationally backed transitional government that seized Mogadishu in late December with Ethiopia’s help says it cannot survive without foreign aid and foreign peacekeepers to quell clan fighting and an escalating insurgency.

Somalilanders, who have wrestled with their own clan conflicts, find this ridiculous.

“You can’t be donated power,” said Dahir Rayale Kahin, the president of the Republic of Somaliland, which has long declared itself independent from the rest of Somalia. “We built this state because we saw the problems here as our problems. Our brothers in the south are still waiting — till now — for others.”

But Somalilanders are waiting, too: waiting to be recognized. In 1991, as Somalia’s government disintegrated and clan fighting in the south spun out of control, Somaliland, traditionally one of the poorest parts of Somalia, claimed its independence. But no country acknowledges it as a separate state and very few even contribute aid — which makes Somaliland’s success all the more intriguing.

. . .

“It all goes back to the Brits,” according to Hajji Abdi Waraabe, an 89-year-old member of Somaliland’s upper house of Parliament.

When the colonial powers sliced up the Horn of Africa in the 19th century, the British got Somaliland and the Italians got Somalia. While the British relied mostly on clan chiefs to govern, the Italians created an entire Italian-speaking administration and imported thousands of people from Italy to farm bananas, build cathedrals and teach the people how to pour espresso.

One result was that Mogadishu, along the southern coast, became a major commercial hub and one of the most beautiful cities in Africa, but its traditional systems of authority were weakened. That is partly why, many Somalia analysts say, warlords were able to outmuscle clan elders and dominate Mogadishu in the vacuum that formed after the central government fell.

The British, on the other hand, never invested much in Somaliland, leaving it poor and dusty but with its traditions more or less intact. . . .

. . .

But the one issue that unites most Somalilanders is recognition. Somaliland has its own money, its own flag, its own national anthem and even its own passport.

“And we have peace, a peace owned by the community,” said Zamzam Adan, a women’s rights activist. “You’d think in this part of the world, that would count for something.”

For the full story, see:

JEFFREY GETTLEMAN. "The Other Somalia: An Island of Stability in a Sea of Armed Chaos." The New York Times (Weds., March 7, 2007): A11.

(Note: ellipses added.)

Top photo shows women selling jewelry. Middle photo shows a traffic cop performing a defensible function of government. At bottom, the map shows Somaliland relative to the rest of Somalia. Source of photos and map: online version of the NYT article cited above.

Better than Socialism, but Not Free Market Enough: More on Why Africa is Poor

Voters in line to vote for President in Senegal on 2/25/07. Source of photo: online version of the NYT article quoted and cited below.

My old Wabash professor Ben Rogge used to say that rulers liked to build pyramids to proclaim their glory. He mentioned the Egyptian pyramids, and he mentioned the whole government-created capital city of "Brasilia" in Brazil.

When rulers in a poor country invest a lot of tax money in infrastructure, such as roads, how much of that is due to their belief in mistaken economic theories, and how much to their wanting to build their own version of the pyramids?

In either case, at least it can be said that the people probably benefit more from their taxes being used to build roads, than from their taxes being used to build pyramids. At least the roads can be complementary to transporting goods, and to the mobility of labor.

But the people would benefit even more if they could keep the tax money to use for their own purposes.

(p. A3) DAKAR, Senegal, Feb. 25 — Moudou Gueye was confident that Senegal’s presidential election on Sunday would turn around his fortunes, at least in the short term.

Seven years ago he voted for Abdoulaye Wade, a rabble-rousing professor who, after decades in opposition to Socialist Party rule, sailed into office buoyed by the votes of frustrated young people like Mr. Gueye, who is now 32. They hoped that Mr. Wade, a free-market liberal, would transform this impoverished nation’s economy, which had been stunted by generations of ineffective central planning.

. . .

. . . Senegal has had relatively robust economic growth that has hovered at around 5 percent over several years (it was lower last year, owing in part to high fuel prices, according to government officials), compared with the 1 percent achieved during much of the Socialist era, and dozens of huge public works projects.

While in some ways the country is better off, economic growth and a building binge have not produced large numbers of jobs in a country struggling to make the transition from an agrarian society based largely on peanut farming to one that harnesses the wealth of a global economy.

. . .

Countering criticism that Mr. Wade is too old to serve another term — his official age is given as 80, but many people suspect he is older — his daughter, Sindiély, who has worked as a special assistant to the president, said he was as sharp and agile as ever.

“It is not a question of age,” Ms. Wade said as she waited to cast her vote in downtown Dakar. “It is a question of dynamism and ideas and what you have planned for your country.”

Along Dakar’s seaside roadway, young men marveled at the cars whizzing below a brand-new overpass, one of Mr. Wade’s long-anticipated public works projects.

Pap Ndiaye, an 18-year-old street vendor who sells baby clothes to people stalled in traffic, said the newly completed road was a sign that the country was moving in the right direction.

“Wade has done a lot for this country,” Mr. Ndiaye said. “Our hope is that he will stay and finish his work.”

Less than a mile away, the road abruptly ends with a bright yellow sign that says “déviation,” or detour. With a hard turn to the right, drivers pour off the broad new highway, and back into the tangled, chaotic streets of one of Dakar’s oldest and poorest neighborhoods.

For the full story, see:

LYDIA POLGREEN. "Senegalese Vote Hinges on Views of Economic Growth." The New York Times (Mon., February 26, 2007): A3.

(Note: ellipses added.)

Mugabe Eats Cake As He Ruins Zimbabwe Economy: More on Why Africa is Poor

Tyrant Mugabe eats cake while his slaves starve. Source of photo: online version of the NYT article cited below.

JOHANNESBURG, Feb. 21 — President Robert G. Mugabe of Zimbabwe turned 83 on Wednesday to the strains of the song “God Bless President Mugabe” on state-controlled radio, along with an interview on state television, a 16-page paean to his rule in Harare’s daily newspaper and the prospect of a grand birthday party — costly enough to feed thousands of people for months, his critics argued — on Saturday.

Zimbabwe’s economy is so dire that bread vanished from store shelves across the country on Wednesday after bakeries shut down, saying government price controls were requiring them to sell loaves at a loss. The price controls are supposed to shield consumers from the nation’s rampant inflation, which now averages nearly 1,600 percent annually.

. . .

On Wednesday, The Herald, the state-managed newspaper, included in 16 pages of tributes to Mr. Mugabe an editorial calling him “an unparalleled visionary” and “an international hero among the oppressed and poor.”

. . .

“The guy is insensitive,” John Shiri, 41, a teacher at a primary school, told a local journalist. “There is no bread as we are talking, but he will be feasting and drinking with his family and hangers-on when there is no wheat in the country.”

. . .

Tawanda Mujuru, who runs a vegetable stall on Samora Machel Avenue in downtown Harare, said that she would be working in a factory if not for the failure of Mr. Mugabe’s economic policies.

“He has the guts to eat and drink when we are suffering like this,” she said. “Let him enjoy. Every dog has his day. We shall have our day.”

For the full story, see:

MICHAEL WINES. "Mugabe Gets Ready to Eat Cake While Fellow Zimbabweans Can’t Find Bread on Shelves." The New York Times (Thurs., February 22, 2007): A6.

(Note: ellipses added.)

Europe Plays Fair with Africa by Reducing Sugar Subsidies

Source of graphic: online version of the WSJ article cited below.

For once, Europe bests the United States in consistently practicing free trade:

BRUSSELS — The developing world has been adamant that rich nations abandon farm subsidies in order to get a global trade deal both sides say they want. A flood of investment pouring into Southern Africa’s sugar industry demonstrates why the poor countries won’t back down on this demand.

The hundreds of millions of dollars being spent to ramp up African sugar production is a direct response to European Union plans to slash import duties and subsidies that for years have locked out farmers in developing countries.

The expansion shows how the EU’s gradual opening of its farm sector can boost production in some developing countries, offer cheaper prices to European consumers and force inefficient EU producers to close.

For the full story, see:

JOHN W. MILLER "African Sugar Production Ramps Up EU Plan to Cut Tariffs Shows How Developing Nations Can Benefit." The Wall Street Journal (Sat., February 17, 2007): A4.