Students of International Development know that Paul Collier’s name is synonymous with development. Collier did a very good job when he was working with the World Bank. Thereafter, he wrote his remedial masterpiece book The Bottom Billion: Why the Poorest Countries are Failing and What Can Be Done About It. The book sought to answer why impoverished countries fail to progress in spite of donor aid.
In his book, Collier spots four traps that poor nations are enmeshed: landlockeness, conflict, poor governance and bad neighbours and natural resource. You don’t necessarily need to agree with everything he wrote. But if you look at, for example, how much countries in the East African Community spend on weapons compared to developmental projects, you can see the conflict trap vividly. When analysis is done on impoverished country, it is evident that no country can escape all of those four traps. If you are not in traps one, two, or three, you are in four.
Collier traces and ties, for example, Africa’s economic backwardness to colonialism that produced many venal, panders and copycats such as Mobutu Seseseko, Jean Bedel Bokassa, Idi Amin and others who looted the treasurers of their countries or disturbed the equilibrium in these countries due to their brutality and ignorance. We can solve this problem by emancipating our minds; putting things in the right perspective and being conscious of who we are and what we are supposed to for the better future of our coming generations. Collier touches on the current cabal of rulers who are prone to and proud of begging and stealing from the public coffers. He proposes a strict code of conduct such as accountability, auditing and evaluation. You can add democracy that empowers the hoi polloi as opposed to empowering hoity toity.
Collier warns that the European Union would most likely not finance the East African Community’s bid to have a regional monetary union as the European Union is currently gasping for fresh air. If they do, it will be for a short time. Will East Africa ignore him or heed his piece of mind?
On the East African Monetary Union (EAMU), Collier says, “Imagine, 16 out of 17 Eurozone countries started breaking the rules of fiscal deficit and balance of payments within the first ten years, little knowing that their misdeeds would culminate to high sovereign borrowing costs, slowing bank credit and forcing tighter fiscal policies.”
Collier bases his argument on what is currently going on. Europe is experiencing an economic imbroglio. In East Africa, countries like Kenya, Tanzania and Uganda are facing financial crises whereby their currencies are in a free fall. Not all East Africa member states have clear financial policies. EA countries have either hidden or different agendas or priorities when it comes to economic policies. Some countries are protective when it comes to their economies while others are open. You can see in their wrangles about implementing agreements on Customs Union and Common market protocols, whereby a series of non-tariff barriers still persist and every country is arguing by considering its interests instead of those of the bloc.
Considering what happened in the eurozone, he warns the EAC, that a monetary union is not the way to go, at least for now. Collier does not mince words. He is suspicious of a politically driven monetary union whose result is likely to be riskier to the region.
“If the most developed countries in the eurozone can find themselves in a Catch-22 situation simply because they broke monetary and common currency rules, what would happen if a similar fate grips a young EA bloc?” He asks. “It is one thing to make rules, but to follow them is a different thing altogether.”
Instead of concentrating on Monetary Union, Collier gives this advice, “There is a need to put up railways, ports and roads to facilitate trade.” Will EAC comply with or make use of this expert opinion?
Source: The African Executive Magazine April 18, 2012.