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Wednesday, August 29, 2012

Africa versus East Asia

Why South Korea succeeded where Uganda failed

A common argument to explain (the better term would be to “caricature”) post independence failures in Africa is always in comparison to East Asia. It is often argued, for example, that by 1960, Ghana and South Korea had the same per capita income of roughly US$100. Yet 50 years later, South Korea’s per capita income is US$ 32,000 while Ghana’s is US$ 3,100. Therefore, the conclusion goes, there was gross mismanagement of Ghana’s potential in comparison to effective management of South Korea’s opportunities. The often unsaid but certainly underlying thesis behind such comparisons is that there is something inherently wrong with Africa. That unsaid “something” is racial; an inherent incapacity for self government.

Although this stereotype was developed by Europeans, its greatest proponents today are African elites – both ignorantly and inadvertently. I write this article with a lot of humility because I also have been an active but subconscious contributor to this narrative. On the surface, the argument seems self evident; how could two nations with the same level of per capita income take divergent developmental trajectories?

Yet the focus on per capita income ignores the most salient ingredients that influence developmental outcomes. For lack of access to detailed information about Ghana, I will substitute it with Uganda which enjoyed an almost closer level of per capita income as South Korea in 1960.

By 1960, South Korea had been in existence as a nation for over 600 years with a strong and centralised state, a common language and a shared consciousness of nationhood. There had been a brief interruption of Japanese colonialism from 1910 to 1945 (35 years). Therefore, the challenge facing Sigman Rhee and later Park Chang Hee, the military rulers in Seoul, was not nation or state building but economic reconstruction after the devastation brought about by the war with what later became North Korea. On the other hand, Ghana by 1960 had been born three years earlier, Uganda two years later. The immediate challenge facing Kwame Nkrumah and Milton Obote was to mould a nation from tens of disparate nations and tribes with different languages, cultures and sometimes hostility to each other.

Secondly, South Korea was endowed with rich institutional traditions based on meritocratic recruitment into the bureaucracy through an intensely competitive Public Administration entry exam known as the haengsi. By 1960, this tradition had been in place for 450 years. It allowed government to promote people from within the ranks than hiring from outside the bureaucracy. Japanese colonialism had actually relied on South Koreans to man the civil service. This gave it vital institutional memory, avoided resistance that comes with change in leadership, ensured supply of high quality expertise and a strong espirit de corp – assets that are intangible but valuable.

On the other hand, up until 1957, there were hardly any Ugandans in the top civil service jobs, the first one appointed to a top position being Yusuf Lule in 1958. Although the British had introduced rich civil service traditions of meritocratic recruitment and promotion, few Africans were integrated into this culture and only in the last days of colonialism. The majority of Africans who served the colonial state were clerks and messengers. With the departure of colonialists at independence, every African with a good education but without experience and skills became a permanent secretary, a commissioner or head of a large public enterprise.

For example, in 1960, Uganda’s entire public service excluding nurses, police and all but a few hundred teachers was a little more than 5,000 strong in a country of more than six million people. Out of the top 10 percent of the civil service jobs categorised as “professional”, Ugandans occupied only 10 percent i.e. 90 percent were non-nationals – Europeans and Asians. Then out of the next tier 30 percent categorised as “technical” jobs, only 40 percent were Ugandans; and out of third tier 30 percent categorised as “sub-technical”, 65 percent were Ugandans. The rest of the jobs, categorised as clerical, were largely occupied by Ugandans.

This nature of power under colonial rule shaped the character of post colonial politics. The nationalist struggle for independence was fought to get African-Ugandans to participate in the management of the country. Yet, although this demand was understandable, the country did not have experienced and skilled people to take over immediately. Obote resisted attempts at rapid Africanisation and relied on inherited European and Asian expertise to sustain administrative competences. This allowed him to expand service delivery without undermining quality. But it also caused his downfall. Thus, when Idi Amin came in, to build his popularity, he met popular demands for rapid Africanisation by chasing away Indians and Europeans thereby precipitating economic and institutional collapse.

Economists have shown that for a country to avoid violent conflicts and sustain a reasonable rate of growth, it needs to have a critical mass of its citizens with primary and secondary school education – about 50 and 30 percent. By 1960, primary school enrolment in South Korea was 60 percent and secondary school 36 percent. Meanwhile, 12 percent of South Korean men and four percent of the women aged 18-21 were either in university or high technical institutions.

In fact by 1930, South Korea had a large supply of technical skills even in the remotest parts of the country. Technology and its application were widely diffuse in the society. With a large army of artisans at every level, there were many small cottage industries producing various value-added goods in the far flung parts of the country. These latter formed the human infrastructure to support industrialisation. All they needed to do was upgrade their skills and join industries producing automobiles, electronics and other industrial consumer good.

In Uganda, on the other hand, primary school enrolment (P1 to P6) in 1961 was a 12 percent. Junior Secondary and Senior Secondary (S1 to S4) was less than one percent. And total enrolment in S5 to S6 was a mere 323 students. There were only 450 students in technical schools of all levels. Yet in spite of these miserable numbers, Uganda was among the most educated nations in Africa. By 1950, there were only two universities in Africa south of the Sahara and north of the Limpopo – Makerere in Uganda and Ibadan in Nigeria. Consequently, at the time of independence, for example, Tanzania had half a dozen university graduates, Rwanda and Burundi had none at all and Congo (Zaire) had less than 10.

At both the level of internal capacity to manage complex modern institutions and at the level of education, there were very limited skills. The belief that under colonial rule services were good is misleading because the services were very narrowly focused, like under apartheid South Africa, to serve a very small population of expatriates. After independence, there was an attempt to rapidly expand these services to serve the wider African population. As a result, the state became overdeveloped in function yet it was underdeveloped in capacity; so its reach was far beyond its grasp. This is what led to the many failures that we African elites cry so much about.

Many African elites argue that blaming colonialism for our failures ignores the role our governments have played in post colonial mismanagement of our nations. This is partly true and I used to make this argument. The depredations of Idi Amin, Mobutu Sese Seko, Siad Barre, etc cannot really be entirely blamed on colonialism. Yet the pendulum of this argument swung from one extreme (of blaming everything on colonialism) to another extreme (of blaming everything on the post colonial administrations). Both extremes are wrong.

“Men make their own history,” Karl Marx wrote on the military coup by Louis Napoleon in 1951, “but they do not make it just as they please; they do not make in it circumstances chosen by themselves, but in circumstances directly found, given and transmitted from the past.” To ignore the structural constraints post independence leaders encountered has been one of the biggest weaknesses of attempts by those who examine the agency (post independence governments) that failed to deliver transformation. It seems that at independence, Africa suffered from over expectation.

Could post independence governments in Africa have performed better? Perhaps, but at a price; they should have aimed at preserving their limited capacity; using it only sparingly. Instead, most governments in Africa moved fast to elaborate public functions. Botswana avoided this mistake perhaps because it had had an almost absentee colonial state. This could have reduced the demands for rapid africanisation. But acting like Botswana would have been a purely technical response to what was actually a burning political problem.

The nationalist struggle for independence emerged to challenge legally sanctioned exclusion of Africans from state power outside of traditional institutions in colonial Africa. That was its fuel. Upon independence, the first demand therefore was rapid africanisation. Although technically disastrous, it was politically popular. The second demand was derived from the first. Africans wanted to take public services to the wider population. Few governments would have survived by resisting this demand.

Political pressure for africanisation undermined the meritocratic systems of external recruitment and internal promotion that allowed the civil service to uphold its high standards. Rapid elaboration of functions without existing capacity made a bad situation worse. What was politically right was technically disastrous. And in our ethnically heterogeneous polities, promoting social inclusion – even on the face of things – was more politically desirable than sustaining technical competence. The problem is that it eroded competence and allowed cronyism and corruption to flourish. Politics is costly and Africa had to pay that price.

Many African elites focus on technical failures in Africa and ignore the political compromises that brought that failure. In other words, the price of political compromise was technical failure. It is possible that if such compromises had not been struck, many states in Africa would have collapsed under the weight of civil war. It is remarkable that African leaders who inherited fictions of states left behind by colonial rule were successful at creating a common national consciousness. This has sustained the sovereignty and territorial integrity of these nations. Today, few states in Africa have fallen apart like Somalia. In others, the state may not be omnipresent yet, but the concept of nationhood has gained a lot of ground.

This brings us to another element that set the stage for success in South Korea and for failure in Africa. South Korea is a homogeneous society. Consequently, its politics is less factionalised and fosters greater capacity for political consensus-building on many policy issues. Most African countries are heterogeneous with different ethnic and religious factions vying for influence. It is, therefore, difficult to build a consensus on anything. To make matters worse, the dominant development ideology of the 1960s was for governments to take control of the commanding heights of the economy in order to foster African participation. Yet states in Africa were the least suited for such strategies because of their internal fractionalisation. Thus, every attempt at state control tended to place public resources in the hands of one group – or at least create a perception thereof.

This generated secondary contestations. All too often, the excluded groups were able to effectively contest their exclusion – real or imagined – hence leading to coups, civil wars, expanding political patronage in form of large cabinets and other appointments to create an appearance of ethnic, regional or religious balance. All these political compromises imposed high costs on the state’s capacity to sustain growth, seek and realise development or build technical capacity to deliver on their promises.

After prolonged economic failure, many governments in Africa adopted liberal economic policies. They sold public enterprises, disbanded state monopolies and removed the dead hand of the state and its politics from business. Today, most economies of the nations of Africa are growing rapidly. It seems to me that in ethnically factionalised nations, the best economic policies are those that favour the free market.

Today, there are many contests over every deal, tender or contract given out by NSSF (which is controlled by government). However, companies like MTN, Uganda Breweries, Crane Bank, etc give out multimillion dollar loans or tenders without parliament intervening and the press screaming. Thus, while many of Uganda’s chattering classes vigorously resist free market policies, citing how state involvement in China and South Korea has been successful, they ignore that the heterogeneity of our societies is bad for state involvement in the economy.

One can argue that my arguments are an excuse for governmental corruption, incompetence and nepotism. If we accept my reasoning, we may become complacent with the weaknesses that we need to overcome. I accept this counter argument with the humility of experience. However, elites in Africa possess overblown expectations. We expect our states of deliver like states in Sweden and Norway. Actually they cannot. It is good to have dreams of grandeur but it is important to temper them with realistic expectations.

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