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25 August 2007

Asia’s Tigers, Africa’s Lions: Or, How to Make Ghana the Next Taiwan…

Everyone used to enjoy talking about the Asian “Tiger” economies — Hong Kong, Taiwan, Singapore, South Korea — and their wondrous economic development. And it’s true: the transformations that took place in these nations — especially places like South Korea and Taiwan — from relative poverty to technologically-sophisticated, modern societies (more modern, frankly, than U.S. society at this point) was remarkable.

Lots of the discussion that’s taken place about this historical transformation focused on the economic policies that these nations employed to drive this change, but there was always some trepidation in talking about it those policies frankly. In almost every case, the governments that oversaw these transformations were not what we might consider “liberal democracies”; more authoritarian governments put policies into place as they saw fit.

But the really untold story, as always, is the cultural one. People start to squirm when someone mentions that it’s something about the “Asian character” that made this economic transformation happen, those wonderful Asian qualities of thrift, family, and the Confucian work ethic.

One reason that this side of the story is never fully articulated is that it leads to the inevitable question of why this kind of economic leap into modernity has not taken place in Africa. I’ve heard even (ostensible) liberals start to mutter things about the “African character” not being capable of the same things as Asians. Ridiculous. It’s amazing how these ideas persist, and are even held by those who think everybody is, at the core, the same.

Well, everybody is the same. All people are economic animals, and for every “Asian Tiger” there’s a potential “African Lion”. As to why we haven’t seen any African equivalent to Singapore or Taiwan, for example, well, that’s a complicated question. But what I want to point out here is that it’s economic and political, not cultural — that is, there’s nothing inherent in the various African cultures (and there are many, many very different ones on the continent) that is antithetical to this model of economic growth.

But let’s look at some factors more closely… One problem in Africa has been outside intrusion. It may seem like an old lefty’s complaint, but colonialism in Africa really did set development back. A piece by a BBC journalist from some ten years ago, “Still the Dark Continent?”, highlights some of these post-colonial woes. In places like Taiwan and Korea, too, there was colonialism — but it was by the Japanese, who at least offered a model of modern, technological and economic development. In Africa, the Portuguese, Belgians, and even the British went in and provided infrastructure in some cases, but not the kind of true development model that the Japanese carried out (admittedly, forcibly) in Taiwan. Moreover, the colonial governments in Africa in many cases viewed the local populations as incapable of the kind of economic development that were allowed the peoples of Asia.

Moreover, various accidents of geography — and geology — made Africa a much more difficult setting to allow economies like Singapore and Taiwan to arise. Virtually none of the future Asian Tigers had abundant natural resources, and so they were compelled to build models based heavily on actual entrepreneurship — Israel, with its high tech industry, is a similar case: it was one of the countries in the Middle East perhaps blessed to be sitting on no oil. A number of African countries — such as Sierra Leone, Angola, Nigeria, and Ghana — were plagued by the fact that they held abundant resources of gold, diamonds, oil, bauxite, or other resources.

On a more general level, as one scholar has pointed out in an article entitled "Does Africa Exist?", “Africa, like Asia and unlike Europe or Latin America, is not a cultural, political, or economic entity. It is a geographic collection of fifty-three states, virtually all postcolonial and recent inventions”. Africa lacks the possibilities, at least at the moment, of something like the EU; it’s AU has nothing on the EU’s structure or economic integration.

So, African countries have followed a different development path, and the results in the post-colonial era have been very mixed: places like Ghana have been reasonably stable and successful; the Ivory Coast had a rapid economic rise but recent instability; and places like Sierra Leone, Liberia, Somalia, and so on, have been scenes of warfare and chaos.

But none of these histories or current conditions say that African countries are destined to permanent scenarios of this sort.

African societies have the identical potential to the Asian Tigers because they embody the same basic values: family and entrepreneurship. When I was in Ghana, I was astonished by the enormous number of small businesses and the aggressive entrepreneurship. It was like Taiwan in the 1950’s: people selling out of small shops, or by the roadside — everything from electronics to textiles to snack foods. In Ghana, people wanted to succeed, to improve conditions for their family. There’s even a book on the Ghanaian approach to business as related to their social structure.

The other place where a visitor could witness a drive for success — and the same applies to Asia — is the Ghanaian emphasis on education. The schools there are based on a strict sense of order, discipline, and vigorous mental and physical education. The schools promote a vision of achievement and success.

So, what’s missing? For one thing, models of outside aid need to re-examined, and at least now there is some debate about alternative models of such aid. In fact, there’s got to be more talk about capital investment and not aid.

At the same time, however, it’s important to note that Asian countries, as they built up a very capitalist, entrepreneurial model of success, actually backed it with an almost socialist model of education and healthcare (particularly in Taiwan). This allowed a kind of security for entrepreneurs: they had access to almost free high-quality education, and did not have to worry about being self-employed and having to purchase their own healthcare. I believe a similar approach in Africa could create a series of “African Lions”.

Finally, there’s the political angle. I don’t like treading into politics much on this blog, but when talking about Africa, it’s inevitable. Michael Radu’s article cited above takes the tack that African leaders need to stop blaming the West for what’s happening in places like Zimbabwe. There needs to be recognition that many of the economic woes there are due to corrupt leadership. I think that it’s even a bit more subtle than this, however. The real problem is not corrupt leadership per se; even prosperous countries like Taiwan and Japan have corruption. The problem is that in places like Zimbabwe, the corruption hurts the business class, and the poorest who are trying to make an entrepreneurial start, the hardest. We tend to ignore corruption in Taiwan, Japan, and other such countries, because the corruption there happens at rather high levels — the government otherwise leaves the people alone to get on with it: to build businesses, to take care of their families, to get educations, and to move their societies forward.

But I want to end on a personal note. The most remarkable thing for a visitor to places like Accra, Lagos, Abidjan, Nairobi is that they are vibrant, active cities filled with African entrepreneurs — just like the streets of Taipei, Shanghai, and Hong Kong. There are people working hard, dreaming hard, and waiting for an opportunity to take their small businesses and build them into something big.

When I was in Taiwan, I heard a story that the founder of Formosa Plastics, Yang-Chung Wang, a company that is now one of the biggest companies in all of Asia, got his start selling simple goods as a street vendor. I think that the same kind of stories can come out of Africa, and we should start pondering about how we can help the “African Lions” emerge…

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