Europe is Asleep.
America is complacent and corrupt.
Asia and Africa will lead the world.
But first, we must build a better foundation.
I’m not an expert on Africa. I grew up in the US and have only been to Africa seven times. I am, however, a student of economics and world events, and I believe it is time for Africa to get out of the trap of thinking it needs to be more like Europe and the West, and the trap of Chinese money and influence. If Africa is going to lead this century, young change makers and brave leaders must unite and create a new framework all nations can build upon.
In this essay, I’m going to lay out the problem, the solution, and then ask progressives to create a conference around the three ideas that will drive Africa into the 21st century.
Kleptocracy is the Norm
Africa has accomplished much in the past twenty ears. Poverty is down dramatically. Literacy is up. Many people have worked very hard to bring Africa more into the world economy. Yet, in many nations, kleptocracy is still the major form of government. According to Transparency International’s recent Corruption Barometer for Africa:
While this is also largely true for many other nations, and the US is getting worse, it is time for Africa to lead the world. Too many government officials are hurting their own citizens. Too many governments in Africa are not true democracies. Too many people have little hope of owning property or holding a respectable middle-class job.
It is time for us to act, and act bravely.
The Driver: Innovation
The way into the 21st century is innovation. Innovation leads to economic growth. Africa has several factors that make it more difficult to grow than China has, but we must prioritize growth. Watch this video please:
We must grow the African economy steadily. That will require building a three-legged platform consisting of:
1. A Pledge to Hit Six Percent Nominal GDP Growth Across the Continent
Africa is now at four percent real GDP growth, which makes six percent about right (implies two percent inflation). Because Africa exports so much raw material, I could argue for seven percent, but let’s start with six. I explain some of the concepts in this essay on monetary policy. Africa has many nations and many currencies. We must create a common unit of account and unit of exchange that lets Africa grow. There are ways to do that, but it will take a lot of effort.
2. Better Functioning Markets
Markets need more transparency, less regulation, and more trade. Africa will have to reduce dependency on commodities and start upskilling people to participate in the world market for white-collar work. The Philippinos and Indians have done this extremely well. Africa needs to build market infrastructure for more trade, more training, more use of technology, and more next-generation ways of working. We don’t need to catch up to the West. We need to lay the foundation for leaping ahead. For example, there won’t be much venture capital until we have public markets where companies can exit. We need African leaders in securities regulations to lay the foundation for this liquidity, or no one will invest in startups. Increasing liquidity is a key driver.
3. Agile Government
Everyone in government should be acutely aware of the current rate of economic growth on a weekly basis. Everything they do should be to help keep nominal growth on pace of six percent as a first priority. This gives them incentives to eliminate road blocks and unnecessary regulation. There are too many licenses, too many restrictions, too many rules. The government must innovate as quickly as the private sector. All of Africa must function more like Amazon.com than like the colonies of old. It’s not a matter of technology. It’s a matter of changing mindsets.
Below, I offer a pledge any citizen of Africa can take to work toward these goals. This is only for brave people who can see the long-term benefits of the three goals above.
We, the people of Africa, must redesign our governments, our institutions, and our societies to prepare ourselves for the realities of the 21st century. It will be a hyper-connected century with data and communications at its center. We pledge to create, enable, and enforce these principles:
- No corruption. Zero tolerance on corrupt practices. Adequately fund government jobs, so people don’t need to accept bribes.
- Full governmental transparency. We must build systems that show everyone where all the money goes. We can build corruption-proof systems, so people can’t steal money.
- Continent-wide connectivity. We can’t leap into the 21st century without broadband connectivity for all. The last mile and the last 20 percent are always the hardest, but we must have digital inclusion for everyone.
- Commit to a consistent six percent nominal GDP growth rate for the entire continent. Commit to monetary policy that supports this goal.
- Government policymakers should work toward their 6-percent nominal growth target every year and make changes accordingly. We need to upgrade the tools and thinking at the African Development Bank and use its influence to create a pan-African growth model.
- Independent central banks.
- Responsible lending and borrowing with full transparency.
- Too many projects take a lot of resources and give poor results. Develop centers for cost-benefit analysis in all countries and communicate about systemic risks.
- Establish digital identities for all people.
- Establish digital rights for people to own their own personal data and help them manage it.
- Establish property rights for all individuals and corporations without intermediaries or brokers. Allow person-to-person transfers of all digital assets.
- Reduce the “brain drain” of the smartest people leaving and not returning.
- Support open, transparent, democratic voting principles.
- Adopt outcome- and evidence-based policies rather than trying to comply with international programs that simply do not work.
- Switch emphasis from natural resources and agricultural products to human capital. Create more from less.
- Develop manufacturing and tech hubs to export more African value. Reduce reliance on imports.
- Make borders and trade more open. Make it easier for people and money to go where they are needed.
- Replace rules with incentives. Reform tax laws to make it easy and automatic to pay taxes rather than burdensome and bureaucratic. Consider consumption taxes rather than taxing income.
- Work toward a common African digital currency based on the concepts embodied in the Libra project.
- Leapfrog the technology of the developed world. We don’t need better schools, we need lifelong learning relevant to work. We don’t need better institutions, we need better systems. We don’t need better intermediaries, we need no intermediaries. New technology can help, but we have to commit to the ends, not the means.
The strongest driver of social change is economic growth — it automatically improves education, health care, transportation, the environment, and everything else. It makes everyone richer. Let’s get serious about it.
Let’s Meet and Commit
I propose a four-day event to take place in February or March in a location all can reach. I would structure it like this:
Day 1: Committing to Growth
On this day everyone understands a plan for meeting the six-percent target: why it’s important, how we will get there, how to get started today.
Day 2: Committing to Agile Government
On this day we learn examples of agile government and attend workshops to come away with targets for streamlining all our processes and turning human busywork into agile software systems.
Day 3: Monetary Policy
We must envisage a system of interconnected digital currencies that give Africa an advantage in trade and payments. We must stop trying to institute the banking regulations and norms of the Western World. We must build the monetary infrastructure of the 21st century.
Day 4: Design Regulation that Works
We must redesign regulation to support long-run economic growth. That means no corruption, full transparency, and a laissez-faire attitude toward markets and regulation. Tight regulation keeps those in power in power, making it much more difficult for innovators.
Africa has money — it’s just not effectively distributed. What’s needed is a new mindset for a new century. This is a call for young leaders to gather in Africa and boldly sketch a new action plan for Africa that gets rid of old habits and builds a foundation for the future.
Are you with me? We need people to join a Telegram (or Slack?) group to plan our first event. This is an exponential century with exponential potential. We must live up to our responsibilities as shapers of the future of Africa.
If you want to join, send an email to me and I’ll send you the invite. Slack would be the right tool if people will use it. Tell me whether you prefer Slack or Telegram.
David Siegel is a serial entrepreneur in Washington, DC. He is the founder of the Pillar Project and 2030. He is the author of The Token Handbook, Open Stanford, The Culture Deck, Climate Curious, and The Nine Act Structure. He gives speeches to audiences around the world — see his speaker page if you would like him to speak at your next event. His full body of work is at dsiegel.com.