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African strategy and tactical moves for definition and implementation
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African strategy and tactical moves for definition and implementation
l remember telling a US ambassador in the late 1990's (when he was jokingly complaining about the pertinacity of the Mauritian lobby for AGOA - 'when you're in the middle of the ocean, thousands of miles from Africa') "Look at it this way" l said, "we are, according to the theory of plate tectonics, on a plate getting 6 cm closer to Africa each year. So, you'll see, we'll get there one day ..." And then, in an aside to these two pertinacious Mauritian lobbyists, MVdlT & the sorely missed PC, "guys, don't you think we may be getting closer too fast?"
Twenty years earlier l had spent a week long residency seminar with a dozen African delegates at Le Morne discussing possible areas of collaboration. One area we unanimously agreed was on the virtues of malt whisky for which the Somalian delegate had an inordinate fondness - and the knack to stock up for all the delegates. But we also quickly agreed (l found myself in a minority of one on issue) that malt whisky was no cure for the island fever l was diagnosed with. lsland fever which arose, so I was told, from an aversion for central planning and a preference for market forces in a liberal economy.
Five years ago, l had the chance of a yearlong mission to Nairobi which l enjoyed thoroughly, discovering the wisdom of a great people, its businessmen & its civil servants. l reveled in the many anecdotes l collected. For example, one from a retired senior civil servant (who had been, in 1965, a young recruit in the Kenyan civil service & a witness): his minister had a call from the outraged English ambassador because a Russian ship loaded with arms was parading off Mombasa, awaiting permission to disembark its lethal cargo. And the minister extricated himself by explaining tongue-in-cheek how nobody should worry: the arms had last been used in 1917, the Russians thought the Kenyans were appreciating the favor - which they did, but only because it had managed to upset the British.
So, when needing to see things from an African perspective, this is no problem for us Mauritians. Yes, we accounted, in the first years of AGOA, for +90% of African exports to the USA, yes we no longer get our malt via Somalia (whilst remaining thankful for the tip) and, yes, we can ring-fence officials from the colonial powers (that were) as quickly as the Kenyans did.
But one thing has eluded us all these years: how to get an African economic strategy going?
I believe we should be more precise and action orientated on such an Africa Strategy, rather than just hope we can be a conduit for investment on the continent. I am convinced we can be more effective by taking a direct role in the action rather be just intermediaries in actions spearheaded by other
By
1.Assessing our strengths v\s the actual situation in various parts of the continent in both the public and private spheres and both
- build on such strengths for action there and
- make up for our weaknesses by tapping the relevant better experiences elsewhere.
2.Have an action plan in specific areas of the public and private spheres where we have an edge.
Below some possible feelers for the purpose, which could lead to a roadmap for implementation.
In the public sphere, we have
- A port and an airport that work (what country in Africa can boast of transporting more foreign travelers than its actual population?). We are doubling airport capacity capacities every 6-8 years (with next upgrade to 8m yearly passengers – from current 4m capacity – by 2024) and have experience in handling regional airports (the one in Rodrigues, 600 km away). Is our airport capacity building and operational expertise exportable? Our airport otherwise collects $X revenues per passenger (from airlines, passengers and commercial activities on site) and costs $Y per passenger handled: Could these elements be used to benchmark with other continental or regional airports to identify areas of cooperation?
- A tax paying population and an efficient Tax Revenue collection body. We could, for example, take Mauritius at various stages of its development (when at GDP per head of, let’s say. $1,000, $3,000, $5,000, etc) and identify tax collection we managed at each such level and how they were achieved (by direct and indirect taxation) for emulation by other countries. We could also lead other countries to emulate our computerization of import clearances which eliminated a fair chunk of corruption at that level. Note: Cost of our MRA (Mauritius Revenue Authority) v\s revenue collection also of relevance for benchmarking purposes with other continental economies again, with one sole purpose: identify areas of cooperation and get on with such cooperation.
- An efficient Central Statistical Office and Central Bank. To take only the former, how do we benchmark our data collection (whether for CPI, population statistics or economic and social indicators) with our African counterparts? And at what price (per person) do we do so here and on the continent? Are lessons obtainable from benchmarking such elements, again with one sole purpose (as Scipio): identify areas of cooperation and get on with such cooperation?
- a high literacy through a free education system in place since 45 years, with its network of teachers, examination syndicate, book printers, etc, etc; again with a success rate of X% on 100 pupils at SC level, let’s say, and a cost per pupil or a cost (of building and maintaining), let’s say, a 500 pupils school, that could be benchmarked and then used for replication if relevant. We would have a Mauritian Africa Strategy in Education, with accompanying local and continental economic benefits, if we could supply yearly, let’s say, 20-50 Build-Operate-Transfer schools in Africa (with European or US partners for part of the financing) and I’m not sure we can, at the moment, BOT one.
- The same would apply to health services (central and at community level). We have since more than 10 years, if I’m not mistaken, Cardiac hospitals which has operated successfully probably hundreds of persons, again at $X per patient. Do we need to have as objective to replicate ONE such cardiac hospitals (or eye hospital or diabetes hospital or whatever) in Africa? For when? And with what ultimate objective (5 per year in 5 years’ time)? If we want to have a game plan in Africa, I believe we should have such ambitions, based on our own local expertise. Of course, with yearly intake of trainees from Africa at our local hospitals or medical\nursing schools.
- A network of roads, bridges, by-passes, traffic management systems, with a network of private sector suppliers or service providers, working in tandem with the relevant authorities. Could these abilities to design, cost and implement be usable on the continent? When we do, yes, we would then have an Africa Strategy.
- Utilities (water, Electricity, gas) that are in constant upgrade and where expertise for capacity building and operational management have accumulated. Should we have involvement and a footprint in corresponding continental utilities as we have for sugar (X% in Tanzania, Y% in Kenya, Z% in Ivory Coast, etc.)
- Etc.
In the private sphere, we have
- Successful banks and Insurance companies, which, again, should be benchmarked against continental counterparts to assess potential intervention on continent. I wondered recently whether Barclays’ backtracking in Africa, leaving the field to ABSA Group Ltd, the SA behemoth, was the only option available. Were there options from Mauritian banks that were not taken and, worse, were not even for consideration at the time? And not even for consideration in the foreseeable future? Do we need a wake-up call for our local bankers and insurers (with only one bank and one insurer, if I’m not mistaken, with a continental strategy – and a pioneer, Dawood Rawat, who was for years a successful but unrecognized ranger on his East African safari)? On that front, operations of banks and insurance companies are planned for complete overhauling in the coming years (for handling trade finance paperwork, insurance claims, etc, through Fintech) and the question is: will our companies be at the forefront of change and then pioneer the change in Africa? If replies to both are yes, then we would have an African strategy in the sector. Regrettably however, it seems to me that innovation at MRA or Customs have far outperformed innovation at our banks and insurance companies.
- Successful hotel sector and hospitality businesses. How many of them have an African footprint? One example: Kenya and probably other African countries with game watching opportunities, have a much higher US customer base in % than we have. Have any local hotel sector or hospitality businesses considered ties-up in such countries to, one the one hand, supply expertise in running their businesses and, in exchange, share the customers for both game watching and beach holiday? I happen to know the Mombasa and Malindi usual tie-ups to game watching, but I must say the Mauritius alternative is three classes above. And a much nicer business proposition to local operators than the backpacker that is sometimes touted. So when do we advertise alongside Kenya in the US market? When do we have travel agents & associates in common in the States?
- The list of more traditional local businesses with no African footprint can be very long, even if such an African absence is, for me, more a mindset that a fatality. Take the case of the distribution sector. Mauritius has a long established, competitive, distribution sector (whether for FMCG, for petrol, gas, medicine of for more durable goods – was a mission for me, when based in Madagascar, to find simple items like a good knife or screwdriver that you would find on any street corner here), streets ahead of what exists in some African countries, where product absence, shelf depletion and resulting loss of sales is the norm – I tasted all the milk brands during my year in Nairobi – and nearly switched to malt! – because each week, there was every week a different one as only option available. Distribution is the backbone of any retail sector of any standing and we are doing well because we have both (even, if the reverse of the coin, is the trade imbalance they generate). How many of our distributors are out there in Africa chasing business? The same would apply to clearance and logistics companies, these usual compères of distribution companies. And the same would probably apply to car (or cellphone or TV or laptop) distribution, spare parts management, technological upgrade – switch to electric for cars –, and repair. All areas where we are just built up successful local competition but with no ambitions for the continent or for regions of the continent, where the real action will take place in the coming years.
- Or to come to the ultimate end of a traditional business, instant noodles (our famous Mine Apollo), with its 10 or so flavors, costing Rs8 each? I believe (a simple stroll down some African supermarkets would probably prove the point or identify the closest substitute to meet market demands) we could flood Africa with Mine Apollo manufacturing set-ups that could be 50 times bigger than the existing local operation.
- Etc.
So, local expertise and experience on the one hand and African opportunities on the other hand, abound and could be without limits. The real issue is why we haven’t jumped in up to now and why we are still so frigid in our outlook. Mauritian diasporas, as well as potential local partners, exist in most of these countries for tapping (to kick start businesses we are very familiar with), but for some reason are still left untapped.
The issue is, regrettably, not addressed in the recent Government programme 2020-24. Not sure that “greater transparency, accountability, efficient use of public funds and the achievement of economic benefits at our embassies and mission” (§ 194) is enough. But the backing of the entrepreneurs of the future (§ 62-64) looks more promising, especially in African sectors where low-level entries are feasible.
I think we should, among others*
- Start our benchmarking of Mauritian v\s African country sectors (public and private), with the task of such benchmarking given to a mix of public (CSO’s, for example, with help from embassies and missions available for the purpose) and private (analysts, accountant and auditors in each country, specialising in this or that sector) organisations, with twice yearly reporting – under Aegis of Economic Development Board (and their continental counterparts) on such benchmarking for identification of opportunities and for action on such opportunities.
- Consider having an Africa desk at every Mauritian public body and every business with turnover of, let’s say, US$15m (Rs500m), with onus on such desks to report on developments made by them in Africa for each financial year. With a certain minimum level (5%?) of total yearly investment on the continent (not just supply of funds to local or foreign investors) and a minimum no. of African jobs created, then allowing these business to benefit from better amortization and taxation regimes for twice the level of investment made. With incentive in place before our next budget.
* with regular press inputs to show whether progress is being made or whether we are stalling.
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