My Beauty Best Teacher

Drake Bennett writes in the Boston Globe about the anxiety related to the diversionary Aid conversation:

Africa analysts say that they have a broader concern: that the all-consuming discussion of aid has obscured - and perhaps even impeded - the recent positive developments on the continent. According to development economists, multinational corporations routinely overestimate the risks of doing business in Africa. Investment is the fuel of a free- market economy, and yet fear may be depriving many African countries of opportunities.

Africa's diaspora has been quicker to spot the opportunities. For years, economists have credited the remittances that African expatriates send home as a major source of income for African countries. Now, analysts say, the more open political and economic climate has meant that expats are increasingly providing more valuable resources: their brainpower and enthusiasm.

Victor Konde founder of the ATDF writes:

Governments have to provide some learning and experimentation space for creative ideas. Mr William Easterly argues that there are two types of approaches to development: “planners” and “searchers.”
Planners, mainly from the developed countries, have ambitious schemes, experienced development economists, serve as experts and financiers and greatly influence government policies of recipient countries — where possible backed by conditions.
Searchers, on the other hand, are often talented locals or returnees with good unproven ideas, often outside official government channels, with limited support.
The planners get most of the attention as they champion one “new big idea” after another. No one knows what searchers exist or champion until the projects, if they managed to get support, become successful.
Promoting entrepreneurship may require provision of support for individuals willing to test innovative concepts.

The Economist writes:

The Europeans are increasingly worried that they are losing both trade and clout on a continent that they used to regard as their own backyard. Over the past five years Europe has watched with a mixture of shock and awe as resource-hungry China has swept across a grateful continent, taking oil and minerals in exchange for anything the Africans want, be it money now, money later, ports or roads...All this has left Africa's leaders in the novel position of being able to pick their friends rather than being dictated to by others, be they white development economists or the IMF. And they are enjoying every minute of it.

Europe, used to privileged access to African markets and politics, has been left floundering by the new competition. Europeans complain that China damages Africa by not linking its loans and investments to improvements in government and human rights, as the worthy Europeans do. But Africans are dismissive: as one official says, “Europe is jealous. They say we have gotten a new colonial master, but our old one wasn't so good.”

Keith Hart writing in Memory Bank:

When I graduated to the field of development studies, the picture of West Africa’s cities was just as distorted as one you might get from boorowing a Manchester school perspective. Here the emphasis of the economists was on the new states’ ability to pursue a neo-Keynesian development program. How could ‘we’ (the politicians, bureaucrats and their academic advisers) provide the jobs and other needs of the hordes flocking into the cities at the time? It was assumed that such provision had to come through the bureaucracy and conform to state-made laws. My paper on ‘informal income opportunities and urban employment’ pointed to the wide range of economic activities that were invisible to bureacracy. But even I saw them through a statist lens (“seeing like a state”), hence the term ‘informal’, not regulated by the bureaucracy. At that time I assumed that the bulk of economic progress must come though public and private sector enterprise of a corporate type.
The informal economy was never adequately described or defined, but these days it is commonplace to read assertions that African economies are 70-90% ‘informal’. Certainly the deregulation undertaken over the last three decades of neoliberal economic policies have led to a radical informalization of the world economy, not least in Africa. But to label these activities ‘informal’ is to avoid identifying what they are positively for or how they are organized, by which social principles.
I would say that the last half-century has seen a massive transfer of population to the cities, where most people have been left to generate their own forms of commerce. The informal economy in this sense has been a holding operation allowing many people to survive in the city and some to flourish. Whatever is coming up next will draw to some extent on this sprawling self-organized economic activity. Our task is to find out more about the promising sectors spawned by such a development.

Niranjan Rajadhyaksha asks at Livemint "What is the solution to poverty?":

Many have asked why Bangladesh continues to be mired in terrible poverty when it has such a large microfinance sector. The good ol’ basics matter more — property rights, open markets, human capital, innovation etc.
A new policy research paper, Who Gets Credit?, published by the World Bank shows that economies benefit more when money is lent to firms rather than households. India is one of the 45 countries the economists have covered in their study.

The East Asian countries managed to develop brilliantly through channelling much, if not most, of their savings into serious growth-oriented sustainable business projects. This is why many East Asian countries may have started at similar GDP levels as Bangladesh in the 1970s but have since massively outpaced Bangladesh in terms of growth and development. Economics 101 shows conclusively how critical savings are to development, but only if intermediated into growth and productivity enhancing projects. If it goes into rickshaws, kisoks, chicken farms, traders and so on, then the country simply will not develop and sustainably reduce poverty...[continue reading]

Abhijit Vinayak Banerjee writes

We economists and development experts are still thinking in machine mode—we are looking for the right button to push. Education is one such button. Within education, there are more buttons: Economists talk of decentralization, incentives, vouchers, competition. Education experts talk about pedagogy. Government officials seem to swear by teacher training. If only we could do it right, whatever the favored “it” might be, we would be home free.
The reason we like these buttons so much, it seems to me, is that they save us the trouble of stepping into the machine. By assuming that the machine either runs on its own or does not run at all, we avoid having to go looking for where the wheels are getting caught and figuring out what small adjustments it would take to get the machine to run properly.

NaijaBlog writes about the "Replication of Values":

If one takes a glance around the Nigerian elite, one finds that it is populated solely by corporate types who work in banking or have senior management roles within large corporate organisations.There aren't any other types of elite at work (for instance, there isn't an intelligentsia elite or a bourgeoisie chattering class). The more difficult trick therefore is how to lure back Nigerians who actually might improve the society with a different set of values - interested in ideas, culture, research and challenging social norms with more contemporary attitudes. I suspect this is a general problem in developing countries - how to create ideological development and inject fresh thinking into conservative societies.
The trouble is, those who are in power tend to select as advisors and thinkers those who share their values. So, in Nigeria, we have 'gender experts' appointed senior advisory roles who believe firmly in the evangelically motivated doctrine that women should be subservient to their husbands; or we have economists who hold that the way forward for Nigeria is to create sweat shops across the country. In other words, conservative, purely economically-motivated values attract their own. In societies such as this, people with fresh ideas will always be treated as outcasts and alienated, while mediocre talents with outdated views get rewarded.

Richard Behar at Fast Company delivers a special report on the China-Africa relationship:

While America is preoccupied with the war in Iraq (cost: half a trillion dollars and counting), and while think-tank economists continue to spit out papers debating whether vital resources are running out at all, China's leadership isn't taking any chances. In just a few years, the People's Republic of China (PRC) has become the most aggressive investor-nation in Africa. This commercial invasion is without question the most important development in the sub-Sahara since the end of the Cold War -- an epic, almost primal propulsion that is redrawing the global economic map. One former U.S. assistant secretary of state has called it a "tsunami." Some are even calling the region "ChinAfrica."