Development cooperation in Africa – passing the torch?

The final edition of Maastricht Debates for the academic year of 2009-2010 looked at the roles of the EU and the BRIC-countries (Brazil, Russia, India, China) in the global economy, and more specifically at their approach to development cooperation in Africa.

The two guest speakers of the evening were on the one hand Mr. Arend Jan Boekestijn, a former Dutch member of parliament and a fervent critic of the current system of EU-aid to the African continent and on the other hand Ms. Hannah Edinger, a German economist living and working in South Africa and Head of Research of Frontier Advisory, a leading research and strategy institute in Johannesburg focusing on emerging markets.

Arend Jan Boekestijn

Hannah Edinger

The two speakers generally complemented each other. By “paying for everything in Africa, whenever needed”, aid donors are causing moral hazard in Africa, Boekestijn warned. He criticized the EU-policy of indiscriminately granting budget-support to all African states and thereby implicitly condoning rampant corruption: “We end up supporting people who don’t deserve our support.”

Edinger agreed, and eloquently elaborated on China’s alternative approach. She explained that China does not define itself as a donor-country, but as an actor investing in Africa in many private sectors.

She did not deny the existence of widespread corruption also in Chinese-led projects. However, more important in her view are Chinese sustainable investments in tangibles such as infrastructure and factories.

She dismissed some of the stories circulating around China’s role in Africa: there is no empirical evidence confirming that China is out to “grab land from Africans”, nor has it been proven that China uses prisoners for hard labor. In her own words: “It is not necessarily a matter of good governance, but maybe of good-enough governance”.

Relying on their experience and knowledge of the topic, Boekestijn and Edinger shared their recommendations for both the EU and Africa to stimulate African economic growth.

Boekestijn encouraged the Western world to follow the Chinese example of ignoring Africa’s corrupt governments and focus on investing into Africa’s private sector. Only then, Boekestijn argued, will an African middle class emerge, rich enough to start a process of democratization.

Edinger agreed, emphasizing the need to support private economic actors for this idea to work. Also, she urged African economies to lower or eliminate intra-continental trade barriers and to strengthen their agricultural sector.

The speakers’ ideas were met with some critical notes from the audience. ”What guaranties does the Western world have that aid flowing into Africa’s private sector is spent on social goods such as education and health care?”, “Why would the private sector function differently than the current African administrations?”

Maastricht Debates: Questions from the audience

“Better than no growth at all”<
Boekestijn believes that private investments would “inevitably outweigh the lack of
economic growth inherent to the current state of affairs in most African states.”

Edinger looked at the question from the angle of Africa’s demographic structure. Because African families are very large, she reasoned, even a small gain in earnings of a single person would create positive externalities for many others.

At the end of the evening, the guests’ conclusions were easy to deduce. In Boekestijn’s view, the EU “has lost the game in Africa” to China’s more innovative approach. Nevertheless, he urged the EU to be more selective in its choice of aid-recipients. Also, he underlined the need for the EU to invest in Africa’s most rapidly changing areas: its urban and agricultural sectors.

Edinger advised Africa and the EU to get to know the Chinese better: “Learn Mandarin.” She argued China’s involvement in Africa was an undeniable and irreversible process and concluded the debate by saying “The Chinese way may be different, but is not necessarily wrong.”

By Romana Michelon

Romana, 21, is a Dutch-Italian student in her second year of the European Studies Bachelor at Maastricht University. Since October 2009, she is a member of the Concordantia student group involved in the organization of Maastricht Debates.

Photos: Sonja Schiffers

More information: Maastricht Debates