Papa Demba Thiam: “Building African economies on their strengths”

Francophone Africa celebrated its 60 years of independence. What economic assessment can we draw from this period?

Papa Demba Thiam: A mixed picture, given the diversity of African economies. The overall situation has deteriorated over the past 40 years with the stabilization and structural adjustment programs. Deindustrialisation has gone hand in hand with the cessation of public investment in infrastructure, education, training, research, public health systems and structures, etc. But, an economy being a universality of interdependent and dynamic rationalities, it changes direction and circumvents obstacles. This is how the informal economy has grown everywhere, helping to reduce the spread of poverty and develop social solidarity. It represents between 70 and 90% of the economy depending on the country. Official growth indicators cannot measure its performance, and governments and multilateral institutions fight it more than they support it. This is why African economies are suffocating with a phenomenon of caps on productive activities, without accumulation of capital to support the structural changes necessary to build African economies on their strengths. People survive more than they develop socially. Unemployment affects even graduates, as in South Africa, officially 2^e continent’s economy, where 54.5% of young people are unemployed. Social time bombs in a continent where the median age is 19.7 years with 1 billion young people under 35 this year.

On what points have governments and multilateral institutions slipped in their analyzes and actions on the continent?

Most African governments no longer have economic policies inspired by the realities on the ground. They depend on experts from multilateral institutions who dictate their economic and financial behavior in return for budgetary support. However, as the conceptual and expert analysis instruments do not suit the field of definition of African economies, the intervention instruments imposed on African governments are neither coherent, nor relevant, nor congruent. How can we determine the growth rate of an economy by only being able to measure between 10 and 30% of its activities (the formal sector)? Because this is what makes it possible to measure the income of States, their repayment capacity, and therefore debt. We are therefore no longer in development. This is why multilateral institutions have systematically specialized in the administration of the consequences of poverty. This explains why one can say of someone very well paid in a multilateral development institution that he is a “principal economist or a specialist in poverty”. Look, in 1960, it was development aid, in 1970, technical assistance, in 1980, humanitarian aid, in 1990, the fight against poverty, in 2000, poverty reduction and, since 2010, the reduction of extreme poverty. With each decade of independence, its declining ambitions for Africa.

Promising before the Covid-19 crisis, Africa will experience a strong recession this year. Under what conditions do you think she can get out of it?

Promising? Do not be fooled by these GDP growth rates which mean nothing to the daily life of the African masses. Before the occurrence of Covid-19, Africa was structurally in economic crisis, with often unsustainable internal and external debt. The new calls for debt cancellation-restructuring in times of Covid-19 follow warnings from the World Bank and the International Monetary Fund, which warned African states against unsustainable debt long before the onset of the crisis. pandemic. It is clear that the efforts of governments to combat the health effects of Covid-19 and the subsequent economic slowdown will hamper growth in both the formal and informal sectors, in a context of increased public debt. But relaunching the economic machine on the same bases, the same recipes and the same expertise would amount to political autism. So why not mobilize African expertise to reinvent the economies of the continent rather than engage in celebrity branding operations who participate in a certain form of intellectual fraud?

We should avoid the trap of the new intellectual and institutional deception that is being set up to further capture the resources of development aid. It pushes the same experts who have failed to take hold of concepts they don’t even understand, such as “paradigm shift”, “relocating value chains” or even “industrialization”. Politicians should also avoid making statements that are populist in nature and difficult to translate into action. For example, the escalation of discourse on the relocation of sovereign industries, in response to the structural vulnerabilities exposed by the situation induced by the pandemic, has been sold too well to African public opinion not to be followed by concrete action. But it will be difficult to “decree” relocations of industries without protecting them with tailor-made technical barriers to trade and / or with new customs taxes.

How, in an international economic environment where the cards are reshuffled, can Africa build a future for itself?

Already, no longer submit to the diktat of single thought, such as the Washington consensus which fabricated poverty for all, the global economic contamination of Covid-19 being only an epitome. Rather, it is necessary to design and implement economic strategies adapted to each environment, according to its specific characteristics. African economies must be built on their strengths by considering at least two factors: the availability of resources and a strategic and inclusive transition of the informal sector. Development policies must be pursued based on: industrial transformation of resources; “interface strategies” to develop value chains that link economic poles; integration of informal activities into formal value chains; and strategic public-private partnerships in value chains to create integrated, self-centered, and therefore more resilient multipolar growth centers.