We recently had the World Economic Forum in Cape Town. Lots of things were said there about the current state of development in Africa and the expectations for the future. Now I readily admit I did not watch each and every thing said there, but I cannot escape the feeling that a few things were either left unsaid, not looked at and that relatively simple solutions were not discussed.
I could be wrong off course, I probably am. But that won't stop me from adding my 2 cents to the debate. Not that many people will read this, certainly not the ones in power. But it feels good to get it of my chest anyway.
Fact of the matter is that the local population of South Africa has been getting a raw deal in the past, and it is not any better at the moment. Yes there are exceptions to the rule, but on a whole the country seems to be moving backwards in development rather then forwards. With the result that you get the usual demagogues screaming for nationalization of major industries such as mining and banking. These deluded fools still believe that this will help, all evidence to the contrary that is widely available. Yet they get support from the ones who are at their wits end, trying to make ends meet and who can blame them?
It is hard to see the world go by, see immense wealth and not have the chance to create even a little bit for yourself and your family. In these circumstances it is only too easy to fall into the trap when someone stands up and tells you that you and your fellow citizens could just take it from those that hold the wealth now. It is a dangerous mix this, combined with racial nationalism it can lead to another failed African state.
So how can it be solved? How can the poor and unemployed be uplifted without actually scaring off the much needed foreign investment? A nation as South Africa has incredible potential, massive natural resources and a pretty decent infrastructure. All the pieces of the puzzle are there, so how can it be put together?
In my opinion it can be summed up in one word: joint-ventures. Look at the mineral resources. It gets mined, shipped out as raw material and finished products get imported. per product this is a cash drain and a jobs drain for the nation. Instead of exporting raw materials it seems a better option to build the factories here, make finished products and export those instead. The capital to build those can be found abroad. Let us import both the capital and the knowledge from producers abroad and set up joint-ventures with local business people to build equally owned production facilities.
Foreign producers have the advanced technology and capital needed, we have the resources and manpower. It could be a match made in corporate heaven. We need the training for the people, the jobs and the added income that comes from the added value to exporting finished products. For the foreign investors South Africa is still a country with lower wages then in Europe or North America. True, the Chinese are cheaper, but they lack the resources. Which is why they buy them here, ship them to China and produce there. The cost per unit when imported to South Africa is still lower then when locally produced. But I think it is in the worlds interest as well to develop the continent Africa in this way. It will create a whole new market for their products.
The market potential in Africa is enormous, as long as the people have the capital to spend. This would be solved in this way. So I believe that in the middle to long term it is in the corporates world own interest to step up to the plate and invest in these production facilities on the continent. And South Africa is probably the best place to start, given the existing facilities and infrastructure.
This will be the way to empower the local people as well as the way to increase corporate profits. It will lead to a more equal and balanced world, and therefor a more stable world. So what are you all waiting for? The time is now to stop sending development aid and instead start helping to really develop the nations. Don't give Africa a fish, teach Africa to catch its own fish and provide the boat and nets. Your dinner will be more plentiful for it.
Subscribe to:
Posts (Atom)
