Coffeeeeeee!

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iFAMINEI’ve been to Africa countless times and there are plenty of reasons that I can see that the Continent should not be in the position it finds itself.  I’ve met a multitude of talented, ambitious, thoughtful and yes entrepreneurial people.  In fact there are parts of Kenya or Tanzania or Uganda I would happy settle and make my life.

The reason Africa is dependent on aid is really a very simple one.   Less than 20% of African exports are manufactured, value added goods, the other 80% are raw materials.  But 65% of the continents imports are manufactured goods.  Africa therefore is a producer of what it does not consume and a consumer of what it does not produce.  The irony of this perverse situation I’m sure isn’t lost.

In Uganda for example coffee is grown in small quantities by about a million households.  In fact Uganda is the 5th largest producer of coffee beans, but it doesn’t have any capacity for processing those beans.  Frankly I was amazed when I read that stat!  This means that less than 1% of the retail value of coffee originated in Uganda is retained by the very farmers who produced the beans.  But here’s the real kick in the proverbials, go to any large hotel in Uganda or Kenya or pretty much any other East African nation and see what brand the coffee is that you get served in a hotel.  My bets are that you get Nescafe and not much else.

Don’t get me wrong here, Africa is blighted by Big Man Politics.  But even this cultural bent is related to how the old colonials left the continent.  For the most part European countries carved-up the continent in search of raw materials, installing a small but well armed band of so called Diplomats & Governors to run the countries they invented (Africa is a continent of nations who do not have socially natural boundaries  check it out there are just too many straight line borders for this to be deniable).  What they didn’t do was educate.  So when the countries found freedom from colonial rule they just didn’t have the educated elite to run the country that was left.  Nett result; a few rose to power and were quickly corrupted.

So we now support Africa with endless aid.  In fact the continent now has a chronic dependence on aid and I don’t see how it actually contributes to or acts to stimulate sustainable economic growth.  The powerful donors have tied the aid to concessions, making the leaders of African nations more accountable to corporate America and EU than to their own people.  In short the structural inequalities generated in the 1950’s & 60’s are perpetuated, promotion of  labour exploitation ensures that the export of primary commodities remains central to the bare survival of those in power.

How to correct this situation?

My suggestion is 3-fold:

  1. Transfer of knowledge, train the people in how to manage their environment to best effect
  2. Provide the technology to do the jobs; this of course is linked intimately to point 1
  3. Build institutional capacity; this is the really difficult one actually.  Good governance, good banks, good savings schemes… the things we probably take for granted

There are without question no shortage of entrepreneurs in Africa, all you have to do is visit Nairobi or Lagos or… you will be accosted with people selling their wares.  No, no shortage here.  The real question is access to funding.  About 3% of adults in sub-Saharan Africa can access funding, the other 97%+ are on their own.

The key to this lock I believe lies with the Western Supermarket Chains.  It wouldn’t take that much effort I’m sure for them to go to Africa, seek out those producers who can make what they need, invest some of their vast wealth in creating capacity and give a listing to those producers who make the grade.  I have no doubt that many will, make the grade that is and I would not complain if I had to pay a penny or two more to get great value, high quality products knowing that a farmer or a producer or co-operative somewhere in Africa is able to feed itself, educates itself, and looks after its own health care.  Now that to me sounds like a win-win all-round.

Its a well used phrase but Trade not Aid is to the point and accurate.  All we have to do is find the will to want to change how Africa is run, how we can economically engage with the vast wealth talented people.  I make but a few suggestions and I’m sure there are people cleverer than me with greater insight than me who can shed much more light on what appears to be a complex problem but actually is quite simple, just immense.

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