South Sudan: Fragile and Resilient

In July 2011, South Sudan gained political independence. With the exception of Eritrea, no other African state has been created in the post-colonial period (i.e., since the 1950s). South Sudan now faces a long and difficult road to stability and prosperity.

Like many of the former European colonies in Africa – especially the Belgian and Portuguese territories – South Sudan’s independence inheritance was limited. In the case of South Sudan, governments in Khartoum systematically marginalized this geographically peripheral region. Some basic data tell a grim tale of under-development:

  • Only about 25 percent of the young state’s population is literate. Most developing countries have figures in the range of 50 to 80 percent.
  • South Sudan possesses a physical area larger than France. The new country, though, has virtually no paved roads. The longest stretch – connecting the capital of Juba to Uganda – is only about 100 kilometers.
  • Less than 1 percent of the population has access to electricity. That’s right, only a tiny fraction of South Sudanese can count on reliable access to a power grid. The 1 percent figure presumably does not include those who have access to a generator.
  • Maternal and infant mortality rates are falling, but they are shockingly high. The improved figures (since independence) are: 76 infants deaths per one thousand and 2,054 maternal deaths for every one hundred thousand births. This maternal mortality rate is the worst in the world.
  • A disputed border with Sudan and internal conflicts have led to the displacement of hundreds of thousands.

Yet, the new country has weathered its early independence phase better than many predicted. This assessment is especially remarkable given the long standoff with Sudan over oil transit fees. And South Sudan does have key natural resources other than oil. A high percentage of arable land, fairly dependable fresh water supplies, and ecotourism potential are a few of the country’s key natural assets.

The world’s newest state, though, is landlocked and situated in a highly volatile region of Africa. The Central African Republic and the Democratic Republic of Congo are both neighboring failed states. Adjacent portions of Uganda, Kenya, and Sudan have also experienced armed conflict or communal unrest in recent years. The South Sudanese people will require much more resilience in the years ahead.

Business Climate and Failed States

This morning I launched a new business. Although I had to fill out many forms and submit fees to various government agencies, this process has been remarkably easy. In fact, I live in a country that offers helpful public resources to support entrepreneurs. For  entrepreneurs in failed states, starting a business is an arduous and expensive task, and one that is frequently abandoned.

People can reasonably disagree about how much businesses should be regulated. Most, however, would concur with the sentiment that the private sector should be restrained no more than necessary. This principle is especially important with regard to forming a new business. If it is too difficult to legally form an enterprise, whole economies suffer. The dynamism of free markets is suppressed. Prospective entrepreneurs will remain without work or under-utilized as employees of existing companies. And black markets will flourish.

The Burden of Bureaucracy

This collage features Franz Kafka and Max Weber, two authorities on bureaucratic obstacles. Illustration credit: Harald Groven (via Flickr, Creative Commons license).

It will come as no surprise that it is very difficult to start a business in failed states. Beyond the challenges of poor infrastructure and under-educated populations, poor governance hinders entrepreneurial activity. Each year the Heritage Foundation and the Wall Street Journal publish an “Index of Economic Freedom.” I don’t agree with all of the ideological judgments behind the index, but it is nonetheless a very valuable dataset.

One of the ten criteria assessed in the index is “Business Freedom,” which is defined as follows:

Business freedom is a quantitative measure of the ability to start, operate, and close a business that represents the overall burden of regulation as well as the efficiency of government in the regulatory process. The business freedom score for each country is a number between 0 and 100, with 100 equaling the freest business environment.

Poor performance on this criterion is common among failed states. Poor performers on “business freedom” are frequently referred to on this blog. These countries include: North Korea, Haiti, Zimbabwe, Central African Republic, Democratic Republic of Congo, and Myanmar (Burma).

In contrast, my home state of Virginia offers a “Business One Stop,” for new businesses. And, based on my experience, Virginia deserves the praise it receives for business friendliness. (Sorry, I couldn’t resist a bit of local boosterism.)

Bucking the Global Trend: Africa’s Economic Growth

Europe’s economic funk continues. Japan’s aging society is struggling under a huge pile of public debt and slow GDP growth. Recovery in the United States is about what can be expected from a post-financial crisis expansionary cycle. And in China, Communist Party leaders are adjusting to much slower growth. In much of Africa, though, growth prospects are strong, if we can believe aid agencies such as the World Bank and USAID.

On April 15th, the Washington-based World Bank issued a periodic check-up on Africa’s near-term growth prospects. Partly fueled by high commodity prices – especially for energy resources and minerals – continental growth is forecasted to be more than five percent per year over the period 2013-2015. The optimistic forecast also highlights the impact of increased consumer spending in many countries south of the Sahara, including places like Ethiopia, Angola, Ghana, and Mozambique. Indeed, many sub-Saharan states have seen above-average growth rates for more than a decade, leading to some reduction in still-high poverty rates. The diffusion of mobile phones and more predictable macro-economic conditions are key factors leading to better growth prospects.

USAID and the World Bank are probably right about continued high commodity prices. Even if some of this new African wealth is squandered through corruption, better terms of trade will lift many ordinary people out of poverty. A cautionary word is in order, though. Enclave-based development – especially if it involves oil or high-value minerals – can facilitate political instability and armed conflicts. Think diamonds in Sierra Leone and Angola, numerous precious resources in eastern Democratic Republic of Congo, and oil in Nigeria. In short, over-reliance on mineral and energy exports can lead to so-called “rentier states” (and failed states) that do not necessarily promote broad-based human development. Careful observers of the DRC and Nigeria know about the “resource curse” all too well.

So, boosting international trade between Africa and other continents is set to grow significantly in coming years. With luck and better governance, many states will avoid the worst excesses of the resource curse.

The perennial problem of limited inter-state trade in Africa also requires urgent attention. Vast distances, colonial legacies, poor governance, and under-investment in transportation infrastructure have all contributed to high costs of trade throughout much of the continent. As USAID indicates,

Trade among African countries makes up only 10 percent of the region’s total trade volume. In East Africa, it costs 50 percent more to move freight one kilometer than it does in the United States or Europe, and in landlocked countries transport costs can be as high as 75 percent of the value of the goods they are trying to export.

Like South Asia (India and its neighbors), Africa possesses huge potential for growth in intra-regional trade and investment. This potential will only increase if Africa’s middle classes continue to swell.

The economic news out of Africa is relatively good, particularly compared to the world as a whole. Still, it is worth remembering the continent’s patchwork pattern of progress on governance, peace, and economic reforms. The overall trend is clearly positive, but recent news out of the Central African Republic (CAR), Mali, and the DRC reminds us that progress is geographically uneven.

The Fall of Bangui: State Failure in the Central African Republic

On the Sudan - Central African Republic Border

The Central African Republic is located in one of the most conflict-prone regions of Africa, which includes Sudan, Chad, and the Democratic Republic of Congo. Photo credit: hdptcar (via Flickr, Creative Commons license).

Over the weekend of March 23-24, the brittle government of President Francois Bozize was finally overthrown. A coalition of rebels known as Seleka has now seized control of the capital city, Bangui. Bozize and many senior figures from his government have fled the Central African Republic (CAR). This new development re-confirms the country’s status as a failed state. Here are two key indicators of that status.

  1. Limited rule of law. The ousted president, Bozize, came to power through a military coup in 2003. Despite CNN’s designation of last weekend’s change of government as a “coup,” the successful rebellion has led to another unconstitutional change of government. In response to the illegal action, the African Union has suspended the membership of the Central African Republic. And, not surprisingly, the new Seleka government has suspended the country’s constitution, promising free and fair elections within a few years.
  2. A stark core-periphery pattern. As I have previously written, the divide between the CAR’s capital city and its hinterlands is immense and longstanding. The core region around the capital has been the main focus of government authority, while the outlying regions – especially in the North and the East – have largely existed outside national government influence. In the past decade, these “ungoverned spaces” have been regionally important as fighters and weapons have flowed across porous borders with Chad, Sudan, and the DRC. If the rebels are successful in retaining control of the capital, will they be any better at forging a geographically unified, well-functioning country?

Outside of obvious concerns about an intensifying humanitarian crisis in the CAR, it does not seem that the international community is all that concerned about the situation there. Notably, France did very little to oppose the fall of Bangui. Yet, we should applaud the African Union (AU) for quickly acting to suspend the CAR and sanction the country’s new leaders. For all of its dysfunction, the AU has at least created a regional political culture that stigmatizes unconstitutional changes of government. If only the AU would get tougher with African dictators that run sham democracies.

Weak and Failed States in 2012

The year 2012 was an eventful one for the world’s weak and failed states. What follows is a quick review of some key trends and highlights from the year that was.

In Afghanistan, the “forgotten war” continued. A long-sought political settlement with the Taliban proved elusive as NATO and the United States prepared for a full military departure in 2014. Insider attacks by Afghan government security personnel on NATO soldiers grabbed headlines, as did continued evidence of widespread corruption and dysfunction in the Afghan government. Afghan watchers are very nervous about the post-2014 era.

In 2012, Pakistan muddled along on a variety of fronts. Relations between Pakistan and the United States remained very strained, even as cooperation improved somewhat by the end of the year. Most critically, the military establishment has strengthened its position with regard to the country’s politicians. Civilian control of the military is only an aspiration at the present time, and true democracy is therefore on hold. Militant attacks on aid workers halted efforts to eradicate polio in Pakistan’s border regions.

In Syria, the ruling Assad clique fought a losing effort of regime survival. If last year was a tragic year in Syria, the year ahead may be catastrophic. The United Nations warns that this key crossroads state could produce more than one-half million refugees in 2013. Intense urban warfare in Damascus and Aleppo could lead to truly awful humanitarian conditions.

Tuareg Rebels in Mali

Mali, previously stable and democratic, suffered major setbacks in 2012. Photo credit: Magharebia (via Flickr, Creative Commons license).

In three African states, Mali, the Democratic Republic of Congo (DRC), and the Central African Republic (CAR), insurgents secured or expanded zones of open defiance. Governments lost the ability to control vast portions of territory, a key marker of state failure. The troubles in the DRC, related to the M23 rebel group, were particularly noteworthy. Rwanda and Uganda again meddled in the internal affairs of their large neighbor, as they did during Africa’s World War of the 1990s and early 2000s.

Despite gains in governance and economic development over the last decade, Nigeria continued to suffer the effects of a well-organized Islamist insurgency. Boko Haram does not seem to represent a mortal threat to the central government, but the Islamists’ activities are further straining religious coexistence in a deeply divided country.

Finally, I close this review with some hopeful developments. In Southeast Asia, the long-mismanaged Myanmar (Burma) is moving towards political openness and engagement with the rest of the world. Though sometimes ignored due to its location between China and India, Burma is an important, resource-rich state that deserves more attention. And Burma seems to be steadily moving in a positive direction, thanks in part to a more enlightened set of autocrats.

Aung San Suu Kyi

Burma’s opposition and pro-democracy leader, Aung San Suu Kyi. Photo credit: World Economic Forum (via Flickr, Creative Commons license).

In the Horn of Africa, 2012 was a relatively good year for Somalia. The Western-financed AU mission is helping the Mogadishu-based government push back militant Islamists. Al-Shabaab lost a huge amount of territory in the last year. And, whatever the reasons, maritime piracy off Somalia declined in the last 12 months.

In Latin America, a new narrative is emerging in Mexico, and perhaps all of Central America. In Latin America’s second giant, economic development and new political momentum is shifting the discourse away from drug violence, even though that violence is still stubbornly high.

Measuring Corruption (in Failed States)

Earlier this month, the respected NGO Transparency International released its annual survey of public sector corruption around the world. The Perceptions of Corruption Index is the most influential effort to assess the relative cleanness of governance throughout the world.

First, here are a few highlights from the 2012 survey, which assigns a score of 0 to 100 to each state, with 0 representing a highly corrupt public sector and 100 representing an extremely clean public sector.

Anti-corruption poster in Port Moresby, Papua New Guinea. Photo credit: Raymond June (via Flickr, Creative Commons license).

Anti-corruption poster in Port Moresby, Papua New Guinea. Photo credit: Raymond June (via Flickr, Creative Commons license).

The cleanest clusters and states are: Scandinavia, the Netherlands, Switzerland, Australia and New Zealand, and Canada. Others scoring fairly well are Chile, Uruguay, Japan, the United States, and a few other European countries.

When examined by world region, Eastern Europe and Central Asia – including Russia, Ukraine and the “-stans” – fare the worst for public corruption. Ninety-five percent of these countries score below 50 points out of 100. (For comparison, 70 percent of the world’s states also score below 50.) Sub-Saharan Africa has the next worst scores overall, with 90 percent of the region’s states scoring below 50 points.  The Middle East and North Africa ranks as the third most corrupt region in the world. And the Americas and Asia Pacific are slightly below the world mark, with 66 percent and 68 percent, respectively, of countries scoring below 50 points.

Figures for the world’s key failed states are fairly predictable. The ten lowest ranking countries – meaning those where bribery, rent-seeking behavior, and corruption are entrenched – include the following failed states: Afghanistan, Haiti, Myanmar (Burma), North Korea, Somalia, and Sudan. Other critically weak and failed states score very poorly on the survey, including: Chad, the DRC, Burundi, Zimbabwe, Equatorial Guinea, and Pakistan.

But how do we know that these scores are valid? Transparency International freely acknowledges that they are assessing perceptions of corruption, and not absolute levels of public sector impropriety. Just a cursory look at the summary index map reveals an  old pattern, with Western countries judged as less corrupt and non-Western states labeled more corrupt. Perhaps the old process of Orientalism is at play in this influential global assessment.

A more careful look at the numbers, though, reveals some subtle differences that matter. In Africa, Botswana has a score that is identical to Spain’s and a bit better than Portugal’s. Ghana’s mediocre score is meaningfully better than those of Italy and Greece. Chile and Uruguay have similar scores to that for the United States.

What are your thoughts about this survey? Do you give much credibility to these scores and rankings?

Rwanda and the DRC (The Fall of Goma)

Eastern Congo’s largest city, Goma, has fallen to the M23 rebels. Since April 2012, the rebels have gone from a nuisance to a serious threat to the Kabila government in Kinshasa. As with the turmoil of the 1990s, the smaller neighboring states of Rwanda and Uganda are playing key roles in the present crisis. Rwanda, in particular, has long intervened in its fragile neighbor to the west.

Eastern DRC humanitarian crisis

Photo credit: European Union Humanitarian Aid and Civil Protection (Creative Commons license).

Before we return to Rwanda’s role, it is worth underscoring the gravity of the current situation. Goma is a city of about one million people, a good portion of them internally displaced persons (IDPs). The city also sits on the border with Rwanda, and is not far from the Ugandan border. Goma is a key trade and transit center in the Great Lakes region.

The startling fact about the M23 takeover of Goma on November 20th is that the city fell with very little resistance from government forces. The BBC is reporting that DRC police officers in Goma are now handing in their weapons to the rebels. Additional government soldiers are defecting to the M23.

And – this is key – the rebels are threatening to march on the capital city of Kinshasa. The DRC’s leader, Joseph Kabila, should know this narrative well. His father, Laurent Kabila, led a march on Kinshasa in 1997 that began in eastern Congo. The elder Kabila, of course, received crucial backing from Rwanda and Uganda.

So, as history repeats itself, what are Rwanda and Uganda seeking to achieve in backing this new group of rebels? It is hard to say. In the not-too-recent past Rwanda has announced intentions to annex part of eastern Congo. And, though such a pronouncement is offensive to many, it is hardly unusual when viewed through a global historical lens. Stronger, more capable states have long sought to control or conquer weakly governed neighboring territories. The work of Gerard Prunier and others suggest that battle-hardened Paul Kagame (Rwanda’s President) tends to see geopolitics through a realist lens.

Rwandan President Paul Kagame

Photo credit: U.S. Army (Creative Commons license).

It is not at all clear that 2012 will be a repeat of 1997. The M23 may not be capable of expanding their domain in the East and marching on Kinshasa. It is clear, though, that the Democratic Republic of the Congo remains a failed state. Even if the central government retakes Goma and other rebel-held areas, the events of 2012 indicate a difficult road ahead for 2013 and beyond.

What are your suggestions for strengthening the Congolese state and bringing greater stability to the Great Lakes area of Africa?