Weak States and Global Economic Development

This post was written by a guest blogger, Evelyn Robinson

Human suffering and insecurity worldwide is being caused by fragile states and violent conflict, a world leader has said. Finland’s Under-Secretary of State for International Development, Anne Sipilainen, spoke out at the opening of the recent conference into conflict and the post-2015 development agenda in Monrovia, Liberia.

Ms. Sipilainen said more than 1.5 billion people live in countries that are in constant battle with violence and political wrangling. She added that peace processes are being demolished by criminal violence and countries’ inability to generate security, justice and economic development.

The minister said: “Environment suffers, education suffers, the most basic health care cannot be provided, child mortality increases, women are not heard… in this kind of condition, it is very difficult to work on long term development challenges and goals.”

The conference was co-hosted by Liberia and Finland’s governments in the latest United Nation-led push to involve societies in issues surrounding disasters, conflict and security and how a universal framework can be created. A new approach must be taken to see the development of fragile states, Ms. Sipilainen added. Only then would we see the international partners coming together and witness international money transfer, equality and aid across the globe.

Also speaking at the conference, Liberia’s Finance Minister Amara Konneh said almost half of all civil wars and political upheaval in the world between 1990 and 2005 took place in Africa, and its war-related deaths far exceeded all other conflicts in the world. He highlighted the importance for leaders at the conference to agree on how conflict, violence, disaster and fragility hinder development around the world and how solutions must be met.

It is recognized that conflict, violence and disaster are huge obstacles which lie in the way of the Millennium Development Goals (MDGs) being met in many countries. The eight aims of the MDGs involve: eradicating extreme hunger; universal education; gender equality; child mortality; improving maternal health; combating HIV and AIDS; environment sustainability; and global partnerships.

Are Jobs In Kenya Being Killed By Corruption?

The reality of leaving school with an education only to find there are no jobs is one frustration many young Kenyans have to deal with. But imagine how it must feel to realize that about 250,000 jobs may never be created because of corruption in your country.

The World Bank has revealed in its latest report “Kenya at Work” that the loss of resources at the hands of fraud amount to that quarter of a million number. As the economic climate stands, about 50,000 youths leaving education gain employment, out of a total of 800,000 graduates every year.

The World Bank country director, Johannes Zutt, said: “Nepotism, tribalism, sexual harassment and corruption determine who gets these jobs leaving the rest to find their own means of survival.” The World Bank’s research says firms pay up to 12 per cent value of government contracts in order to win them, and four per cent of their sales goes towards bribes.

The organization concludes total bribes on government contracts are Sh36 billion, while another Sh69 billion is paid in other kickbacks. The report suggests: “Kenya stands out for its high level of business-related corruption.”

The country’s growth is below the African average and substantially below the growth of its neighbors in the East Africa Community. Mr. Zutt said other obstacles in Kenya’s job creation are access to electricity and poor infrastructure. General election shocks and the Euro crisis have left Kenya’s economy in a “stable but vulnerable” state.

The report says: “Kenya’s economy is out of balance and the external position has become even more vulnerable as the country’s current account deficit has skyrocketed and could reach 15 per cent of GDP in 2012. This is among the worst external balances in the world and poses a significant risk to Kenya’s economic stability.”

An imbalance in import and export has struck over the past ten years, as the fragile state’s imports have grown faster than its exports and the top four exports not making enough to pay for oil imports alone. The World Bank report recommends that manufacturing capacity should be boosted. And, critically, Kenya must deal with the negative effects of corruption on farmers.

Kenya’s Intervention in Somalia

On Monday, the Islamist group Al-Shabab withdrew from Kismayo, its last major stronghold in Somalia. The Al-Qaeda-affiliated group has been under pressure from an armed African Union force, working in partnership with the fragile Somali government. Though this military victory is a critical milestone for the Mogadishu-based government, it is remarkable how this victory occurred.

In October 2011, Kenya – without international blessing – invaded southern Somalia. Though the full motivations of the intervention are still a bit murky, the core explanation seems to be Kenya’s desire to bring stability to a neighboring failed state. Somalia’s problems go back to the 1980s, and the clan chauvinistic and repressive rule of the Mohammed Siad Barre government. With the close of the Cold War and massive reductions in Western aid, the Barre government fell in 1991, and most of Somalia has struggled mightily since. Because of Somalia’s collapse, Kenya has long hosted hundreds of thousands of refugees, suffered from depressed economic performance, and the weathered the scourge of maritime piracy.

In 2007, the United Nations gave its support for the creation of the African Union Mission in Somalia, or AMISOM. Though the mission only gradually mobilized military resources to support the Somali central government, AMISOM was granted a muscular “peace making” mandate. However, it was not until August 2011 that the AMISOM mission (of around 9,000 soldiers in mid-2011) helped push the anti-government group Al-Shabab out of the Somali capital.

Kenya’s entry into Somalia – and the integration of Kenyan soldiers into AMISOM in mid-2012 – is the main reason the mission has grown to around 16,000 personnel at present. Crucially, Kenya’s forces are focused in the southern portion of Somalia, where AMISOM did not previously have a presence.

What is remarkable about the Kenyan intervention is how commonplace these actions were in the pre-United Nations era. Before the UN, failed states were frequently conquered in whole or part, or otherwise controlled by stronger (neighboring) states. The United Nations era norm against conquest does have real benefits, but, as Kenya recognizes, it can also allow the problems of failed states to fester and blight whole sub-regions.

*** Did you like what you read here? You might be interested in the new book by this blog’s author, Failed States: Realities, Risks, and Responses.

The Digital Divide

The phrase has been circulating for at least a decade now. Once Internet access became widespread in developed countries, concerns about a “digital divide” emerged. Some talked about the “fast world” and the “slow world,” with regard to information flows. Over the past decade, this divide has narrowed sharply, at least in terms of basic access to the Web. (A newer version of the digital divide is concerned with the speed of connections.) The World Bank reports that the percentage of the world’s people with access to the Internet increased three-fold over the period 2002-2010, from 10 to 30 percent.

Access rates in developed regions – typically exceeding 70 percent – do still skew the global average. Even so, growth in Internet access is mostly occurring in developing countries. Nigeria, for example, experienced a four-fold increase in access in just three years (over 2007-2010). Nigeria’s rate (28%) is now comparable to the world average, with obvious implications for society, economy, and politics. Kenya, the world’s leader in mobile money usage, experienced a three-fold jump over the same three-year period (for a rate of 26%). Other key developing countries like Vietnam and the Philippines have experienced similar surges in information access.

Yet, the digital divide persists. Even a casual glance at the World Bank data indicates very uneven growth in access to the Internet. At the very low end of access, a few dozen countries have only tiny proportions of their societies online. In places like Bangladesh, Cambodia, Papua New Guinea, Afghanistan, Ethiopia, and the Democratic Republic of Congo, less than five percent of the population has access to the Web. In Ethiopia (with 90 million people) and the DRC (with 70 million people), fewer than one percent of the population has access to the Internet.

ICTs (information and communications technologies) are not the panacea for economic development that some claim. As Padraig Carmody (of Trinity College Dublin) has argued, low-income households sometimes spend too much of their budgets on information access through a kind of conspicuous consumption. And better access to information is no guarantee of better job prospects for all.

Even so, it is striking that some low-income countries are surging ahead in this area. And it should come as no surprise that a supportive governance environment is a key to this progress. Some authoritarian regimes (notably North Korea) still greatly restrict access to information. Even in more democratic contexts, legal and bureaucratic obstacles can limit growth in mobile phone usage and telecommunications investment. Nigeria, for example, went through a dramatic period of liberalization in the 2000s, which has led to its remarkable rise in Internet access. As just one indicator of this growth, a significant minority of this blog’s readers reside in Nigeria.

*** Did you like what you read here? You might be interested in the new book by this blog’s author, Failed States: Realities, Risks, and Responses.