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Business, Politics, and the State in Africa

Business, Politics, and the State in Africa

Doctor Tim Kelsall

(2013)

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Abstract

In recent years Africa appears to have turned a corner economically. It is posting increased growth rates and is no longer the world's slowest growing region. Commentators are beginning to ask whether emerging from Africa is a new generation of 'lion' economies to challenge the East Asian 'tigers'? This book goes behind the headlines to examine the conditions necessary not just for growth in Africa but for a wider business and economic transformation. Contrary to neoliberal economics, it argues that governments can play an important role in this through selective interventions to correct market failures, and, controversially, that neo-patrimonial governance need not be an obstacle to improved business and economic conditions. Drawing on a variety of timely case studies - including Rwanda, Ethiopia, Tanzania and Ghana - this provocative book provides a radical new theory of the political and institutional conditions required for pro-poor growth in Africa.
'It is delightful to be puzzling more over Africa's successes than its failures. It is great to read a book that both helps us to puzzle and points to the likely answers. When all that is done in clear prose, we have something well worth reading.' Mick Moore, Professorial Fellow, Institute of Development Studies 'Tim Kelsall has written a seminal book that identifies the management of rents as the central factor determining the economic performance of African countries. Business, Politics and the State in Africa advances the debate on governance and development into a new and more productive field, and is sure to stand as a key text for the next decade.' Alex de Waal, Executive Director, World Peace Foundation 'Revealing the evolution of Ghana's, Tanzania's, Ethiopia's and Rwanda's development policy and performance, the empirically-grounded narratives laid out in this book constitute a bracing antidote to the intellectual and ethical complacence behind the mainstream championing of "good governance" and a "level-playing-field" business environment as ways forward for development. The authors' findings and conclusions are sure to be profoundly discomfiting for practitioners - in ways which contribute to, and hopefully will help, spur the new thinking which is urgently needed.' Brian Levy, School of Advanced International Studies, Johns Hopkins University and University of Cape Town, and formerly a World Bank governance adviser 'Recent growth trends in sub-Saharan Africa have been hailed by the proponents of neoliberalism as a strong affirmation of their policy doctrine. Tim Kelsall's volume not only challenges the triumphalism of neoliberals but points to the kinds of state and business coalitions that can generate policies towards structurally transforming African economies. The book combines solid theoretical reasoning with detailed case studies from Asia and Africa. A welcome and timely addition to the literature.' Howard Stein, Professor, University of Michigan, Ann Arbor 'Tim Kelsall provides fresh perspectives on an old post-colonial African conundrum. He presents highly nuanced arguments grounded in empirical detail to hint at the possibility that some forms of "clientelistic politics" might actually conduce to development in African states.' E. Gyimah-Boadi, Executive Director of the Ghana Center for Democratic Development/Afrobarometer and Professor in Political Science, University of Ghana 'Offering a fresh and sweeping perspective that provides insight into the necessary political conditions for economic development, Kelsall demonstrates how contemporary African regimes can move their economies toward more productive trajectories. Rather than reviving the familiar nostrums of good governance and best practices, this book argues that regimes (and potentially donors as well) should "work with the grain" to solve basic collective action problems that will enable economic change. This concise, compelling and readable argument will be useful for advancing the understanding of scholars and practitioners alike.' Peter Lewis, Johns Hopkins University, School of Advanced International Studies 'This is an important and original book, which deserves wide circulation, particularly within the aid industry. Laying to rest the assumption that "good governance" is the pre-condition to development, it offers an enlightening model of how "development patrimonialism" can, under specific conditions, be harnessed for the type of sustained economic growth that may lift African countries out of their "underdevelopment".' Patrick Chabal, King's College London 'A stimulating book, well worth reading for those also grappling with the policy dilemmas involved' Nicholas Westcott in International Affairs
Tim Kelsall is an associate of the Africa, Power and Politics Programme (www.institutions-africa.org) and is a resource person for the Partnership for African Social and Governance Research (www.pasgr.org). He is the author of Contentious Politics, Local Governance, and the Self: A Tanzanian case study (2005), and Culture under Cross-Examination: International Justice and the Special Court for Sierra Leone (2009) as well as articles published in journals including Africa, Commonwealth and Comparative Politics, Human Rights Quarterly, the Review of International Studies and Development Policy Review.

Table of Contents

Section Title Page Action Price
About the author i
Title page iii
Copyright iv
Contents v
Abbreviations vi
Acknowledgements viii
Introduction: growth, governance, and economic transformation in Africa 1
The debate about African growth 2
The role of industrial policy in development 6
Rents and economic development 8
Neo-patrimonialism and the problem of African governance 12
Developmental patrimonialism? 15
1 | Developmental Patrimonialism? 18
Rent management and development – a model 24
Figure 1.1 A typology of rent management 24
Rent management and economic performance in Côte d’Ivoire, Kenya, and Malawi 27
Table 1.1 Regimes, rent management, and economic performance 29
Conclusions 46
2 | Tanzania: growth without poverty reduction 49
Historical context 49
Rents, industrial policy, and investment 54
Sectoral examples 62
Economic performance 70
Conclusions 72
3 | Ghana: a star but static performer 74
Historical context 74
Rents, industrial policy, and the investment climate 78
Sector evidence 83
Economic performance 89
Conclusions 91
4 | Ethiopia: rent-seekers and productive capitalists 93
Historical context 93
Rents, industrial policy, and investment 99
Sectoral examples 108
Economic performance 115
Conclusions 118
5 | Rwanda: the party leads, the market follows 120
Historical context 120
Rents, industrial policy, and investment 125
Sectoral examples 135
Economic performance 141
Conclusions 142
6 | Conclusion: challenging the orthodoxies on business and politics in Africa 145
Revisiting our argument 146
Reflections on our cases and our model 148
Table 6.1 Selected economic indicators: Tanzania, Ghana, Ethiopia, Rwanda 149
Figure 6.1 Mixed rent management – the new African modal type 154
Beyond the model 155
Notes 159
Bibliography 167
Index 185