Sub-Saharan Africa can free itself from a policy of official developpement assistance (ODA) that has failed to industrialize it

Globe afrique

Official development assistance (ODA) is ineffective in sub-Saharan Africa. But a coherent industrialization program, backed by a private investment fund, could gradually replace it and thus finally promote rapid development in the region.

Lack of will to develop sub-Saharan Africa? 

The inefficiency of public development aid has been denounced for 6 decades, and the OECD has also pointed the finger at its scattering and dispersal. Agronomist René Dumont in the 60s, economists Jean-François Gabas in 1988, Jeffrey Sachs in 1990, William Easterly in 2001 and Dambisa Moyo in 2009 were already questioning the method of ODA. In 2015, in the article "L'aide publique au développement n'aide pas l'Afrique" published in Le Monde Afrique, former diplomat Laurent Bigot wrote: "ODA is a business that supports tens of thousands of international and national civil servants, as well as a myriad of consultants. They all have one objective in common: not to saw off the branch on which they are sitting and on which they are living handsomely". "It's nobody's money. Yet the donors take these sums out of their taxpayers' pockets, but make no demands as to how they are used.

But this model endures, and the Sustainable Development Goals (SDGs) imposed by the UN since 2015, continue to work against the industrialization and development of sub-Saharan Africa. By enacting a dogmatic policy followed by African states and organizations, international institutions are playing with fire. Extreme poverty and malnutrition, combined with the ongoing demographic explosion, are fuelling the rise of terrorism and political instability. Today, they are generating massive immigration to the EU and human tragedies in the Mediterranean.

It is now urgent to change the paradigm

According to the World Bank, current policies will create "at most 100 million new jobs over the next 20 years, rather than the 450 million that Africa needs". Demographic forecasts and poverty indices for sub-Saharan Africa also suggest that, within 20 or 30 years, humanitarian chaos will be unmanageable. Sub-Saharan Africa needs to develop very quickly. But when we consider that European industrialization required several centuries of know-how, and that China benefited from Western aid without which it would still be among the poorest countries, it's clear that sub-Saharan Africa won't be able to industrialize on its own in just a few years.

Announcements of investment of billions of euros in multiple projects with no overall coherence follow one another at countless African or international forums, but without an efficient methodology, the capital will either not come or will more often than not be wasted. For example, the African Union's (AU) African Agenda 2063 has never got off the ground in 10 years, just as the Organization of African Unity's (OAU) Lagos Plan of 1980 also stalled.  Even in the highly unlikely event that the AU plan produces results at the approach of 2063, how many hundreds of millions of Africans will suffer extreme poverty or succumb to hunger between now and then? The young entrepreneurs who are 35 or 40 years old today will have aged 40 years and will then be 75 or 80 years old! The goals are distant, but time is running out.

A private fund to top up the program instead of taxpayer-funded ODA

The investment fund dedicated to the "program for the industrialization of sub-Saharan Africa in less than 20 years" would, in the medium and long term, provide a return on capital which, while not rivalling that of the best-performing financial products, would nevertheless appeal to countries, institutional and private investors keen to demonstrate CSR and inclusivity values, while safeguarding their investments in a fund with serious and prudent management. As my last article in Tribune Afrique explained, "To kick-start sub-Saharan Africa's success, we need an industrialization program worth 1,000 billion euros over 20 years". The amount, which may seem considerable, must be equal to the challenge in terms of jobs, but also in terms of supplying the consumer goods needed by a sub-Saharan population expected to reach 2 billion by 2050 and 4 billion by 2100. 

To achieve this, it is essential that the creation of new industrial or agricultural production tools should not be anarchic, but rather part of a managed process. In this way, production facilities that form complete local ecosystems or are integrated into global value chains will multiply the positive effects of each euro invested. To generate sufficient profit margins to ensure the fund's viability, it will often be necessary to use a vertical integration business model from production to marketing. Given the scale of the task, and in order to strengthen the fund while we wait for the program to produce its effects, we will also need to integrate external investments.  

From poor, dependent African states to prosperous economic partners

Today, many Africans feel that recourse to development aid sends back to the world an image of assisted countries, which undermines the credibility of their vital forces. On the other hand - and this is a fundamental difference - the relationship maintained with African states as part of the coordinated mission of the management firm, the program and its fund, is akin to a relationship between partners or, although the financing often comes from external investors, a service provider with clients.

Sub-Saharan Africa is plural, and we need a paradigm that unites its peoples. Such a paradigm would make it possible to gradually break with an ODA model which, despite having benefited from 2,000 billion dollars in 60 years, is outdated and benefits only a few, while many others remain in extreme poverty and continue to struggle with hunger. So, after the ideological projects written by international institutions, it's clear that our program, which is aimed more at volunteer African entrepreneurs and populations, is the first real, credible, large-scale project. Sub-Saharan Africa must now make it its own by voting for it.

A consultant and entrepreneur, Francis Journot heads the program for the industrialization of sub-Saharan Africa or the EU-Africa Regionalization Plan, as well as Africa Atlantic Axis. He is the initiator of the International Convention for a Global Minimum Wage project.