South Africa and Foreign Investment

This first appeared on John Campbell's Africa in Transition.
 
Yesterday, I had a discussion with a few students about the various lenses through which different American communities view sub-Saharan Africa. I chose to talk about the business community, civil society, and the federal government.

One view that seems to be quite common among the American business community is Africa’s enormous untapped economic potential. However, clearly, that hasn’t translated into the investment necessary to tap that potential. I speculated that this timidity was related to a number of issues, including the widespread poverty of African consumers and our lack of nuanced understanding of the African business climate.

Interestingly, South Africa, despite its highly developed (and Westernized) business climate, has also failed to attract significant foreign investment.

In the most recent installment of the World Bank’s biannual “South Africa Economic Update,” released last week, the authors emphasize that now is the time for South Africa policymakers to start focusing on the country’s medium term growth prospects, including working to attract more private investment, to reduce its sizable unemployment.

The authors note that South Africa actually provides favorable and rising returns on investment but that “risk perceptions or structural barriers to investment” likely impede foreign firms.

However, the report’s authors believe that South Africa’s economic problems can be overcome by promoting policies that generate higher employment, productivity, savings, and investment to kickstart a "virtuous cycle of inclusive growth.”

An added advantage for American business is that establishing a foothold in South Africa could make it easier for private firms with little or no Africa experience to begin expanding into the continent, helping to provide the much needed investment and employment that Africa needs.

Read the report here.

Nigeria's Challenge

This article was coauthored with John Campbell and first appeared on The Atlantic. Read the whole thing here.

On May 29, 2011, as newly elected Nigerian president Goodluck Jonathan took the oath of office, Boko Haram, a shadowy Islamic terrorist group opposed to Nigeria's secular government, detonated three bombs at an army barracks in Bauchi state, killing at least 14 people. Two weeks later, the first suicide bombing in Nigeria's history killed five people just outside the Nigeria Police Headquarters in the national capital, Abuja.

These attacks highlight the challenges that Jonathan's government faces if it is to improve governance, reduce conflict, and promote economic development, all despite Nigeria's extreme inequality, a youth bulge, crumbling infrastructure, and high unemployment. His biggest hurdle will not be the Boko Haram, who in many ways are symptoms of Nigeria's problems, but the entrenched interests that have run Nigeria since the end of the civil war in 1970.

Continued

Mapping Violence in Nigeria

This post originally appeared on Movements.org, the Future Forum, and Africa in Transition.

The recent intensification of attacks by Islamic militant group Boko Haram in northern and central Nigeria, including its capital Abuja, is alarming to Nigerians and the international community alike. But is it really an escalation?

Nigeria has been marred by violence almost continuously during its post-independence history. To cite recent episodes, since 2005, the Movement for the Emancipation of the Niger Delta (MEND) has waged war against the Nigerian government and the oil industry over what it deems is an unfair distribution of the wealth the Delta region produces. They have killed soldiers, kidnapped oil workers, and destroyed infrastructure, and have threatened renewal of its campaign against the government and the oil industry. Near the city of Jos, situated in the middle belt region of the country, economic, religious, and sectarian conflict (often between Christians and Muslims) has killed thousands over the past three years. Following the disputed presidential elections in April 2011, violence along religious lines erupted in northern states, claiming the lives of an estimated 800 Christians and Muslims, after southern Christian Goodluck Jonathan was declared the victor.

Considering the apparent daily attacks and bombings attributed to Boko Haram in the past few weeks, there is a new, palpable feeling of insecurity in the country. More than fifty civilians, soldiers, and militants have been killed in the last week in separate attacks in Maiduguri, Kaduna, and Suleja, prompting the indefinite closure of the University of Maiduguri and the banning of motorbikes in that city, as well as an unprecedented 10 p.m. curfew in Abuja. Further, bombings in the capital during its 50th Independence Day celebration in October as well as the June bombing at the National Police Headquarters have underscored the federal government’s inability to suppress violence, at least in the short term.

However, press and other reporting of the violence and unrest are often contradictory or inconsistent. At times, numbers of victims appear to be underestimated. Sometimes, however, casualties are double-counted. And disagreement over responsibility is common.

In an effort to improve our understanding of the scope of the unrest, we have initiated a crisis mapping project, the Nigeria Security Tracker, sifting through media reports, looking for incidents of violence that ostensibly can be connected to political, economic, and social grievances directed at the state or other affiliative groups (or conversely the state employing violence to suppress those uprisings). Using Ushahidi’s relatively new Crowdmap platform, we are recording each event we find, categorizing the data, and plotting it on a map and timeline. Over time, we hope to be able to evaluate the frequency of attacks, the magnitude (measured in terms of lives lost or injured), and the location of incidents.

Crisis mapping has a number of advantages. For one, it requires a more rigorous definition of violence and consideration of information as part of the process of determining which incidents should be included. It provides a means to organize and analyze often conflicting reports while at the same time allowing us to database information for future reference. In addition to being visually, appealing, the act of mapping also creates a novel opening to discuss violence in Nigeria for a technology-hungry media.

Of course, its analytical value is equally limited. Dependence on published reports means that incidents will be missed or reported inaccurately. This is particularly relevant in Nigeria where media is often concentrated in the south and important events, especially in the north, may not receive the coverage they should.

Further, it does not answer the question of why these incidents happen or why their frequency or intensity might be changing. As a result, we are working under the assumption that violent incidents often take place because of the weakness of the government and popular alienation from it, making scarce legitimate channels for redress of grievances. This alienation in turn is, at least in part, driven by Nigeria’s extreme poverty and inequality, which is most pronounced in the north; a political system that encourages winner take all competition; overzealous security services operating within a culture of impunity; and perverse corruption, which saps the political will for political solutions.

Follow the Nigeria Security Tracker here.