African Economic Outlook 2016 Wants More
People in African Cities by Paul Conton
The foreword of this 400-page report,
subtitled Sustainable Cities and
proudly tells us, "A
team of over 100 researchers, economists,
statisticians and other experts from Africa and other regions of the
world collaborate on the AEO". And indeed a few pages later a
veritable galaxy of scholars and eminent persons
are listed as contributors.
Despite this, the report's sponsors, the ADB, OECD and UNDP, still find
it necessary to add a disclaimer on page 1, "The opinions expressed
employed in this publication are the sole responsibility of the authors
and do not necessarily reflect those of the African Development Bank,
its Boards of Directors or the countries they represent; the OECD, its
Development Centre or their member countries; or the United Nations
This is nothing short of administrative cowardice.
Do you accept the main thrust of the report, for which you have engaged
so many professionals and spent so much time and money, or don't you?
If you do believe in your report, why compromise it at the outset? If
believe in it, then don't bother to publish it, plain and simple, or
if you think it has at least some
value, publish it as an
alternative professional opinion and register your disagreement
clearly. If you
don't know whether or not you accept the report, if you are unable to
come to a conclusion about it, then you are failing in your mission.
Don't publish it until you are able to come to a conclusion one
way or another, hopefully in the not too distant future.
Having said that, the group may have fair reason not to believe in the
report. For decades, professional economists have argued over the
conundrum of Africa's underdevelopment. The first six chapters of AEO
2016 lay out the problems of Africa in great detail: widespread
poverty, low rural and urban productivity, lack of industrialisation,
even deindustrialization, urban slums and congestion, extensive
rural-urban migration, poor infrastructure, low education and skills
base, widespread inequality; these and more are discussed in the
report's first six chapters. Chapter 7 brings forth AEO's big solution,
reflected in the report's subtitle: focus attention on the cities as
engines of structural transformation in order to build a bright new
Africa. Redress what the report claims
has been a bias towards rural areas by devising new attitudes, policies
and (inevitably) investments for the cities and the urban newcomers.
The authors are well aware that many economists have argued that Africa
needs rural investment more than it does urban, but they claim that the
weight of professional and political opinion has shifted or is shifting
towards the cities. Early on in the report they cite a seminal 1969
paper outlining what is known as the Todaro Paradox: under certain
conditions creating jobs in the cities causes urban unemployment
to increase, not decrease, as the presence of jobs in the cities
attracts more and more rural migrants. The report details clearly the
plight of rural migrants in the cities, without relevant skills or
education, eking out a living on the streets with no prospect of career
advancement, often living in precarious slum housing. In the end this
and much other evidence showing the damage to African economies of
overflowing cities is dismissed or ignored as the authors promote
policies that favor rapid urbanization. Even as Chapter 7 lays out the
new agenda, however, the authors are less than emphatic in their advice
(all emphasis mine):
"Urbanisation can contribute
to economic development and structural transformation..."
"Africa’s urbanisation could increase
agricultural productivity and rural development by..."
transform the rural non-farm economy..."
"Cities can provide
enabling conditions for Africa’s industrialisation..."
"African cities can
drive service-led growth..."
"Africa's urbanisation can contribute
to environmental development..."
The African experience over the last fifty years has been the reverse
of many of these hypotheses. It's hard to argue that the rapid
African urbanisation thus far has contributed to economic development
structural transformation or increases in agricultural productivity in
Africa. Indeed much data
shows increasing urbanisation is directly
correlated with increasing staple food imports. Far from Africa's
cities promoting Africa's industrialisation, they have become huge
consumers of foreign imports, promoting industrialisation in China and
elsewhere. And given the growth of African urban slums, it's laughable
that Africa's urbanisation has contributed to environmental
Evidence that Africa's urban dwellers have higher incomes than their
rural counterparts has often been used to justify the argument for
greater urbanisation. Many of the new arrivals end up
selling imported trifles on the streets. Yes, they can eke out a
applying a small mark-up to whatever sellables they can lay their hands
on and pressing them on passers-by, and in short-term daily cash terms
they may end up better off than their rural counterparts, but in terms
real value added to the economy there is no comparison with the rural
producer (much value is added to foreign economies by these sales!).
The real challenge of course is not to
abandon rural areas to urbanisation but to reorganize and capitalize
such as to make these expanding, dynamic places that attract
local enterprise and energy rather than repel it.
No one claims this will be easy, but without this the future looks
bleak. Demographic data presented in AEO 2016 indicates that even
though African urbanisation
(defined as the percentage of the population living in urban areas) is
increasing, because of high African birth rates, in absolute terms the
African rural population is increasing
not decreasing, and will
continue to do so for many years.
The result of the much vaunted urbanisation then is increasing numbers
of poor city dwellers selling all manner of imported trinkets on the
streets and increasing
numbers of impoverished rural dwellers waiting to flee to the cities.