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Strong values underpin economic success

Oct 24, 2004 Success, Sunday Nation

What does the word “globalisation” mean to you? In the minds of most people these days, a host of negative connotations emerge spontaneously. We think about “exploitation” – that we are being stripped naked by the rich countries and their storm troopers, the multinational corporations; about “volatility” – that we are being sucked into the instability of other people’s markets; and about “neo-colonialism” – that we have never truly taken charge of our own destiny.

Wajibu, a local journal that regularly covers weighty subjects in considerable depth, interviewed me recently on the subject of globalisation. It gave me the opportunity to reflect on what connecting with the outside world means to us in Kenya. Are our fears about rapacious international players real? Should we exercise great caution as we open up our economy to outsiders? Should we, indeed, put up the shutters and go our own way – find homegrown solutions to our problems and forsake the international economy?

Whilst we are right to be concerned, I think our economic options are extremely limited. The Kenyan economy and market is far too small to allow us to achieve economic lift-off. The purchasing power, savings rate and potential for self-generated investment is simply too limited. Our 30 million people, 17 million of them subsisting on less than a dollar a day, simply cannot ignite a growth engine. We have no choice but to be an international player. The issue is not “if”, but “how”: how to set the terms of engagement.

All over the continent, countries and companies are finding that they need access to a bigger pool of money than they can find at home. Most leading Kenyan corporations have hit the ceiling of growth in this country; many are busy laying a foundation for growth in Eastern Africa and beyond. They have found that you can play around with prices and contemplate local mergers and acquisitions all you want: those traditional routes to growth are increasingly leading to dead ends.

Nor do we have the skills we need to perform in the 21st century. That is a direct result of our failure to invest in meaningful education for 40 years. The countries that did – India, China, South Korea – are all enjoying knowledge-driven growth. They have produced engineers, programmers, researchers and managers in large numbers, and these people are all now contributing to an international competitive advantage in skills. We have no such advantage; if anything, we have lost what few knowledge workers we produced to richer countries.

That means that if we wish to have mobile phone services, we have no choice but to let in the Vodafones and Celtels so that the necessary expertise arrives in the country. If we want to our ICT sector to take off, we must depend on the knowledge of the IBMs, HPs and Microsofts. We cannot yet develop our own Samsung, our own Infosys or our own Reliance to take on these global giants – and win.

We must go for export-led growth, just like the countries that produced these companies did. We must let growth lift our people out of poverty, just like it did in much of Asia. The alternative is to stagnate within the four walls of a socialist dream of self-sufficiency – a dangerous pipe dream, as India, China and Russia found. We will not attack poverty and inequality unless we grow the economy. The alternative is bloodshed.

A market-led growth strategy has its dangers, of course. It may throw up many social problems, and could, if not mitigated, create more poverty and inequality rather than less. That is why enlightened nations put in place the appropriate controls. They tax activities that hurt the social fabric. They rely on a set of rules and regulations to guide all investment and business activity. They provide safety nets. They have growth policies that focus specifically on the poor. They design incentives for industries to locate equitably in regions across the country. It is our inability to do these things that is hurting us – not globalisation per se.

The problems of capitalism and globalisation result from bad behaviour – not from the system itself. Bad behaviour can be regulated. The problem is that because of the corruption and ineptitude in our institutions, we are unable to regulate. The answer is to strengthen ourselves, not to chase others out because we are incapable. Much abuse by corporations has local roots – all those violating Lake Naivasha are not foreigners! They are responding to a seemingly insatiable world demand for flowers and exploiting local conditions. If they are allowed to get away with polluting the lake, or exposing staff to dangers – then that is a problem with us. The more enlightened companies will not do it. Those that will, must be regulated. In the past, corruption has stopped us in our tracks. But the answer is not to oppose trade – it is to strengthen our own values and build institutions around these values – not to blame others.

The weakness in our own values exposes us to another danger: that of cultural invasion. We are unthinkingly taking on the creed of consumerism, the belief in greed. As consumers, we are blindly buying anything western and rejecting anything homegrown. So we want nasty burgers instead of wholesome sukuma. We will buy third-hand three-piece suits rather than wear the loose cotton tunics that make sense in our climate. We prefer to watch unmitigated trash in the form of soap operas from Mexico, rather than support our own local theatre.

What explains our willingness to abandon our traditions and embrace the creed of greed? Sharing, modesty, hospitality – these were once good African values (just like they were once good Western values). Where did they go? How and why did we allow them to be replaced by ostentation and self-centredness? If your values are half-hearted, they will be lost in a heartbeat. What undoes them is not the remorseless march of history, trade, globalisation or anything else. What undoes them is the weakness in our own hearts. The problem lies in each and every one of us, and so does the solution.

That is where the work is needed – on our values. The fact that they were unravelled so easily is telling. We have chosen selfishness over sharing. We have chosen to ignore the plight of the poor. We have chosen pollution over regulation. We have chosen to vote for rascals. With strong values we can face all storms – globalisation or anything else. Without them we are always exposed.

We must always allow fresh winds to blow into our boma. The flow of new ideas from far afield prevents intellectual inbreeding. Yet a renaissance in this country must start from values. We need to do the hard thinking that works out what we commonly stand for. Do we believe in equality of opportunity, in human rights, in diversity? Then we must shape our institutions and our economic strategies around these beliefs. Otherwise we will forever be playing unfamiliar tunes on somebody else’s instrument, and wondering why our souls no longer stir to the music.

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