Almost half of Africa is at war! Even a cursory look at conflict data from the Uppsala Conflict Data Program reveals a common denominator for most of these conflicts, namely, inequalities in resource allocation or perceived discrimination by the people in power. Even in relatively peaceful countries, income disparities threaten peace at the micro level. Africa has been experiencing impressive economic growth in the past decade – an average of 5% for the 54 countries in the continent. However this growth has not resulted into equal benefits for everyone. In many countries, high levels of income inequality exists where you find a tiny but wealth elite, a small middle class and a huge low income population. These have contributed to a fragile peace which manifests itself in the proliferation of private security companies and houses built with high walls as fences, especially in my country Uganda.
In the World Development Report of 2011, citizens raised issues linked to individual economic welfare (poverty, unemployment) and injustice (including inequality and corruption) as the primary drivers of conflict. From this background, I propose an alternative approach to achieving and sustaining peace and security outcomes in Africa, one that is proactive rather than reactive and that addresses one of the major root-causes of the problem, namely, inequitable resource allocation. I call it shared prosperity, or if you will, sharing the cake.
If I were an African leader therefore, I would tackle this problem this problem from two fronts: first as a business leader by involving the poor in big business and secondly as a political leader by reducing disparity in access to high quality public services.
Rethinking business – from corporate social responsibility to social enterprise
Traditional business sees poor people just as consumers of final products, period! The problem with this model is that poor people end up contributing to corporate profits which are often repatriated outside the country and the big businesses then make up for the guilt by setting up corporate social responsibility schemes for the underprivileged, using part of their profits to implement small scale charitable acts which are usually unsustainable.
We have come to a point where businesses need to appreciate that apart from being just consumers of their products, poor people can play an active role in their value chains, thereby becoming partners helping them to take charge of their own lives. For example, beer companies need large quantities of cassava to be used in their production processes but prefer to obtain these from large scale farmers where the overhead costs are lower, thereby leaving out the small scale farmers. In the long run, the companies and large scale farmers get richer while the poor small scale farmers continue in the same state, hence perpetuating income inequality. What these companies instead need to do is to tackle head-on the challenge of playing in informal markets and/or organising the markets for the poor by putting in place the special infrastructure and measures that are often needed by large numbers of poor and vulnerable people to participate actively in these markets.
Thankfully, we are beginning to see this shift. From micro-franchising to last mile renewable energy distribution solutions such as Solar Now and Ready Pay Solar, poor people are being made part of delivery chains of global businesses. The businesses of the future and the businesses that Africa needs are those that consider poor people as part of their delivery infrastructure, not just recipients of corporate social responsibility.
Therefore, as a leader in the private sector arena, my role will be to change existing business models to incorporate the poor and under-privileged in the value chains. Specifically as an upcoming entrepreneur, I will prefer a social enterprise model that will place the needs of the poor and underprivileged at the centre of its business.
Social protection – increasing quality of shared public services
It was Mahatma Ghandi who said “A nation’s greatness is measured by how it treats its weakest members”. African countries have enjoyed high levels of economic growth in the last decade but spending on social protection measures remains the lowest amongst all the regions in the world – according to World Bank Social Protection Atlas data. Positively, according to the IMF, Africa’s governments have sustained spending in basic social services like health and education over this time period. However, these have focussed on increasing access with little attention paid to the quality of these services.
If I was a public sector leader therefore, my role will be to put in place policies to increase social protection programs and safety nets and improve quality of public service delivery. Good quality public services will reduce the disparity between the rich and the poor and shield the poor from excessive out of pocket expenditure on services that should be provided by government such as health, education and safe water supply. High quality public education for example will enable individuals from poor backgrounds and marginalised communities compete favourably with their counterparts from rich families for limited jobs in the short run while eliminating regional disparities in the long run.
These two paradigms, namely rethinking business and social protection, will work complementarily to reduce disparities in resource allocation both within and between regions in a country and the reduced inequality will contribute to harmonious and peaceful coexistence.
Drawing from the above, one major takeaway is that public and private leaders will play different but complementary roles in ensuring shared prosperity. Public sector leaders will create policies that reduce the disparity between the rich and the poor by ensuring access to quality public services. Private sector leaders on the other hand will reengineer their business models to incorporate marginalised people in their sourcing and sales channels.
The theme of the Africa Leadership conference of 2017 hypothesizes that peace and security will contribute to ending poverty. I would like to submit that ending poverty will contribute to peace and security in the continent. Let’s prosper together.