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Development planning: Why has Africa failed at the basics?

Development planning: Why has Africa failed at the basics?

There is no gainsaying that Africa is both in a position of emergence and a position of struggle. This is because Africa is emerging as a valuable player in regional politics around the world. In the last decades, Africa has witnessed a sharp rise in its gross domestic product (GDP), and it is expected that the GDP will rise from 4 percent to 5 percent in 2020 and 2021.

This trajectory has made Africa outpace their regional counterparts, even in terms of capital inflows and economic growth. Despite a significant rise in foreign inflow of funds to Africa, inequality of opportunities has peaked in recent times.

Some countries like Egypt, Nigeria and South Africa receive large capital inflows to kick-start their development process while some have had to endure low capital inflows for a relatively long period (for example Eritrea, Mozambique, Lesotho).

Apart from capital inflows, notable disparities remain in income, assets, financial access, and opportunities across African countries.

Additionally, while significant success has been achieved in ending banditry, terrorism, and open conflicts in Africa, recent occurrences in countries like the Central African Republic, the Democratic Republic of the Congo, Kenya, Mali, Nigeria, Somalia, South Sudan, etc., highlight unabating terror incidence and thus extends the continent’s challenges of establishing lasting peace and security among its citizens. All these undermined development efforts in Africa.

African national governments and stakeholders are increasingly interested in a reform that goes beyond poverty relief of the poverty reduction strategy papers. For example, the Ethiopia government recently adopted the National Plan Commission in Addis Ababa in 2018 intending to accelerate the accomplishment of the 2030 Agenda; Nigeria’s vision 2020 is another development plan that aims to efficiently use human and natural resources to achieve rapid economic growth; many other development plans are being adopted in Uganda, South Africa and a host of Africa countries, with no apparent result (Easterly, 2009).

Since the independence of most African nations around the 1960s, African states have adopted different development plans to account for structural rigidities in their economies and societies, as marshalled out in the theoretical and policy propositions of development economics of the western world.

Western development economics was consecrated on grand and visionary models that aimed at inducing strategic structural changes with a central role assigned to the government in planning and development.

However, these western models of development have been faulted not only to be irrelevant to African development objectives but also to the type of growth trajectories that fit the development path of Africa.

In the development model of the western world, pervasive market failures characterised a less-developed economy. For African nations to resolve almost unavoidable problems of market failures, central coordination and allocation of resources should be favoured.

Corroborated by the established model of welfare economics, which argued that government action is required to correct market failure, African nations centrally planned their economies to encourage capital formation and accumulation, efficiently excess labour, implement the policy of greater industrialisation, expunge restrictions on foreign exchange constraint and capital controls, and coordinate the allocation of resources through programming and planning.

Despite the national development plans of African countries being more ambitious than the growth and social development objectives of poverty reduction strategy papers, the development objectives of Africa seem ambiguous in the context of planning.

Inappropriate planning for the realisation of the development plan in Africa generates questions of how and why past development plans have failed and the need for a much more robust and comprehensive growth agenda with clear identification of key opportunities and challenges.

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In Africa, planning for effective coordination was just understood in the context of rationality, deliberate, consistent and coordinated economic policy formulation without clear procedure on how to merge the tenets of planning for the realisation of development objectives.

Even under the existing theoretical dispositions (economic growth theories), African development would not take place automatically. Deciding in advance the specific course of action (planning) and entailing the laydown goals for economic development in Africa will ensure productivity grows concurrently with population growth in Africa.

Challenges of planning in Africa have also been fuelled by inappropriate capital mobilisation (domestic capital and capital outsourcing). For example, there is no consensus on regional financial integration among trade blocks in Africa.

How financial integration affects trade blocks in Africa is one of the fundamental questions that raise concerns on what should be done to improve financial development and growth in Africa.

Aggregate savings patterns need to be broad-based such that private industrialists, traders, landowners, and financial groups can invest a considerable part of their income in the direction which is conducive to assuring the country’s rapid development.

Dr Ibrahim A. Adekunle is a lecturer at the Babcock Business School, Babcock University, Ilishan-Remo, Ogun State, Nigeria.