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The Itinerary of an Idea

1 Oct 2004

  • Author(s): Thandika Mkandawire
  • Source: D + C Development and Cooperation, Volume 31, Number 10, October 2004


The belief that lack of “good governance” might be the main hindrance to economic growth in Africa was firmly set in the minds of the international community following a World Bank report published in 1989 which categorically declared: “Underlying the litany of Africa’s development problems is a crisis of governance.” By governance is meant the exercise of power to manage a nation’s affairs. Since then the expression has attained the status of a mantra in the development business. It is presented as the discovery of new truths that must be hammered into the benighted minds of African policy makers. The Africans themselves often consider it as one more item on the aid conditionalities list.

Rarely recognised, even by Africans, is that the inspiration came from African scholars and that the current use of the concept diverges significantly from their own original understanding. In the preparation of the 1989 report, the World Bank did the then unusual thing of consulting African scholars and commissioning them to prepare background papers, apparently at the insistence of Africans within the World Bank. Among the scholars were Claude Ake, Nakhtar Diouf and Ali Mazrui. Their papers focused on state-society relations in Africa as the main problem. In the introduction to a volume of background papers to 1989’s Long-Term Perspective Study (LTPS), the World Bank acknowledged the contributions of the Africans:


    “Consideration of these aspects was very much a result of the collaborative approach adopted early in the preparation of this report. In the process, it became clear that any assessment of the region’s performance in the past and directions for the future would have to be informed by issues that cut across various disciplines to include history, culture, politics, and the very ethos of Africa. By listening to the report’s African and other collaborators, it was evident that a report with a scope such as that of the LTPS could no longer evade these issues. These collaborators greatly strengthened that ability of the LTPS to address, if not authoritatively, at least in a well-informed manner, the deep-seated concerns that ultimately shape and direct the course of economic growth and development. The ten papers presented in this third volume of the LTPS Background Papers contain some of those invaluable contributions.”

The general understanding within African intellectual circles then was that the main challenge of development was the establishment of state-society relations that are (a) developmental, in the sense that they allow the management of the economy in a manner that maximises economic growth, induces structural change, and uses all available resources in a responsible and sustainable manner in highly competitive global conditions; (b) democratic and respectful of citizens’ rights; and (c) socially inclusive, providing all citizens with a decent living and full participation in national affairs. Good governance should therefore be judged by how well it sustains this triad. The urgency of the democratic aspect of good governance was highlighted by the clamour for democracy by social groups that had opposed misgovernment and the imposition of policies by unelected institutions—national or foreign.

Downsized states and instability

This widespread view in African intellectual circles followed the concern with the failure of authoritarian regimes in Africa to ensure both human rights and development. It was informed by the belief that the downsizing of the state insisted upon by donors addressed only the short-term issues of stabilisation, while undermining long-term developmental capacities. And given the potential for ethnic conflicts and the growing social blindness of economic policy, there was also the view that poor state-society relations only exacerbated political instability. Good governance would therefore have to pay special attention to issues of equity and inclusion.

The initial response to the 1989 report from staff of the International Monetary Fund (IMF) and the World Bank, especially the economists, was at best lukewarm for a number of reasons. First, it was felt that the focus on politics was deterring attention from the task of “getting the macroeconomic fundamentals right”. Indeed, a report on Africa produced five years later stridently argued that orthodox adjustment policies work and that the poor performance of African economies was due to their failure to implement agreed-upon adjustment policies. There was hardly any mention of governance. Second, the new focus did not leave much room for the World Bank. Its insistence on the importance of local initiatives, political accountability to the citizens and the need to reconcile African traditions and institutions with “modern” ones were not exactly the types of things the World Bank could relate to in a quantifiable and operational manner.

A few years later, however, with African economies showing signs of recovery, there was an orchestrated campaign by the Washington-based financial institutions to highlight the “turnaround” in policy adoption in Africa. These institutions attributed the turnaround to their own persistence with their own policies, and to the emergence of African leaders with a new awareness of the demands of globalisation. A major World Bank report on Africa in 2000 stated that “many countries have made major gains in macroeconomic stabilisation, particularly since 1994” and that there had been a turnaround because of “ongoing structural adjustment throughout the region which has opened markets and has had a major impact on productivity, exports, and investment”. There had indeed been a sea change in the African policy landscape and, as a result, arguments that African countries had refused or been slow to adjust, or that enough time had not passed, became less credible.

However, as had happened many times before, these reforms did not lead to the expected outcomes, and celebration of “recovery” proved premature. Considerable evidence – including some from within the World Bank itself – suggested that adoption of the prescribed policies had not worked. Much of the “recovery” could be explained by so-called exogenous factors – weather, terms of trade, plain good luck and end of conflicts – rather than adjustment.

Thus came the question “Why is it that even when the recommended policies were implemented (often under the aegis and conditionalities from the International Monetary Fund and the World Bank), the results hoped for did not materialise?” The answer was “institutional weakness” or “bad governance”. The new proponents of good governance argued that the policies themselves were sound and that good governance must also mean implementing orthodox economic policy. Good governance thus simply became one more instrument for ensuring the implementation of adjustment programmes. Because macroeconomic policies were sacrosanct, it was important that the democratic institutions that might come with good governance were not used to undermine economic policy. This was ensured by introducing institutional reforms that effectively compromised the authority of elected bodies through the insulation of policy technocrats and the creation of “autonomous” authorities.

As a consequence, the current use of “governance” is still very much business as usual. Thus although the IMF took on good governance, it also insisted that the many reforms (fiscal, financial, etc.) it had been involved in were indeed core components of good governance. Many other donors have followed suit, simply relabelling various divisions from one thing to “governance”.

The approach to good governance and economic policy that finally became dominant differed radically from that of the African contributors who were strongly opposed to adjustment policies because not only were they deflationary and thus not developmental, but also because they were externally imposed, weakened the state and undermined many of the post-colonial “social contracts”. For the African contributors, good governance related to the larger issues of state-society relations and not just to the technocratic transparency-accountability mode it eventually assumed in the international financial institutions. The actual use of the concept of good governance sidestepped the central concerns of the Africans and rendered the notion purely administrative. And all too often, it looked like a fallback position for failed policies.

Thandika Mkandawire is the Director of UNRISD.

References:

Zafar Ahmed (1990):
Introduction, in: World Bank: The Longterm Perspective Study of Sub-Saharan Africa: Institutional and Sociopolitical Issues. Washington DC, World Bank
World Bank (1989):
Sub-Saharan Africa: From Crisis to Sustainable Growth: A Long-Term Perspective Study
World Bank (1994):
Adjustment in Africa: Reforms, Results and the Road Ahead
World Bank (2000):
Can Africa Claim the 21st Century?

The present Viewpoint appears in "D + C Development and Cooperation", Volume 31, Number 10, 2004.

The article is posted with permission of the Journal.