Prof. Kevin Chika Urama, FAAS
Senior DirectorAfrican Development Institute (ADI)
African Development Bank, Global Community of Practice Seminar, 15 & 16 March 2021
“Strengthening individual, organizational, and institutional capacity for inclusive growth in Africa –without which the global sustainable development goals and Africa’s Agenda 2063 will not be achieved”
Strengthening Institutional Capacity for Inclusive Development in Post COVID-19 Africa
Presentation Outline
• Introduction: Why Knowledge and Institutional Capacity?
• Institutional Capacity in Africa before COVID-19
• Implications for Inclusive Development in Post-COVOD-19 Africa
• About the Seminar?
• Concluding Question
Why Focus on Knowledge Systems and Institutional Capacity?
“Africa doesn't need strongmen; it needs strong institutions” Obama
What Institutions & Organizations To Focus on?
• “Capacity” refers to the availability of resources and the efficiency and effectiveness with which individuals, organizations, or institutions deploy these resources to identify and pursue their development goals on a sustainable basis.
• Institutions are the formal or informal rules of the game of a society.
– Organizations are the actors or players – groups of individuals bound by a common purpose to achieve defined objectives within the rules of the game.
– Individuals are the key actors and beneficiaries from both institutional and organizational systems of a society.
• Knowledge: facts, information, and skills acquired through experience or education; the theoretical or practical understanding of a subject.
Key FunctionsInstitutions shape the performance of the economies by their effect on the costs of exchange and production:
Knowledge, Institutions and Organizations are the “soft infrastructures” that shape the way economies cope with market failures and exogenous shocks such as COVID-19. The Pareto-efficient outcome is only one of many possible outcomes achievable in perfect market conditions under certain institutional arrangements.
Adapted from Boliari, N (2007)
Key Components of the Soft Infrastructure
Supreme Audit & Accountability
Systems
Integration, collaboration, and
coordination to achieve coherence
& economies of scaleGovernance
structures, systems, and operations
Business Development and Industrialization
2.80
2.90
3.00
3.10
3.20
3.30
3.40
3.50
3.60
3.70
3.80
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Source: AfDB CPIA Website
CPIA Components 2004 - 2018
Quality of Public AdministrationEconomic managememntQuality of Budgetary and Financial ManagementEfficiency of Revenue Mobilization
Institutional Capacity and Government Effectiveness in Africa Before COVID-19
0
0.5
1
1.5
2
2.5
3
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
GERD by SDG Regions, 1996 - 2016
World
Landlocked Developing Countries
Least Developed Countries
Small Island Developing States
Africa (Sub-Saharan)
Western Asia and Northern Africa
Africa (Northern)
Asia (Western)
Asia (Central and Southern)
Asia (Central)
Asia (Southern)
Asia (Eastern and South-eastern)
Asia (Eastern)
Asia (South-eastern)
Latin America and the Caribbean
Oceania
Oceania (Australia/New Zealand)
Northern America and Europe
Europe
Northern America
Capacity in Research for Development
Worl
d s
har
es o
f G
DP
, GE
RD
, res
earc
her
s an
d
pu
bli
cati
ons
for
the
G20
, 200
9 an
d 2
013
(%)
Low investments in knowledge and institutional capacity underpins the capacity underpin almost every aspects of human existence.
Investments in Institutional Capacity and GDP Growth are closely linked
Source: UNESCO Science Report, 2015
-
5.00
10.00
15.00
20.00
25.00
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
Tri
llio
ns
Middle East & North Africa
North America
Sub-Saharan Africa
East Asia & Pacific
European Union
Central Europe and the Baltics
Caribbean small states
Latin America & Caribbean
South Asia
Gross Domestic Product by Regions, 1995 – 2018 (Constant US$ 2010)
1. Africa’s GDP is among the lowest in the world
-9
-7.9
-10.00
-8.00
-6.00
-4.00
-2.00
0.00
2.00
4.00
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Fiscal Balance - Pre-COVID-19 Fiscal Balance - COVID-19
Fiscal Balance in Africa 1980 - 2021
3. Low fiscal capacity to adapt to exogenous shocks such as COVID-19
0
1000
2000
3000
4000
5000
6000
7000
8000
1960
1962
1964
1966
1968
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
Kg
per
Hec
tare
Cereal Yield
East Asia & Pacific
European Union
Latin America &CaribbeanMiddle East & NorthAfricaNorth America
South Asia
Sub-Saharan Africa
Source: World Bank May 2020
Total factor productivity in agriculture is lowest in Africa than all other regions of the world
3. Low factor productivity in in key sectors
Cocoa Norminal Prices
Year (1960-2017)
Price
s
1960 1970 1980 1990 2000 2010
12
34
COTE D IVOIRE GDP Growth(Annual %)
YEARS (1961-2018)GDP
1960 1970 1980 1990 2000 2010 2020
-10
-50
510
15
Norminal, Cocoa,Coffee,Cotton, Tea Prices(1960-2017)
YEARS
Coco
a,C
offe
e,C
otto
n,T
ea P
rice
(Dollars
)
1960 1970 1980 1990 2000 2010
12
34
REAL COCOA,COFFEE,COTTON,TEA PRICES (1960-2017)
YEARS
Cocoa,C
offee,C
otton,T
ea p
rice (D
ollars
)
1960 1970 1980 1990 2000 2010
12
34
56
78
Key for lower panel only: Cocoa (Black), Coffee (Red), Cotton (Green), Tea (Blue).
32.29
0
20
40
60
80
100
120
140
160
M1
M7
M1
M7
M1
M7
M1
M7
M1
M7
M1
M7
M1
M7
M1
M7
M1
M7
M1
M7
M1
M7
M1
M7
M1
M7
M1
M7
M1
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 20192020
Crude Oil Price 2006 - 2020 (US$)
4. Reliance on commodity exports with little value addition creates low returns to and high vulnerability to external shocks
Low value added by sector (% of GDP)
0
10
20
30
40
50
60
1990-1999 2000-2009 2010-2018
Agriculture, value added Industry, value added
Services , value added
GDP Per Capita 2019 (261-114704)CPI, 2019 (Range: 9 - 87)
5. African countries rank poorly in Corruption Perception Index, 2019 and GDP per Capita
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
1959 1961 1963 1965 1967 1969 1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013
Territorial Emissions, UNFCC Data – Values in MtC/year. Own Analyses
OECD Africa Asia Europe North America
Historical Territorial CO2 Emissions 1959 - 2014
7. And Africa remain more vulnerable to the external global shocks even when it contributes little due to low capacity to adapt
Gross National Incomes and School Enrolment Rates, 2007
1. The relative cost of higher education per student trained as a proportion of Gross National Income (GNI) is higher in Africa than in the developed countries, including the USA and Europe.
2. African governments are the primary source of funding for higher education in Africa. Limited fiscal space men that other development challenges: poverty alleviation, climate change adaptation, water insecurity, peace, etc., may be prioritized
1. African University rely Mostly on Government Funding and Contribute GDP Growth
0
10
20
30
40
50
60
70
80
90
100
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
MIL
LIO
NS
Linear (Total income) Linear (Total expenditures)
Funding Gap in One Key Anchor Institution (US$)
Source: African Development Institute, Capacity Development Needs Assessment, 2018
Key Challenges:
1. Donor dependency and unstable funding for program implementation.
2. supply-driven agenda setting, 3. Low productivity and variability in the quality and
relevance of work produced.4. Low utilization of local capacity and low demand for
technical services by African experts in the RMCs.5. Lack of appropriate infrastructure for capacity
development and research6. High staff turnover and brain drain due to lack of
resource to offer competitive salaries and benefits, 7. Inability to cope with the rapid technological
transitions in their respective sectors, 8. Non-conducive environment and incentives to quality
research and impacts.
2. Lack of continuity and longevity in Africa-led knowledge & capacity development institutions
• The Sussex Manifesto, 1979: calls for the rejection of the notion that existing international division of labour in science and technology, which has engendered self doubt, the associated knowledge dependence and binomial linear relationships between the “Global North” and the “Global South” in ways that hinder innovation in Africa by in Africa by Africans.
• In 2008, former Liberian President, H.E Ellen Johnson Sirleaf reminded delegates at the Science in Africa Summit that: “No country on earth has developed without deploying, harnessing and utilizing S&T, whether through technology transfer or homegrown solutions”.
• President Kagame on the other hand, stressed that: “We in Africa must either begin to build our scientific and technological training capabilities or remain an impoverished appendage to the global economy” The New African, vol. 494, p. 78.
• There is one thing developing countries cannot do without: home grown capacity in scientific research and technological know-how. Increasingly a nation’s wealth will depend on the knowledge it accrues and how it applies it, rather than the resources it controls. The “have” and the “have-nots” will be synonymous with the “knows” and the “know-nots”. Serageldin. 2008.
• These statements are anchored in decades of attempts by the African governments to turn around its development fortunes through efforts to mainstream STI in Africa’s development policies and actions. Examples include the Monrovia Strategy (1979), the Lagos Plan of Action,(1980), the Abuja treaty (1991), and most recently, the adoption of Africa’s science and Technology Consolidated Plan of Action (CPA) by the African Union in January 2007.
• 2010: African Manifesto for Science, Technology and Innovation called for accelerated investments in STI in Africa. Urama et al. (2010). African Manifesto for Science Technology and Innovation African Technology Policy Studies Network (ATPS), Nairobi, Kenya. http://www.scienzecittadinanza.org/public/set-dev_africa20manifesto.pdf
• The African Development Bank Group recognized that “No matter the amount of financial resources mobilized for Africa’s development, such funds would yield only limited or modest results if countries do not have the human, organizational and institutional capacity to absorb and effectively utilize them”, AfDB, 2010.
• The African Development Bank Group recognized that “weak institutions and capacity to formulate and implement policies, strategies, programmes and projects remain a persistent challenge in RMCs across the continent, particularly in ADF countries and in RECs” African Development Bank Group, 7th General Capital Increase (GCI-VII) 2019, para. 99, ADF15 paper, para 212.
• The African Development Bank is stepping up its efforts to help overcome this constraint.
• Strategic Options for Strengthening Africa’s Knowledge Institutions to effectively support Inclusive development transitions in Africa: what needs to be done differently?
• Strategic Options for Mobilizing Resources for Strengthening Institutional Capacity for inclusive development in post-COVID-19 Africa; and
• Organizational and Operational Arrangements for a Continental Knowledge and Capacity Development Fund (KCDF) for Africa.
Seminar Goals: Critically examine
Theme 1: Strengthening Knowledge Institutions
1. Strategies to achieve and retain a critical mass of endogenous capacity (individual skills, organizational and institutional systems) - competencies and experiences, organizational structures, systems, and information resources for transformative change in Africa?
2. How investments in knowledge, institutional capacity, technology and innovations can be structured to effectively contribute to socio-economic development and improved wellbeing in Africa?
3. How to catalyze on the unprecedented challenges of COVID-19 as an opportunity to rethink strategies for strengthening institutional capacity in African-led Institutions?
4. New frameworks for strengthening knowledge and institutional capacity and its effectiveness at the institutional, national, and regional levels? What are the implementable strategic programs and policy priorities to make a difference?
1. Continental strategies, policies and frameworks for mobilizing adequate resources at scale for enhancing Africa’s knowledge systems and institutional capacity for inclusive development post-COVID-19?
2. Role of African the African Public and Private Sector: How Africa can mobilize domestic (public and private) resources in support of African knowledge systems and institutional capacity for inclusive development in Africa. What are the opportunities, structures, organizational systems, and incentives needed at national, regional and continental scales?
3. Role of International Development Partners (Multi-lateral and bilateral), Philanthropies, and Private Sector: What are the opportunities, structures, organizational systems, and incentives needed for transformative change in cost efficiency and development effectiveness of international support to African knowledge and capacity development institutions?
4. What specific action can specific stakeholders take to address low confidence/trust in African institutions? What can African institutions themselves do? What can African governments, private sector and philanthropists, civil society do? What can development partners and funders do?
Theme 2: Resource Mobilization
1. Organizational arrangements to support resource mobilization at scale and effective operation of a continental Knowledge for Capacity Development Fund (KCDF) for Africa?
2. Organizational structures to accelerate the implementation of Africa’s continental development strategies: AfDB’s High-5s and AUC’s Agenda 2063, ACFTA; regional and national development agendas, etc.?
3. Types of institutional actors and key functions the KCDF could such a fund support?
– Strengthening governance structures, systems, and operations, – Skills development, – Knowledge systems, research, and innovation- ways learning by doing inclusive development. – International collaboration, regional integration, and coherence– Core funding for institution building
4. Hosting Arrangements: How well positioned is the African development Bank Group to convene and host the proposed Knowledge and Capacity Development Fund for Africa? What are the strengths, weaknesses, opportunities, threats to hosting such a fund at the AfDB and how can these be mitigated?
5. Structures and policies to Implement the fund: What will be the role of Stakeholders: Donors, Continental Organizations, National Governments, the Diaspora, Private Sector, NGOs, etc.?
Theme 3: Organizational and Operational Arrangement
RISKS TO WATCH
Complexity
Risk Perception, Mitigation
and Guarantees
Bureaucracy
Informality
Complexity – institutions, capacity, African development, knowledge systems mean different things to different stakeholders
Bureaucracy – existing formal and informal rules and cultures for managing organizations create inertia for transformative change.
Informality – unwritten rules of the game and cultural traits passed from generation-to-generation slow transformative change
Path dependency - Individuals and organizations are used to existing institutional structures and resist changes.
Risk Perception, Mitigation and Guarantees: uncertainty and information asymmetry can lead to innovation nostalgia.
Knowledge Dependence: impeding knowledge and institutional capacity for socio-technological transitions to inclusive development in Africa
Knowledge Dependence
Path dependency
Knowledge Dependence
“Africa tends to be a child with many parents, very many parents. And unfortunately, most of the parents want their child to learn how to walk their way… and most of the parents do not want to hear and listen to the child when the child is asking to walk their [own] way. Our researchers, our PhDs, our patents, our ideas, we are a child, and nobody wants to allow us to walk our way. If you unpack that analogy, there’s quite a bit in there.” CGD, 2019, p. 10 – 11.
Source: Urama et al. (2010). African Manifesto for Science Technology and Innovation African Technology Policy Studies Network
(ATPS), Nairobi, Kenya. http://www.scienzecittadinanza.org/public/set-dev_africa20manifesto.pdf
YES, TOGETHER WE CAN.
“ Our journey has never been one of shortcuts or settling for less. It has not been the path for the faint-hearted - for those who prefer leisure over work or seek only the pleasure of riches and fame. Rather, it has been the risk-takers, the doers, the makers of things,…, who have carried us up the long, rugged path towards prosperity and freedom” - H.E President Barack Obama, Inaugural Address, 20 January 2009.
Can We do this?
The New Normal
The African Development Institute’s, AfDB Virtual Capacity Development Academy (VCDA) –transforming technical assistance, training and policy dialogue for inclusive development in Africa.
36
Thank You
African Development Institute“Strengthening capacity for inclusive growth in Africa – without which the global
sustainable development goals and Africa’s Agenda 2063 will not be achieved”
Contact: e-mails: [email protected]
© African Development Institute, 2020
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