African oil exporting countries, including Angola, Nigeria and Sudan, have squandered a decade’s worth of economic opportunity by failing to diversify or reinvest windfall profits into sustainable growth, according to research by the Mo Ibrahim Foundation.
Over the decade that the foundation has been collecting data for its comprehensive “governance” index, Africa’s 14 oil exporters have gone backwards in several measures, including overall governance and diversification.
Of a possible score of 100, oil exporters manage just 2.9 for economic diversification, showing how little progress they have made in weaning their fortunes off oil. None of the 14 countries scores well in the “sustainable economic opportunity” category, which measures criteria such as transparency of state-owned companies, ease of doing business and the quality of infrastructure.
“They are really ill prepared and they haven’t made use of these high revenues,” said Sif Heide-Ottosen, an analyst at the foundation.
By contrast, non-oil exporters have generally had a much better decade, improving in several categories from participation and human rights to human development. Non-oil exporters have opened up a nearly 10-point gap over their oil-exporting counterparts in the overall governance index, scoring 52.3 out of 100 against just 43.5 for oil exporters. Strong overall performers include Mauritius, Botswana, Ghana, Rwanda and Senegal, all of which are in the top 10.
In the decade since 2007, corruption and bureaucracy have got worse, with 33 of the continent’s 54 countries going backwards. The most improved indicator is digital and IT infrastructure, partly reflecting an explosion in access to mobile phones as well as a proliferation of related services for households and business.
Of the top performers, Rwanda is the most improved, reflecting the development priorities of Paul Kagame, the president, whose authoritarian, results-oriented administration has won strong backing from international donors. South Africa remains in the top 10, but has fallen back in several categories, reflecting the erosion of institutional independence under the presidency of Jacob Zuma. Ghana, one of Africa’s better-run economies, has also slipped down the rankings.
The research lends weight to those who talk about Africa’s “resource curse”, in which countries most endowed with natural wealth are more prone to corruption and mismanagement. Dimeji Bankole, a former speaker of the house in Nigeria, said: “We are on a type of drugs in Nigeria called oil.”
Mo Ibrahim, a Sudanese telecoms billionaire who has ploughed part of his fortune into encouraging better governance on the continent, has frequently played down the hype of the “Africa rising” story, urging instead what he has called “Afro-realism”.
Nevertheless, researchers at his foundation see cause for mild optimism, with improvements in overall governance, measured by the index over the past decade, in 37 of Africa’s 54 countries. That means that 70 per cent of African citizens have seen an overall improvement in the way their countries are governed and the opportunities they can expect, the foundation says in its report.
The index has served to turn the spotlight on important aspects of development, including the effectiveness of administration and the quality of data. The index has gradually added criteria as more reliable data have become available. This year it includes 95 indicators, up from 58 in 2007, and has supplemented results with findings from Afrobarometer, a pan-African research network that measures public attitudes to democracy, governance and economic conditions.
“If you have sound robust data, then you can have sound robust public policies,” said Nathalie Delapalme, executive director of the Mo Ibrahim Foundation.