Saturday, June 30, 2007
TED Global: An Update
Of course, I am late as ever in posting the update from TED Global. At the very outset, let me say that it was the finest conference I have ever been to, and that is quite something coming from a conference-skeptic like me. Kudos go out to my buddy and IPEG compadre, Emeka Okafor who produced the conference with Chris Anderson. Like at every TED, there were a fair amount of big names sprinkled across the conference, from Bono to Larry Page to Jay Walker to President Kikwete himself.
For me, the highlight of the conference was clearly the redefining of the aid issue, which started with Ugandan journalist Andrew Mwenda's forceful attack on Bono, Sachs etc and on international aid in general. He dared anyone in the audience to point to a country that developed thanks to aid, which led to some pointless heckling by Bono who jumped up and said something about the potato famine in Ireland. Bono later tried to defend his point of view by referring to the Marshall Plan. Now, Bono seems incapable of understanding a fundamental difference: the Marshall Plan rebuilt countries like Germany which were among the richest countries on the planet before the great war. What was destroyed during the war was physical infrastructure, not human infrastructure. The presence of the latter meant that there was a great absorptive capacity in place for the large amounts of money flowing in. To compare post-war Germany with Uganda is really quite bizarre.
I think Mwenda really began to tear apart the aid scenario when he unpacked the Ugandan budget (which is largely dependent on aid) and showed how large a percentage of the budget went to paying salaries of government officials. Obviously, in such a scenario, the government officials (who are the types that Bono etc hobnob with) have every incentive to keep the status quo going.
Now, don't get me wrong. This blog is named after a U2 song, after all. I actually think Bono has his heart in the right place, but his understanding is too one-sided and since he lives in a bubble chamber, he does not hear/listen to other opinions. So, when so many Africans launched a ferocious attack on aid, he was clearly taken aback since he thinks what he does is universally good and the only people opposing it are unkind right-wingers in the west. Of course, the irony in all of this is that Bono was responsible for TED coming to Africa after an impassioned speech he gave at an earlier TED.
I think Bono, Jeff Sachs etc do not understand the damage they cause. They do not seem to understand that perception is reality and if the only reality people hear of Africa is disease, poverty and hunger, soon enough, that will be the only Africa there is. In fact, every place in East Africa I visited was the exact opposite of the public image of Africa. It reminded me of the press India used to get in the foreign media in the late 80's. Compare that with today and you understand why perception matters.
Else you could look at some hard facts: Botswana has an A+ bond rating and Egypt's stock market delivered 145% returns in the last financial year. The question then is why doesn't the money follow? Obviously, it's because it has become impossible to separate Botswana from Somalia and Africa is treated as a country, not a continent of 53 countries, each with its own problems AND investment opportunities. This perception problem clearly affects capital flows which are desperately needed for investment, and that's something Bono, Sachs, Nick Kristof etc don't seem to understand. It's the perception of India that has changed globally which had led to huge capital inflows. Similarly, the perception of African countries need to change and I'd advice anyone who has doubts to actually visit Africa, and not just the refugee camps. Nairobi, for instance, is one of the most vibrant cities I have seen and there is no reason to believe there aren't real investment opportunities there.
There was also some talk about Chinese imperialism, made by some American member of the audience. This stuff is damn rich coming from the citizen of a country that kept Mobutu in power for 32 years, and that's the tip of what happened on the continent during the Cold War. As Trevor Manuel said at a World Bank meeting, the Chinese never sent in an army into Africa to do business, and that ended all talk about the yellow peril.
It's true though that you can feel the Chinese presence everywhere in Africa, from a business and strategic standpoint. One obviously has to wonder then where on earth the Indians are. India has had long standing relations with most African countries and the Indian diaspora is everywhere on the continent, so why the Indian government doesn't play a much larger role in Africa is a bit strange. Africa will be the last frontier for investments, and the largest source of natural resources, so why would we simply let the Chinese have a free run of the place, especially when it's India that has the historical ties to leverage.
Okay, so this post has rambled much longer than I intended. Just wanted to post some nuggets from TED. I will follow up with any other thoughts I may have missed and pictures from my safari in Seringeti, which was really the best thing I've done to date. Truly magnificent. In the meanwhile, if you're interested in learning more about what happened at TED Global, tune in to Ethan Zuckerman's excellent coverage of the events. And if you want shallow and superficial coverage, there's always the Economist, which has almost nothing to say about the debate that dominated the conference.
For me, the highlight of the conference was clearly the redefining of the aid issue, which started with Ugandan journalist Andrew Mwenda's forceful attack on Bono, Sachs etc and on international aid in general. He dared anyone in the audience to point to a country that developed thanks to aid, which led to some pointless heckling by Bono who jumped up and said something about the potato famine in Ireland. Bono later tried to defend his point of view by referring to the Marshall Plan. Now, Bono seems incapable of understanding a fundamental difference: the Marshall Plan rebuilt countries like Germany which were among the richest countries on the planet before the great war. What was destroyed during the war was physical infrastructure, not human infrastructure. The presence of the latter meant that there was a great absorptive capacity in place for the large amounts of money flowing in. To compare post-war Germany with Uganda is really quite bizarre.
I think Mwenda really began to tear apart the aid scenario when he unpacked the Ugandan budget (which is largely dependent on aid) and showed how large a percentage of the budget went to paying salaries of government officials. Obviously, in such a scenario, the government officials (who are the types that Bono etc hobnob with) have every incentive to keep the status quo going.
Now, don't get me wrong. This blog is named after a U2 song, after all. I actually think Bono has his heart in the right place, but his understanding is too one-sided and since he lives in a bubble chamber, he does not hear/listen to other opinions. So, when so many Africans launched a ferocious attack on aid, he was clearly taken aback since he thinks what he does is universally good and the only people opposing it are unkind right-wingers in the west. Of course, the irony in all of this is that Bono was responsible for TED coming to Africa after an impassioned speech he gave at an earlier TED.
I think Bono, Jeff Sachs etc do not understand the damage they cause. They do not seem to understand that perception is reality and if the only reality people hear of Africa is disease, poverty and hunger, soon enough, that will be the only Africa there is. In fact, every place in East Africa I visited was the exact opposite of the public image of Africa. It reminded me of the press India used to get in the foreign media in the late 80's. Compare that with today and you understand why perception matters.
Else you could look at some hard facts: Botswana has an A+ bond rating and Egypt's stock market delivered 145% returns in the last financial year. The question then is why doesn't the money follow? Obviously, it's because it has become impossible to separate Botswana from Somalia and Africa is treated as a country, not a continent of 53 countries, each with its own problems AND investment opportunities. This perception problem clearly affects capital flows which are desperately needed for investment, and that's something Bono, Sachs, Nick Kristof etc don't seem to understand. It's the perception of India that has changed globally which had led to huge capital inflows. Similarly, the perception of African countries need to change and I'd advice anyone who has doubts to actually visit Africa, and not just the refugee camps. Nairobi, for instance, is one of the most vibrant cities I have seen and there is no reason to believe there aren't real investment opportunities there.
There was also some talk about Chinese imperialism, made by some American member of the audience. This stuff is damn rich coming from the citizen of a country that kept Mobutu in power for 32 years, and that's the tip of what happened on the continent during the Cold War. As Trevor Manuel said at a World Bank meeting, the Chinese never sent in an army into Africa to do business, and that ended all talk about the yellow peril.
It's true though that you can feel the Chinese presence everywhere in Africa, from a business and strategic standpoint. One obviously has to wonder then where on earth the Indians are. India has had long standing relations with most African countries and the Indian diaspora is everywhere on the continent, so why the Indian government doesn't play a much larger role in Africa is a bit strange. Africa will be the last frontier for investments, and the largest source of natural resources, so why would we simply let the Chinese have a free run of the place, especially when it's India that has the historical ties to leverage.
Okay, so this post has rambled much longer than I intended. Just wanted to post some nuggets from TED. I will follow up with any other thoughts I may have missed and pictures from my safari in Seringeti, which was really the best thing I've done to date. Truly magnificent. In the meanwhile, if you're interested in learning more about what happened at TED Global, tune in to Ethan Zuckerman's excellent coverage of the events. And if you want shallow and superficial coverage, there's always the Economist, which has almost nothing to say about the debate that dominated the conference.
