Sierra Leone needs trade, not aid
- Monday 29 December 2008.
By Mohamed C. BahPresident -Sierra Leone community Association-Atlanta, GA.
The political climate in Sierra Leone today as it has been in many generation before is that reform or the new agenda for change means borrowing more money from the World Bank and other International financial institutions to pay for nation building projects and public services.I am generally, not faulting or blaming our present government for requesting donor assistance at this challenging times, because they are finacially cash strapped and have no choice.The underlining problem is that Sierra Leone fundamentally needs a new direction when it comes to our dependency on donor money or foreign Aid.
Many Sierra Leoneans share a greater understanding that our emerging democracy, like other developing countries,do not have the resources, financial structures and expertise to radically depart from our addiction to foreign Aid.It is also true that a decade of instability, poor governance and the lack of strategic alternative to foreign aid have kept the prospect of a donor-free Sierra Leone far from possible. That government institutions which brings in revenues needs a serious overhaul, broader transparency with an effective accountability before potential revenues can be properly streamlined to internally support public projects.
How about doing business differently where our economy is not driven by donor dollars but rather by an export oriented market, a robust manufacturing industries link to our very natural resources with a modernized and transparent financial infrastructure.I believe, we as a country and people, can do miracles, if we seek to build a future where economic prosperity transcend poverty and where progress overcome corruption and ineptitude.
TRADE NOT AIDThe issue of donor/foreign Aid are classified into two categories:one is how effective has our government managed these resources for the overall good of its citizens and secondly what plans do we have to gradually wean ourselves from the dependency of the so-called donor money?As true as it has been that international financial support have helped us some how in the past, the horrible monster of AID money have caused a major devastation to our political landscape due to mismanagemts and where economically our government function or work only through the infusion of donor money.The perception we inherently get over the past three decades is that we are reduced to a "beggar nation" and more importantly our democratic decisions as a nations are tied down or influence by how these donors/financial institutions wants us to operates our government institutions.
Indeed, no nation have grown their economies through Aid.Donor money have caused more death to the future of Africa than the epidemic disease of AIDS.Sierra Leone, like other African nations, have many times,poorly managed these resources, raised the debt to the ceiling and weakened our international credibility.Aid has brought misery, enriched corrupt public servants and eroded trust in government.It is time to do away with donor money and introduce a TRADE system.I am describing trade with our neighboring countries and the developed world not the photo-opt trade conferences that produce just hand shakes, but trade that establish the movement of goods and services which economically benefits participating nations.I mean a demand and supply system where trading countries maximize their potential earnings and double their national revenues.
NO QUICK FIXI am advocating for a greater reliance on trade and a market oriented economy as oppose to the old tricks of the Western World’s false pretense of finding solutions to Africa’s failing economy in the name of making profit for investors and shareholders of their financial institutions (World Bank).This brings me me to the center piece of my analysis: Sierra Leone needs Trade not Aid.First, as a country, let us agree that Aid is a quick-fix that comes with a lot of challenges and obligations.It has failed to work because it does not address long term solutions.We must replaced it with a common sense solution.If we change our mind set and move to new political height with a strategic planning of accumulating foreign reserves like the Chinese,Indians,Botswanans,Ghanaians and other nations.If we seek to create an account surplus with the revenues we get from our natural minerals/resources and move forward to purchasing treasury bonds,equity and other investment assets at international level,we can certainly replaced AID with Trade.If we make our existing or soon-to-be trading partners a more vital source of revenue creations, millions of our people will benefit form such profitable ventures.
THE CHINE AND INDIAN TRENDIndeed, those who share a do-nothing approach and think we are not ready to throw our dependency on donor money should ask Sir Milton Margai of Sierra Leone, Kwame Nkrumah of Ghana and Shekou Toure of Guinea how and why were they successful in gaining independence form British and French colonial rule.The road to economic independence lies through the gate way of a strong TRADE and financial investments on the international market.Government workshops and blue print plans that describes the guide line to poverty reductions or the UN Millennium goal are just as good as the implementation effort and our ability to accomplished them.What Sierra Leone, predominantly, lack from a constructive stand point, is a strategy for change, the management capacity and the structural discipline to follow through on our national development agendas.As Liberian President Sir Leaf Johnson puts it: "the problem in Africa is not the lack of resources, but a poorly managed systems."
Today, China and India constitute an unprecedented stories of economic development.They are quickly reaching the heavy weight status in the global economy.Two factors that are helping them-Manufacturing and TRADE.They do not rely on Aid but global trade.Europe, Japan, India, U.K. Brazil, Mexico, Turkey and Argentina are among the top 15 nations that have the world highest GDP.
While China and India are both large economies, the parallel i want to make is that they too have poverty, some political turmoil and even an under performing economy in the past.However, the reforming of their financial systems, growth in the agricultural, manufacturing and service sectors, their huge trade surplus and the accumulation of foreign reserves have made them the "new emerging economic powers".It is a wide illusion to believe that we can develop our nation through AID and not using our human capitals and reform policies to follow the economic trend of an advanced market economy.
On the other hand, it is true that we are partly to be blame, because we do ask for these donor supports and used them for the wrong reasons.Sierra Leone, Like other African governments, care less to read the "fine prints", terms. conditions and particularly the high interest rates these loans carries.Apparently, due to lack of financial planning and the lack of proper oversight in managing these loans, the ability of the government to repay becomes daunting and systematically we wind up owing the world financial community.Indeed, widespread corruption and poverty have become a stumbling block to implementing loan guaranteed programs let alone AID money.That is why, i think our new leadership and government should gradually and sensibly eliminate donor money and begins to create a market economy where TRADE is the new guiding star to our nation’s future.
SOURCE OF ECONOMIC GROWTHSierra Leone is a small economy that can be developed if we focus on two elements:Human capital and Trade.How about identifying the following sectors:Agriculture,Mining, Marine resources, Timber and Foresty.These are good trading categories.Like Botswana, we can make mining 55% of our national revenue, Agriculture 25% Marine resources 10%, Timber and Foresty 10%.The question is where can we have the capital and ingenuity to build a manufacturing nation.If we managed our mining revenues properly with a corruption-free practice and sound fiscal discipline, we can easily fund or pay for public projects and services without relying on Loans, Aid or Donor dollars.
Government focus must be on revenue creation and accumulation of surplus for national savings.These new economic behaviors, if implemented will significantly reduce the need for "out side donors".We just cannot become consumers alone expecting to create jobs and economic growth for our people.Rather, we must create income through trade and other commercial opportunities.
Indeed,what we lack is not the ideas to find a solution to our economic problems.The problem is when and how can we build a financial system, like other developed nations,that would bring prosperity and break away the cycle of poverty and deprivation we have witnessed for so long.We are never eager to take a new approach in a alleviating our human suffering,but many of us are always interested about what opportunities are available for me and my family.We must begin to realize that access to new possibilities and the attitude of doing things differently(change) can open the door to many good things for our beloved nation.
I am sure our present goverrnment is seeking opprotunties to replace the neo-colonialization of donor money with a market and trading economy.First,we must agree together with one voice that Sierra Leone needs trade and not Aid. If political independence came with a struggle and pragmatic leadership, economic independence must take a similar course, this time, fought with "idealism, innovation and 21st century fresh thinking".
If you wish to send a comment about this article e-mail MC Bah @ mcbah4440@yahoo.com