Providing A Foundation For Wealth Creation And Development In Africa

This paper examines the struggle in Africa to alleviate and eventually eradicate poverty. It is argued that the most effective way for African countries to deal with poverty is to create wealth. Unfortunately, these countries have not been able to create the wealth that they need to confront poverty. This is due primarily to the fact that since independence, many African countries have not been able to undertake democratic institutional reforms to create and adopt institutional arrangements that guarantee and sustain the rule of law. Within legal systems in which the rule of law is accepted and respected, civil servants and political elites are adequately constrained and hence, cannot easily engage in growth-inhibiting behaviors such as corruption and rent seeking. In addition, these types of institutions enhance peaceful coexistence and provide an enabling environment for wealth creation. So they can effectively deal with poverty and improve the people's living conditions, African countries must engage in reforms to provide themselves with institutional arrangements that guarantee the rule of law.

This book investigates the role of wealth in achieving sustainable rural economic development. The authors define wealth as all assets net of liabilities that can contribute to well-being, and they provide examples of many forms of capital – physical, financial, human, natural, social, and others. They propose a conceptual framework for rural wealth creation that considers how multiple forms of wealth provide opportunities for rural development, and how development strategies affect the dynamics of wealth. They also provide a new accounting framework for measuring wealth stocks and flows. These conceptual frameworks are employed in case study chapters on measuring rural wealth and on rural wealth creation strategies. Rural Wealth Creation makes numerous contributions to research on sustainable rural development. Important distinctions are drawn to help guide wealth measurement, such as the difference between the wealth located within a region and the wealth owned by residents of a region, and privately owned versus publicly owned wealth. Case study chapters illustrate these distinctions and demonstrate how different forms of wealth can be measured. Several key hypotheses are proposed about the process of rural wealth creation, and these are investigated by case study chapters assessing common rural development strategies, such as promoting rural energy industries and amenity-based development. Based on these case studies, a typology of rural wealth creation strategies is proposed and an approach to mapping the potential of such strategies in different contexts is demonstrated. This book will be relevant to students, researchers, and policy makers looking at rural community development, sustainable economic development, and wealth measurement.

The Covid-19 pandemic has aggravated the tension between large development needs in infrastructure and scarce public resources. To alleviate this tension and promote a strong and job-rich recovery from the crisis, Africa needs to mobilize more financing from and to the private sector.

Promote a new social contract based on the ability of leadership to improve the general welfare of society Provide more legitimacy to the creation of wealth and facilitate, beyond sports and music, the rise of new role models whose leadership and contribution to the advancement of society can become an inspiring force for the youth Reform the education system, so as to eradicate illiteracy and spread know-how and values necessary for a successful market economy Reinforce the strategic capabilities of the state, strengthen institutions underpinning the well functioning market economy, and decentralize power Foster regional integration to create larger markets for the development of industries and investment Promote longer-term population growth policies by among others, forcefully fighting pandemics such as HIV-AIDS and malaria, as well as malnutrition Set an ambitious development vision and benchmark competition in the implementation of reforms in areas such as business environment, infrastructure, labor productivity, and set up Free Processing Zones to gain access to international markets Create an enabling environment to attract mature technologies in Africa and encourage domestic use of technology Shift IMF and World Bank policies toward promoting growth and employment and encourage the most promising African countries to exit from IMF lending Stop providing sustained financial assistance to governments with an established track record of corruption and to regimes that have failed over an extended period of time to improve the standard of living of their populations.

A significant contribution to the debate on poverty alleviation in Africa, Professor Mbaku offers practical policies for economic growth. He argues that the most important contributor to poverty and deprivation in Africa is the absense of institutional structures that enhance indigenous entrepreneurship and wealth creation. He explains that these are so vital that living standards will continue to deteriorate unless these building blocks are put in place.

Chapters in this book contribute to our understanding of the theory, structure and practice of entrepreneurship in diverse African countries. Case studies examined include: African multinational banks and businesses, female entrepreneurs, culture and entrepreneurship, finance and entrepreneurship and SMEs.