3 February 2018

Africa: Ceaseless Battle Against Continent's Scourge

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The 30th summit of the African Union opened this Monday, January 29, in Addis Abeba, the capital of Ethiopia. On this occasion, the heads of state and governments of the continent focused on a central theme: Corruption.

It had the theme, "Win the fight against corruption: a sustainable path towards the transformation of Africa".

Corruption is a global scourge that affects all continents. It can be defined as the misuse of power for private purposes and is for a decision-maker to do or refrain from doing, to facilitate an act or transaction, by its function, in exchange for a promise, or a benefit.

A phenomenon that is exacerbated by globalisation, and of which some of the characteristics are the purchase of conscience and illicit enrichment to the detriment of the community, it concerns, in a broad sense, vague segments of society. These range from the official who disregards compliance with the regulation for a few straight passes, to the decision maker using his prerogatives to facilitate procurement.

This contribution focuses on the type of significant corruption that often leads to currency leaks that are detrimental to the economy. Africa is fully concerned by the phenomenon since it loses, according to a report commissioned by the African Union to Thabo Mbeki, former President of South Africa, between 50 billion dollars and 80 billion dollars annually. This is against a help net development estimated by the Organisation for Economic Co-operation & Development (OECD) at nearly 100 billion dollars in 2016.

The causes of corruption are multiple and seem to be explained by several factors, of which human rivalries fundamentally lead to bidding in terms of wealth acquisition. In Africa's case, the cultural context marked by the preponderance of the family, the existence of factors of political and religious influence, the strong social demand expressed by the social groups because of galloping poverty and the intense demands for solidarity often lead managers managing public goods to enrich themselves unexpectedly. The exacerbation of the phenomenon is linked to the persistence of impunity.

Corruption manifests itself in several ways: exporters repatriating a tiny part of export earnings, the rest being accounted for in front companies located in exporting countries, overcharging of public markets, payment of a commission or even of retro-commission.

The economic and social consequences of corruption are real. In addition to the figures of the African Union mentioned above, the United Nations Economic Commission for Africa (ECA) estimates the annual losses incurred by the continent at about 148 billion, representing a decrease by a quarter in growth.

Moreover, in addition to undermining the unifying foundations of society by promoting non-compliance with the rules and breaking the principle of equality of citizens before the law, it is economically harmful by its overcharging dimension that obeys the meagre resources of the state.

This financial windfall that goes out illegally and escapes the control of the economy represents a significant shortfall that could have allowed to build schools and health centres and fight more efficiently against youth unemployment which constitutes a real endemic to the continent. By promoting delinquent agreements and collusion of interests, it often makes fragile, especially in the award of public contracts, the quality of products and services consumed nationally.

Given the inefficiency of repressive measures, one of the solutions to be explored in the short-term in the fight against corruption seems to reside in the capacity of countries hit by the scourge to set reference prices to better control overbilling. New information and communication technologies should also be exploited as part of an alert strategy.

Of course, genuine economic growth strategies coupled with effective redistributive policies are remedies to be explored. At the international level, the International Monetary Fund (IMF), as guarantor of the global financial system, should also participate in the search for solutions by calling on nations to take greater responsibility, particularly in the control of financial flows leaving for tax havens. In the longer term, it is important to strengthen civic education modules to instil in young people good practices.

Magaye Gaye Is an Economic Consultant and President of the Senegalese Political Party Third Way.

Ethiopia

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