Joe Studwell's blog

My new book, How Africa Works, is out in the UK and will be out in the US on February 17 (and dates around this in other parts of the world). The first review that I have seen was published in the Financial Times. Here it is: ‘A dazzling reassessment of the continent’s historic handicaps, and its potential for economic development. … One of the most original and important books on Africa in years.’ How Africa Works by Joe Studwell — how to change the economic trajectory A dazzling reassessment of the continent’s historic handicaps, and its potential for economic development In 2013, writer and academic Joe Studwell produced a brilliant, intellectually daring account of the factors underlying Asia’s economic miracle. Called How Asia Works, the book flew in the face of the pro-market prescriptions of the Washington consensus, concluding that Asia’s most successful economies had thrived through unorthodox policies: a combination of agricultural reform based on intensively farmed small plots, financial repression and industrial policy turbocharged by a ruthless drive to export. Impressed, government officials in Ethiopia and Rwanda, both serious about development, suggested that Studwell write about their continent. “In Ethiopia, in particular, I was struck by my hosts’ depth of knowledge and their appetite for more,” Studwell writes, before concluding in typically terse style: “The invitations were flattering but pointless.” He knew nothing about Africa. Studwell subsequently set about putting that right. He devoted seven years to intense reading and field research, collecting empirical evidence rather than received wisdom. The result is one of the most original and important books on Africa in years. Especially in the dazzling first section, almost every page bristles with ideas and challenges to lazy (often prejudiced) thinking. How Africa Works is arranged in three parts. The first, contrary to the title, is an analysis of why Africa doesn’t work. More accurately, it catalogues the factors, sometimes surprising, that help explain why most of the 54 states into which Africa was corralled by colonialism have failed to emulate Asia’s economic take-off. The second section is a study of four states — Botswana, Mauritius, Ethiopia and Rwanda — that have managed to generate long periods of sustained growth. The third is an assessment of what it would take for other African economies to emulate that record, with particular emphasis on the agricultural and manufacturing revolutions that were essential to Asian growth. Throughout, Studwell steers carefully between the Scylla of fatalism and the Charybdis of frothy optimism. Africa’s two big development handicaps, he argues, are a sparse population and what he calls “low budget” colonialism. The first factor, in particular, challenges conventional thinking, but Studwell makes his case powerfully. At the start of the 20th century, Africa’s population density — at under five people per square kilometre — was similar to England’s in 1066 Before the 20th century, because of factors including a high disease burden, slavery and the preponderance of crop-destroying elephants, Africa was thinly populated. Between 1700 and 1850, the population barely budged and, even by 1950, there were fewer Africans than there had been Asians in 1500. At the start of the 20th century, Africa’s population density — at under five people per square kilometre — was similar to England’s in 1066. Studwell argues that this retarded development. In pre-colonial times, it slowed state formation. Unlike in crowded Europe, where nations were formed through war, in Africa, when one set of people didn’t like their leaders, they simply picked up and started someplace else. At the onset of colonialism, there were 10,000 African polities, some of them proto-states but many “loose groupings” of between 5,000 and 10,000 people “constituted as micro-monarchies”. Since independence, a sparse population has made it harder to deliver services, such as electricity and education, to rural populations. From Studwell’s perspective, the explosive population growth of recent decades, viewed with alarm by many Africa-watchers, is nothing more than “an extremely belated process of demographic normalisation”. Since 1960, around the time many African nations gained independence, the continent’s population has more than quintupled to 1.5bn and is forecast to add a further billion people in the next 25 years. The previously sparse population, overlaid by “low budget colonialism” — shallow, brief and extractive — made Africa less ready for take-off than many Asian states. Tanzania, by no means an outlier, gained independence with two engineers, 12 doctors, 120 ethnic groups and 85 per cent illiteracy. African leaders made a collective decision not to contest colonial borders. Since 1960, Studwell counts five interstate wars and 38 civil wars. “Most of Africa was frozen as an atomised, pre-modern ‘ethnic’ jigsaw,” he writes. “The violent process by which state formation took place in Europe was interrupted.” Studwell is too astute to blame everything on colonialism, or even on pre-colonial factors. The book’s second section examines how four countries set about overcoming their inheritance, albeit imperfectly. The chapters on Mauritius and Ethiopia are particularly enlightening. Mauritius, dismissed as “an overcrowded barracoon” (slave enclosure) by the writer VS Naipaul, is now on the cusp of becoming a high-income country. The key, argues Studwell, was to forge a political coalition across ethnic lines, one whose overriding goal was development. In lieu of the radical land reform that took place in Asia’s most successful economies, Franco-Mauritian sugar barons were forced to finance development through taxes. These were recycled into special economic zones and a textile industry that became the basis for a push into higher-end manufacturing, finance and luxury tourism. Mauritius has not done everything right. Studwell blames it for not pushing manufacturing beyond jewellery, watches and small-scale electronics. But the key to its significant success, he writes, has been a lack of ideology. Whether former Marxists or rampant capitalists, leaders emulated China’s cautious attitude described as “crossing the river by feeling the stones”. They experimented and then did more of what worked. Ethiopia has been even more important as a potential development template. With 137mn people, it is the continent’s most populous nation after Nigeria. Once a byword for famine and misrule, under Meles Zenawi, who came to power after the overthrow in 1991 of a disastrous Soviet-backed regime, Ethiopia modelled itself on South Korea and Taiwan. For Meles, everything was about instilling a sense of national mission. He liked the story of Taiwanese customs officers who extracted bribes on imported consumer items but never on the capital equipment needed for national improvement. Ethiopia prioritised agriculture — a Studwell essential — building rural roads and providing farmers with advice and fertiliser. Agricultural output quadrupled. Farmers’ savings were trapped by capital controls (Studwell’s financial repression), lifting investment to 41 per cent of GDP, on a par with Asia. Meles, who died in 2012, thought growth would trump ethnic conflict. After 1991, the economy expanded by 6-10 per cent annually, but conflict came anyway amid resentment over the political control exerted by officials from the northern Tigray region from where Meles came. Studwell calls the resulting 2020-22 war in Tigray, in which 600,000 people died, “the biggest development tragedy in a generation”. Still, growth continued and Studwell too hopes that economic gains can eventually smother ethnic divisions. The final section strikes a note of measured optimism. Some countries will fail, Studwell writes. But others have hit a stage at which development becomes possible. In 2030, Africa will finally reach the population density of Asia in 1960, its point of take-off. African urbanisation rates are the fastest in history. Ninety African cities have populations above 1mn against two in 1960. Scarcer land and more urban demand has forced an improvement in yields and created a landless peasantry fit for the factory. Relative wages have fallen, while education levels have soared. With the right policies, Studwell argues, the conditions are in place for Asian-style manufacturing-led development. He dismisses those who say technology means Africa has missed the boat. A textile machine costs $100,000 upfront, he says. A Madagascan worker costs $65, paid monthly. Studwell’s conclusion is that, while most African countries are not going to become development states, many can move the policy needle. If by 2060 they reach the African Development Bank’s target of $4,500 GDP per capita — a stretch for some admittedly — the continent would have an economy not much smaller than today’s China. Africa he concludes is not “a miracle waiting to happen”, nor is it “a monolithic failure”. The truth lies somewhere in between. How Africa Works: Success and Failure on the World’s Last Developmental Frontier by Joe Studwell Profile £25/Grove $32, 448 pages David Pilling is the FT’s Africa editor