At the heart of political economy is how politics affects the economy and vice versa. Society wants the supply of public services like healthcare, education, security, and infrastructure to be flexible, innovative, and efficient. However, the barriers created by bureaucracies often stifle innovation. The argument for harnessing the policy-market nexus to increase aggregate economic welfare remains compelling. While conventional arguments on the ability of the private sector to intrinsically generate efficiency gains remain valid, governments' traditional role of providing an enabling environment to foster private risk taking for capital accumulation is no less important. This chapter offers insights into the political economy of the public policy dynamics of the African economy and society, with emphasis on public-private collaborations for policy innovation. To break new ground and solve some of the most pressing challenges of our era, innovating the public policy cycle is key. Nowhere is the policy innovation imperative more compelling than in Africa.
“Massive poverty and obscene inequality are such terrible scourges of our times — times in which the world boasts breathtaking advances in science, technology, industry, and wealth accumulation — that they have to rank alongside slavery and apartheid as social evils.”
– Nelson Mandela
A core political economy issue in the growth literature is how to structure the relationship between the public and private sectors to ensure optimal outcomes. While conventional arguments on the ability of the private sector to intrinsically generate efficiency gains remain valid, governments’ traditional role of providing an enabling environment to foster private risk taking for capital accumulation is no less important.
Borrowing from contemporary theories of policy change, in this book, I raise some fundamental questions about the political economy of development in Africa vis-à-vis the appropriateness of contemporary policy devices and paradigms, the compatibility of individualistic analytical frameworks with the African philosophy of Ubuntu, the debate on the rise of neoliberalism vs. Africa's traditions and values, and the implications of path dependence and the vestiges of colonization for the African Union’s Agenda 2063 and the African Renaissance. From local communities and NGOs to African governments and international development agencies, to build the Africa we want, a multi-stakeholder development policy and programming framework which recognizes Africa's vastly heterogenous economies and societies is needed.
Society wants the supply of public services like healthcare, education, security, and infrastructure to be flexible, innovative, and efficient. However, the barriers created by bureaucracies often stifle innovation. Harnessing the policy-market nexus to increase aggregate economic welfare depends, to a large extent, not only on how business-government relations are designed and managed, but also on the specific dimensions of such relationships (Maxfield & Schneider, 1997). Amid the current wave of digital transformation, new innovations that can help governments fulfil their social contracts are increasingly emerging. And while the role of the state in creating incentives and reducing transaction costs is clear, a nuanced understanding of contemporary social policy requires a firm grasp of the role of business. At the same time, most public policy challenges are complex and non-linear in nature. To break new ground and solve some of the most pressing challenges of our era, innovating the public policy cycle is key. It goes without saying that nowhere is the policy innovation imperative more compelling than in Africa.
Africa continues to grow in importance. On March 7, 2019, the online edition of The Economist characterized the new scramble for Africa thus: “Governments and businesses from all around the world are rushing to strengthen diplomatic, strategic and commercial ties.” Regional integration is progressing fast across the continent. And not just that. There is broad-based support from African governments and other important stakeholders both on the continent and within the broader international community. For instance, the AfCFTA, aimed at establishing a single market across the continent, represents an important milestone in achieving the bold objective of an economically integrated Africa.
Indeed, this is a pivotal moment for Africa in the context of policy development. Given the scope, size, and potential development impacts of the AfCFTA, it is arguably one of the most consequential contemporary policy developments on the continent. Not only is the AfCFTA expected to launch Africa into the mainstream of global commerce, but the pact is also poised to make the continent more competitive globally (World Bank, 2020). In the context of coherence and reinforcing policy actions across countries and sectors to achieve synergistic outcomes, it is also worth mentioning that the AfCFTA is aligned with the 2030 Agenda for Sustainable Development – with its 17 Sustainable Development Goals (SDGs) – as well as Agenda 2063, the African Union’s continent-wide policy blueprint for inclusive growth and sustainable development.