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Infrastructure development alone not enough

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DURING a recent visit to Ethiopia, a question: Is the unprecedented infrastructure development in Addis Ababa cascading to the majority? was raised by a colleague which prompted the writing of this piece.
The question was asked with reference to Zimbabwe whose economy has been overshadowed by the effects of Western-sponsored sanctions against the country but has, however, done well under the difficult circumstances.
It is difficult to begin to give an accurate picture and analysis of both Zimbabwe and Ethiopia’s economies since the two nations’ fortunes contrast acutely due to their political situations.
This is so because where Ethiopia has the luxury of enjoying cordial relations with multilateral institutions like the International Monetary Fund (IMF) and the World Bank, Zimbabwe does not enjoy that pampering.
Where Zimbabwe has had to go it alone, Ethiopia and other African nations perceived to be compliant by the West have received all the support they can get.
This is why the Zimbabwean story is not only an amazing one, but also a blueprint for other nations which dream of totally controlling their resources and means of production.
Zimbabwe has ensured that it creates a solid base through human capacity development programmes that have, without doubt, uplifted the livelihoods of poor peasants, farmers, miners and engineers, to mention but a few.
While Ethiopia has been applauded for its economic turnaround strategy that has seen massive infrastructure development and rehabilitation in the capital, Addis Ababa, the reality is that before any economic activity can be talked about it has to tally with human capacity development.
This ensures the translation of the economic activity to the majority as is the case in Zimbabwe.
Any economic activity in any nation can only have meaning and traction if there is increased local participation.
This is what Zimbabwe has done through its Land Reform and Resettlement Programme and the ongoing Indigenisation and Economic Development Programme.
These two programmes are anchored on the massive education development programmes that Government initiated and championed since 1980.
Any infrastructure development initiatives can only bring real economic gains if it is supported by the locals who are supposed to be the real beneficiaries of job creation.
The more than 400 000 households that have benefitted from the Land Reform and Resettlement Programme are testimony to the significance of human development.
It is in light of the above that statistics by the IMF, the World Bank and the United Nations Development Programme (UNDP) are in most cases questionable as they tend to focus only on a country’s Gross Domestic Product (GDP).
Rarely do they give priority to human development.
This is why the 90 plus percent unemployment rate in Zimbabwe is questionable.
The Ethiopian case is one such misnomer by the said organisations.
While there is visible activity in so far as infrastructure development is concerned, the striking reality is that many in the East African country are wallowing in grinding poverty.
Compare this to Zimbabwe where the majority have not only had opportunities to raise capital and sustainable livelihoods and development, they are in fact making use of Government’s empowerment initiatives to uplift their livelihoods.
Talk of tobacco, cotton and maize farmers, the Tokwe Mukosi Dam and the just launched construction of the Beit Bridge-Harare-Chirundu Highway.
All these point to a country vigorously pursuing the human capital development agenda.
But the Ethiopian case is interesting.
According to a report by the World Bank’s Global Economic Prospect released in June, Ethiopia will be the fastest growing economy in Africa.
‘‘Ethiopia is forecast to expand by 8,3 percent in 2017, Tanzania by 7,2 percent, Ivory Coast by 6,8 percent, and Senegal by 6,7 percent, all helped by public investment. However, some countries need to contain debt accumulation and rebuild policy buffers,” reads the report in part.
Ethiopia’s economic growth is hinged on public-led spending on infrastructure and a strong demand by locals. It has also recently become an investor destination of choice for particularly Chinese investors.
But there is a catch.
In its March 2 2015 issue, The Economist said Ethiopia’s GDP growth figures cannot be taken seriously:
“Just how sustainable is Ethiopia’s advance out of poverty? This is a vexed topic among bankers and others in Ethiopia who hold large wads of birr, the oft devalued currency. Despite hard work by the World Bank, oversight from the International Monetary Fund, and studies by economists from donor countries, it is not clear how factual Ethiopia’s economic data are. Life is intolerably expensive for Ethiopians in Addis Ababa, the capital, and its outlying towns. Some think Ethiopia’s inflation figures are fiddled with even more than those in Argentina. Even if the data are deemed usable, the double-digit growth rates predicted by the Government of Prime Minister Meles Zenawi look fanciful.”
The most important thing for countries to do before they wave the ‘development’ flag is to first give prominence to human capital development.
Zimbabwe has done that with aplomb and it stands on solid ground as the much anticipated boon gathers momentum.
Let those with ears listen.

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