Debt-relief and International Capital Markets

The heightening of consciousness about Africa produced by the Live8 Concerts is a good thing.   In a world of constant social networking, millions of young people who wouldn’t have done so otherwise will think about African poverty, do research projects in high school class rooms about African development.  There is a worry though that this kind of global digital age populism distracts from tough decisions and critical agendas.   John Kay’s column in the Financial Times. (www.ft.com) on debt relief is a good antidote to this tendency.  Debt-relief is the kind of public policy which is probably harmless except for the reality that it makes people think more is being accomplished than actually is and this sends incorrect market signals about what forms of economic activity should be encouraged.   It is much more important to reward fiscally-sound and economically innovative governments like Mozambique and Senegal , than to use a global Chapter 11 to eradicate the bad economic behaviour of lenders and consuming regimes.   Easterly’s very useful strategic focus on the doable and the practical matches the kind of strategic social entrepreneurship exemplified by the Bill and Melinda Gates Foundation, focusing as it does on fixable areas of public health which are not covered in the footprint of traditional aid strategies (www.nytimes.com) .     As millions of young people focus on Africa as a result of the accomplishment of celebrities leveraging celebrity status to put items higher on a global agenda, it is important to focus on the need for (a) innovative capital markets backing African management talent through an African infrastructure bank; (b) the empowering of entrepreneurship and social entrepreneurship at a local level which provides concrete  examples of success and ;  (c)  the celebration of African cultures through great artists like Achebe, Soyinka, Sembene, Yameogo, Sissako who show that the African voice is not a voice of tragedy alone, nor one that is derivative from colonial experiences alone.  It is instead part of the celebration of global achievements and, as such, a motivating force to ensure that the first two goals are met realistically. http://news.ft.com/cms/s/3a791c3c-e736-11d9-a721-00000e2511c8.html  (John Kay)

http://www.nytimes.com/2005/07/03/opinion/03easterly.html (William Easterly)
www.johnkay.com and http://www.nyu.edu/fas/institute/dri/Easterly/Media.html