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The U.S. Should Encourage Structural Transformation Strategies in Africa

The U.S. Deputy Secretary of Treasury, Neal Wolin, is currently on a visit to three African nations—Rwanda, Tanzania and South Africa. In these countries he will meet with senior government officials “to discuss strategies to reduce poverty and drive economic growth in the region.”  Following on the heels of President Obama’s and Secretary Clinton’s recent trips to the continent, this trip further demonstrates the commitment by the current administration to African development issues. Treasury has indicated that the deputy secretary will focus on areas of interest including food security and sustainable agriculture-led growth through country-led strategies, as well as interest in helping develop infrastructure, strengthening the financial sector and improving the investment climate.

The important issue, however, is the trip must be more influential in the sustainable development of African nations.

It is a positive step that the Treasury Department is emphasizing “country-led strategies,” which is what the African countries themselves talk about all the time when they meet with international development and government officials from the industrialized world. The truth, however, is that very few of these countries have properly articulated a country-led strategy, given insufficient space and time to develop them. Their efforts are consumed by responding to initiatives from the outside, whether they come in the form of structural adjustment programs, HIPC initiatives, poverty reduction strategy frameworks, etc. While there may be some convergence of interests in all of these externally-driven initiatives, they have often not allowed governments to take adequate responsibility for the development processes. It is time for this to change.

The Deputy Secretary can significantly help the countries that he is visiting by encouraging them to think long term. Agriculture-led growth is certainly laudable but the countries must have a framework for using that growth to achieve structural transformation, and the deputy secretary should encourage them to think strategically in that direction. His main message should be “Let us start building the blocks that will lead to structural transformation in partnership.” The main components of any U.S. partnership with Africa must be intended for achieving structural transformation of the economies within a given timeframe, using strategies that the African countries themselves have developed. This is doable in that the countries are already developing their institutions for that purpose, but they could use an extra boost in morale.

Encouraging African nations to take ownership of development initiatives and establish frameworks for long-term growth will be a welcome and significant step taken by the U.S. for the betterment of the whole African region.