"I showspeed" shocks America: How did Africa get here?

Nairobi Expressway: With the City CBD
in the background

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When the American You Tuber, Ishowspeed, visited Africa last Month, live streaming his stunts, Americans were shocked. To them, Ishowspeed had demolished the narrative of an underdeveloped, poverty- stricken Africa.  

The African story previously was a story of destitution, of people living in hovels, no water, no electricity, no cities, and no cars... blah blah! “Africa is a shithole continent,” Trump said.

The Live streams of expressways, high-rise buildings, modern cars, happy, healthy, and energetic people, shocked Americans, -and destroyed the narrative.

I hear the live streams have stirred interest on the continent, and tourism enquiries are rising. I leave that to tourist- arrivals data at the end of the year.

My point here is to answer the question: How did we get here?  

 It’s a combination of factors, to wit: Geopolitics, the digital revolution, the emergence of China as the second-largest power house, change in economic fortunes, good housekeeping in Africa, and the 2008 financial meltdown in the West.

 A little lesson in history is in order here. In 1989, the Berlin Wall that divided East and West Germany, came down, paving the way for the reunification of Germany. This was also the first step towards the collapse of the Communist Soviet Union in 1991. The collapse of the Soviet Union ended the “Cold War Era” balkanization of the world- into Eastern and Western blocks.

The collapse of the Soviet Union was engineered by two words in Russian- Glasnost (transparency), and perestroika (accountability). These two words sparked off demands for independence from the Soviet Union that gave birth to a string of independent countries, including Ukraine.

It collapsed in 1991, spelling doom to dictatorships around the world.  Africa was not spared. Africans began demanding Glasnost and Perestroika. By 1995, dictatorships in Africa were collapsing like dominoes.

Scared autocrats first expanded the democratic space but were soon overwhelmed and voted out. The new regimes began to put the African house in order. I am not saying the democratic practice was ideal. Far from that. Neither is it even now. But it was a start.

Let’s jump to 2008, when the West suffered a financial meltdown fr

 Concepts turned into reality;Konza City
in Kenya under construction

om which it is yet to recover. Poverty came calling even though the West was still pretending to call the shots. Meanwhile, China emerged as an economic powerhouse, dwarfing Europe and Japan. It was sitting on a neat mountain of forex reserves, then estimated at US$4 trillion.

The new regimes in Africa were in a hurry to develop infrastructure to support economic growth and were shopping around for new partners. China on the other hand, was shopping for partners in Africa.

The Chinese exploited lethargy in the West to jump into Africa’s development space. While the West promised development aid on condition of further democratic reforms, - whose goal post kept changing, the Chinese showed up with dollars and shovels.

So efficient was China is disbursing development finance to Africa, that in less than a decade, she became the largest financier –and builder- of infrastructure in Africa. The second slot went to Africa’s own multilateral lender, African Development Bank. It had come of age and was aggressively financing infrastructure development in Africa.

 Third, economic fortunes turned north due to high commodity prices driven by Chinese demand.  This supported growth and poverty alleviation in Africa. Tax collection rose tenfold, enabling governments to fund some of the infrastructure projects from domestic sources.

Ethiopia, for instance, funded its Grand Renaissance Dam, GERD, from own resources.  GERD cost a whopping US$5 billion and is the largest hydro dam in Africa, generating 6GW of electricity.

 However, due to latent demand for infrastructure, Africa had to borrow to build new roads, railway lines, electricity power plants, and the like. China was a willing lender. Consequently, Africa has in the last 20 years, increased its stock of new tarmacked roads, wider and deeper ports, new railroads, and expanded electricity generation. In just about a decade, power generation has risen to 9300MW in East Africa, turning power outages of the 1990s into a chapter in history.

Reliable and affordable infrastructure enables robust economic activity. They ease access to markets, cut operation costs for productive sectors, open up unexploited areas, and reduce travel time. All these benefits combined buoy economic productivity.

 Investment in infrastructure, coupled with political stability, good management, and high commodity prices, resulted in robust economic growth averaging 5 per cent a year for nearly two decades.  “Africa was rising,” said the respected magazine The Economist in 1995. Two decades earlier, the same Magazine had declared “Africa a hopeless continent.” The Continent’s narrative had changed! This turnaround opened Africa for business and investment.

At that point, Sovereign funds were sitting on US$ 100 trillion with nowhere to invest. So Africa began floating Eurobonds that were always oversubscribed. The money went into financing infrastructure.

This renewed development focus, coupled with Chinese generosity, effectively sidelined the West from Africa’s development agenda.  By 2010, the West, including the Bretton Woods Institutions - IMF and World Bank, were knocking on the door, and Africa was not in a hurry to let them in.

Seeing somebody else eat their, the West resulted in selling fear and propaganda against China; “Chinese Products are substandard, Chinese Contractors are inexperienced, Chinese debt trap diplomacy, Chinese Check Book Diplomacy.”  Africa was even accused of behaving like a prostitute, going to bed with whomever had money.

Africa gave the West a deaf ear. It is the wearer who knows where the shoe pinches. She dished out contract after Contract to China. China had one advantage: Its contracts were relatively cheap,   condition- free, and were efficient in delivery. In just a decade, 2004-2014, China had bagged US$45 billion worth of contracts in Africa. They delivered ahead of time and on budget.

Their counterparts in the West were stuck. They didn’t have the financial muscle to even start construction of the projects they bagged.  They could not raise the capital to fund projects in Africa. As they struggled to raise funds, they were hoarding African development projects. So the contracts were terminated. 

 Others were financially weak, and efforts to breathe life into them were fruitless. They collapsed!

Oh and I forgot one more thing. The digital revolution. This resulted in cheap telecommunications gear in Africa. Landlines became history. In fact there is a generation of Africans that knows nothing about landlines. Mobile phone culture grew so fast that in some countries, such as Kenya, there are more registered Mobile phone lines than there are adults. Fast, cheap, and convenient Mobile phone handsets are diffuse in Africa, and the rate of growth continues unabated.

This has spawned the birth of the digital economy and innovation. Today, foreigners are stunned that Africans, especially in Kenya, the birthplace of M-Pesa, a mobile money transfer app, use digital money more than they use cash in their daily transactions. Almost everyone has a mobile phone handset, and all are enabled for money transfers. Mobile Money transfer has become a major employer in Africa.

 The growth of innovation has enabled the growth of diaspora remittances into Africa, increasing the flow of forex into the continent. In addition, the internet has spawned content creators, into which economy, “Ishowspeed” fitted well. 

That’s how we got here. Now the West is grasping for metaphors to cushion their lies.  Meanwhile, Africa is steaming ahead.