The perhaps not-so-startling win of Spain at the World Cup in South Africa has partially obscured a far more interesting victory: a successful cup in the world's supposed basket case continent. Despite the doom and gloom from opinion leaders that the World Cup would be marred by crime, instability and corruption, South Africa appears to have been successful in producing a quality tournament without negative news.
These good feelings were further boosted by a paper released by McKinsey and Co. two weeks ago showing that economic growth on the continent is expected to be robust. Rather than just a passing moment, this growth is sustainable: a significant portion comes from knowledge-based industries and not just from expensive raw resources. Economic integration is also looking up: five African nations have recently started a new economic union that should further increase trade.
This is good for the continent, and it has attracted the attention of major economic superpowers. China, which has had a strong African plan for several years now, has been funneling billions of dollars of investments to the continent, building up infrastructure projects and educational institutions.
This investment is not without critics. Former Foreign Policy Editor-in-Chief Moisés Naím talked about the issue of Rogue Aid from countries like China and Saudi Arabia several years ago. Essentially, these countries provide billions of dollars of investment while demanding few improvements in governance. It is aid without morality, and it is making it difficult for Western governments to compete with aid programs that shutter under the weight of accountability requirements.
China, of course, is not spending out of generosity, but rather as a means to ensure the long-term stability of its economic engine by securing critical resources. The problem, today and tomorrow, is that the United States needs these resources as well, and we have not put together a coherent plan to ensure that we develop the capacity in African countries to open markets and build stronger democratic institutions.
The United States is not entirely blind to this problem. The U.S. President's Emergency Plan for AIDS Relief was started by President George W. Bush, and remains one of the few foreign policy accomplishments of that administration. Unfortunately, the funding spigot for that program has started to dry up as the Obama administration directs funding to other health issues like malaria. Other strong programs include the Millennium Challenge Corporation, which has been quite successful in its development programs, but has high standards on its aid that is undercut by China's more generous terms.
These problems are compounded by the recent focus on deficit reduction here in the United States. Senator John Kerry's Senate Foreign Relations Committee has decreased the level of spending for the State Department and foreign aid, and much of the funding cut in committee is unlikely to be restored anytime soon.
Thus, we see a situation where the United States is significantly under-investing in a critical growth opportunity at just the wrong time. What we need today is a new Africa strategy - and quick.
I do not think development experts nor the American public will accept the low standards of Chinese aid. Instead, the United States must use its wealth and higher popularity to begin a new push to reconnect with Africa. Through public diplomacy initiatives, we need to create an environment in which local citizens demand the higher accountability of American dollars. Of course, we will never get around Africa's long-lasting dictatorships. But outreach is certainly possible in the many African countries with better governance records. Reducing bureaucratic hurdles (without lowering accountability) can also ensure that programs have a more cause-and-effect connection, by reducing the gap between plans and implementation. This can raise the support of Africa's democrats, while increasing the image of the United States.
America cannot afford to be outspent in the modern century equivalent of the Race for Africa. It is critical that new sources of funding are secured, and that America continues to be the world leader in development. Failure could mean missing a critical opportunity in the continent's future, a situation the U.S. would regret for decades to come.
Posted on July 12, 2010