Organisation, economics development agriculture

I have often written on this page that capable managers are of equal importance to engineers. This has been reiterated because one reads and hears again and again that if developing countries are to make headway they must be given priority to producing engineers and technicians.

What can we attribute the damage of 30 000 metric tonnes at Lilongwe NFRA silos to? Poor management, not poor engineering. Time and time again I have read essays or books which have said the cause of widespread famine is not always shortage of food but the management or logistics involved.

Less than five years ago, Malawian spokespersons were praising their leaders and government from rooftops for achieving food self-sufficiency. Now we learn Malawi is going to ask not for more oil from Zambia, which President Michael Sata graciously made available to Malawi as soon as President Joyce Banda took office, but for maize. Where is the surplus that was said to be bursting the silos? The management rather than agricultural scientists bear the responsibility for current shortages.

Malawi’s development like the development of countries that are well ahead must look to agriculture as the first stepping stone. But what is economic development? Is it the same as economic growth?

Time was when two terms, economic growth and economic development were used interchangeably. Economists these days highlight the differences rather than similarities.

In economic growth the focus is on annual changes in the gross domestic product (GDP) and the corresponding changes in per capita incomes. In economic development we look at changes in standards of living. Economic development is said to be multi-faceted, we look at both inputs and outputs. The best indicators of living standards are said to be life expectancies and mortality rates. That high incomes per capita is not synonymous with economic development as highlighted by the World Bank publication, World Development Indicators, 2006 as reproduced in the book Economic Issues and Policy by Jacqueline Murray Brux. On page 169, we are shown a list of 19 developing countries and their life expectancies, eight are from Asia and Latin America the last 11 are all from Africa. Botswana which is usually categorised as a middle income country is said to have a life expectancy of 35 years, next are Lesotho and Zimbabwe with 36 and 37 respectively. Obviously per capita income is not a perfect indicator of a community’s standard of living or welfare, social behaviour interferes with the would-be outcomes of high growth rates.

The presence of adequate educational and health facilities give a clue whether a society is experiencing economic development. How many doctors are there per population of 100 000, what percentage of men and women is literate, what percentage of school age children is actually in school? How many children die before the age of five and how many pregnant women die per 1 000 or so? These statistics give a more reasonable idea of the nature of economic development taking place.

Nowadays all developing countries give top, but not exclusive priority to agriculture. First as a source of food security. A hungry nation is an angry nation. Agriculture is also a source of exports that earn foreign reserves (foreign currency) which are used to pay for imports.

The doctrine of specialisation as expounded by David Ricardo and his followers exhorts developing countries to stick to agriculture in which they have got comparative advantage compared with developed countries. Unfortunately, industrialised countries do not practise what they preach. They do not give up food and cash crop production as they build more and more industries. Instead they adopt more productive methods for their agriculture, heap subsidies on it and erect tariff and non-tariff barriers against imports of agricultural commodities from developing countries.

For sustained development, almost equal attention ought to be paid to both agriculture and secondary industries. This is not quite a new idea. As soon as some African countries attained independence in the early 1960s they set about building manufacturing industries under statutory bodies called development corporations. Malawi had its own Malawi Development Corporation (MDC), for example.

African countries failed where Far East Asian countries succeeded. Broadly, the explanation is to be found in organisation. Asian countries were organised for success, African countries were not. Malawi and other African countries should have a second look at how the Fours Tigers organised themselves for success.