In the ancestral Igbo culture, the best person to borrow money from is your kinsman. There is a reason for that: if you cannot repay and he comes after your properties, he can take all, but at the same time, he has a fundamental responsibility to support your family because your children are partly his!
Igbos name their children Nwaoha (child of the community) and Adaoha (daughter of the community) to conceptualize that a child belongs to the community and not just the parents. And if the parents fail in their duties, the community has a responsibility to support. That is the spirit of Umunneona Economics and the power behind the Igbo apprenticeship system.
This takes me to the latest news that China wants to reduce its debts to Africa as the borrowers are struggling badly to service the debts. An Igbo axiom notes that if you are holding someone down on the ground, you are also likely to be on the ground to keep that person from standing! Simply, the lender and borrower have many things in common.
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Wish for a time when Africa can afford to borrow internally just as America, China, Japan, etc do.
Yet, China should NOT be overly worried about Africa’s possible inability to repay. The real issue is that no one has explained how these loans have improved the common man in the continent. China should be worried about that!
While China has consistently doubled or even tripled its financing pledges for Africa during previous Forum on China-Africa Cooperation (FOCAC) meetings, the stagnation of this sum at the last FOCAC summit, held in 2018, should have raised concerns.
This year for the first time, the Asian giant has cut down investment pledges from $60 billion to $40 billion, at the recently concluded ministerial level FOCAC meetings held in Dakar, Senegal. This is a worrying sign of the times for the continent.
It’s easy to rationalize this drastic reduction as a result of China’s poor economic performance in the wake of the pandemic with China’s GDP growth at 2.3% in 2020, down from 6.0% in a pre-pandemic 2019, but this doesn’t tell the full story.
Comment: Thanks a lot for sharing these very important thoughts. The last sentence got me – I believe it is the real issue. In your opinion, what aspect is more important to improve the common man: human capital or employment opportunities?
My Response: If you focus on “employment opportunities”, you become constrained in your policy playbook since employment does not come via fiat. It is an effect of something. Forget when politicians create an agency for creating employment. There is nothing like that unless expanding bureaucracy.
Human capital is fundamental for the advancement of nations and people. When the minds of people are liberated, they shape their future and those jobs will open up. That is why parents send their kids to school instead of taking them from one company to another looking for jobs for them.
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None of these loans can liberate a nation or its people, because the intent is never to empower but rather to enslave.
You borrow heavily to finance physical infrastructures, but at the end your citizens neither gain expertise nor become employed.
It’s a scam.