President Kagame's take on aid

After all the frivolities of my bloggings, this is an important item. This is a speech from the President of Rwanda and it outlines the country's thinking on Aid and its influence on countries. It makes interesting reading.

Africa has to find its own road to prosperity

By Paul Kagame

Published: May 7 2009 19:35

At recent meetings of the Group of 20 and the International Monetary Fund, world leaders have gathered to discuss the global economic crisis. Unfortunately, it seems that many still believe they can solve the problems of the poor with sentimentality and promises of massive infusions of aid, which often do not materialise. We who live in, and lead, the world’s poorest nations are convinced that the leaders of the rich world and multilateral institutions have a heart for the poor. But they also need to have a mind for the poor.

Dambisa Moyo’s controversial book, Dead Aid, has given us an accurate evaluation of the aid culture today. The cycle of aid and poverty is durable: as long as poor nations are focused on receiving aid they will not work to improve their economies. Some of Ms Moyo’s prescriptions, such as ending all aid within five years, are aggressive. But I always thought this was the discussion we should be having: when to end aid and how best to end it.

Aid has not only often failed to meet its objectives; it has also rarely dealt with the underlying issues of poverty and weak societies. We see this with our neighbour, the Democratic Republic of the Congo. There, 17,000 United Nations peacekeepers – the largest and most expensive presence of its kind in history – treat the symptoms rather than addressing the issues of capacity, self-determination and dignity.

Often, aid has left recipient populations unstable, distracted and more dependent; as Ashraf Ghani, the former finance minister of Afghanistan, has pointed out, it can even sever the relationship between democratically elected leadership and the populace.

Do not get me wrong. We appreciate support from the outside, but it should be support for what we intend to achieve ourselves. No one should pretend that they care about our nations more than we do; or assume that they know what is good for us better than we do ourselves. They should, in fact, respect us for wanting to decide our own fate.

At the same time, as I tell our people, nobody owes Rwandans anything. Why should anyone in Rwanda feel comfortable that taxpayers in other countries are contributing money for our well¬being or development? Rwanda is a nation with high goals and a sense of purpose. We are attempting to increase our gross domestic product by seven times over a generation, which increases per capita incomes fourfold. This will create the basis for further innovation and foster trust, civic-mindedness and tolerance, strengthening our society.

Entrepreneurship is the surest way for a nation to meet these goals. Michael Fairbanks’ book, In The River They Swim, which uses Rwanda as one of its examples, highlights the need to respect local wisdom, build a culture of innovation and create investment opportunities in product development, new distribution systems and innovative branding.

Government activities should focus on supporting entrepreneurship not just to meet these new goals, but because it unlocks people’s minds, fosters innovation and enables people to exercise their talents. If people are shielded from the forces of competition, it is like saying they are disabled.

Entrepreneurship gives people the feeling that they are valued and have meaning, that they are as capable, as competent and as gifted as anyone else. Asking our citizens to compete is the same as asking them to go out into the world on behalf of Rwanda and play their part.

We know this is a tremendous challenge given our status as a land-locked nation emerging from conflict, with few natural resources, little specialised infrastructure and low historical investment in education. But, in fact, we have reasons to be optimistic: we have a clear strategy to export based on sustainable competitive advantages. We sell coffee now for high prices to the world’s most demanding purchasers; our tourism experience attracts the best customers in the world and market research reveals that perceptions of Rwandan tea are improving.

This has resulted in wages in key sectors rising at more than 20 per cent on an annual basis. We have cut our aid as a percentage of total GDP by half over the past decade, and last year we grew at more than 11 per cent even as the world entered a recession.

While this is encouraging, we know the road to prosperity is a long one. We will travel it with the help of a new school of development thinkers and entrepreneurs, with those who demonstrate they have not just a heart, but also a mind for the poor.