good government

july'08

'Good governance is perhaps the single most important factor in eradicating poverty and promoting development' according to Kofi Annan, former UN Secretary General.

Similarly 'The Economist' in a survey of the continent concluded that Africa remains poor because of bad government.

Good governance then would appear to be paramount in promoting higher living standards. But what is good governance?

In seeking to achieve good government a president or prime minister should look around for the ablest people to head up the various departments of government. And merit should be the continuing determinant in all further appointments including the civil service; nepotism, where family and friends are favoured, should not be acceptable in any way. All government ministers should make a declaration of assets when appointed. And ministers, staff in government departments and civil servants should all be well paid with the proviso that anyone found to be involved in any form of financial irregularity will be dismissed immediately. Honest and competent people have to be the foundations upon which good government is built.

With sound government in place, the president/prime minister will be keen to ensure that the institutions of the country are secure under his/her government. This will involve amongst other things seeking to uphold the rule of law, maintaining the independence of the judiciary/ central bank and protecting human rights.

Within days of being elected any government will be keen to turn its attention on the welfare of the people - all of the people. This will mean looking to forge development right throughout the country - not just in areas where important ministers reside.

Among the first tasks should be to ensure that supplies of food are adequate and guaranteed. Steps should also be taken to increase safe water supplies, improve sanitation and encourage good hygiene which would lead to all round improved health. It is vital to work for good health throughout the nation and so steps should also be taken to establish medical facilities throughout the entire country as soon as enough nurses and doctors can be found or trained. Education is vital and initially a plan to ensure that ALL children have access to free primary school education should be drawn up. In African countries where numerous languages are spoken, English or French should be taught in schools. Infrastructure, too, should be looked at so that good transport and communications can be established which would also allow food supplies to be easily moved around the country in emergencies. And every family should have their own registered plot of land to build a home and to grow food. Having a fixed address also allows families to borrow money to improve their homes/ smallholdings as well as alerting the authorities to where schools and medical facilities may be needed. In this way by giving the people the 'basic tools' they can start to help themselves.

At the same time governments should strive to reduce wasteful bureaucracy and to free up the economy. In his book ‘The Mystery of Capital’ Hernando de Soto relates his experience in trying to set-up a small garment workshop in Peru. Getting a group of his students together, they set to work to find and complete all the necessary documents that were needed to set up a small business on the edge of Lima. After many days of painstaking work and bus journeys to numerous government departments, they finally managed to register the business as a legal entity after 9 months. And the cost of establishing this one man operation - over $1,200 (£600) or about 30 times the average monthly wage. Is it any surprise then that most business men/ women in developing countries find it too time consuming and expensive to register thus losing the advantages of becoming a legal entity which include being able to borrow money to expand. Setting up businesses is vital for jobs which in turn will grow the economy. Bureaucracy like this is ludicrous and needs to be re-written in user friendly terms.

Foreign investment should be encouraged by the setting up of an economic development agency which can fast track investors through the various procedures needed to start up a company. Here, however, to maximise opportunities international business leaders will first need to be convinced that property rights are secure, contracts can be enforced and sound economic policies are in place. For no matter how attractive labour costs might be, very little foreign direct investment (FDI) will arrive if international companies sense unpredictable government. And poor areas of the world suffer from a lack of FDI and there is no greater example of this than in sub-Saharan Africa where with 12% of the world's population, the area receives less than 1% of total FDI.

By setting up in poor countries foreign firms bring in new technology, provide extra jobs and implement training and education programmes for their workers. And in time ancillary industries will spring up producing more jobs. Whatever goods are being produced will help the trade balance either by producing substitute goods for domestic use or through exporting them abroad. With increased numbers of people at work, tax revenues will increase and more money will be available for building much needed schools and hospitals and improving infrastructure. Foreign companies may seem to pay low wages but to workers in the developing world they pay well in relative terms. However, international labour standards in the number of hours worked, child labour and working conditions should be adhered to.

Examples of corruption are not just found in the developing world as recent cases involving the votes for favours scandal on the International Olympic Committee and the regularity in the number of times funds seem to go missing in the EU budget prove. However, corruption is more prevalent in developing countries where the opportunities are greater due to poor pay and endless bureaucracy. There corruption comes in many guises including favouring friends for government contracts, police using protection rackets, stealing from employers, etc. And it usually has a devastating effect on economic life. In order to remove this blight the president/ prime minister should set up an independent body with power to investigate anyone at any time including all government ministers. This will reassure the people and any would be international investors that the government is working earnestly for the good of the country. A free press, too, would further help expose corrupt practices.

In an age when boundaries are virtually guaranteed, is there any need for poor nations to spend billions of dollars accumulating sophisticated arms? Procuring expensive weapons surely is a waste of valuable foreign currency and is a major area for gross corruption. Most governments in the North now say they no longer supply arms to the Least Developed Countries. We have to take their word for that but rich countries should go further and extend this ban to include all developing countries. Internal security should be the responsibility of the police backed by an army of appropriate size and border disputes should always be settled by continental organisations like the African Union or the UN. War should be avoided at all costs for it can destroy in days what has taken years to build. A good leader would never forget this.

Putting all these policies into action will not be easy and for a long time social and economic indicators may show few signs of change - like when trying to turn round of an ocean liner. Some people may even become critical and the government seeing an election ahead may start to reach for easy options. But these should all be rejected. If a government is both seen to be honest and competent and working for the good of all the people, then the electorate will probably want to give that government a longer period for their policies to show results. For there is no alternative - history declares that better living standards only come from an expanding economic performance.

So there should be no walking away when the going gets tough - governments need to be in for the long haul. And when their policies start to show results the economy will move forward rapidly, poverty indicators will decline, flight capital will start to return from abroad, overseas aid will increase and even educated nationals who have been living abroad may come back.

As a result of that success, the government won't need to worry about elections - it will probably be returned to power time after time. For voters aren't stupid - they know that good government is the real 'wealth of nations'.

There is an acceptance in our modern age that democracy is the gateway to good government or as Sir Winston Churchill once put it 'democracy is the least worst form of government'. And remarkably this form of government was first attempted in Iceland as long ago as AD 930 with the setting up of the 'Althing' - the world's first parliament.

site of 'Althing' - the world's first Parliament

Democracy is the only political system that guarantees free expression whilst helping to protect the people from economic and political catastrophes. This form of government where the people are allowed periodically to freely choose their own leaders encourages positive renewal as defeated political parties need to keep re-shaping their policies in order to make themselves electable at the next poll. Today it is estimated that real democracy, where free and fair elections are held regularly, is now found in 89 countries representing 57% of the population of the world. Of the other countries in the world, some are pseudo democracies where, although there are periodic elections, the ruling party frequently bars opposition candidates from standing, restricts opposition parties access to the media and usually ensures that in any count ballot boxes are stuffed with enough votes to ensure re-election of the current president/ prime minister e.g. Zimbabwe, Guinea. In yet other countries autocratic regimes and military dictatorships range from the benign e.g. China, Cuba to the reprehensible e.g. N Korea, Burma.

Many countries in the South, particularly in sub-Saharan Africa, have struggled to come to terms with democracy. There the political landscape we see today is the result of the carving up of the continent by the European powers at the Berlin Conference in 1885. Into the melting pot went 10,000 kingdoms, tribes and federations mixed up with Christians, Muslims and other religions and when they came out they had metamorphosed into just 50 countries which for the most part were then ruled over by the colonial powers (e.g. UK, France, Germany, Spain, Portugal) until most gained independence in the 1960’s. Little training in administration was given to the indigenous people by their colonial masters and the few institutions that had put down roots in these countries struggled to survive after independence. And so with no middle class, tribal and religious conflicts breaking out and the political manoeuvrings of the Cold War pulling countries in different directions, it was little wonder that many of these newly independent states found themselves at the mercy of unscrupulous autocrats and military dictators as soon as the 'liberty' bell had been rung.

And that can be seen today as only 11 countries in sub-Saharan Africa are considered to be democratic:- Benin, Botswana, Cape Verde, Lesotho, Mali, Mauritius, Mozambique, Namibia, Sao Tome & Principe, Senegal and South Africa. At the other end of the scale military despotism still reigns in Sudan, Eritrea, Congo Democratic Republic, Zimbabwe and Equatorial Guinea - even after 50 years of independence.

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