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A garment factory in Ghana. Experts say the failure of most African countries to use the recent commodity-based growth to start a more sustainable growth based on the development of the manufacturing sector is making the continent’s long-term prospect worrisome (© Dominic Chavez/World Bank)

Renowned Chinese economist advises Africa on economic development

Do what you are good at, says Ha-Joon Chang

“Countries can decide their development path. Countries become good at things because they want to excel at making those particular things,” renowned development economist Ha-Joon Chang told an audience on 3 April at the second Annual Adebayo Adedeji Lecture, part of activities marking the 2016 Africa Development Week, which took place in April at the Economic Commission for Africa (ECA) headquarters in Addis Ababa. 

Dr Chang, known for his refreshing ideas on development theories, explained that several ways to development and industrialisation exist. Citing South Korea as an example of an industrialisation success, Chang declared that history is replete with examples of countries forging a different path than the one they were advised to follow by international institutions. 

“Most developed economies have succeeded in growing their economies because of the infant industry,” argued Chang. The strategy of this policy is to develop skills and protect the domestic market until such time they can be mature. “Infant industry protection creates the ‘space’ for improvement in productive capabilities, but does not automatically lead to productivity increase.” 

Chang explained that countries make the common error of not investing in productivity growth such as machines, research & development and skills. He therefore advocates a focus on manufacturing because of this industry’s interconnection with other industries and its capacity to boost complementary industries. Chang warns against neglecting exports as “economic development requires export success.” 

Carlos Lopes, Executive Secretary of the Economic Commission for Africa, explained that much of ECA’s inspiration on work on industrialisation comes from Dr Chang. “He provides an excellent mix of history and economics by bringing to us the experience other countries have gone through in their development experience.” 

The Adedeji lecturer did not disappoint. He noted that countries often fail to upgrade or add value to their products. In order not to lose the benefits made from initial investments in industrialisation, countries must upgrade their industries and create their own value chains to be globally competitive, Chang declared. 

To develop economies, Dr Chang believes, countries can utilise a strategic combination of an export-based economy and an infant industry. He thinks that the shrinking of policy space, which states often bemoan, has not made industrial policy impossible to use. 

Chang, author of widely discussed policy books, notably Kicking Away the Ladder and 23 Things They Don’t Tell You About Capitalism, said that the late Adebayo Adedeji, after whom the annual lecture is named, was a beacon of hope during the dark times of colonialism in Africa and other regions. 

ECA launched the Adebayo Adedeji lecture series in March 2014 to honour and recognize the intellectual contribution to development, service to Africa and humanity of Professor Adedeji who was the ECA Executive Secretary from 1975-1978 and UN Under-Secretary General from 1978-1991. 

African Media Agency/IC Publications

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