Economic growth and leadership succession
There is growing speculation about the fate of Ethiopia’s leader Meles Zenawi. Has a leadership struggle started? The way this plays out will have profound implications for the fortunes of a country with one of Africa’s largest populations and fastest growing economies.
Sub-Saharan Africa has had nine high-growth regimes with annual average growth rates of 7% or more since 1960, whereas the much wealthier region SE Asia has had only six. However, African high-growth regimes tend to be fairly short-lived.
In SE Asia, most high-growth regimes have spanned changes in political leadership, whereas in Africa only one country has achieved this. Why? This article explains the decisive differences in economic policy-making institutions and/or political leadership traditions.
So what are the implications for Ethiopia or other African high-growth regimes like Uganda or Rwanda? If they are to avoid the fate of other high-growth but short-lived regimes, they must now invent a binding order of succession.
In recent days there has been fevered speculation across the internet about the fate of Ethiopia’s Prime Minister, Meles Zenawi, and the leadership struggle liable to follow his—as yet unconfirmed—demise. (An excellent overview is provided here.) The way this struggle plays out will have profound implications for the fortunes of a country with one of Africa’s largest populations, and fastest growing economies.
At the Developmental Regimes in Africa project, we have been finding that how a country handles its succession process is crucial to political stability and economic growth, and that traditionally, African countries have managed this process rather poorly.
Sub-Saharan Africa, it may surprise some readers to know, has not been short of high-growth regimes―defined as a regime with a decadal annual average growth rate of 7% or more. Since 1960 it has had nine, whereas Southeast Asia, a much wealthier region, has had only six.
However, it will come as less of a surprise to know that African high-growth regimes tend to be fairly short-lived. A typical high-growth regime in Africa lasts for 13 years, whereas in Southeast Asia it lasts for 23.
Associated with this fact is that in Southeast Asia, high-growth regimes in Laos, Malaysia, Thailand and Vietnam have all spanned changes in political leadership, whereas in Africa, only one country—Mozambique—has achieved this.
The question is why?
One answer might be that Southeast Asian states have been comparatively free of the authoritarianism, corruption, cronyism, and nepotism that afflicts so many African countries—but it is actually more complicated than this. Anyone familiar with Southeast Asian governance knows that it often falls well short of good governance ideals.
Rather, what seems to distinguish successful Southeast Asian regimes from African ones, is that economic policy-making is either entrusted to a bureaucracy that is effectively insulated from the hurly-burly of leadership politics (as in Thailand during the 1960s and 1970s), or political leaders are embedded in strong political parties with traditions of consensual decision making and clear conventions governing leadership succession (Malaysia in the 1970s, Vietnam in the 1990s, Laos today).
This explanation also fits our successful African case, Mozambique, which has a strong governing party, FRELIMO, with succession conventions established following the assassination of its first President, Eduardo Mondlane.
It also helps explain why our only Southeast Asian outlier, General Suharto’s Indonesia, was unable to sustain the 26 years of high growth experienced under his rule. In Indonesia, the bureaucracy was less insulated than in Thailand, while the ruling Golkar was weaker than other parties in the region.
So what are the implications for Ethiopia (or other high-growth regimes like Uganda or Rwanda, for that matter)? The good news, from a developmental point of view, is that Ethiopia is fortunate to have a ruling party stronger than that in many other African states—so there is at least a chance that growth will continue. The bad news is that it is far from clear that the EPRDF is as robust as Mozambique’s Frelimo, Malaysia’s UMNO, or the Vietnamese Communist Party, while the apparent absence of an obvious successor or clear conventions governing the succession process is an obvious cause for concern.
If it is to avoid the fate of other high-growth but short-lived regimes, the EPRDF must now invent a binding a succession tradition, with or without Meles at the helm.
This is a slightly edited version of the original post on the blog The political economy of development in Africa.