Good Governance Still Africa's Achilles Heel

This post was co-authored with Charles Landow, associate director of the Civil Society, Markets, and Democracy Initiative at the Council on Foreign Relations.

The $5 million Mo Ibrahim Prize, named for the Sudanese telecommunications billionaire who funds it, is awarded to a democratically elected African leader who serves his or her term and then steps down in accordance with the country's constitution. (As an added inducement, the prize winner gets another $200,000 annually for life.) One person definitely not in the running this year is Laurent Gbagbo of Cote d'Ivoire. He lost his race for reelection on November 28 but refuses to go. He and Alassane Ouattara, the recognized winner, have both sworn themselves into office and appointed cabinets, sparking yet another political crisis.

The stalemate in Cote d'Ivoire is a story that we have heard far too many times in Africa: an entrenched leader clinging to power after tainted elections. To name just two recent examples, Kenya descended into conflict after President Mwai Kibaki refused to cede office following a fishy reelection in 2007, and President Robert Mugabe of Zimbabwe bullied his way to a new term the next year in a campaign marred by widespread violence.

One silver lining of the Cote d'Ivoire crisis is the unified stand of African leaders and outside powers against the stubborn incumbent. The African Union (AU), the Economic Community of West African States (ECOWAS), the United States, the European Union, and the UN have backed Ouattara as president and called on Gbagbo to step down. The international effort includes both carrots and sticks. The U.S. government has suggested it might allow Gbagbo to retire in the United States, and ECOWAS has raised the prospect of using "legitimate force" to dislodge him.

African leaders' firm stand against one of their own marks a welcome break from the past. But good governance remains the continent's Achilles heel. According to the latest Freedom House rankings, only 9 of sub-Saharan Africa's 48 countries can be considered "free." Another 23 countries are "partly free," leaving a third of countries in the most repressive category. These totals are nearly identical to the rankings from 10 years ago. Another indication of the continent's political stagnation is the sorry fact that the Mo Ibrahim Prize has not been awarded since 2008; no suitable recipient could be found in the last two years.

Lack of good governance in Africa is galling because it condemns millions to poverty and fails to unleash the continent's great potential. A 2010 McKinsey Global Institute report offers some eye-catching findings on Africa's economic promise. Between 2000 and 2008, it was the world's third fastest-growing region, with real GDP expanding by more than 46 percent. Its economy is also broad-based, with natural resources accounting for less than a quarter of the continent's growth during that time.

McKinsey projects that by 2020, consumer spending in Africa will total $1.4 trillion, up from $860 billion in 2008. By 2040, the continent will likely have the largest working-age population in the world. Africa's full potential will not be realized, however, without substantial improvements in governance across the continent. Expanding the rule of law, fighting corruption, providing basic services and efficient administration, and ensuring orderly transitions of power -- all are necessary if countries are to provide the kind of secure climate that will attract investment and allow citizens to thrive.

Not all of these things will happen at once, and not all are needed for strong growth to begin. Indeed, many fast-growing countries in Africa and elsewhere struggle with ongoing governance challenges as they develop. But as long as governance continues to lag, Africa's development will remain uneven and will continue to leave millions of its people behind. Indeed, although the UN's Human Development Index shows many African countries making strong progress since 1970, it also shows that the only three countries with lower human development in 2010 than in 1970 are African.

How can good governance in Africa be promoted? Some have proposed heavy-handed approaches. The Oxford economist Paul Collier has called for long-term international peacekeeping missions and assistance for post-conflict countries. He also suggests a deal in which international powers would protect a government from coups--reinstating elected leaders by force if needed -- if the government agreed to international charters on democracy and transparent budgeting. Collier insists that the world has so much at stake in stabilizing post-conflict countries that we should not worry about infringing on sovereignty.

Another controversial idea comes from Stanford economist Paul Romer, who proposes that poor and struggling countries establish "charter cities" to be run by developed foreign powers. These powers would establish all the hallmarks of modern governance, attracting workers and investors and, in the process, building a shining example of progress to inspire the host country.

A third approach is to encourage countries to use their natural resources wisely by putting revenues into an international trust. The World Bank did just this in Chad. In exchange for help from the Bank in extracting and exporting its oil, Chad's government agreed to place most of the earnings in escrow and spend them on reducing poverty, promoting development, and saving for the future. However, Chad later reneged on these commitments and the World Bank ended the arrangement in 2008. A Bank evaluation cites several causes of the program's collapse, but lays most of the blame on the Chadian government.

Such neo-colonial solutions may be enticing in theory, but they face daunting obstacles. Few countries today would eagerly volunteer for long nation-building interventions. Charter cities raise a host of legal, logistical, and other questions. And as for international arrangements to manage public funds, the Chadian example shows that at the end of the day, resources belong to governments, who can do with them what they please.

This does not mean that outsiders cannot help promote and secure good governance -- especially at turning points such as today's crisis in Cote d'Ivoire. The African leaders pushing Laurent Gbagbo to cede power deserve credit, and sanctions imposed by the United States, the European Union, and others may also help. But when leaders like Gbagbo refuse to budge, the choice for international players comes down to a difficult and costly military intervention or a sheepish retreat. For better or worse, responsibility for good governance ultimately rests with a nation's leaders and people themselves.