I am writing this blog on a plane flying back from Kampala, Uganda; Nairobi, Kenya; and Abuja, Nigeria where I have spent the past week immediately following Election Day in the U.S. I have interacted with Africans from many nations, regions, tribes and allegiances during this period and clearly Africa is like a new world again, and America is its friend. The result of our Election, has given them new hope in spite of their acute awareness of our subprime mortgage debt, over-leveraged financial system, and economic malaise. Surprise, surprise, their banks and financial systems are in better shape than ours, as "they never bought our toxic instruments" - probably because there were too many eager buyers in the developed world. And while there may not be as many houses or banks as ours, their systems of mortgage financing are solidly asset based.
Barack Obama has over night changed the African mindset and "yes, we can" is echoed by everyone, in casual conversation with a taxi driver, woven into speeches by business people at meetings, ads for products or events in the newspapers, and even by government ministers. In some respects it has gone too far as many think the U.S. may now provide visas for all Africans, have jobs for them in the U.S., or at the very least give them a space at a U.S. school. If your name begins with "O" and you live in Kenya, in particular, you fantasize that you may be a cousin of Obama. Barack, which means blessing in Swahili, fortunately is not a name used commonly, as I was told the real name is Baracka so our President-Elect may have had his name shortened.
In Kenya, the day after the Election was a national holiday. All the embassies I came in contact with stayed open all election night with food and drink and TV watching for the hundreds they invited - many stayed from 8pm (Africa time 12pmEST) until 7am or 8am when the full results were known. What a difference I saw from the attitudes when I was last there six or twelve months ago: no heavy debates, but constructive dialogue about America resuming the role in leading the world in dialogue on the impact of the current financial crisis on their lives and when the impact would trickle down, which they fully expect, and share the hope that somehow Obama will be a savior.
In Nigeria, of course, they benefited from $150 barrel oil, but fortunately they based their budget on $65 a barrel and are adjusting to estimates of $45 for next year. It will restrict their budget surplus, since 75% of their export is oil. It will restrict the building of all too important infrastructure projects, particularly roads, dams, electric power lines. Uganda, so far, has no oil, but it is drilling. Commodity prices, particularly coffee, have been strong all year, although the recent declines will have a major impact on their ability to maintain GDP growth rates of 6 to 9% - which has been common in much of Africa in the past few years.
What impressed me above all was the intimate knowledge of not only our Election process, even down to the state level, but a sensitivity to the secondary effects of a slow down and recession worldwide. While Africa clearly has a very high level of poverty with incomes of under $2 per day, there is a growing lower-middle and middle class that have jobs, cars, trips, vacations, eating out, new clothes and accessories. These types of Africans are looking to a period of doing with less and don't seem to express any hardships in the process. I was intrigued to hear a group of ten around a dinner table talk about the fact that not only do Americans have to cut back but they, Africans themselves, could do "without another suit" have a "staycation" (vacation at home). And probably most simplistic or impactful, they universally said "you know we don't have to turn in our 3, 4, 5 year-old car when with a little fix up the car can run for another few years." The conversation vividly brought home to me that we, in the U.S., have been living in a society where few of us have been spending on real needs, but rather, satisfying our shopping impulses, subliminally put into our head by advertising and by the media. We have been indulging ourselves for years in excess in every aspect of our lives. We think we "need" things when, in fact, we all have more sweaters, shirts, ties, shoes, cars and "things" than we really need, while the Africans that we conjure in our minds as "needy" are cheerfully willing to do with less. Obviously, those in poverty who don't have their basic needs met will be more severely impacted and deserve our concern, but the rest of us - both African and American - can afford to cut back.
We won't know for a while when all of this will sort out, but hopefully the malaise that we all are all feeling one way or another currently will restore basic values and eliminate excess - much of which was financed by far too much speculation and excessive credit. And if Africans can tighten their belt, maybe we can or will and we won't be that much the worse for it. Maybe it's a new paradigm of family values. Sadly, it is going to result in dislocation in many industries and we will have to find ways to re-train and re-employ people in new areas to satisfy demand for new products and services that are only bounded by our creativity and imagination to develop.
Africa is a continent with 750 million people, rich in resources and rapidly taking its place in the modern world - much of its population still desperately needs our assistance, but there is a growing proportion of the population that will experience many of the economic setbacks we are currently facing in the U.S. and Europe, and they seem to be doing it with a stoic but constructive attitude.