Prospects for the Formation of Developmental States in...

International Review of Research in Emerging Markets and the Global Economy (IRREM)

An Online International Research Journal (ISSN: 2311-3200)

2016 Vol: 2 Issue: 1

757 www.globalbizresearch.org

Prospects for the Formation of Developmental States in Africa:

The Case of Zambia

Venkatesh Seshamani,

Professor of Economics,

The University of Zambia, Lusaka, Zambia.

E-mail: [email protected]

Obrian Ndhlovu,

Lecturer in Economics,

The University of Zambia, Lusaka Zambia.

E-mail: [email protected]

_____________________________________________________________________

Abstract

It is acknowledged that a developmental state, more than any non-developmental state has

more prospects of bringing about rapid growth and development. And yet, the number of

developmental states in the developing countries, especially in sub-Saharan Africa can be

counted on one’s finger tips. This is because a developmental state is premised on a number of

prerequisite criteria that most developing countries fail to meet. In recent years, the Economic

Commission for Africa and some African leaders have been strongly advocating for the

transformation of African countries into democratic developmental states. This paper discusses

the case of Zambia. It explains the concept of a developmental state, why Zambia is not a

developmental state, what it has to do in order to transform itself into a developmental state

and what lessons it can learn from states that have become developmental in order to achieve

this transformation.

___________________________________________________________________________

Key Words: Developmental state, neopatrimonialism, Zambia, Botswana

mailto:[email protected]

mailto:[email protected]





1. Introduction

The purpose of this paper is to provide a fairly comprehensive understanding of the concept

of the developmental state that is increasingly gaining ground in sub-Saharan Africa; to use

Zambia as a case study of a country that is currently far from being a developmental state; and

to examine what it would take for the country to become developmental. While there are several

studies both within and outside of sub-Saharan Africa of countries that transformed themselves

over a period of time from a non-developmental to a distinctly developmental state, this is the

first such analysis done for Zambia. The utility of this analysis derives from the fact that while

many valuable lessons can be learnt from the experiences of countries that have successfully

attained the status of developmental states, no country’s experience can be replicated in Toto.

As the ECA (2011) report states, “one size fits all” cannot be applied to the modelling of

developmental states in Africa. Depending on its own history and current scenario, a given

country like Zambia will have to determine its own optimal route to its developmental

destination by incorporating the salient features that characterize a developmental state.

Many concepts of contemporary significance have been traced back to much earlier times

than when they were developed formally in the sense in which they are contemporarily

understood. For instance, human development is a concept that became popular after it was

defined under the aegis of the UNDP by the late Pakistani economist Mahbub-ul-Haq and

economics Nobel Laureate Amartya Sen in 1990. Today development is understood mainly in

the sense of human development in which they defined it. But the seminal seeds of the concept

could possibly be traced to the scriptures in ancient India and to Biblical writings. (Seshamani,

2014).

Globalization is yet another concept that is of widespread contemporary significance that

has evolved prominently only over the past two and a half decades. But this concept again has

been traced back to the times of the Roman era two thousand years ago. (Salvatore, 2010).

The concept of the developmental state also falls in this category. Although it has been

evolving over the past three decades, writers have shown that it can be found in some nebulous

form in the earlier works of Paul Rosenstein-Rodan, Arthur Lewis, Tibor Scitovsky, Paul Baran

and others in the nineteen forties and fifties (Chang, 1999). In fact, the Economic Commission

for Africa (2011) even states that: “Over the ages, developmental states have evolved, and they

characterized the growth of the Netherlands in the 16th century, England in the 16th to the 19th

century, and Germany in the mid-19th to the early 20th century” (p. 96). The concept, however,

prominently came to light through the work of Chalmers Johnson (1982) wherein he tried to

explain the miraculous recovery of the Japanese economy after its destruction in the Second

World War.





In this paper, we begin with an elaborate description of the concept of the developmental

state. We then proceed to discuss some major issues and definitions related to the concept. This

is followed by a discussion of the concept within the context of Africa with Botswana as an

example of the concept and finally the case of Zambia.

2. The Concept of a ‘Developmental State’

Johnson (op. cit.) describes the developmental state or ‘plan-rational state’ as an

interventionist state that, through a planned process, establishes clear economic and social

objectives and influences the direction and pace of economic development in the country. (See

Economic Commission for Africa, ECA, op. cit.). This intervention is nevertheless not a market

substituting but a market conforming intervention. The main differentiating feature of the

developmental state in this regard is that direct intervention by the state in the development

process and not uncoordinated influence of market forces, is what determines the allocation of

economic resources. It must be highlighted here that there is little ownership of industry by the

government but a competent government bureaucracy rigidly regulates the private sector. So

essentially, a developmental state economy is a model of capitalism but it is a special form of

capitalism that is sometimes described as ‘state development capitalism’.

As Meyns and Musamba (2010) explain succinctly, Johnson’s developmental state, as seen

in the Japanese case, is characterized by three distinctive institutional features. One, it has a

small but inexpensive professional and efficient state bureaucracy (the Ministry of International

Trade and Industry, MITI, in Japan). Two, the bureaucracy directing economic development is

protected from all but the most powerful interest groups so that it can set and achieve long-

range industrial priorities. Three, the state must guarantee that policy tools give bureaucrats

additional authority to craft interventions in the economy without undermining market

principles.

In a sense, the achievement of a developmental state is to be viewed more as a prime

instrument than as an end in itself. According to Johnson, any country that wants to match the

economic achievements of Japan “must first of all become a developmental state and only

thereafter a regulatory state, a welfare state, an equality state or whatever kind of functional

state a society may wish to adopt”. (op. cit. p. 306).

Johnson’s clear-cut delineation of the concept of the developmental state notwithstanding,

there has subsequently been contributions by a plethora of other writers on what they think

constitute the essence of a developmental state. Consequently, as the ECA (2011) report states,

developmental states have differed in their evolution, context, trajectory and manifestations.

The ECA report amplifies on this statement as follows:

“There are therefore cultural and conjectural peculiarities in the emergence and nature of

developmental states around the world, and so ‘one size fits all’ cannot apply to the engineering





and modelling of developmental states in Africa, as elsewhere in the world. Developmental

states have emerged largely through trial and error and learning by doing, which have no

formally designed templates that aspiring countries can copy. However, while contexts may

differ, the concept of the developmental state is a useful analytical tool in explaining the nature

and character of states and the propensity for good economic performance by countries,

deployed across time and space. It lends itself to a degree of comparative analysis because

developmental states have discernible, common attributes that can be investigated across

countries and over time, even against variations in context”. (p. 97).

The last part of the above quote alludes to the possibility of comparative analysis across

spatial-temporal regions and contexts, by looking at some of the fundamental characteristics

that must be exhibited by any state before it can be deemed to be developmental. It is in this

sense that we have justification to make some meaningful cross-country comparisons. For

example, going back some sixty years in historic time, both South Korea and Zambia were at

similar unenviable states of underdevelopment. Many development analysts at that time saw a

positive future for African countries such as Zambia while dismissing the East Asian countries

such as South Korea as a lost cause. History has proved their prognosis to be completely wrong.

South Korea is today a developed country that has even become an aid giver while Zambia,

still poverty ridden, is currently in the throes of yet another economic crisis and is not in a

position to refuse any external assistance it can get from ‘good Samaritan’ donor countries.

What accounts for this difference? One important distinction between the two countries that

could majorly account for the differences in their respective growth and development

trajectories is that South Korea evolved into an indisputably developmental state while Zambia

has remained a developmental state aspirant.

Notwithstanding what we have described in the preceding paragraph, one must be careful

not to make one particular inference. And it is this. All development outcomes of a

developmental state need not be positive. Equally, it is not valid to conclude that no positive

development outcomes are possible unless and until a state becomes developmental. In other

words, there is no one–to-one correspondence between developmental states and positive

outcomes on development. While developmental states definitely have a high empirical

probability of generating positive development outcomes, this may not invariably be the case.

Mkandawire (2001) wrote in this regard:

“If a developmental state is not to be deified into some kind of omnipotent and omniscient

leviathan that always gets what it wants, then the definition must include situations in which

exogenous structural dynamic and unforeseen factors can torpedo genuine developmental

commitments and efforts by the state, as happened in some of the most successful Asian

developmental states”. (p. 291).





Indeed, despite being acknowledged as an exemplary developmental state consistently over

more than four decades, South Korea faces today several problems such as declining growth,

rising inequality, high youth unemployment, mounting debt and a challenge to liberal

democracy – problems startlingly similar to those that Zambia too faces today! And if such

were the case, a logical conclusion would be that transforming itself into a developmental state

could not in itself provide a quick panacea for Zambia’s development challenges. What must,

however, be recognized here is that the developmental state did give South Korea a huge push

start toward progress as in the case of other countries that embarked on a similar path and that

problems started appearing only after it had attained a mature stage of development when it

would have the capacity to deal with the problems.

Despite differences in their manifestations, there are developmental states across all parts of

the world. Thailand, Singapore and South Korea in East Asia, China in South Asia, Brazil in

South America, France and Sweden in Europe, and Botswana and Mauritius in Africa are some

prominent examples.

3. Theoretical Issues and Other Definitions of the Developmental State

If a developmental state is one in which there is state intervention with the intention to

produce development outcomes, then two issues need to be resolved:

Issues relating to the kind of state intervention required to produce developmental

outcomes;

Issues relating to what constitutes development outcomes.

As regards the first issue, what is more relevant is not the quantum of intervention but the

nature of the intervention. The concept of the developmental state stresses the primacy of

politics. The nature of state intervention is closely correlated to the way in which the state’s

bureaucrats and technocrats function. If these bureaucrats wield political power wisely, they

can contribute to accelerating growth and human well-being.

Robert Wade (2003) envisages a developmental state as one characterized by “governed

markets”, one in which there will be a “synergetic connection between a public system and a

mostly market system, the outputs of one becoming inputs for the other”.

Wade underscores the idea that the rule-making power of the bureaucrats can serve to

enhance economic growth only if bureaucrats construct economic rules that advance the long-

term capital and technological character of the nation as a whole, rather than simply enhancing

the power of government agencies or lining the pockets of predatory rulers. (Italics ours).

In more popular contemporary jargon, what is being stressed is the importance of ‘good

governance’ by the state. Unlike the Washington Consensus based on neoclassical thinking that

argues for minimizing the role of the state, the advocacy here is for improving the role of the





state by addressing problems that may cause poor state intervention that may weaken the link

between state capacity and development effectiveness.

There is no unique resolution to the second issue. The most common outcome that has been

discussed in the context of the developmental state is economic growth. But several writers

have said that while economic growth is important, one must also produce other desired

outcomes. According to Leftwich (2000, 2008), there has to be legitimacy attached to the

economic growth which can happen only when there are significant increases in the standard

of living for a large number of the population.

Evans (2010, 2011), using Nobel Laureate Amartya Sen’s capability approach, argues that

a developmental state is one that focuses on the development of capabilities of individuals

rather than just economic gains.

Yet others such as Doner and Slater (2005) define developmental states as those that possess

the ability to upgrade from lower value to higher value economic activities. This was a key

element in South Korea, Singapore and Taiwan. But as Routley points out, if such a definition

is used, a country like Botswana, which is acknowledged to be a model developmental state in

Africa, cannot be deemed to be a developmental state, since Botswana has struggled to even

diversify the economy, let alone upgrade.

One consensus that has emerged from the plethora of writings is that a state in order to be

recognized as developmental must possess two things in combination: developmental

structures (state capacity) and use of those structures to perform development roles. The key

phrase here is ‘in combination’. It is possible that a state has both the development structures

and the development vision but they exist separately. It cannot be called a developmental state.

Where a state has capacity but is not closely linked to any development vision, it can be an

effective state but not a developmental state. That is to say, a developmental state must be an

effective state but an effective state need not be developmental.

Using the above features, Routley (2012) provides her working definition of a

developmental state as follows: “A developmental state has sufficient state capacity to be

effective in its targeted areas and has a developmental vision such that it chooses to use this

capacity to work towards economic development – In other words, it has developmental

structures and performs developmental roles”. (p. 8).

The above definition is in line with the earlier definition of Chang (1999): A developmental

state is one that pursues policies focused on coordinating investment plans; has a national

development vision; engages in institutional building to promote growth and development; and

plays a critical role in resolving the conflicts that arise out of reactions and counteractions to

the development trajectory between winners and losers. (Cited in Meyns & Musamba, 2010).

Based on a survey of the main literature, Routley (op. cit.) brings out the following

fundamental features of a developmental state:





1. A capable, autonomous (but embedded) bureaucracy (Evans, 1995);

2. A political leadership oriented towards development (Musamba 2010, Fritz and

Menocal, 2007);

3. A close, often mutually beneficial symbiotic relationship between some state agencies

(often discussed as pilot agencies) and key industrial capitalists (Johnson, 1982, 1987);

4. Successful policy interventions which promote growth (Wade, 1990; Beeson, 2004).

(Routley, 2012, p. 8).

Based on the above characteristics, Routley (2012) provides a categorization of

developmental states as shown in the following table:

Table 1: Categorization of Developmental States

States Description Attributes

Japan, South Korea, (Taiwan) The Big Three – Japan is often

seen as the first developmental

state, both in terms of its prior

uptake of developmental state

attributes and having been the

first state to which the label has

been applied. Despite variations

between the three, the

similarities of South Korea and

Taiwan’s strategies to each

other and to Japan means that

they are often seen to cohere as

a group and are often seen as the

model developmental states

- Industrial based

economy;

- High economic

growth rates;

- Professional

bureaucracy;

- Autonomous

state

bureaucracy

Malaysia, Indonesia, Thailand

and Philippines South Asian Developmental

States – these states also

achieved significant economic

growth around the same period

as The Big Three. However,

their growth levels were not

quite so high and they were seen

to have a less autonomous state

bureaucracy and seen by some

to have more issues with

corruption – although not to

have become predatory states.

- Economic

growth, more

FDI based than

the Northeast

Asian Big

Three;

- Good economic

growth rates;

- Less

autonomous

bureaucracy

than The Big

Three.

Botswana Botswana is frequently held up

as an example of African

developmental state. What

perhaps marks Botswana out

more starkly, however, is the

natural resource based economy

on which this developmental

state has been built.

- Good economic

growth rates;

- Natural

resource-based

economy;

- Democratic (de

facto one party

state).

Mauritius, Chile, Costa Rica,

Kerala (one of the states in

India)

Social Democratic

Developmental States – These

are states which have achieved

a reasonable level of economic

growth but have also invested

heavily in reducing poverty and

social exclusion. They are also

democratic and have a fairly

open political space.

- Reasonable

economic

growth rates;

- Democratic;

- State

investment in

social

protection,

health and

education.





Cote d’Ivoire (1960 -1975),

Malawi (1964 – 78), Kenya

(1965 – 75), Tanzania (1967 –

1978), Rwanda (2000 – 2010)

Developmental

Patrimonialism – These states

have been identified as

continuing to operate in a

patrimonial manner but through

centralized rents and a civil

service that is to some extent

autonomous to have achieved

some significant development

outcomes. The gains obtained

during these periods however

have not been sustained.

- Good growth

rates;

- Patrimonialism;

- Centralized

rents;

- Relatively

autonomous

civil service.

Ethiopia, South Africa Aspirational Developmental

States – Key political actors in

both South Africa (the ANC)

and Ethiopia (the President)

have publicly advanced the case

for pursuing a developmental

state strategy. Whether and how

this project will progress is

unknown.

- Political actors

stating an

intention to

create a

developmental

state.

China China’s recent impressive

economic success has led a

number of scholars to see it as

having been in line with the

developmental state model

since the mid-1980s (Evans

2011).

- Good growth

rates;

- State

investment in

infrastructure,

education and

health;

- Sustained

economic

growth

Source: Routley (2012), p 10 – 12.

4. Some Further Reflections on the Developmental State Concept in the

Context of Africa

Although developmental states are found in all parts of the world, they are nevertheless

scarcely spread across the globe. Given that a large majority of countries even today fall in the

category of developing countries, one would have expected a much larger prevalence of

developmental states. Unfortunately, developmental states are the exception rather than the

rule. The rule seems to be non-developmental states of various kinds. State failure rather than

success seems to be the pervasive norm.

Dixit (2006) cites Rotberg (2004) who provided a taxonomy of state failure, labelling

successively worse cases as weak, failing, failed and collapsed states. At the time his paper was

written, Rotberg counted 30 weak states, 7 failing states, 2 failed states and 3 collapsed states

– unpleasant statistics indeed!

A major reason that is cited for the prevalence of such states is that the portrayal of

benevolent governments that seek to promote social welfare is an ideal against which real

governments are in sharp contrast. Real governments turn out to be typically predatory





governments that extract economic rents from its citizenry. A ‘grabbing hand’ and not a

‘helping hand’ in fact characterizes the state.

It is obvious knowledge that many of these failed states are in Africa. One may wonder why.

One reason could be that African governments are not in essence democratic. Even though the

erstwhile one-party dictatorial rule was replaced in most African countries by multi-party

systems, many of them have remained de facto one-party and one-man rule. All the same, this

cannot be an adequate reason since many successful developmental states have not been

democratic. Singapore is still a mildly repressive dictatorship. South Korea is struggling to

establish democracy. Thus, democracy and developmental state need not go hand in hand.

Fritz and Menocal (2006) put forth the argument that political economy factors and their

social underpinnings lie at the heart of why some states are developmental while many others

are not. In their words: “the dynamics engendered by the interaction of certain social and

political structures in many developing settings are not propitious to development. Such

structures – clientelism, patronage and populism, as well as ‘neopatrimonialism’ and state

capture – are not immutable, but they can be deeply entrenched. The challenge for the

international community is to determine how it can best support reform efforts that engage both

directly and indirectly with such structures towards the goal of creating more modern states”.

In the above quote, Fritz and Menocal have captured the scenario that has been obtaining in

many African states. And today there is a growingly vociferous advocacy for the developmental

state in Africa. It is recognized as being central to the process of accelerated economic growth

and social transformation of any country.

The Economic Commission for Africa, ECA (2011) identifies the following requirements

for the construction of developmental states in Africa:

1. Capable and farsighted democratic leadership;

2. The creation of effective development coalitions;

3. The building of transformative institutions, and primarily a competent and professional

bureaucracy;

4. A focused industrial policy with a phasing-out process to protect local industries, which

is necessary for their growth and consolidation;

5. Heavy investments in skills, education, health care and infrastructure (including

economic infrastructure) for expanding human capabilities.

The above conditions are not beyond Africa’s reach. Given strong political will and vision

in combination with human capabilities to articulate and implement the vision, a developmental

state is achievable in any African country. Going to our table above, the fact that some African

countries have been ‘developmental’ during certain periods of time, especially in the incipient

years after independence, is proof enough of the possibility of resuscitating the developmental

state in this continent.





This discussion will not be complete without a mention of the passionate prescription of the

developmental state for Africa by the late Prime Minister of Ethiopia Meles Zanawi. He agreed

that most African states were predatory states but the solution did not lie in transforming them

to pure market-driven states. He viewed the South Korean and Taiwanese models as among the

best illustrations of the developmental state. He argued that one could not change a rent-seeking

political economy just by reducing the size and role of the state, since a neo-liberal paradigm

did not allow for technological capacity accumulation, which was at the heart of development.

For that, an activist state was needed that would allocate state rents in a productive manner.

After the passing on of Meles Zanawi, the mantle of carrying on the passionate advocacy of

the democratic developmental state has been taken up by President Paul Kagame of Rwanda.

Speaking at a symposium on the developmental state organized by the Meles Zanawi

Foundation on August 21, 2015 in Kigali, Kagame reiterated Zanawi’s views.

Kagame said: “He (Meles Zanawi) rejected the false choice between the state and the

market. Every developed economy, without exception, is the fruit of a free market, and a strong

developmental state, working in tandem. The orthodoxy of shrinking the state to the bare

minimum, and replacing it with externally-funded non-state actor (here you can say NGO), left

Africa with no viable path out of poverty”. (Kagame, 2015).

Kagame further stressed that democracy and development are inseparable and that there was

no trade-off or choice between them. There may be some examples of non-democratic

developmental states, but they should not be the example for Africa.

While on Africa we shall now look at Botswana, the oft-cited exemplar of an African

democratic developmental state.

5. Why Botswana is a Developmental State?

Just as South Korea was initially written off as a country with no future, Botswana too at

the time of independence was one of the poorest African countries and no one could have

predicted it would transform itself into a developmental state within a few decades. But

Botswana has distinctly come to be known not just as a developmental state, but a democratic

developmental state. And just as The Big Three – Japan, South Korea, and Taiwan - are

described as the ‘East Asian miracle’, Botswana is regarded as an ‘African miracle’.

What did Botswana do to earn the sobriquet of an African miracle? Meyns in Meyns and

Musamba (2010) describes how Botswana addressed each of the prerequisites of a

developmental state.

In the first place, Botswana was fortunate to begin its development odyssey since

independence with a sustained development-oriented political leadership that made economic

development as the sole overriding objective. The leadership provided by both Seretse Khama,





the country’s first President and his successor Quett Masire has been cited as the principal

reason for the country’s success. They worked to promote the principles of ‘democracy,

development, self-reliance and unity’. There was continuity in development policy under the

aegis of National Development Plans. The policy choices were good and growth promoting.

It is also emphasized that Botswana’s political leaders did not succumb to practices of

neopatrimonialism and corrupt self-enrichment. Meyns states that “the country has avoided the

major pitfalls of primordialism which have led to the demise of so many other sub-Saharan

African countries”. (p.47).

In the second place, Botswana set about gradually building state capacity, creating a

competent and effective public service which in turn, attracted foreign aid and private

investment and facilitated the rapid growth of the economy. And alongside building a

bureaucracy based on merit, the political leadership also endowed it with autonomy in pursuing

the country’s development objectives. The civil service was made immune from political

interference, thereby shielding it from corruption and guaranteeing its professionalism. Meyns

states that: “The Ministry of Finance and Development Planning has become the embodiment

of the developmental state in Botswana”. (p.47).

It should be noted here that as per the 2015 Corruption Perceptions Index compiled by

Transparency International, Botswana had a score of 63 (0 indicates highly corrupt and 100

indicates very clean) with a relatively high rank of 28 out of 175 countries. Botswana for quite

some time now has been assessed as the least corrupt country in Africa.

Thirdly, Botswana encouraged the development of a production-oriented private sector.

Since independence the country welcomed private investment, and, according to Meyns, “This

was one of the wise decisions that the country’s founding leaders took”. (p.49). It made

Botswana a market-based economy on the one hand while the state remained as the main

propeller of growth on the other. Meyns quotes Edge (1998) to bring this out: “By planning

within the context of a market economy, government policy has tended to influence the

direction of government expenditure during the planning period while providing an

environment in which the private sector activity can thrive”. (p.49).

Fourthly, Botswana has promoted performance-oriented governance. And despite its

blessing in the form of diamond mining, the country has managed to avoid the resource curse

by ploughing back large parts of its mining revenue into development-related investments such

as roads, water supply, energy, education and health, which have contributed significantly to

improving the living conditions of the population.

Notwithstanding Botswana’s transformation into a developmental state and the consequent

achievement of one of the highest sustained growth rates in the world, some fundamental

problems of development remain. These are:





- High levels of poverty, inequality and unemployment; in the language of the

UNDP, it is tantamount to saying that the growth has been jobless and ruthless

growth; it has also not been inclusive in the sense of benefiting all segments of

society;

- Botswana has also not been able to diversify its economic activities. There are not

enough linkages established between mining and other sectors.

- As pointed out earlier there has also not been any upgrading of economic activities.

This analysis is testimony to the contention that a developmental state is not a guaranteed

solution to a country’s economic ills. A developmental state too has its own share of problems.

But what one can confidently say is that a developmental state more than any non-

developmental state has a greater chance of bringing about rapid growth and development.

6. Why Zambia cannot be described as a Developmental State?

A developmental state is a much more demanding concept than what may appear on the

surface. Johnson’s pioneering work (op. cit.) on the developmental state envisages a fragilely

balanced optimal mix of state intervention and the free play of market forces. Market forces

have the capacity to ensure efficiency while state intervention takes care of balanced, inclusive

and equitable growth and development. The success of a developmental state, therefore,

depends on how meticulously it can achieve this balance.

Zambia’s history since independence shows that its development trajectory has been

characterized most of the time either by ‘too much state intervention and too little market’ or

by ‘too much market with too little state intervention’. And for some time now, Zambia has

been having an inept public sector and a frustrated private sector with neither having

meaningful interactions with the other!

Up until the advent of the Third Republic in 1990, the country was managed by a central

authority that spread its tentacles like an octopus over the entire economy, providing answers

to all the basic economic questions that one hears in an ECON100 class – what to produce, how

much to produce and how to produce. With the market and the private sector having little scope

to participate in the economy, inefficient allocation of resources resulted from a combination

of inappropriate policies and adverse external environment. When it became a chronic

phenomenon, it led the country into a deep crisis.

It was not as though the political leadership was at that time devoid of any development

vision. Kenneth Kaunda propounded his development philosophy of humanism, which

emphasized that man indeed was the centre of all activity.

The country also set up institutions such as the National Commission for Development

Planning and invested its resources in social and physical infrastructure, notably education that

included the creation of the University of Zambia.





All this was possible because at independence Zambia was a fairly prosperous country with

a good stock of foreign reserves. But even as these reserves got depleted, the country faced a

massive external shock from which it could not recover. The price of copper, Zambia’s main

export and the principal source of foreign exchange, collapsed while the price of oil, which

Zambia had to wholly import, quadrupled in 1975, changing the face of the economy almost

overnight. The political leadership could not make timely adjustments to the changed

circumstances so that by the early eighties, from a prosperous country it became a crisis-ridden

country with mounting levels of poverty. Ad hocist adjustments only made the situation

deteriorate from bad to worse.

Then came the Third Republic with a new political dispensation that moved hastily towards

implementing policies based on the Washington Consensus that liberalized the economy,

established the primacy of the market and competition but reduced the role of the state in

determining the country’s development trajectory. This change managed to stimulate growth

by getting the erstwhile-distorted prices right, but the other objectives that were the

responsibilities of the government suffered. The result was a further rise in poverty and

inequality.

Successive governments brought in their own ideas of how the economy should be run. The

result was there was no continuity and coherence in the development strategy. The most

poignant aspect of this is that a political regime change tended to discard even the good aspects

of prevalent economic strategies and policies in order to completely dissociate itself with the

erstwhile dispensation. This resulted in a tendency to throw the baby away with the bathwater.

Several examples can be given of such tendencies that led to ad hocist approaches to

development.

When the MMD (Movement for Multi-party Democracy) government of President Chiluba

assumed office, among the many changes it brought about was its decision to dismantle the

National Agricultural Marketing Board (NAMBOARD) and discard the Agricultural

Cooperative Marketing Unions that were effectively engaged in collecting the surplus produce

of farmers even in the remotest parts of the country. The reason was simply that these

institutions were associated with the former UNIP (United National Independence Party)

government of Kenneth Kaunda. The Chiluba government doled out instead huge sums of

money as loans to private traders to distribute inputs and collect outputs. But the traders used

the money to invest in lucrative Treasury Bills and not for the purpose for which the loans were

given. This led to a significant rise in rural poverty. Thousands of small farmers whose produce

remained uncollected sank into penury.

Again, when the Mwanawasa government took over from the previous government, they

wanted to discard the then just prepared Poverty Reduction Strategy Paper (PRSP), not





adequately realizing that this was a requirement of the IMF for assistance to Zambia. And the

PRSP was eventually discarded and replaced by a Five-year Plan document.

In sum, over the six decades since independence, the Zambian economy was driven first by

plans, then by no plans, then by some plan substitutes (PRSP) and then again by plans,

depending on the predilections of successive leaders. These varied development strategies have

produced sporadic developmental outcomes in a staccato sequence. But this is a far cry from

the foremost requirement of a developmental state. And poverty remains the Zambian

economy’s lingering Facebook profile!

Another important point to note is that while reforms are necessary, the pace of reforms has

to be determined by what the country can bear. In a country that has been characterized by a

protracted period of one kind of regime, a big bang approach to change it dramatically could

end up doing more harm than good. South Korea adopted a gradualist path of change from

dirigisme to neo-liberalism and this helped the country to adapt to changes without causing

major disruptions to the economy and to people’s living standards.

In Zambia, when the Chiluba government took over, wanting perhaps to demonstrate its

earnestness to transform the long-prevalent economic regime characterized by controls and

central planning into a liberalized market-oriented environment, it began to effect policy

changes at a pace that produced some consternation even among the IMF and the World Bank

that were the principal advocates of such changes! In hindsight, this may have been a major

reason why the economy took a longer time to adjust to these adjustment measures! In the

interim, there was again a rise in poverty and inequality.

The above point is particularly significant when one notes that over time, the country’s

institutional capacity has also been weakened by corruption and political patronage. This has

impeded the development of meritocracy in the public service, and hampered bureaucratic

autonomy. There is also a lack of inspiring political leadership with a clear-cut vision for

Zambia’s future.

In here, it may be mentioned that Zambia’s score on the Corruption Perception Index for

2015 is 38 that places it at a relatively low rank of 76 out of 175 countries. One can see the

striking difference when one contrasts this with Botswana’s performance on this index

described in the earlier section.

It will be clear that the transformation of Zambia into a developmental state will not be a

smooth one. It calls for collective and inspiring national leadership that will be strident in its

advocacy for a developmental state and let all stakeholder groups know that from now on it

means business in fulfilling the basic requirements of a developmental state.

In the next section, we suggest some immediate steps that Zambia needs to take to achieve

this objective.





7. What Prerequisites need to be met for Zambia to become a Developmental

State?

The foremost requirement for Zambia to be transformed into a developmental state is to

recognize that a long-term vision based on consensus is necessary. Political regimes may come

and go but the development ethos and vision must persist over the long period. The advent of

a new political regime must not torpedo the existing development programmes simply on

account of political animosities between political parties or even among leaders within a

political party. There has to be developmental state persistence.

To achieve the above, there has to be a serious dialogue among all stakeholders including,

in particular, political parties on the formulation of a common development vision and an

assurance that no matter which party or leader comes to power, this vision will continue. In

other words, there has to be a long-term development compact that there will be a long-term

phase of unbroken political will to follow development policies.

Secondly, there has to be a constant monitoring of the changes happening in a dynamic

globalized world and ones’ own economic policy regime must be continually adapted to be in

sync with those changes. As we have already stated, it is the failure on the part of the Zambian

policy makers to do this that led the country to a crisis by the early 1980s. No timely attempts

were made to adapt to the onset of the adverse circumstances since the powers that be persisted

in the illusory hope that this phenomenon would be short-lived. It was not short-lived and the

country fell into a deep crisis, joining the ranks of the highly indebted countries with sharp

increases in the levels of poverty and inequality.

Even today (2016), the looming power crisis that Zambia faces with its potential to majorly

disrupt the growth trajectory, is symptomatic of inadequate preparedness in terms of strategic

planning.

Thirdly, there has to be huge and concerted efforts to build state capacity to implement

development policies. For this there is need for huge investments in providing quality education

and health care. Again, Zambia can take a cue here from Botswana, which spent 20% of its

annual budget on education.

Fourthly, the bureaucracy must be a meritocracy. Public positions should not be treated as

sinecures with which to reward political stooges and sycophants even though they may not

possess the requisite qualifications to hold such positions.

Fifthly, the meritocratic public service must be endowed with a significant amount of

autonomy, free of political interference.

Sixthly, in a globalized world in which knowledge and technology is key, there is a constant

need to upgrade the level of economic activities. The world is advancing rapidly towards a

cashless, paperless, online, internet-driven, digital economy and Zambia will have no choice

but to gear its development programmes and activities to be in sync with these changes, no





matter how Herculean a task this may appear at first sight. Given a strong collective will and

inspiring leadership, nothing is impossible.

Finally, the country needs to adopt a draconian approach to root out corruption and

strengthen institutions of governance and democracy. In the face of rampant corruption, no

development is possible even if all other preconditions are met.

8. Conclusion

African leaders the continent over are eager to establish developmental states in their

countries. With strong commitment, it is not an impossible task to accomplish. However, in

many countries that are not yet developmental, the path ahead is by no means a bed of roses.

The contribution of this paper is to examine for the first time the prospects for Zambia to

transform itself into a developmental state and to demonstrate that the road ahead has numerous

challenges that must be overcome. Several multidimensional and multidirectional policy

reforms need to be implemented on a sustained basis before the desired goal can be achieved.

Acknowledgement: This paper was prepared under the aegis of a SAIPAR (Southern Africa

Policy Analysis Research) project with sponsorship of the African Development Bank (AfDB).

Their support is duly acknowledged.

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