1050x300-AS-Out of Africa

Out of Africa

Author(s): Andrew Sheng

Date: Mar 19, 2014

Theme(s): Finance & Macroeconomics

Publications: Opinions & Speeches

Asia, like Africa, needs to restructure the way it thinks in order to take ownership of its future.

Asia has been a major beneficiary of globalization, having built the global production chain that supplies the West with consumer goods. The global financial crisis of 2007-2009 opened a whole can of worms about the benefits of globalization, as the confidence of the West was shaken to core.

Some people think that the rise of Asia is inevitable, going so far as to say that China will overtake the U.S. as number one. But as the Asian Development Bank study on Asia 2050 reminded us, nothing is pre-ordained or inevitable. China has to break out of the middle-income trap first, as do Thailand, Malaysia and a number of Asian economies.

Indeed, the withdrawal of quantitative easing (tapering) has shaken the confidence of many emerging markets, exposing their vulnerability to hot capital flows. Financial markets today worry about the Fragile Five – Indonesia, India, Brazil, Turkey and South Africa. If advanced markets are on the recovery track, who needs to invest in high risk emerging markets?

As Dr. Victor Fung said at the Fung Global Institute Asia-Global Dialogue last December, “Asia needs to re-think traditional approaches to growth, employment and sustainability, given the combined impacts of re-balancing, changing demographics, urbanization and environmental stresses.”

The problem is not that we are confident of our future, but that we are all insecure. This is no longer a unipolar world, but a multipolar situation where no one is fully in charge.

Because Asia is a mosaic of different countries, cultures and even civilizations, there can be no single voice in Asia. The future of Asia will be shaped by the confluence of these differences and their complex engagement with the West.

Recently in Kuala Lumpur, I was given a remarkable book about “Emerging Africa” by Dr. Kingsley Chiedu Moghalu, currently Deputy Governor of the Central Bank of Nigeria. Dr. Moghalu comes from the new generation of post-Independence young Africans who studied in the West and is back in Africa, helping its rejuvenation.

Prior to the freeing of Nelson Mandela and ending of apartheid in 1990, Africa was considered a dark continent, burdened by its history of slavery and colonial domination, and a laggard in world affairs. Today, it is viewed as a new frontier in the relentless march of globalization, a rising lion that seeks to compete with Asian tigers.

But Moghalu asks the right questions: What is today’s Africa to Africans and what should it be?

These are exactly the questions that should also be asked by Asians. In the last 20 years, with the rise of China, India and ASEAN, Asia has transformed beyond belief, creating global convergence between rich and poor countries, even as social inequities worsened at the national level.

Asia as a whole will need to engage the rest of the world, even as its own GDP grows in relative strength. As former Governor of the Bank of Israel, and currently nominee to become Federal Reserve Board Vice-Chairman, Stanley Fischer, said at the Asia-Global Dialogue last December, “if emerging markets want a greater say in the global economy, they must contribute ideas and proposals on how to improve the system.”

Seen from a long historical perspective, Africa shares the same colonial history as large parts of Asia. Between 1870 to 1910, as the European powers competed for power, Africa was carved into different colonies, almost exactly as Asia was carved up, except that China was too large to swallow. The period of colonization, which did not end in Africa until the fall of Apartheid, was to leave indelible marks on the African psyche. Hong Kong remained a colony until 1997.

Mogalu framed the issue correctly, when he argued that Africa’s “rise” has not yet happened because the factors that will drive the continent’s renaissance are not yet in place. The chief factor is “a re-invention of the African mind; a re-invention that imbues it with a worldview, mental infrastructure, a philosophical foundation for its prosperity in which Africans think through the world and their place in it before they embark on action.”

Asians are further advanced than Africa in their hard infrastructure of roads, bridges and airports. But what is the mental infrastructure that each Asian nation needs to construct in engaging the modern world, given the disparities of class, race, culture and language?
This is a journey with many twists and turns. What did our ancestors think when they journeyed out of Africa and began to populate Asia, reaching not only to the Pacific, but also crossing the Bering Straits to begin to populate the Americas? The last wave of people out of Africa led by Moses ended up with the Ten Commandments.

Moghalu states succinctly the issue that confronts Africa and Asia alike: “Africa has no automatic future. The continent will have a future that it shapes by itself, whether one of prosperity or one in which this moment in time will look, in hindsight, much like the hopes and euphoria yielded by the decolonization of the continent half a century ago.”

Having grown up in a former colony, I have come to realize that the most complex problem in forming one’s own mental infrastructure is the colonization of the mind. As several Canadian social psychologists (Henrich et al, 2010) observed, the bulk of research work on human behavior and psychology in the world’s top journals are based on samples drawn mostly from Western, Educated, Industrialized, Rich, and Democratic (WEIRD) societies. The scientific question is whether the WEIRD samples are the outliers or whether the rest of the world are the outliers?

We cannot answer these complex questions until we dig out the data and perspectives from the rest of us. And that is the question out of Africa for Asians.

 

The views expressed in this article are the author’s own and do not necessarily reflect Fung Global Institute’s editorial policy.
This article first appeared in the The Star Online Business News Section March 15, 2014