11, June 2020
The role of Institutional change in reviving Cameroon’s economy 0
Since late 2016, the Republic of Cameroon has been going through a devastating armed conflict that has worsened what was already a fledgling economy. Historically, this civil strife can be traced to constitutional crisis in the governance process of the entire nation (Konings & Nyamnjoh1997). The blatant disregard for the culture, traditions and customs of the Anglophones were fundamental threats to the rule of law that heightened tensions leading to the current socio-political impasse. A Transparency International report identified Cameroon’s judiciary system as the most corrupt in Africa. In the larger study of seven countries within the continent, one out of five persons interviewed admitted they had offered gifts to judges or related judicial matters. In Cameroon 80% of those interviewed perceived the judicial system is rather very corrupt (Koschel,2007).
Moreover, the dictatorship style of leadership and the unchecked power of the executive branch of government that undermines major cooperation and inclusion of the various regions have been counterproductive economically. According to Douglas North, social and legal norms and rules are foundations for the basis of institutions that underlie economic activities (North,1990).
This memo seeks to examine how institutional change can revive Cameroon’s economy. Institutional economics is defined as a study in economic history which focuses on the costs of human coordination and cooperation through time, which is essential in bringing about change in the society (North,1990). We will achieve this objective by looking at some principles of governance that can positively influence economic activities for growth and development. Among other things, this memo will consider the rule of law and economic growth, abuse of power, and social cohesion as essential elements in economic activities.
What is at stake?
In consideration of the fact that effective institutions promote economic growth by reducing transaction costs of operating in the economy, whereas ineffective institutions dis-incentivize market participants and lead to economic decline (North, 1990), how can Cameroon revive its institutions in order to foster economic growth?
Evaluation of Findings and Conclusions
The rule of law is essential for the regulation of markets, property rights, checks and balances of the executive branch of government, all of which are foundational to economic growth. In this regard, North indicates that formal constraints such as laws and a constitution are necessary in the harmonious functioning of every institution. In addition to these formal constraints, culture and ideologies make up informal constraints of the institutions. The absence of the rule of law often leads to anarchy and this is true of most countries that are going through civil wars. It has been established that civil war tends to reduce growth by around 2.3% per year; with civil wars (in his dataset) averaging seven years in duration, the typical war leaves a country 15% poorer than it otherwise would have been (Collier, 2005).
Collier’s findings further buttress the position that the ongoing civil war in Cameroon has led the nation to financially disastrous condition. In fact, “many countries in Africa without any system of good governance in place show an association between conflicts and poor law enforcement in protecting the natural resource base and in observing human rights” (as cited in Yiew et al., 2016. Pg. 3744).
According to a UN report, corruption, illicit trade and money laundering contribute to State weakness, impede economic growth and undermine democracy. These activities eventually create a permissive environment for civil conflict.” (UN Report,2004).
The absence of the rule of law has far reaching effects on the efficiency and effectiveness of institutions. Lessig (2013) explains that “institutional corruption is manifest when there is a systemic and strategic influence that undermines the institution’s effectiveness by weakening its ability to achieve its purpose, including to the extent relevant to its purpose, weakening either the public’s trust in that institution or the institution’s inherent trustworthiness.”(Lessig, 2013 p. 553).
The downward slope regarding the rule of law is closely related to abuse of power. Prior to the ongoing conflict in Anglophone Cameroon, even to this day, the executive branch has abused power with impunity. Throughout our nation’s history, presidents have targeted their political opponents as we see it unfold in the ongoing conflict (Tumi, 2006). This is detrimental to the nation’s economy because abuse of power is a guaranteed source of dissension and frustration; some of the ruling elites must be aware of impending political instability from a culmination of these negative feelings (North, 1990).
Moreover, political scientists and legal scholars attest that institutional checks on executive discretion, including through independent judiciaries, are integral to the very concept of the rule of law. Such checks and balances are economically important because of the classic time-inconsistency problem (Kydland & Prescott, 1977). In the same vein, Haggard & Tiede maintain that “the rule of law, property rights, and contract enforcement cannot be credible unless there are effective limits on executive discretion” (Haggard & Tiede, 2011. p.674).
In consideration of the heavy toll of corruption in Cameroon, evident not only in the judiciary, but in the widespread of bribery in contracts, taxation of imports, and the embezzlement of state funds, the economy cannot thrive because: “A predatory government acting on its self-interest is prone to squander the wealth of the country and exploit the business community through unjust taxes and misappropriation of resources and profits. In the long run, these self-preservation strategies can eventually lead the ruling dynasty to its destruction.” (North, 1997, p. 154). The World Governance Indicators, specifically the indicator on control of corruption, placed Cameroon in the lowest 10 percentile, while also ranking it low (25 percentile or lower) for the remaining indicators (Broadman & Recanatini, 2001).
On the other hand, social cohesion and the prevalence of justice provide a favorable environment for businesses and investors. The inevitable result is security of life and property which in turn encourages integrity, hard work, entrepreneurship and technological progress, while its absence defeats economic motivation. In line with institutional economics, transaction costs of doing business escalates with the prevalence of injustices. And, in the end, more complex contracts and the alliance between business and politics become the norm, causing the economy to suffer (Khalid, 2015). Khalid further argues that the “crowding out” of investments is bound to emerge and tax collections will decline as enterprises reassess their risks and returns from operating in that economy (Khalid, 2015).
In reality, social cohesion does not only attract investors, but it equally provides a flourishing socio-political environment that boosts both investors’ and consumers’ confidence. It is within such environments that institutions and markets thrive. As Khalid (2015) points out, social cohesion and institutional efficiency consistently have an equal and important effect as does resources endowment in bringing about economic development and higher civilization.
Recommendations
In order to restore some credibility to institutions, there is urgent need to revisit the training of administrators and legal experts. It is well known that admissions into the National School of Administration and Magistracy (ENAM) is fraught with political machinations, and for this reason, the performance of the graduates who run most of our institutions is mediocre. In this regard, Lasswell & McDougal (1943) insist on the vital role of training those who provide legal service in a democratic society because of the enormous influence on attitudes toward the law.
Transparency and accountability are foundational to economic activities. How can a nation regain the trust and confidence of its people who are distraught due to a lack of transparency and accountability? For years Cameroonians have been constantly disgruntled with parliamentarians and other community representatives who singlehandedly execute projects after having embezzled substantial sums of money. This lack of accountability and transparency hampers cooperation and coordination, both of which are essential in the chain of production and the wellbeing of all.
In conclusion, having been endowed with rich human and natural resources like other African countries, such as Rwanda, that have walked down the path of civil war, Cameroon has a potential for an economic future. However, our country cannot realize its full potential if the ruling government does not chart a new path marked by patriotism, the rule of law, and the common good. Such an aspiration can only succeed to the extent that government officials learn from history and rise beyond the inordinate desire for personal aggrandizement. It is important, in this regard, for all branches of government to be in sync with unwavering determination to implement changes that are most needed to restore the ethics and nobility of our nation’s institutions. There is no better way than relying on the tested and proved findings that have been clearly outlined in this memo.
Culled from Pan African visions
16, June 2020
Manyu: The blame game should not be our game 0
For decades, I have heard generations of Manyu sons and daughters blame their misfortunes on others. If it is not a minister, it is a village chief that is responsible for our unfortunate fate.
If the minister or the chief is not to blame, then it is a brother or a cousin who has succeeded and who is supposed to carry the family’s burden on his head.
If the issue is not with a brother or a cousin, then their wives are very bad or too greedy. This blame game has been on for a long time. Everybody seems to be bad except us. And if every Manyu man is bad, who then is good among us?
If we stand in public and condemn others, who then will ever be good among us? Have we forgotten that when we point one finger at the other person, we are unconsciously pointing four of our own fingers at ourselves?
The blame game should not be our game. It is a game for the weak. A game designed for the lazy and desperate. We don’t have to fall into that trap. It is not designed for us.
I grew up with the mentality that in life, only two people owed me something – my father and mother. They were the two people who decided to bring me here on earth. If along the line someone decides to give me a helping hand, I would thank them and praise God.
But I always make sure that I replicate that act of goodness without expecting any gratitude from the receiver of my act of kindness. I cannot ask everybody to be like me. I just want the world in which my children will live to be a better place than the one I met.
The worst thing that can happen to a man is for him to spend time speaking evil about someone else. Let’s not forget that what we put out there is exactly what might come back to us.
But how can the people of Manyu walk away from their blame game? Instead of blaming, I think we should be doing. If we think our ministers and lawmakers are not good for us, we must doing something to demonstrate that we are different. What are we therefore doing to be different from them?
We must make common cause to achieve some of our collective goals. There is power in numbers and we are many. We cannot sit and wait for others to come and bail us out of the underdevelopment that has been ours for decades. We must act. We must use our numbers to make a difference.
The Manyu Project is therefore an opportunity for all of us to join hands and give Manyu a face-lift. We are not going to bother anybody who does not want to join, but we are simply tired being invited to be part of a blame game that has never delivered any results.
In this regard, here is the money transfer number ( 237677992864) for those of us back home for us to pay in our CFAF 1,000 for multiple projects that will be implemented in various villages.
There is another account being set up in Dublin, Ireland; another in the United Kingdom and others will be set up for those in Canada and the United States.
Canada and the United States have well organized Manyu Associations and some members already have their contributions. The desire to join is huge and we think we can really make a difference. The account statements will be published in our Boh Manyu forum for accountability purposes.
I am from Ossing and no project will take place in my village until other villages have tasted the milk of human kindness that abounds in us. We can do it.
Let us be busy. The busier we are, the better for us as we will not be seeing the wickedness in others. Let us not forget that what we see in others is exactly what we are. If we see angels in others, then we are angels. If we see wicked people, then that is what we are. No human being is perfect. We must always bear that in mind. Have a great day!
Dr Joachim Arrey