It is time for African countries to stop taking foreign aid, said Kenyan President Uhuru Kenyatta in a tweet today. The feature quote comes from remarks he delivered during the Pan African Parliament, last month.
“The future of our continent cannot be left to the good graces of outside interests,” said Kenyatta. “Dependency on giving that only appears to be charitable must end. Foreign aid, which so often carries terms and conditions that preclude progress is not an acceptable basis for prosperity and freedom. It is time to give it up.”
— President of Kenya (@President_KE) June 12, 2015
Kenyatta advocated for a plan to integrate trade and migration across the African continent. Earlier this week, a deal was struck to create the largest free-trade zone in Africa. The Tripartie Free Trade Area unites three major trade zones: the Southern African Development Community, the East African Community and the Common Market for Eastern and Southern Africa. It stretches from one tip of the continent to the other.
More than $1 trillion in gross domestic product comes together under the new deal. National parliaments have two years to ratify the deal that does not yet specify how the agreement will be enacted. The hope is that it will make it easier for companies based in the countries to do business in other places, including outside of Africa.
“What we have realized is that having one trade regime is better than the costly multiple trade regimes,” said lead negotiator and Common Market for Eastern and Southern Africa Secretary-General Sindiso Ngwenya.
Above all else, the trade area is meant to propel economic growth in the 26 countries. Opinions about the agreement are mixed. Harvard economist Calestous Juma told BBC’s Focus on Africa that he is optimistic about what may come from the new trade bloc. He predicted trade within the continent will increase by as much as 30 percent.
“By having larger markets, it signals the possibility of being able to manufacture products at a scale that is cost-effective,” said Juma. “As soon as banks notice that they can lend to larger investors, say in manufacturing, that will lead to the liberalization of the financing sector, greater access to finance and more investors coming to Africa.”
But there are concerns about the negative consequences of introducing free trade. Obstacles like poor infrastructure will hamper the potential gains of such an agreement. And as Hilary Matfess points out in Quartz Africa, there is the potential harm for people at the bottom, especially farmers.
“Opening to trade with a country with very different economic characteristics will yield predictable results – however, for African farmers, opening to trade with their similarly agricultural neighbors is a fraught prospect,” she writes.
Fixing the major problems requires more investments, especially in infrastructure, and support for small-holder farmers. Those happen to be two areas where foreign aid can provide support. But Kenyatta and other leaders in Africa are increasingly looking to solutions that do not depend on money from countries like the United States and United Kingdom.
For now, the aid-free future that Kenyatta called for is inching past rhetoric and towards action.