"Except for religious conflicts and the petty wars of feudal lords, wars are primarily fought over resources and trade. President Woodrow Wilson recognized that this was the cause of World War I: 'Is there any man, is there any woman, let me say any child here that does not know that the seed of war in the modern world is industrial and commercial rivalry?'"
- J.W. Smith, Institute for Economic Democracy

On the world changing blog site recently, the author roundly aired his disdain for the management of the online commodity outlet store overstock.com for the hanky-panky they had pulled on company stock. The blogger was particularly hot over the fact that overstock.com was the parent of the otherwise wonderfully appealing and altruistic worldstock.com:

We locate magnificent items made by craftswomen (and craftsmen) around the world. We emphasize sustainability: choosing items that are environmentally sound, and that don’t burn up the natural or human resources of their producers. We pride ourselves on being honest brokers: we don’t gouge producers with our clout, nor consumers with mark-ups, thereby allowing the artisans to receive an average of 60 - 70 percent of the money you spend in Worldstock. Our goal in Worldstock is not to make money, but to create tens of thousands (and someday millions) of jobs in the poorest regions of the world, while bringing customers unique products of which they can be proud – hand-crafted clothing, jewelry, ceramics, furniture, and much more.

And just as I’m going Wow! What a wonderful specimen of ICT leveraged marvel per public/equal access potential and putting the tech-disadvantaged entrepreneurs of the 3rd world and sub Saharan Africa (SSA) on the global trade map, I noticed in the comments section, a couple of respondents had also thrown in a couple of more similar ventures:

You are today where your thoughts have brought you; you will be tomorrow where your thoughts take you.
- James Allen

A lot of parallels can be drawn between the informal/underground economies of developed countries like the US, UK, Canada, and the economies of sub-Saharan Africa (SSA) -- lost tax revenues, distrust of government, lawlessness, crime breeding grounds, low education and work skills, poor quality of commercial services (no warranty nor returns on purchases,) etc.

These characteristics pretty much define the economic twilight zone called the underground economy – regardless of whatever society it occurs in, however, the major difference lies in the proportions of occurrence. According to this article, the US loses about $35 billion tax revenues per annum to the US underground economy ($35 billion ~ GDP of Uganda OR almost 4X the GDP of Rwanda.) A minuscule 0.3% of US GDP, whereas in SSA, the underground economy typically constitutes 50% or more of the gross economic agenda.

The underground economic environment frequently and conveniently, forms the backdrop of crime paperbacks and movies – ruthless goons, mugging, homicide, violence, drugs, prostitution, etc. Or in the case of the above referenced article where the author conveniently builds his case against illegal immigration/immigrants in America entirely on the underground economy cliché. But I am seriously at odds with the author’s implied inference; shutting down illegal immigrants will shut down the underground economy. No sireeee – in good times or bad times, you will always have legal citizens who are criminals, prostitutes, working for under-the-table pay, etc., and neither can anyone attribute the chronic SSA underground economy syndrome to illegal immigration. Hence, I agree more with Venkatesh’s field notes, which gives a more humane face to the phenomenon; shadow economies are sustained in survivalist communities via a complex web of relationships that are not always criminal.

The reason why the universe is eternal is that it does not live for itself; it gives life to others as it transforms
- Lao Tzu

Email and GSM constitute the most discernible proof of ICT4D within business communities, families and sundry social networks of sub-Saharan Africa. People now ask, “how the heck did we ever make it without email and (GSM) mobile phones all these years?"

This Gartner study illustrates just one aspect of the monumental transformations email has unleashed in the US business sector; the study surmises that email as a direct marketing tool alone, is taking over the $200 billion direct mail market; email-advertising revenue was forecasted to hit $1.5 billion in 2005 from $948 million in 2001. And another piece of evidence of email prowess in the US business arena is seen in this 2004 article; KeyCorp – a major financial services company, saved $15 million in the first year they implemented a digital check processing system; most of the savings were realized via elimination of microfilm, printing, handling and mailing of paper statements as well as all the manual processes involved. 

However, on the SSA front maybe with the exception of South Africa, getting exact statistics on economic and business improvement directly attributable to Email and GSM is a lot more daunting – nonetheless, grand impacts of email and mobile phones in the SSA entrepreneurial community can be illustrated in the aggressive growth spurts recently recorded in several SSA business avenues.  A good example is the international courier business; 7 to 10 years ago, air courier and freight delivery services to Africa was totally at the mercy of the big guns -- DHL, FEDEX, UPS, USPS, etc. However, with email and GSM proliferation in SSA, a rash of smaller, African-owned/operated airfreight service providers, brokers and forwarders have sprung up all around the US. If you’ve ever been anywhere around the Jamaica and Queens neighborhoods in New York lately (immediate business environs around the JFK airport,) you would observe a substantial African logistic-business presence. The Average transit time for airfreight originating from New York to most sub-Saharan African destinations is about a week, and these nimble African operators in New York are able to exchange freight and shipping information pretty quickly with their SSA-based counterparts via email, phone calls or text messages; 10 years ago, such volume of electronic correspondence would have swallowed all the profits and put these small operators out of business, and the scarcity of email, fax and phone amenities in SSA would have made it absolutely impossible to compete in the expedited freight and courier delivery arena.

In Africa

Have you ever placed a call to a personal mobile phone in SSA? it may not be a very pleasant experience – especially if the individual on the receiving end doesn’t immediately recognize your number or decipher your identity within the first 10 seconds; you are either going to have the phone hung up on you, or be subjected to some pretty strong interrogatory verbiage:
Who are you?
Who is this?
What do you want?
You are calling from where?
For who?
The tirade is all delivered in the most biting staccato – feels like getting a hug from a porcupine.

The 21^st century miracle of sub-Saharan Africa (SSA) maybe the teledensity up-tick; Mobile phones are finding their way very fast into the hands of sub-Saharan Africans, but phone etiquette is not quite there yet.

And then there’s superstition; rumor has it that some people can broadcast a voodoo hex out over a mobile phone call – the spell could turn an innocent call receiver into a goat or dog or whatever, who would then go vomit money to whoever put out the voodoo spell. So the second rule of the African phone etiquette is; if you don’t recognize the number of the incoming call, you don’t pick up!

Africa vs. West

Another interesting technology-fostered socio-cultural disconnect – this I actually experienced first-hand when I first moved to the United States from Africa.

In Africa, we usually go charging down to the utility companies – electricity, telephone, water –whenever bills came due or in the event of frequent billing disputes or termination of service. You would present your billing records and argue your case vigorously with customer service attendants until your situation was rectified “in their books.”  Then you got turned over to the technicians responsible for restoring your service – for these guys, you’d typically have to “show appreciation” upfront (a bribe), in order for your service to actually be restored. That sums up the average 3^rd world/SSA utility company customer service experience.

"Nowadays, anyone who cannot speak English and is incapable of using the Internet is regarded as backward."
- Prince Alwaleed Bin Talal Alsaud

International trade is a most critical element in the economic development of any progressive nation – protectionism in such a context is a total oxymoron. I believe the constructive powers inherent in international trade relations became more vivid after president Clinton came into office, and walked right into the befuddling perplexity that had become American foreign policy bereft of the guiding beacons of Capitalist vs. Communist global polarization of the cold war era. He had to get pretty creative in assembling a fairly decent foreign policy configuration from the debris of the cold war mess – he struck out for international trade relations! Reaching out and building bridges to the nations of the world via innovative and strategic trade policies – the outcome were evident in GATT, WTO, NAFTA, etc.

Now, have you ever imagined what powers one nation (or a bunch of nations) could have over another (bunch of nations) if they controlled say 10% of the others’ trade process? A lot!

This World Bank report on new trade patterns between Africa and Asia may portend significant particulars for the sub-Saharan Africa (SSA) ICT panorama.

My annotated summary of the report:

"Exports from Africa to Asia tripled in the last five years, making Asia Africa's third largest trading partner (27 percent) after the European Union (32 percent) and the United States (29 percent)."

China’s new tactics at courting African leaders – take the recently concluded Beijing summit in China, makes me wonder if China is trying to send the west a message: You are losing market share in Africa because of your high-handedness, you got too comfortable, now we are having your breakfast and moving in on your lunch, hÇŽo ba!

"Indian and Chinese foreign direct investment (FDI) in Africa also grew, with China's amounting to $US1.18 billion by mid-2006… "

While Asia accounts for one-quarter [25%] of Africa’s global exports, this trade represents only about 1.6 percent of the exports shipped to Asia from all sources worldwide. By the same token, FDI in Asia by African firms is extremely small, both in absolute and relative terms.

I wonder if this is the same kind of mistakes Africa made with EU and US from the on start? How many fortune 1000 companies in US are owned by Africans? Compare to how many top 500 African companies owned by non-Africans-- would be interesting to study the topmost Africa 500 companies’ shareholder makeup – will save that for a later blog.