The problem with the African continent and the problem with the aid industry is that is has distorted the structure of incentives facing the governments in Africa. The productive margin in our government search for revenue does not lie in the domestic economy. It lies with international donors. Rather than sit with Ugandan entrepreneurs, Guinean business, South African enterprising leaders, our governments find it more productive to talk to the IMF and the World Bank.
Aid increases the resources available to the governments. And that makes working in government a most profitable thing you can have as a person in Africa seeking a career.
The most enterprising people in Africa cannot find opportunities to trade and work in the private sector because the institutional and policy environment is hostile to business. So the most enterprising Africans end up going to work for the government.
There's more - 17 minutes of video to be exact - in which Mr. Mwenda shares his insights. Definitely worth the time.
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