Building a Hong Kong in Africa?

A Stanford professor leaves to build a new economic model for Africa, but it faces challenges.

He's one of the fathers of the new economic growth theory, and he's been on the short list for a Nobel price in economics. He's founded companies, including online teaching firm Aplia.

Now, Professor Paul Romer of Stanford University's Graduate School of Business is leaving the campus to pursue a new, somewhat startling private endeavor. Using Western know-how and bureaucracies, he wants to build modern metropolises in one of the most challenging areas of the world: Africa.

"I am embarking on a whole new direction in my career," Romer said during a recent meeting in Menlo Park, Calif., with Swedish, Finnish, and Pakistani journalists. "I am going to put my whole career on the line with this new idea."

Paul Romer Stanford University

The idea is to create city-states along the coast of Africa that can become economic hubs for the region and at the same time be insulated from the continent's notorious corruption and political chaos. In a sense, it's what the British did with Hong Kong in the 19th century when China was relatively unstable.

Romer envisions a Nordic country, perhaps, emerging as a champion for his concept. The European host could accelerate economic growth by taking charge of police forces, jails, and courts. Local government would take care of the rest.

A modern form of colonialism? To many, it might seem like it, but the colonizer would be a "disinterested trustee government" that would preside over a form of what Romer calls "delegated democracy."

"The British raised tens of millions of people out of poverty" in the colonial era, Romer said. "Hong Kong is the most successful development program in economic history."

Romer said he would not trust the United States to serve as a steward in Africa, and he even doesn't think even the European Union is up for the task.

A cynic, however, could also point out that Nordic countries have been, historically, relatively homogeneous and isolated and have not had to deal with conflicting ethnic and religious interests like Britain, the U.S., and several African nations. Thus, what makes Scandinavia successful makes it unsuited for an African voyage, he asserts. But Romer prefers to focus on the Nordic countries and their history of conflict mediation and peacekeeping operations, working closely with the U.N.

He has discussed his idea, which might strike some as radical, in small circles for some time, and now he'd like to influence the wider debate on development issues, such as the effectiveness of development aid.

He does not believe in the philosophy of many non-governmental organizations (NGOs) that national governments are best avoided altogether in favor of directly reaching needy Africans. Good governance requires more discipline and a guarantee that the party in power does not abuse its power.

 

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