Part 1
It will soon be three decades since the introduction of GAMSEM – Gambians for Self-Employment, a new, independent and grass-roots cooperative movement. Believing in the wisdom that the “Masses, And The Masses Alone Are Their Own Liberators”, Gambians came together to build a cooperative federation called GAMSEM. This re-introduction commemorates the cooperative spirit echoed by International Workers’ Day and the devastating COVID-19 pandemic. It re-affirms our long African tradition of democratic cooperation and peaceful co-existence. In this historical context, we may find useful lessons to learn for renewal in the cooperative movement.
Past Introduction of GAMSEM, An Alternative Cooperative Movement
Gamsem
The policies of the Gambia Government is bringing home to more and more Gambians the bitter fact that they have no one to rely upon but themselves if they are to make ends meet and if they are to survive the mounting difficulties of social living. The growing number of self-help groups, kafos and Kompins, ethnic, regional and other communal associations, non-governmental organizations, and other spontaneous and restructured groupings go not only to show the widespread discontentment with government policies, but even more important, the fact that ever greater masses of Gambians are beginning to realize that their destinies in fact lie in their own hands and not on the callous policies of the growingly careless government. Frustrated and disappointed by decades of worsening government corruption and inefficiency, endless unfulfilled political promises and a long record of failure in the implementation of various public projects, many Gambians are reaching out for other alternative methods of economic survival and social redressment. The rising tide of activism in non- governmental organizations by ever greater numbers of Gambians is one such venue that people resort to out of their realization that nothing good can be expected from the present government.
After their country’s attainment of independence nearly three decades ago, Gambians went to spare no effort, time and energy in trying to reconstruct the nation and putting their society on a path to genuine development they gave unwavering loyalty. As loyal citizens they defied all economic difficulties to dutifully pay taxes and rates and made all the sacrifices called for by the national leadership in spite of the fact that the vast majority of them had little or no access to the basic amenities that can be reasonably expected from modern government. Farmers patiently allowed most of the results of their arduous toil to be squandered by parasitical marketing broads and a state -controlled cooperative union in which white -collar thievery is the order of the day. Gangs of voluntary labourers from villages across the length and breadth of the country sweated and pulled together all their meagre resources to build, often without any government help, almost all the schools, dispensaries, feeder roads, seed stores and to dig all the wells of the Gambian country side. And yet in times of acute economic crises caused or worsened by bad government policies, as in the late 1970s, 1982, or 1984, when government was forced by international financiers to adopt severe “corrective” measures, it was always the masses of the poor and powerless Gambians who always, and with little protest, had to bear the worst and heaviest burden. Innocent backs already laden with the woes and the abuses of decades of exploitation and neglect were always the ones forced to carry the heaviest loads of “corrective” economic reforms.
And yet in spite of all these sacrifices and evidence of loyalty from the masses of Gambians, the state never even tried to honour its part of the social contract that is the bedrock of all relations between civil society and any political state. Gambians have indeed got nothing other than a very bad deal from their thirty-year partnership with the present government. To see how this has happened let us take a brief look at the past.
A BRIEF LOOK AT THE RECENT PAST.
Although the PPP-regime continued more or less the same harmful policies it had inherited from the colonial administration, the country’s economic performance during the first ten years following independence remained relatively strong. Per capita income, or what the average citizen earned from various economic activities, grew by 4%, in other words, D4 over every income of D100. Inflation was low, so the price of a loaf of bread, a cup of rice, or taxi-fares, school and hospital fees, for example, remained stable and the same over long periods of time. This in fact was so much so that the names of many goods and commodities assumed their price -value since prices were so stable; thus, some bread loaves were called 3-pence = bread or six-pence -bread. Foreign debt, which was the amount that The Gambia owed other countries or foreign banks and international lenders, was nothing worth much to worry about.
However, in 1975, government introduced what it called its First development Plan. It could be remembered that then the richest group of Gambians were the small class of groundnut merchants who acted as agents of the then foreign companies that bought groundnuts cheaply from farmers and in exchange sold them expensive imported manufactured goods. But by the beginning of the 1970s the profit from such exploitation was whetting the appetite of a new, young and upcoming class of politicians and bureaucrats, or top civil body of the new independence state and machinery of government.
The real intention of the First Development Plan was to give this new class of politicians and bureaucrats a greater part of the profit that was being squeezed out of the masses of farmers in the countryside of toilers and poor and powerless tax-payers of the urban areas. One way of doing this was by expanding the role of the public sector that was under the control of this new government class. Thus, the first Development Plan expanded the public sector dramatically. Several urban based parastatals, or self-administered but government owned companies, were established like the G.U.C, NTC, Ports Authority, etc, etc, to create luxurious jobs for members of the educated elite, favoured politicians and other well-connected personalities. Ghost companies and enterprises with various under -cover connections, hiding under names like Mr. X and sons or Mr. Y and Co, helped with “development certificates”, government-guaranteed loans and over-generous tax breaks, over-valued exchange rates and protective tariffs, began to appear manned by new and miraculously rich gentlemen. This trend continued so dramatically that in six years the civil service more than doubled and public investment (money spent from government cash) increased by 700% or in other words seven times more than government was spending six years earlier.
Almost all this spending was financed by funds diverted from the groundnut export. The then Gambia Produce Marketing Board, GPMB, made an average annual profit of 47% of the farmgate prices under the period 1974-1978. In other words, the board kept D47 of every D100 earned from reselling the groundnuts it got from the farmers. The Gambia Cooperative Union, G.C.U., took a good deal of the rest. Funds taken from these two organizations, foreign lenders as well as the Central Bank of the Gambia and other parastatals were used to build the Gambia Commercial and Development Bank, GCDB, which was the main motor of the First Development Plan and the primary distributor of so-called development capital. The GCDB was used to be the main source of finance for the ghost and undercover companies secretly controlled by the politicians and the bureaucrats.
When, because of the drought and neglect of agriculture, enough money could not be squeezed out of the farming population, government resorted to the tactic of foreign borrowing for financing its dubious project of enriching a selected few at the detriment of the vast majority. Foreign loan was then preferable to further intensification of domestic exploitation since it meant little immediate cost to any one group in the country. Furthermore, the burden of foreign debt would only become evident in the course of time, and could be then evenly spread out among taxpayers.
In this way the first Development Plan was essentially a plan of replacing the old merchant class of groundnut traders by a new elite of politicians and bureaucrats. It paved the way for the creation of a new privileged elite who used their control of state-power and the machinery of government to enrich themselves through embezzlement, corruption and open stealing of funds extorted from Gambian farmers and other tax-payers. As rural parties to these crimes chiefs, alkalolus, party-chairmen and other rich and influential noblemen were given access to privileged positions in the Cooperative Union and access to soft loans, farming implements and agricultural inputs.
A POLICY THAT COULD NOT LAST
In the long run, however, such a policy, that benefited the unproductive at the cost of the productive sections of the population and that enriched a parasitic coalition of politicians, bureaucrats and their lackeys of the countryside, could not last long.
Hence by the end of the 1970s and the beginning of the 1980s, the economy had weakened seriously. Though the difficulties began with the oil crises, two serious droughts and declines in the price of groundnuts, and wrong economic policies by the government made a bad situation even worse. Government budget deficit (the difference between what it earned and what it spent) grew from 3% of the GDP (Gross Domestic Product which is the sum total of all goods and services produced and offered under a single year) during 1965 – 1975 to 15% of the GDP during the period 1980 -1985. Losses by parastatals averaged 6% of the GDP during the latter period. Poorly selected investment projects, neglect of the agricultural sector and negative real interest rates went to further worsen matters. Corruption, white collar-crime and embezzlement of public funds increased dramatically to become an epidemy within government institutions, parastatals and all public sector projects.
By 1984 the country was facing a deep economic crisis. Per capita income, or in other words the amount earned by the average Gambian, had fallen by nearly 10% compared to that of 1980. And yet prices of almost all goods and services kept doubling and doubling again.
The price of rice, sugar, kerosine, petrol, candles, matches, salt, transport fares and everything else kept on rocketing up. The budget deficit went up to 21%. The amount that government owed to foreign banks and governments totaled 114% of the GDP, that is to say it was more than the sum total of all the goods and services produced and offered by all Gambians put together. Gross foreign exchange reserve had fallen to the equivalent of two weeks of imports. Debt service arrears, or belated payments on the said government debts, had reached up to 65% of the GDP and foreign donors and lenders were refusing to provide any more assistance. The IMF (International Monetary Fund) which was one of the international financing organizations through which government got most of its loans and financial assistance, was considering stopping the Gambia from getting any more help because of the country’s poor economic performance. Acute shortages of all goods followed and the poorer sections of the population suffered the most out of these shortages. When there was sugar, rice was not to be found, when there was some oil, matches, petrol and other basic goods ran out of supply. The shortages had become so acute that, reacting to the growing chorus of complaints, the president angrily went on blaming Gambians for the overconsumption of rice and urged them to try other types of food stuff.
In spite of pressures from the IMF, the world Bank and other foreign donors and lenders, the Gambia government refused to see the reality of the economic crisis that it has plunged the country into. Government spokesmen continued to blame the drought, the results of the July 1981 Revolt and international economic situation for the cause of the problems. By putting the blame on these factors government hoped to justify its reluctance to introduce effective reforms that would arrest the worsening situation since these were factors that government could do very little about. But the fact was that bribery, corruption and other white-collar crime, which could be curtailed if not effectively stopped, were draining the country’s resources, and totalled about 27% of the GDP (according to some conservative estimates), and were also depriving government of much needed revenue. Luxurious imports for the good life of the spoiled members of the privileged elite was eating up too much of the foreign currency that was then in acute shortage; and this was an area in which government could act. Government could have seen the situation as one that warranted emergency measures and it had available to it many options that could bring some immediate remedies.
Apart from the fight against corruption and the curtailment of luxurious imports, it could introduce some rationalization measures in government administration, expand the tax-base upwards and more into the private sector since only the poor and the impoverished are known to pay taxes and rates in the Gambia; it could streamline the parastatals that were being overmanned through nepotistic recruitment and impose a stricter regime of accountability; it could introduce debt relief for the farmers and provide more incentives that would promote agricultural production.
But though the ruling politicians, governing bureaucracy and their experts knew all these, they shied away from such measures because they feared they, as a group, would be hurt mighty well. Since they placed their group interest above the interest of the country, they continued putting blames where they were not be put and adopted a do-nothing -policy.
But as international pressures mounted and even started coming in the forms of threats, government half-heartedly went into a number of standby agreements with the IMF. This involved that the Fund had to send a number of foreign experts who would standby to watch and see that IMF directives would have to be implemented. To act as if something was being done about the corruption that even the IMF and the World Bank had been repeatedly complaining about, government introduced the Assets Evaluation Commission. Government also agreed to devalue the Dalasi by 25% in 1984. All that, however, seemed too little and too late. In fact, after successfully convincing the international community of donors and lenders to release the funds that it needed to borrow, it did not take too long for the government to abandon once and for all the idea of Assets Evaluation and all that had anything to do with fighting corruption that nevertheless continued spreading.
The Gambian elite in fact only started to realize that things were indeed serious and that their policy of doing nothing was no longer tenable around the beginning of 1985. A French -backed lobby in a Paris Donor’s Conference (International meeting in which pleading borrowers meet with donors and lenders) strongly argued against meeting any of the Gambian representative’s requests. The Gambia government had never thought things would get that bad. The country had always been a loyal friend of the west, backing it all throughput its cold war against the then soviet bloc of countries. But by then The Gambia was also foot-dragging in its negotiations with its highly irritable confederal partners in Dakar. Those money -lenders thought it better to let the Gambian crisis deepen to give the Senegalese a chance of taking the country than let unknown successors snatch the country from its corrupt and incompetent rulers.
Meanwhile, inside the country itself, the lack of foreign exchange was causing shortages that were biting hard on the luxurious consumption of the privileged minority. Petrol, a must for motorism, their supreme status symbol, was in acute shortage and lines along gas stations were running up in kilometers. Something had to be done! The country’s policy-makers were at last waking up to sanity.
