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Monday, September 25, 2023

Letter to the president on the state of the nation: current economic situation

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By Lang Conteh

As a small open economy, The Gambia stands at a critical crossroads in its march towards sustainable development, especially given its vulnerabilities to the myriad of external shocks in the wake of the Covid-19 pandemic and the outbreak of war in Ukraine, which had concomitant deleterious effects on supply chains all over the world, thereby causing unprecedented cost push inflationary pressures on the prices of essential goods and services here at home. These shocks evidently exposed the stark realities of our contemporary economic challenges which require a whole new thinking and a paradigm shift in the economic management of our scarce resources, so as to shift the production possibility frontier on a path of sustained growth and resilience, in fulfilling the yearnings and aspirations of our people for a better life.

Gambians in their multitudes at home and abroad, are concerned about the economic, social and political options for The Gambia going forward after the 2021 Presidential Elections.  Are the current economic and social policies and practices the correct fit for the country given is history of twenty-two years of unimaginable misappropriation and wanton dilapidation of its resource endowments? What sort of relationships must the country adopt with the rest of the world geopolitically, in its strategic posture in international cooperation, and internally with itself in terms of promoting good governance and territorial equity? What are the urgent priorities that need to be addressed to attain food self sufficiency and security before other aspirations can be achieved? What are the best options to source development financing and implement policy? How does The Gambia tackle and adapt to the challenges of an ever-growing digital world economy? How do we solve the problem of massive youth unemployment and stem the tide of clandestine migration through the so-called back-way syndrome? What are the causes of success and failures of past regimes? These and many other critical challenges facing us as a Nation State require in depth analysis and research in order to put the Country on the right trajectory of growth in creating the wealth of a Nation.

It is precisely for these reasons that the Gambia Government must enjoin on itself to put up a platform of all Gambian intellectuals, either by expanding the Economic and Social Council which recently ended its deliberations Chaired by His Excellency Himself, or by nurturing a National Think Tank whose role would be to engage both the general public, policy makers, private enterprises, and Gambians in the diaspora, in examining the full spectrum of ideas, development practices, concepts and theories that will have the most optimal impact in developing an endogenous development model that fully takes into account the peculiar needs, problems and aspirations of the population of our Nation.

It is worth recalling that the Coalition Government of 2017 did indeed promulgate the setting up of the Gambia National Think Tank (GAMNATT), which had started well only to fade into oblivion for lack of support and enthusiasm. With its rigorous research background and disciplined analytical approaches, GAMNATT was expected to provide the evidence-based arguments needed for effective public policy decisions and implementation, by acting as a strategic intellectual partner between Government and Gambian professionals and experts at home and abroad, which aims to support socio economic transformations and growth via better uptake of policy-relevant knowledge and evidence-based data on best practices. Through research, the Think Tank could help design and monitor policies and programs to ensure they have a positive impact on people’s lives. GAMNATT could also organize seminars, conferences, workshops and disseminate its findings through the publications of papers and by spreading ideas and discussions through the media. These are all necessary and relevant means that put emphasis on incorporating local content in the discussion and formulation of public policy.

In fact, the Secretariat for GAMNATT has been up and running on a voluntary basis until 2020 and had accomplished important projects such as the setting up of the new Department of Strategic Policy Delivery (DSPD) presently lodged under The Office of The President. The entire conceptualisation, design of the organogram template, and elaboration of its duties and functions were exclusively developed by GAMNATT. 

This is just to demonstrate that it is becoming generally accepted in developing African countries, that public policies work best when local actors design and implement them. Without locally generated data and analysis, well-intentioned programs rarely respond to realities on the ground. Local experts are also needed to monitor implementation. Otherwise, the most thoughtfully designed projects may lose momentum or even collapse over the longer term.

More and more, bilateral and traditional international donors recognise that local ownership is critical to successful development interventions. However, as evidenced by the case of GAMNATT, our governments often fail to invest in those national organizations that can do the ongoing research and analysis needed to effect improvements over time. The political and economic renaissance of Africa can only be realised by the power of our ideas, backed up by powerful institutions, which exert a strong influence over development actors: development agencies, developing country governments, NGOs – and also development researchers.

It is essentially for all the reasons cited above that it is deemed an imperative for the Government of the Gambia (GOTG) to take ownership of bringing Gambian Thinkers together as its Flagship Partner in the research and development of ideas that will leap frog our development process towards a sustainable path. The challenges that face us as a Nation cannot be solved by ad hoc conferences and interim measures, and interventions in the Interbank Foreign Exchange Market.

Policy context

For more than fifty years, The Gambia has experienced rates of economic growth close to the rate of population growth. This poor performance has not permitted a sustainable reduction in poverty. Overall, the reduction in the incidence of poverty has been especially weak in rural areas. This situation stands in stark contrast with the stated objectives of the economic and social policy programs so far adopted, such as the Economic Recovery Program (ERP) in the 1980s,  the Program for Accelerated Growth and Employment (PAGE) in mid 2000s, and the latest National Development Plan (NDP) promulgated by the incumbent regime. Only during the ten-year period 1995-2005 did the Gambian economy register a strong growth trajectory which improved the level of per capita income. However, since 2006, the growth path weakened with the decline in productivity of the traditional engines of growth (agriculture, construction, telecommunications, financial services), the lack of dynamism in the private sector, the rapid rise in public expenditures, and the persistence of a high current account deficit in the balance of payments. With almost 2.5 million inhabitants in 2017, The Gambia continues to experience strong population growth (2.5%), even if it has begun the demographic transition.

The predominantly young population is confronted with limited access to basic social services, jobs and skills for self employment. The question of employment remains the top priority for households and public policy makers. The likelihood of achieving the Millennium Development Goals (MDGs) even by extension to 2023 is diminishing. Equally, the goals set in the NDP notably concerning poverty reduction, reducing galloping inflation, reducing maternal and infant mortality rates, improving primary school completion, and access to sanitation are likely not to be achieved in the target period. Similarly, the regional decentralisation policy pursued to date has proven inappropriate given the unequal geographic distribution of the population, low economic activity, lack of basic infrastructure in all Provincial Regional Capitals, and the acute shortage of fiscal resources at the local governance level, which have resulted in a concentration of development and most economic activity in the Greater Banjul Area and Western Region of the country, thereby creating huge territorial inequities and disparities in development.

The weakness of GDP growth is explained in part by the insufficient level of productivity, lack of economic infrastructure, difficult access to factors of production (water, quality inputs, financial capital), the vulnerability of agriculture to climatic shocks, the weak structure of agro-pastoral value chain, lack of even a basic cottage industry for transformation of local produce, problems with access to land, and land governance issues. The sluggishness of the economy is also due to delays in the implementation of reforms in the energy sector and poor management of water resources, bottlenecks in land reform, institutional and public service reforms in general, failure to attract large investments in strategic sectors of the economy, the inadequate capacity of the state civil service machinery, and problems with the efficiency of public spending, as well as the resistance to change by certain important actors.

Against this background, Government is hereby called upon to articulate a National Strategic Development Blue Print with Strategic Guidelines that will direct the initiatives needed for tangible actions and results for the benefit of the population which are based on three Strategic Pillars viz:

1.         Bringing about a structural transformation of the economy: By strengthening current drivers of growth and developing new sectors that can create wealth, jobs, and social inclusion with a strong incentive to attract foreign direct investments and boost exports. This pillar is based on a more balanced approach to development, with the promotion of Regions and creation of Economic Poles in order to stimulate the potential for development across the entire territory, and in creating a viable economic hub to boost The Gambia’s development potential throughout the National Territory.

2.         Promoting human capital development: Through a significant improvement of the education sector by laying greater emphasis on professional and skills training, science, engineering and technology, and elevating the level of health facilities and medical platforms. These policy actions are intended to impact significantly on people’s living conditions and engender a more sustained fight against social inequalities, while preserving the resources base and fostering the emergence of viable territories.

3.         Enabling good governance: to strengthen security and stability, protect rights and liberties, review the Constitution to include Term Limits in all elective functions, Governorship of the Central Bank, Senior Management of Government Parastatal Organisations, consolidate the Rule of Law, and create a setting more conducive to social peace.

Through their synergies, as well as their converging and cumulative effects, these three strategic pillars will allow the Government to establish the conditions needed for the emergence of a New Gambia.

This debate must continue unabated, because our Country, The Gambia Our Homeland needs it, and needs all hands-on deck. A former colleague said it well in a different forum, “we are retired, but we are not tired”, yet.

Long live The Gambia our homeland.

Lang Conteh holds a BSC and a graduate diploma in economics, a BSC in accounting from Norfolk University, VA USA, a master’s degree in finance and economics from Vandervilt Unv. Nashville TA, USA among other distinguished other qualifications.

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