Posted by: Petros | September 26, 2009

Do Contracts Mean Anything in Africa?

I have been musing about what keeps sub-Saharan Africa in poverty.  One thing that I’ve observed is that contracts, whether written or oral, don’t seem to mean very much.  I know of an African who signed a contract that he would return to Africa after his training but apparently never intended to do so and remains here in North America.  Oral contracts also have little worth because bait and switch tactics are not uncommon:  for example, a friend who grew up in South African and now lives in Canada once sent a large sum of money to youth minister back in Capetown with the belief that it would be used to purchase a automobile to be used for ministry.  Instead, the youth minister used it to pay a bride price so he could marry.  My friend said that he broke all communication with the youth minister when this happened.

We can be critical of Western individualism, and Africans are very good at putting people first.  But many Africans envy the West without of knowledge of how it actually works.  Every aspect of Western economy depends on the sanctity of contracts.  The vast majority of the time, these contracts work.  For example, if I go down to my local Staples and buy an item, I know that I can return it within 30 days for a full refund.  That is a contract.  And it works, and I’ve exercised my 30-day option many times.  As a result, I am a loyal patron of Staples; I will gladly pay more for item knowing that I have the option to return it if it is unsuitable for me.  In everyday life, we live according to many such contracts:  with our employers, with the phone company, with the gas company, with our bank, with our investment advisors, with Mastercard and Visa; when we buy house, or when we buy a furnace, a new kitchen, or windows for the house.  Without valid contracts, life in North America would cease to function and chaos would ensue.  And yet, in dealings with Africans, keeping a contract seems to be optional.  Is this not one reason for the chaos that exists in much of Africa today?

Contracts that don’t function in North America are reason why we have courts to deal with disputes.  In the final analysis, here in Canada I have made hundreds of contracts that work well, but I’ve only had a few that didn’t, such as with my sports club, the Pavilion in Thornhill, where it took over 4 months to get them to honor an oral contract.  Yet when it comes to Africa, I’ve come to think that the exception is the rule; I have had a much higher percentage of contracts with Africans that did not work than I’ve had here in North America, and I’ve come to believe that the lack of priority given to the honoring of contracts is one of the main reasons Africa does not have a well-functioning economy.

Yet we talk a lot about the growth of Christianity in Africa.  Christians however should be willing to honor contracts.  So one would think that the more Christian Africa becomes, the more contracts would be worth something.  Admittedly, cultural transformation takes time.


Responses

  1. I am sorry that you feel the way you do about contracts in Africa. You wrote this article based on what facts and how many countries in Africa did you do business with? and you think western countries are any better?

  2. I have based my question upon my own personal experience, readings and the experiences of others. The countries involved would include many of the French-speaking nations in sub-Saharan Africa. I am not saying that western countries are perfect for there are bad people everywhere. But I wonder whether the relatively higher regard for contracts isn’t one of the important reasons why Western economies function relatively better compared to African economies.

    But why should you feel sorry about my observations? My desire is not merely to point out a fault of Africa or Africans, but to try to diagnose what are some of the problems and what are the root causes. If this can be done, then perhaps the effort of theological education could be focused upon building the kind of character in people that would help transform Africa for the better.

  3. If Africans learned not to honour contracts, they learned it from the coloniial administrators. The only reason we have poor governance in Africa is because the only role models available to newly democratic governments were those of the previous regimes. And if they look further afield, do they see anything better?

  4. Thank you Adrian for this comment. Yes there is plenty of blame to go around. And 200 years from now, if Africa remains in the same kind of poverty, it will because of former colonial powers and the continued influence of foreigners? This is why, for example, Zimbawe has inflation and there is endless war in Africa. But, however, if we look to Asia we see that India, China, Thailand and even Viet Nam are developing countries with an increasing standard of living. Hong Kong, formerly British, is the commercial centre of China.

    So the reason why the African scholar that came here to study theology under our scholarship program will never return to Africa is because we, the colonial power, cheated his ancestors; it is therefore ok for him to lie to us, violate his contract, and never return to Africa? We have it coming to us. Besides, his former level of poverty justifies his violation of the contract with the Christian charitable organizations that gave him money. These organizations are rich and he was poor, so it make sense for him to lie in order to get us to give him money so that he could come to Canada and study a PhD.

  5. When making a generalization from a personal experience or a few examples, the risk is often to overstate one’s opinion. I happen to have some idea of what constitutes the primary ground for your assessment, Peter, and I understand the reasons for your conclusions. But not only do the cases on which you base your observation under-represent Africa, but, also, they lead you to pose the problem in a manner that is not directly relevant for many other cases.

    In the few other cases I am aware of, the fundamental issue does not appear to be the contract, but the circumstances surrounding the honoring of the contract. Every contract assumes a BASIC set of circumstances that make it possible to be honored, conditions without which it would be legally and morally unreasonable to expect anyone to honor it. I am not referring to unforseen circumstances (although there is room for that, too, in a contract) which some contractees could manipulate so as to “escape” their contract; I am talking about the conditions which make a contract valid. It is one thing to have an agreement, it is another to create the conditions that permit each party to honor what was mutually agreed upon. I have found myself much eager to honor my contracts in the US, and the reason seems to be that these contracts are “incarnated,” that is, they take into account my reality and address the circumstances which permit me to honor them. The entire system tends to be strcutured so as to encourage people to honor their contracts, and I feel both the obligation AND the power to honor mines. I am afraid that most (not all) of the contracts that lead to the frustrations and conclusions you have drawn are “disincarnated” contracts that tend to ignore the circumstances of their application (again I am aware that you have had situations for which apparently this was not an issue).

    Also, some times, in the case of the training of people for theological education in Africa, I would suggest that some of the problems for those who seek to honor their contract are beyond the reach of the parties involved. It is increasingly clear to me that a dialog needs to take place that would bring up-to-date our vision, paradigms, the methods and the procedures with which we work. I may be showing too much optimism here, but I believe that most “betrayers” have not premeditated their “betrayal.” And if this is true, then contracts do have meaning for those people, even if they have not been able, so to speak, to “honor” them. The question we are not asking, then, is, why do they “fail?”

    So finally, in light of the complexity of the issue, what is true with specific cases might appear overstated because of generalization or failure to thoroughly discuss the situation, bring nuances, and seek viable alternatives for difficult cases. I tend to believe that the problem is more a structural challenge than a moral flaw. It is not about being Christian or not, and Peter knows that by honoring his contracts in North America he is not doing much more than non-Christians, so the paradox of African Christianity’s progress and the failure with contracts in general has little relevance for the conversation. Other non-Christian but prosperous nations experience similar quality of partnership in their “businesses.” So Peter’s ironic remark that poverty would justify the violation of a contract does not advance the conversation, I think, neither does Adrian’s blame of the colonial administration for unacceptable failures in Africa. If poverty has any role to play here, it will be only to point to the circumstances which our contracts may not have often taken into account. Meanwhile, Africans should take responsibility for their own actions despite their circumstances, and fight to have them taken into account in their contracts or, eventually, improve these circumstances. Let us not forget, for this matter, the structural issue. Surely China and India are emerging, now, but their current progress was not a gift; quite the contrary is true. They have had to fight for it, against other powerful nations. Why should any nation have to fight against prosperous nations to build a growing, stable, and competitive economy for itself? Because the truth is that we are not naturally inclined to elevate others but ourselves. When we elevate others we do so as long as they stay below us. I am not expecting the situation to be different anywhere in the world, I am just saying that there is something structural in the current order of the world that makes it difficult for certain standards to apply properly in some countries, until these countries are able to earn they place at the table of true partnership and equitable game. Then contracts will be more often honored, still with the same people who once appeared as betrayers.

  6. Thanks for your comments Elisee. In my reading of David Maranz, Africa Friend and Money Matters, who has studied the issue of differences between Western and African treatment of money, I draw the following relevant points from the numerous examples that he gives: (1) The failure to fulfill a contractural obligation is most often not related to circumstances, but from a lack of respect for the oral or written agreement (though he does mention a cases where contracts are broken because of mitigating circumstances); (2) The long term consequences of these actions are negative: i.e., if you don’t fulfill your contractual obligations towards clients, then they will not give you repeat business–the lack of repeat business means that on the whole the economy will not function properly and that nobody will trust anyone else; (3) Banks apparently don’t give very many loans (p. 152, under the rubric: “A loan is eligible to be repaid when the creditor’s need becomes greater than the debtor’s need”):

    On a more formal level, loans from a bank, for example, are much less common than in the West. People of limited means cannot borrow from a bank; they cannot even afford to have an account in a bank. But even banks go bankrupt because individuals and governments do not repay their loans, which are in effect uncollectable. Part of the problem with loans in the formal business sector is the lack of capital, but a major problem is the collecting of monies due–practiacally no one repays a loan voluntarily, even if a promissory note or other document has been signed. I think there is also an underlying concept that a bank is there to provide and loan money–its coffers are full of money, it has far more money than I do, and therefore is it not a little absurd to think of me giving money to a bank? A bank, and people of means, are there to be givers, not receivers.

    This of course is a one Westerner’s assessment. I have likewise heard that in some countries (like CAR), the native people cannot get loans. If the debtor feels that the creditor must have sunk to a lower level before a loan must be paid, it leads to everyone being poor, which is pretty much the case. Functioning economies must have a safe way whereby those with money can lend money to those who need money to start a business, buy a house or a field. When there is no such basic trust, then the banking system will not function. The US banking system nearly collapsed because too many loans were given to people who were unreliable. But what happens when almost nobody is reliable? Then, you have a systemic inability to develop economically.

  7. The consequences of not fulfilling one’s obligations are unquestionable everywhere in the world, and Africans may suffer the most from their chronic failure to fulfill their contractual obligations, at least in the current world order. My concern, however, is elsewhere. I have not read David Maranz yet, but he seems to suggest, according to what you write, that the failure of Africans to fulfill a contractural obligation is most often not related to circumstances, but from a lack of respect for the oral or written agreement.

    If this assessment is generally true for Africa, then I must ask, which Africa are we talking about? The question applies both synchronically and diachronically to Africa. The African culture I know the most values the respect of one’s word, and some people would choose to take their life rather than to fail to honor their word. In other African cultures, I heard, the ability to deceive is culturally considered a skill, but note that even there it is not a violation of what is normally expected. It certainly may become a problem when dealing with a different culture, but from inside this culture it is part of the game and therefore not seen as a lack of respect of any kind, at least not in the sense that you (and perhaps Maranz) seem to understand it. The point is that even in what would appear to many, including me, as a morally flawed culture, the actors still have a sense of playing by the rules.

    The true question is, whose game are we playing? Whose rules are we applying by? Has there been an agreement on the game and its rules, rules which include the basic circumstances (be they cultural, economic, social, etc.)? That is the question we are not asking when we assess our experiences with Africa and generalize about what is going on on the continent. And for this agreement to be possible, an honest conversation must take place, and I am realizing more and more that this dialog, truly, is not taking place. What’s left? Those who are portrayed as betrayers have to fight and earn the power to be part of the decision making process about the game and its rules. Then we could expect a fairer and more mutually satisfying game.

  8. The analogy of a game and rules is very interesting, because it leads me to quote another line from David Maranz: “What is the one most fundamental economic considerations in the majority of African societies? I believe the answer is approximately this: the distribution of economic resources so that all persons may have their minimum needs met, or at least that they may survive.” And, “What is the one most fundamental economic consideration in Western society? The answer is the accumulation of capital and wealth” (emphasis his).

    Maranz goes on to argue that Africa is largely successful in meeting its fundamental economic consideration, as is the West. But when I look at Africa, I see Africans who are essentially unhappy because of their poverty. They become even more miserable when they take into consideration the wealth in the West.

    So one can play a game with a set of rules. But if Africans are unhappy with the current level of poverty they must be willing to change the rules. In any case, I have nothing to lose by bringing up this dialogue, and so I do not worry too much about overstating my opinion.

  9. I think I need to read Maranz to be able to give a fair assessment of what he says about Africa, and about which Africa. For now, I am not sure that “distribution” vs. “accumulation” is the best caricature of the two economic systems. Again I prefer to speak of the African culture I know best, and it does not have “distribution” as the center of its economic consideration, but “community.”

    The difference is that distribution is concerned about HOW to use wealth, whereas community tends to ask WHO generates wealth. In this model the answer is, everyone. Everybody is expected to generate wealth, and I have lived in my native culture long enough to know that wealth generated by the community does not go to those who, for no valid reason, do not participate in generating it. There are proverbs, stories, social censure on laziness. Traditionally most young people by age 18, virtually all of them by age 21, no longer depend economically on anyone, and this includes girls, despite what we see today portrayed in the media. There is no place for “social parasites” in my culture, and there is no such thing as distribution in the sense that all must have from such thing what they need to live.

    Now, the emphasis on community makes people prompt to assist those who are in need for valid reasons, and it is this principle that is pervasively being abused by a modernizing African society that has lost its cultural landmarks. All over Africa we more and more have people who, at age 30, have no stable economic situation. Because modern education is the primary cause, culturally they are not automatically seen as lazy people. They are seen as people who have done what they should by going through a long schooling but who, in spite of everything, still cannot secure a job in a broken system. As a result, the community principle is activated as a survival strategy, in the hope of a better tomorrow. Meanwhile, a growing number of people abuse this generosity, which strikes outsiders from the West so powerfully that they see a distributive economic system. The truth is that this is the symptom, not the cause, of the illness of Africa.

    As to the question of happiness, you would agree that this is difficult to measure, and every good expert in issues of satisfaction with one’s own life would tell you that happiness depends on factors far more important than wealth. I think what most modern (to be exact) Africans are unhappy with is the growing gap between 20 years of schooling with all that means for the person they have become at the end of this long process, and its end-result for their lives: unemployment, low-paid jobs, in cities and towns more and more expensive. As they buy that which the West has been selling through the literature, Hollywood, TV, the radio, and now the internet, they come to believe that they will be happier in the West, and so they seek to take expensive and risky trips at all cost to cross the oceans. When they eventually make it to the West they are greeted by another set of problems: cultural shock, unemployment or poorly paid jobs, cost of living, identity crisis, home-sickness, etc. I would think that most of those who manage to get integrated into the new culture agree that if they could get the job security they have in the West and a relatively stable life, even with much less wealth, in their home countries they would have long returned home. The tragey of Africa is not its material poverty; the tragedy of Africa is the materialization of its poverty.

    When we stop materializing Africa’s poverty and look deeply into the soul of the continent, then the true character of what she is suffering from will appear, plainly. The West has not always been wealthy, and in terms of resources Africa is far richer than all of Western Europe and North America combined. But Western nations have had a different kind of wealth that helped overcome its matrial poverty: education, political and cultural freedom, and a long history of what sociologists call, in French, “la conscience de nation” which has overcome the negative effect of Western ethnicity. Africa is still very, very largely uneducated, politically dominated and exploited, culturally disoriented and subjugated, and socially fragmented and destabilized. Even inside the same geographical territory people do not have a sense of forming one nation; instead they still see themselves as composite tribes. Africa’s poverty is primarily immaterial, and perhaps this is why she struggles more, for so far her diagnosis seems to have been beyond the reach of her doctors.

    Yet, Africa cannot participate in deciding about the game of the world order and its rules until she has learned to speak the language of her playmates and until her playmates have learned to speak her language. Until then, we will continue to do sign-language, and hope, and fight, and hope, and fight still. There is no way to go back, we can only move forward, and this will be, for long time still, an up-hill battle. But there is no reason for resignation.

  10. This is a most relevant subject. It is not only we as Africans that are to be blamed. Foreign companies doing business in Africa are sometimes guilty of having double standards. Contracts with other parties are honoured but not the same when it comes to contracts with Africa.

  11. Thanks for this comment and the favorable mention of this article on your blog too.


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