Monday, April 28, 2014

Hot/Mango Season and Economic Development

Although it’s always hot in Burkina, the especially high temperatures of March and April are designated the “hot season.” How hot, you ask?  It’s so hot that my meals are salted with my own sweat.  It’s so hot that most volunteers get some form of heat rash.  Yeah, that’s a thing, and it’s unpleasant to say the least.  It’s so hot that the nighttime low is in the mid 80’s and the low in my hut is the mid 90’s.  It’s so hot that I drink two liters of Oral Rehydration Salt (ORS) solution every day in addition to my daily 5L water intake. Staying hydrated is a full time job.  It’s so hot that birds landing on my tin roof get roasted to a golden brown, but only if I can get them down within a minute (kidding…they don’t land on my roof because they would get BURNT TO A CRISP).  IT’S SO HOT THAT EVEN BURKINABE ARE PERSPIRING!!

But it just so happens that hot season is also mango season.  Mango season is an important time for my village economically.  There are over 100 mango trees in my village alone, and plenty more “en brousse,” or the generally uninhabited areas off the beaten path.  Even before the mangos are ripe, Women use long poles with hooks on the end to pull mangos down from trees. Their kids climb the trees to assist.  Other kids are responsible for cushioning the fall of the mangos with any available piece of material as they plunge to the ground.  Many women of the village sell mangos to cars and bush taxis on the highway that stop at the toll booth.  That’s around 30 women selling mangos.  Economic specialization isn’t a well understood concept among Burkinabe.  Frankly I’m just surprised the women don’t get into fights over who is selling to which car.  Often it’s just a mad foot race to the car/bus window; first to get in the customer’s face and yell “MANGORO” (Jula for mango) makes the sell.

The chief of my village is also the president of a regional association of mango producers, called L’Union Provincial des Produeteurs de Fruits et Legumes de la Comoe (UPPFL-CO).  That translates to Provincial Union of Fruit and Vegetable Producers of the Comoe (my province).  Don’t let the name of the organization mislead you, though; they only deal with mangos.  While I’m unclear on the financial specifics of the union, people in the region can pay $20 to participate and they make money on the mangos produced by trees on their property (or that they collect en brousse). 

There’s even a dried mango factory in my village run by the UPPFL-CO, which typically starts operating at the end of April and runs through May.  When I say factory I’m referring the practice of having a bunch of people in the same place producing a product more than the actual structure, which resembles all of the other buildings in village.  Hundreds of kilograms of mangos are peeled, sliced, and dried in gas powered ovens.  Mangos are highly acidic and ovens are hot, so the factory gets pretty hellish for the women who work there, but at least they have (extremely temporary) jobs.  Most of the dried mangos are exported to Europe, but some are sold in Burkina as well.  The union presumably does well, as the chief of my village has a Toyota Tacoma that he frequently drives into Banfora, my regional capital.  Most of the people in my village however, don’t have enough mango trees on their property (or the means to transport large quantities of mangos from the bush) to make it worth joining the union.  As so often results in the developing world, the financial success of the UPPFL-CO is enjoyed by a privileged few, rather than the poor majority.

But enough about mangos, let’s look at the economy of Burkina Faso as a whole.  More than 90% of economic production in Burkina is agricultural.  And almost all of the agricultural goods produced in Burkina are consumed domestically due to the small scale of production and the expense of exportation.  This includes vegetables such as tomatoes, garlic, onions, green beans, eggplant, and cucumbers.  It also includes fruit such as mangos, papayas, and watermelon: each with their respective two month season.  The list wouldn’t be complete without the starches that form the lion’s share of any Burkina diet: corn, millet, potates (basically sweet potatoes) and ingyam (also sweet, potato-like starch).

One of the exceptions to this “domestic consumption” rule of agriculture is sugar.  I live directly across the highway from the largest (and only) expanse of commercial sugar cane production in Burkina.  The company, SN-SOSUCO, was created by government in the 60’s to collectivize sugar production in the region.  It was state owned until 1998, when part of it was sold to a European company, F.C. Shaffer.  Although it currently claims to be a “public-private partnership,” the “public” partners are most likely high ranking government officials who pocket their share of the profits.  Privatization brought European management expertise and technology, but continued the system of exploitation and corruption that was already in place when SOSUCO was state owned.

The company claims to have a workforce of over 3,000, including 800 permanent staff, 400 seasonal workers and more than 1,800 day workers, making it Burkina Faso’s “largest private employer.”  As some of the men in my village who work for SOSUCO explained, “day worker” is a generous description of a job that is about as grueling, temporary, and low paying as jobs can get.  In a classic Burkinabe exaggeration, my friend in village also told me that none of the sugar produced in the fields is consumed in Burkina Faso, but that’s clearly not true because the sugar rectangles (it would be misleading to call them cubes) that are used at every coffee kiosk in every village of Burkina come in a box with the SOSUCO logo on it. 

It is fair to say, however, that SOSUCO enjoys a monopoly on sugar production in Burkina and a monopoly on the temporary labor market in my region, allowing it to fix prices and pay day-to-day workers next to nothing.  While the company claims to actively promote  the economic development of the region, it currently supports no development projects in the region that I know about.  The factory did bring electricity from Cote d’Ivoire (not even all electricity is produced in Burkina) to the village adjacent to mine where its main factory is located, but it managed to bypass all of the villages on the 15km of road between the factory and Banfora.  When the company was state owned it also built a system of water pipes running through the fields and the villages adjacent to them, but these had to be built anyway to support large scale irrigation.

Cotton is another exception to the “domestic consumption” rule of agriculture. But although it is produced by independent Burkinabe farmers, all of the cotton is purchased by another “public-private partnership,” SOFITEX.  The company has a monopoly on cotton purchasing, allowing it to dictate the prices it pays Burkinabe farmers.  Although the company claims to promote the “social welfare” of the general population, a visit to any cotton producing village proves otherwise.  It’s also substantial to note that even SOFITEX exports raw cotton to be processed elsewhere.  None of the fabric or clothes available here are made from Burkinabe cotton.  In short, Burkina Faso doesn’t have the industrial capacity to process cotton.

There’s livestock in Burkina Faso, too, but you won’t be eating a T-bone steak from a grass-fed cow in Burkina anytime soon. Even if we ignore the fact that cows here eat mostly dead plants and weeds instead of grass, Burkina Faso has little to no capacity to process meat on an industrial scale for exportation.  Your average butcher killed the cow on market day with his rusty machete, carried it to the market in a donkey cart, cut it up on a dirty table with the same rusty machete, and hung the pieces up to display in a hot, fly infested section of the outdoor market that half the vegetarians in the world cite as the reason they don’t eat meat.  A lot of villagers have animals in Burkina, but livestock here are more of a savings mechanism than a profitable investment.

Gold is another export of Burkina, but it’s mined by……you guessed it…..foreign companies! While there are many government officials that benefit from the fees that companies pay to mine here, the average Burkinabe sees no economic benefits from this industry. In fact, the Burkinabe that are “lucky” enough to get a job in the mines face extremely dangerous working conditions for little to no pay.

One of the few actual “industries” in Burkina is beer production.  It’s brewed domestically and consumed domestically.  All of the beer in Burkina is produced by the same company, which mass produces the two cheapest beers, Brakina and Sobbra, but is also contracted to produce foreign beers like Guinness and Pelforth.  The poor quality of the Brakina and Sobbra make it extremely unlikely that anyone outside of Burkina will ever enjoy the happiness of a lukewarm Brakina on a hot day. 

So if Burkina doesn’t produce most of the manufactured goods sold here, who does?  The answer is A LOT of companies in A LOT of other countries.  The “pagne” (colorful African fabric) that villagers wear is imported from Nigeria.  Mustard is imported from France.  Tissues are imported from Cote d’Ivoire. Cigarettes are imported from Ghana.  Spaghetti is imported from Turkey.  Tomato paste is imported from Italy.  Canned corn is produced in China for a French company based in Singapore.  Powdered milk is produced in Ghana.  The margarine that suspiciously doesn’t melt in 110 degree heat, leading many volunteers to speculate that it is more plastic than butter, is produced in Ghana.    Any item in Burkina that mildly resembles an item you would buy at a grocery store in America was imported.

But the best example of the “import saturation” phenomenon in Burkina is rice.  Rice is a staple of the Burkinabe diet, featuring prominently in at least half of all dishes that can be considered “Burkinabe cuisine.”  Yet most of the rice consumed in Burkina is imported from Thailand.  Due to climate, rainfall, farming techniques, government subsidies, and a variety of other reasons, it costs less to mass produce rice in Thailand than it does in Burkina.  So Burkina imports millions of kilograms of rice every year, while domestic rice production has virtually disappeared.

As you might have guessed, all luxury goods are imported as well.  The motorcycles that Burkinabe own are produced by Japanese companies, such as Yamaha, or Chinese companies, such as AP Sonic.  Most of the cars that aid organizations (including Peace Corps) use are Toyotas, while the cars that wealthy Burkinabe own are a mix of foreign imports (a lot of Mercedes).  All of the medicine distributed at the village health clinic is produced in India or China.

Burkina Faso is an interesting case study of economic globalization’s effects on underdeveloped countries.  Due to international trade, Burkinabe have access to goods that can’t be produced here (tissues, motorcycles, cigarettes, etc.).  However, Burkina also hasn’t developed the industrial capacity to produce anything short of sugar and dried mangos.  Development economists that support trade liberalization would argue that Burkina shouldn’t be producing goods that it doesn’t have a comparative advantage in producing, basically economics jargon for products that cost less to produce in Burkina than elsewhere.  For example, Burkina imports rice from Thailand because Thailand enjoys a comparative advantage in producing rice.  But the goods that Burkina has never and doesn’t currently enjoy a unique comparative advantage in producing much of anything.

A large number of development economists also believe that Foreign Direct Investment (FDI) is the driving factor of development, claiming underdeveloped countries are not making themselves attractive enough for foreign investment.  Some foreign companies have invested in Burkina, but most those companies have invested in the capacity to extract raw material for the lowest cost and export it elsewhere for processing (where most of the profits are made).  Burkina doesn’t have a skilled workforce to offer.  The roads are decent here (by African standards), but without a major river or ocean port,  it’s very hard to get goods to regional, much less international, markets. The bottom line is that Burkina Faso has very little potential for economic growth.  There will always be a global demand for cotton, sugar, and gold, but a vast majority of Burkinabe don’t benefit from these industries in any meaningful way. 

It is too often assumed that development will come with international trade and foreign investment, which can bring jobs and technology, but can also establish extractive markets that do very little to develop domestic national economies.  Sustainable economic development must ultimately come from within.  It’s difficult to start a business in Burkina, but it’s possible.  Savings and Credit associations that exist in many villages can provide small loans to members who contribute a small fee each week.  Microfinance organizations can offer to services and loans to people who are willing to work to pay them back.  If host country nationals don’t learn to use the resources at their disposal to increase their income, there will never be a substantial middle class between the absurdly rich and extremely poor.*  Equally as important, Burkinabe need to learn to help other Burkinabe.  Those with the power to make changes typically have a vested interest in maintaining the status quo, but society as a whole will never progress if the resources aren’t available for the poor to help themselves.

* Currently the “middle class” of Burkina (those living above $1.25 a day, the line of extreme poverty established by the World Bank) largely consists of low level government employees (teachers, nurses, etc.), a majority of which are paid out of foreign aid budgets instead of actual government revenue.

It’s difficult, but not impossible, to be a successful entrepreneur in Burkina, as demonstrated by my friend in village, Siaka.  Siaka is what, in Peace Corps jargon, we call a “positive deviant.”  He’s a Burkinabe who exhibits behavior that is atypically positive, in this case an entrepreneurial drive and work ethic that is more American than Burkinabe.  After dropping out of high school, he taught himself passable English and started a business in my village producing “atieke,” a local delicacy that is similar to kous kous.  He has successfully applied for, received, and paid back 3 loans from a microfinance organization called Zidisha.  Zidisha is one of many microfinance organizations that connect entrepreneurs in the developing world with “investors” in the developed world.  I put the word “investors” in quotations because most of these entrepreneurs are asking for less than $1,000 and people can specify their contribution.  In other words, you don’t have to manage a hedge fund to help these people out.  The loans have a low interest rate and a specified deadline by which they need to be paid back.  And studies have shown that over 90% of microfinance loans are actually paid back.

To give you an idea of what Zidisha looks like, I’ve posted the link to their website below.

https://www.zidisha.org/fr/

To conclude, sustainable economic development in the developing world is extremely complicated.  It’s about more than the GDP (total value of goods/services produced in a specific country) or GDP per capita (GDP divided by population) of a country. It’s about more than foreign investment or the natural resources a country has at its disposal.  Foreign governments, aid organizations, and corporations can contribute to economic development, but at the end of the day sustainable economic development is about host country nationals from all segments of society helping themselves and each other.  It’s not about “lifting” the world’s poorest people out of poverty; it’s about those people climbing out of poverty using the resources that are available.

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