State capture has hampered Africa’s development agenda

Throughout Africa, high levels of poverty stick out as a continental emblem. Sixty years after many countries gained independence, nearly half (if not more) of the population lives in extreme poverty.

This means more than 530 million people. Millions of children have no access to education because many countries have failed to develop and implement policies to enhance access to education. Children, for example, fail to attend school because the colonial rule on uniforms still applies.

Many households have no access to safe and clean water for domestic consumption. Whether near freshwater lakes or rivers, nothing much has changed in the last 60 years. Shelter remains a challenge too. Poor housing conditions in rural and urban areas point to high levels of poverty.

On the whole, only a few countries have improved the living conditions of their people, with Mauritius and Botswana leading in Sub-Saharan Africa as examples to cite even though with some limitations.

One factor that has certainly detained development in Africa and resulted in the suffering of millions of citizens is state capture. This specifically involves the hijacking of policies, laws and even state institutions by powerful individuals and groups to ensure these serve their interests. It is about influencing the making and implementation of policies to serve narrow self-interests rather than the public interest. They construct and deconstruct state institutions to serve their private interests rather than deliver public goods.

How this continues to manifest across the continent was brought to the fore in a recent researchers’ meeting convened by the African Leadership Centre (ALC) Kings College, London; the Institute for Development Studies (IDS), University of Nairobi; and the African Centre for Open Governance (AfriCog). 

Studies on state capture show that business actors, powerful families, the elite and corporations in Africa tend to manipulate or influence laws and policies to include provisions and clauses that favour their narrow interests. In some instances, powerful families take over the state and the functioning of governments and public institutions. Powerful people or even corporations determine what policies should be made, what laws are passed and how regulations will be made to serve their narrow interests.

Where state capture is prevalent, powerful people take control of parliaments and dictate to co-opted legislators what laws to pass and how to pass them.

They infiltrate the judiciary to ensure decisions are sold to private interests. Their private firms dictate what public institutions should do and how. In Tunisia, when Ben Ali was president, his family had more than 630 firms doing business with the government. His family was the country, and the country was him. The families decided which multinationals would do what and who would be exempted from what tax.

Narrow interests

But state capture is different from lobbying and generic corruption. Lobbying is legal and legitimate everywhere, especially when done to promote public interest or ensure the delivery of public goods. However, when aimed at benefiting narrow interests rather than the public good, it turns into corruption because it is done for private gain. The activities under state capture often look legal but gradually turn corrupt when those behind them begin to benefit in private. 

Simply put, state capture turns public institutions and the government in general into a political marketplace. In this market, support is traded through influence in the making of favourable policies, laws and regulations. Public resources gradually turn into patronage or private material that is given for the purposes of cementing loyalty and not improving the well-being of all.

The private businesses, powerful individuals and families that capture the state access these resources for their private interests. They trade their influence in the political market to the disadvantage of the public. Above all, the government and public institutions are structured and reconfigured to serve these narrow interests. All this is done to consolidate power and ensure the long-time survival of political alliances and allied interests and to loot public institutions.

South Africa provides a good example of state capture. The Gupta brothers captured the state under President Jacob Zuma using their business empire spanning mining, media, tech and manufacturing.

The band of three brothers co-opted President Zuma’s family members into their businesses and then their platform for influence became solid. They were thus able to influence who became who in government and in key ministries such as finance, mining and transport.

The family had an influence on South Africa’s Revenue Services, where they would claim astronomical refunds. State capture spilt over into the procurement of goods and services. The best-known examples include South Africa’s electricity supply company. The contracts to build new electricity supply facilities would be given to politically connected contractors but they did so bad a job that the plants collapsed immediately after they were completed. South Africa today has one of the worst electricity supply systems in the region.

There are many types of Guptas even in developed countries. But here, the rule of law and strong institutions ensure impunity is punished. Presidents are indicted or prosecuted after leaving office.

Kenya is also home to examples of state capture. Here, the union of politics and business has led to all forms of corruption for many years. The Goldenberg scandal of the 1990s showed how private interests influence the enforcement of regulations and laws. Under President Mwai Kibaki, the Anglo-Leasing scandal also showed the influence of private interests in government. Outside of Anglo-leasing, there were policies made through the influence of the business elite surrounding President Kibaki.

These policies later benefited powerful individuals and their companies. Energy policies and in particular increased connections to the national grid emerged as one area that was captured immediately after the new government was formed in 2003. Increasing electricity connections was indeed a need but the elite captured the sector. President Uhuru Kenyatta’s government had many examples too. The Eurobond scandal is yet to be settled. The exemption of some firms from paying taxes and making policies that tend to favour some firms are citable examples. Infrastructure projects everywhere bred many disputes arising from the award of contracts and non-completion of work.

State capture diverts public resources to private needs. It stunts growth and hampers the delivery of services. The focus is private gain and therefore it does not bother those involved that the services are poor or absent. This is what ails development in Africa.

Prof Kanyinga is based at the Institute for Development Studies, University of Nairobi; [email protected]; Twitter: @karutikk