Latest News
Tony Blair working to build the next frontiers of Africa
Tuesday, Jun 01, 2010 in Office of Tony Blair, Africa Governance Initiative
Reuters interview transcript:
Darcy Lambton (DL) - Now there’s a buzz of excitement right now about the investment potential of frontier markets, but already the search is on for the frontiers of the future - three potential candidates, Sierra Leone, Rwanda and Liberia. At least, that’s the view of the Africa Governance Initiative. Its founder, former British Prime Minister Tony Blair, joins us now. Let’s start off with the work of the AGI, the business model, what is it about that model that you think is helping to create the conditions for sustainable investment in those countries?
Tony Blair (TB) – My view is that the problem with African countries is not just a matter of aid. Aid helps, but really what they need is sustainable development, and to make that development sustainable they need governance, they need capacity, they need leadership decisions to be implemented and followed through, and the two things that my teams do there are – First, we get in a group of highly committed young-ish people who will have got experience in the private sector or the public sector, they come in, they work alongside the President of the country and build that capacity. And the second thing is I interact politically with the leadership too. So there’s that additional dimension, because I’ve sat in the leadership seat, I know what it’s like to try and take those decisions, I know how complicated it can be, but the combination of if you like, almost a kind of social enterprise alongside the President and the political interaction I think gives us an opportunity to make a real difference there.
DL – O.K, let’s start off with Rwanda first and its economy. A lot of hope pinned on the IT Sector, on high-tech innovation, how realistic is this aspiration of building a regional IT hub, when you have the likes of Kenya and Uganda already making huge strides in this area?
TB – The two absolutely critical things for any African country that wants to develop sustainably are; - 1. That you put together the right business environment, so that people come into an environment that is predictable, where they’re able to get the right access, where they’re looked after, and where they’re, as we tried to do in Rwanda, you get a one-stop-shop to come into the country. And the second thing is the transparency - that you come in on a transparent and an open basis. Rwanda has got both of those; it’s got strong leadership, its got leadership that’s determined to open the country up in the right way. So, you know, there will be a lot of competitors in the information technology space and other things, but I think Rwanda is a country that has got a very very good prospect for these areas.
DL – Political risk is a key factor for any foreign investor looking at a country like Rwanda, elections coming up later this year, and we are getting reports of opposition supporters being intimidated, being imprisoned, is that really a sign of the kind of political stability that will attract foreign investors?
TB – Well, look, what I always say to people is that you’ve just got to understand what Rwanda’s gone through. It went through I think the worst genocide probably since the Holocaust, since the Second World War, so it’s not surprising that they are incredibly sensitive to anything that provokes or promotes that type of dissention again. Now, I think that political evolution has got to happen, I think the President is well aware of that, but my view of him is that he is someone who is actually deeply committed to his country, to reconciliation, and recognises the very point that stability is the key to getting investment into the country, and therefore to ensuring a future in which the prosperity is there, so that people don’t go back to the old ways. Now, that often causes difficult situations where people from the outside will be critical, but I think they’ve just got to understand the evolution of the country and how difficult it is.
DL – O.K next on the list is Sierra Leone, we had an investment summit here in London late last year. How are things going right now in terms of attracting inward investment into the country? And also, I want to talk about corruption briefly if we can, since November three government ministers have been fired, accused of corruption. What are your concerns that may deter would be foreign investors?
TB – You know sometimes people say, well you know you’ve had ministers arrested for corruption, isn’t this a sign that things are bad? I say actually it’s a sign that they’re willing now to take action. After the Sierra Leone Investment Conference we got a major $400 million investment announced, there are a whole series of other investments that are in the pipeline now, I think you know you’ve got the first sort of private equity people going in there and working at it, and if we can build the infrastructure of the country, particularly electricity and roads which we are now focusing on, which the President is very focused on, and the President again I think is a really decent, deeply committed guy, you know I think it’s possible we can bring Sierra Leone to the next stage and start to embed the idea amongst the people that you know politics and proper government can deliver.
DL - And the last country on the list is Liberia, geographically very big compared to the other two, but small population, just over 3 million, how tough is it attracting foreign investment into that country given the competition in the region and also the legacy of civil war that’s still very prevalent?
TB – Well it is really tough, on the other hand, Liberia like Sierra Leone has come through this very difficult time there’s a great commitment from the international community. I mean, the Americans for example are really committed and embedded; you’ve got a major UN force there in Liberia. I mean I think Liberia, the challenges are big but the President again is absolutely committed to making the change necessary, you’ve got some major investments that have been announced in Liberia, and again what you have is the most fantastic possibility. I mean the countries got resources, it’s got incredible beaches and I always say with that part of West Africa, the tourist potential is just enormous because they’re on the same time-zone as most of Europe, 5 or 6 hours away. You know, if you can get the thing moving and going potentially it’s of tremendous benefit.
DL - Finally Mr Blair, how do you persuade foreign investors to put their money into these countries given their recent pasts, the civil-wars that they’ve all come through compared to other markets that have a history for, shall we say, greater stability, the likes of Nigeria or even Kenya?
TB – Well that’s a good point. I mean there’s no point ever in saying to people trying to dismiss the past; you know the past is there, it has its impact and its implications even now. On the other hand if you look at all three countries they have been through this period some years back now, there is a tremendous commitment from the leadership there, there is change happening that is positive, and I suppose there’s very few frontier markets you go into that there isn’t a risk/reward balance that’s different when you’re investing in a very developed market. But the thing is if this investment pays off it’s going to pay off in a very big way. And my view which is why I’m working, why my charity is working in these three countries is that long term you know they are a great bet. Now you’ve got to put all the caveats in and investors will do that, but the natural potential of these countries is enormous and the political leadership and determination is there.
