The Need For A New Economic Vision And Development Model For The Gambia

According to the World Bank (2023), “global growth is expected to decelerate sharply to 1.7 percent in 2023. It is the weakest growth rate in nearly three decades, overshadowed only by the global recession caused by the pandemic and the 2008 global financial crisis (World Bank, 2023).” In other words, it predicts a slowdown and a bearish economy for developing economies like the Gambia as the spillover of the pronounced weakness that is experienced by the United States, the euro area, and China will exacerbate other headwinds faced by emerging markets and developing economies (World Bank, 2023).

A famous saying is that “governments sometimes get the policy right but the politics wrong, or the politics right but then stuff up the policy process.” That is quite right and not a misnomer, as that typified nations, particularly developing and emerging economies. In this context, the need for a new economic vision and development model for the Gambia cannot be overemphasized, as the continuous application of a capitalist punctured model has not delivered the desired outcomes of our investments for the past 58 years of nationhood and independence. Capitalism is advanced and not in line with our current development parameters as a least developing country (LDC), based on our human assets index (HAI) and economic and environmental vulnerability index (EEVI). We are among the poorest as per the UN poverty index, and we do not have the fundamentals as the required foundations were not built to support and fuel the delight of capitalism. As such, we are applying the wrong oil in the motor and statistically getting the equations mixed up because environments and economic geographies vary across countries. Taking Nelson and Winer (1982) as an example, in their ground-breaking book: An Evolutionary Theory of Economic Change, they argue that the production function framework (either exogenous or endogenous) is the wrong approach to understanding technological change. We can use this classic argument to illustrate our case of applying capitalism without understanding it and getting it right.

Additionally, the capitalist economic model we have adopted has placed us in a state of no development, stifling our creative spirit and inhibiting our desire to see a new and developed Gambia. Due to this, the economy is vulture-infested, deep-rooted, and greed-based, creating parochialism and vested interests among groups and individuals, thus creating a wedge between rich and poor. The latter are primarily marginalized under the guise of false ambivalence of issued-based policies. At the same time, this is made possible based on rugged capitalism, structural reforms, and economic development designed to benefit the rich and those in power calling the shots across our nation’s public and private sector institutions. This indicates that we will not grow but remain fixated on quick fixes and in the “dead aid” conundrum.

We must formulate a policy convergence and confluence to understand better the hellish road we took in pursuing free-market policies to address our structural, institutional, and administrative development challenges. Making and implementing economic policy decisions is not about putting forward the best ideas or blaming who is at fault. It is not a contest of theorizing without practice. In reality, it is about contextualizing and prioritizing policies that will significantly and positively affect lives and livelihoods in our country. Hence, for effective economic management to happen, (a) ideation, (b) courage, identification, (c) design, (d) formulation, (e) consultation, (f) coordination, (g) direction, (h) implementation, and (i) influence are all required in the policy-making governance framework.

Therefore, there is a need for a change in the structure of our economy. That need for a change requires objective reasoning and reflections, critical analysis, and examination of the problems by taking stock of our current development imperatives and then focusing on what needs to be done, how, what, when, and why? That is fundamental! It will help us understand that the crux of the problem lies not in our failure to harness the economy’s private sector but in failing to determine the stakes of prioritization, allocation of resources, and organizing the public and private sectors well for the public good.

More importantly, we need new orientations and models of development in the Gambia’s fiscal ecosystem because of vast economic disparities, senile economic growth, marginalization, rising unemployment, rising crimes and insecurity, rising prices of essential commodities, corruption, misplaced development priorities, misaligned policies, and wasteful public spending. These contribute negatively to weakening our expansionary growth prospect and capability to create jobs for our teeming youthful population, generate optimal financial revenues, and provide inclusive development across our national divide.  

As a result of these unprecedented challenges, a fundamental shift in economic policies requires recalibration and re-evaluation in the form of a paradigm shift that is practical and responsive to our needs and aspirations as a people and country. Our failure to strategize, re-evaluate, and repurpose our economic fundamentals on the constructivist approach will create the cyclical and cataclysmic “continuum” of unending stressors of economic chaos and uncertainty as we are continued to pass through the volatile socio-economic and political situation uncertainties that began to hit our domestic shore. 

Hence, it becomes imperative to look at our NDP from a global, regional, and domestic level to ascertain whether the set objectives can provide concrete and realistic solutions amidst the continued challenges faced by the country at the domestic and international levels.

We need not be dogmatic in our thinking and application of capitalism but give democratic socialism a try and see its outcomes for our country. According to Jena (1965), “democratic socialism offers several ameliorative measures to improve the living conditions of the relatively poor by ensuring a reasonable degree of employment safety, socialization measures with control over output, investment, and employment policies, prosperity measures that aim to increase and maintain industrial activity, and egalitarian measures that aim to reduce income and wealth inequality.” Understanding this dynamics will help us explore democratic socialism to determine an extensive degree of convergence and further validates Walker’ (1991) study that investigated the application of democratic socialism in Germany, France, and Italy. This will enable us to operate outside our comfort zones and resist indulging in ideological polemics and populist rhetoric. Hence, implementing the articles of faith on democratic principles, secular values, and socialism through ideation, vision, and pragmatism to build the “Gambia We Want,” where equal opportunities and endless possibilities exist for every Gambian child. That is critical as the capitalist model we had adopted/executed needs fixing. The equations must be applied correctly to give us the magic numbers to set our country on a growth-led and successful trajectory in all spheres of development through the rhythm of democratic socialism. Democratic socialism is the new oil for growth as it has all the necessary ingredients and development cure for our nation. It does not intend to eliminate private corporations but rather brings them under greater democratic control through government revenues and tax incentives to encourage companies to act in the public interest and not be obsessed with raking profits and poor service quality delivery.

In this context, maintaining the ‘status quo’ of our designed and adopted economic development, coupled with the financial pooling of resources generated by loans and further walking on the debt trap, is not an option. Currently, our public debt officially stood at 90% of GDP, and that is unsustainable. This could be higher if we factor loans contacted by parastatals and other public enterprises. Such high level of public debt reduces the Gambia’s capacity to borrow for high-impact development projects. Our public debt portfolio, therefore, cannot be built with the expectation of debt forgiveness, misuse of resources, or a relaxation of our economic policies promoting good governance and the rule of law. Given that our country has limited resources, vulnerabilities, and limited fiscal space, it cannot recover and stay strong, resilient, and competitive in the face of rising global economic challenges. Thus, inadequate resource management, compromised fiscal responsibility, and ineffective governance have grave consequences.

However, we must not be bandied around in setting our development models on the whims and caprices of “half-baked” theories presented and imposed on us by the IMF, World Bank, ADB, and the EU. Our development parameters, models, and strategies must instead be designed in line with democratic socialism if we are to move from a state of underdevelopment and non-growth, where poverty, incompetence, and corruption tamed our creative ingenuity for the pleasure of self-serving desires to a state of organic and fluid sustainable growth and development. Below is what I suggest in setting the ball running if we desire to reach the summit of growth, development, and economic prosperity:

1. Our foreign policy must be aligned with our national economic policies and centered around partnerships and collaboration for development and investments rather than budget support and financial aid. The latter cannot be sustained and could compromise our national development policy and values, as development assistance comes with conditions attached. 

• Build a blue economy by centering it on the plank of state entrepreneurship based on innovation and environmental sustainability. We understand our fishery and marine resources and need not be told what needs to be done to harness those unexploited prospects to create jobs for our people and raise revenues for the government. so, to invest, support, and sustain our productive sectors (for example, the fishing, agriculture, and manufacturing sectors), we must ensure our macroeconomic fundamentals are built on the dynamic of ex-post-cum-ex-ante, where our sovereign wealth funds generate financial resources. In this way, we are spared from rugged capitalism that forces us to rely on foreign aid and loans to fund our budget and development. 

• It is necessary to have a different tax policy than a developed country because: (a) the primary objective is not merely economic stability but economic development; (b) revenue maximization should be given higher priority rather than the ability to pay or equity; (c) we need to follow a policy of active intervention of the government in economic affairs and not laissez-faire; (d) it aims at accelerating economic growth and addressing economic inequalities. This is a strategy for shifting resources from the public sector to the private sector, from consumer goods to investment goods, and from import goods to export goods. 

• Focus on dynamically increasing returns to scale (i.e., from the dynamics of learning by doing) with a strategic focus on R & D rather than relying on laws of diminishing returns in investing in science, technology, and innovations to unveil the power of Schumpeter’s ‘creative destruction’ in the Gambian minds through the state to drive the transformations of Gambia’s economic development model and people’s centric vision. This will transcend into a healthcare and preventative economic development model to provide timely, quality, affordable and effective health services as ‘health is wealth’.

• Despite its enormous potential, the tourism sector has yet to be fully exploited. The industry must be examined in the context of its strategic importance to the national economy to transform lives (i.e., create jobs and revenues) for the citizens and the government. We deserve a booming tourism industry that attracts high-end tourists instead of a lame all-inclusive packaged tourism strategy. If we wish to gain strategic advantages in the sub-region, tourism marketing and promotion must be re-examined. Other countries within the subregion dwarf our tourism potential (Senegal, Ghana, Cape Verde, etc.), whose products and infrastructure are considerably superior to ours. Hence, linking our tourism with our economic vision and development model is essential, since ‘Brand Gambia’ needs to be competitive

• In budgeting, we must look at the sustainability of public spending by being financially conscious, prudent, frugal, and mindful of non-business value-added expenditures. Thus, we must ensure that appropriate strategies are identified under the government’s wage differentials, and capital outlays. Doing this will help us address the root causes of spending outside our public budget, as we need to identify and address the real problems, not the symptoms.

7. Adopt austerity and policies that are mutually beneficial, sound, and uncompromising to avoid the SAB dilemma. A reasonable budget is appropriately costed and not adjusted over time by the executive and presented to the hallowed house of the National Assembly for approval. We must get our acts right and save ourselves from a governance’s conveyor belts of short-sightedness and tame increasing inflationary pressures. 

8. Implement effective tracking and trending systems to monitor the execution of the identified, agreed-upon policies and costs by tailoring them to our needs rather than becoming too ambitious and developing policies outside the realm of SMART principles.
9. Ensure that the policy environment is conducive, effective, coordinated, and carried out in compliance with the NDP to avoid deviation resulting in policies being politicized and misaligned

There is a general perception that democratic socialism will not work in the Gambia since those in the capitalist class and “men in gray suits,” who seek self-aggrandizement without considering people’s needs, espouse that notion. However, based on rational thoughts and my constructivist approach, it can only be proven or disproven whether it can work through its delivered outcomes. For this reason, let us experiment with democratic socialism and see what it can offer to our people and the commonwealth of our resources, as ‘one size does .’t fit all’. This will help us prepare our readiness to change the narratives of our development trajectory for the better.

In conclusion, understanding The Gambia’s need for a new economic vision and development model will encourage collaborative behaviors in engaged scholarship, enabling scholars, researchers, policymakers, stakeholders, and organizations to discuss the issues, assess the need for change, and develop solutions. For us to continue relying on failed, and “half-baked” policies halting our development is a high-stakes game, a bearish path, and a bleak future.

References:

Jena (1965).

Nelson, R & Winer, S. G. (1982). An Evolutionary Theory of Economic Change. Belknap Press.

Walker, I. (1991). Democratic Socialism in Comparative Perspective. Comparative Politics, 23(4), 439–458. https://doi.org/10.2307/422259

World Bank (2023). Global Economic Prospects. Washington, DC: World Bank. https://doi.org/10.1586/978-1-4648-1906-3