Can Business Rights Alleviate Group-Based Inequality in Sub-Saharan Africa? Understanding the Limits to Reform

Abstract

Africa’s indigenous minorities face unique constraints, particularly in terms of engaging in even the most basic business activities. They typically lack business rights, but, even where such rights have been extended, they have had scant impact on group poverty. This paper argues that the failure of business rights to meaningfully transform the livelihoods of marginalised minority groups stems from elite capture of resources, dependency on external validation, and a contradiction between a collective problem (group poverty) and an individualist solution (business rights). African states could alter conditions through active pursuit of affirmative action policies, but lack socio-economic and political incentives.

Acknowledgements

An earlier version of this article was presented at the UNU-WIDER workshop on legal empowerment of the poor. The author is grateful to Naman Trivedi, Kwabena Akuamoah-Boateng and Regina Titi-Ofei for their helpful research assistance, and to Rachel Gisselquist, Wendy Hunter and two anonymous reviewers for their valuable comments.

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

1. Although the interpretation of ‘indigenous’ peoples is contested, this paper defines them as ‘mainly nomadic/semi nomadic pastoralists and hunter-gatherers (or former hunter-gatherers). The hunter-gatherers include among others the Pygmies [Baka and Batwa] of Central Africa, the San [Basarwa] of Southern Africa, the Hadzabe and Akie of Tanzania and the Ogiek, Sengwer, Watta, Yaaku of Kenya. The nomadic or semi-nomadic pastoralists include among others the Maasai of Kenya and Tanzania, the Barabaig of Tanzania, the Endorois, Samburu, Turkana, Rendille, Orma, Borana and Pokot of Kenya, the Karamojong of Uganda, the numerous pastoralist communities in Sudan, Somalia and Ethiopia, the Touareg of Mali, Niger and Burkina Faso, the Fulani in Niger, Mali, Burkina Faso and numerous other West African countries, the Mbororo in Cameroon, Chad and other West African countries, the Toubou in Niger and the Himba in Namibia’ (http://www.iwgia.org/regions/africa/indigenous-peoples-in-africa). See also, United Nations Regional Information Centre for Western Europe, n.d.

2. Doing Business is intrinsically linked to formalisation: the economies that rank highest on legal, regulatory, and procedural metrics correlate with lower informality (World Bank, 2015; p. 22; CLEP & UNDP, 2008; pp. 71–3). Similarly, LEP’s underlying assumption that formalisation is good reflects the worldview of Peruvian economist Hernando de Soto, who co-chaired the CLEP. De Soto’s (2000) widely read book, Mystery of Capitalism, emphasised the establishment of formal property rights and land titles for the poor, which he saw as the key vehicle for poverty reduction (Lyons, 2013, p. 78).

3. Despite its provenance, the LEP initiative is not particularly well known outside practitioners and scholars of poverty research. Yet, whereas the nomenclature of LEP and, specifically, business rights, is not generally part of the development lexicon, the thesis behind expansion of business rights nonetheless is quite prominent. It has been proffered in a host of recent initiatives promoting entrepreneurship in the developing world, including the Global Enterprise Monitor (GEM) and the World Bank’s Enterprise Surveys, and numerous donor programmes. In fact, the idea of getting the poor to do business and engage in entrepreneurship has become de rigueur and is arguably most clearly reflected in the World Bank’s Doing Business reports, which are something of an heir to the less familiar business rights/LEP agenda.

4. Although the indigenous peoples are invariably minorities, it is important to note that this does not refer to national minority groups per se, some of which may be quite influential in political and economic life (see Arriola, 2012).

5. However, rights without empowerment are non-fungible for indigenous peoples, and even Uganda’s alienated Batwa, who at least have ‘recognition’, have little land as compensation and find themselves largely dependent on government hand-outs.

6. It is important to note that there are limits to the generalisability of CBT. CBT assumes access to land and land rights; hence it illustrates the intersection with other LEP pillars, namely indigenous legal rights, and land rights. Yet whereas a CBT model may have promise for the Maasai, such opportunities would not be available in instances where traditional land has been appropriated, and/or designated for other uses, such as in Botswana’s CKGR or Rwanda’s Volcanoes National Park. In Botswana, Cameroon and Rwanda, indigenous community members were evicted: absent access to land, there is no recourse available to peoples forcibly moved (literally) to the margins of the modern economy.

7. Recent field research in Kenya by Sophia Wood (2017) at another Maasai CBT initiative, Oldarpoi Mara Camp, finds that success is significantly dependent on the quality of the individual leading the effort. This too, suggests limited institutionalisation of the CBT approach to LEP.

8. There is no consensus on the size of the new middle class, but it is variously estimated at between 9 and 10 per cent of the population (BusinessTech, 2015).

9. Indeed, both IWGIA (n.d.) and the African Commission (ACHPR & IWGIA, 2005) seem to indicate that land dispossession is the primary threat, along with lack of access to justice, representation, and the like. Tellingly, ‘business’ is mentioned only twice in the 119 page ‘Report of the African Commission’s Working Group of Experts on Indigenous Populations’ (ACHPR & IWGIA, 2005). It is worth considering whether indigenous groups, according to their principal international interlocutors, desire to be in business (as conventionally understood) at all.

10. Interviews conducted in January 2010 with informants in Zambia’s Southern Province revealed that these attitudes remain prevalent in various ethnic communities, (although they exist alongside emergent cattle farmers that are commercially integrated, suggesting that cultures do adapt to modern economic conditions). How much demand exists for opening, for instance, a small business, may vary considerably across communities.