Ntata’s Uncommon Sense: Leaking airport, leaking Malawi

Ordinarily, I wouldn’t be one to blame any particular president for the embarrassingly shoddy airport infrastructure exposed the water leakages that resulted in a flooded Kamuzu International Airport the other day.  But we do live in a country where even good rains are claimed by the party faithful to be the result of great leadership, so perhaps we must point the figure of blame in the same direction it is pointed when good rains or anything good ever happens in this almost perpetually bungled country.

The real question is why. Why is it that after 50 years of independence, 50 years of politicians promising that the country will develop and people’s lives will improve, we seem to be moving backwards?

And How. How can any administration that claims to be running the country well and seeking a new mandate from voters allow for an airport, the first impression any visitor to the county has of Malawi, to become so dilapidated that it floods when it rains?

The reason is actually quite simple.  Our political leaders have been unwilling to implement the necessary solutions. They are so obsessed with development structures that are likely to bring them quick votes in their so-called weak areas that they become blind to very elementary political realities: Good infrastructure brings investment. Investment bring in economic growth. Economic growth brings in votes.

The blatant and most clear example is with the current Democratic Progressing Party (DPP) administration under both the late Bingu wa Mutharika, and now being perpetuated by his brother, the incumbent Peter Mutharika. Instead of developing the airport and improving air travel, they build a house of parliament. Instead of solving electricity problems, they build a football stadium. I will come back to this point shortly.

First of all, we must all agree that in the years succeeding independence, instead of building on the important infrastructural foundations that were set by Kamuzu Banda during the one party rule, most of the structures and systems that were set up then have been destroyed and sometimes even deliberately allowed to dilapidate.

The country that once had a vibrant commercial investment framework in the form of Admarc, the Malawi Development Corporation and the Press Corporation group, as well as solid infrastructure for development in the form of reliable electricity, water supply and other services, is now just a thing of the past. What we have left are a failing service delivery system, and a country leadership that seems more interested in building hotels, football stadiums and roads in places they are not particularly needed; a love affair with projects that often have questionable public utility.

Now, underdevelopment is thought to be about lack of investment, and many political economy theories can account for this. Yet, there has been much investment in Malawi but without the corresponding development to show for it over the past 50 years. The problem has been that investment growth has not led to output growth. We therefore need to explain not simply underinvestment, but also the miss-allocation of investment.

It is in this regard that we must blame the DPP’s penchant for the construction of white elephants—investment projects with negative social surplus.

Bingu wa Mutharika’s successful food security project notwithstanding, (and I still have great admiration for Bingu) I wish to propose that as Malawians, we need to stop praising and clapping hands for DPP white elephants that only serve to entrench the DPP in power but have no real substance in improving the country’s economic situation or investment profile.

The DPP type white elephant projects simply have been a particular type of inefficient redistribution, which ispolitically attractive when these politicians find it difficult to make credible promises to supporters.

It is the very inefficiency of such projects that makes them politically appealing. This is so because it allows only some politicians to credibly promise to build them and thus enter into credible redistribution. The fact that not all politicians can credibly undertake such projects gives those who can a strategic advantage. Socially efficient projects do not have this feature since all politicians can commit to build them and they thus have a symmetric effect on political outcomes.

It seems to me that white elephants are preferred to socially efficient projects if the political benefits are large compared to the surplus generated by efficient projects.

Around 2008 when the Chinese offered to help Malawi with some needed development projects, the DPP leadership, at that time under late Bingu wa Mutharika, asked the Chinese government to help with the following projects: finishing the parliament complex which had been started with funds from the Taiwanese government,a new National Stadium, a new university at Ndata, a five star hotel and presidential villas in Lilongwe, and the Karonga-Chitipa road.

Think about this for a moment.

These projects were being built at a time when Malawi was already facing energy problems with serious blackouts that were discouraging serious investors. You must then wonder why the DPP did not ask the Chinese at this time to assist first and foremost with projects to solve the electricity problems.

Solving electricity problems would in improve the lives of all Malawians in the short term, and in the long term have an even more positive impact in encouraging more investors to come to Malawi (One of the main cost issues at the Kayelekera mine, for example, that affected the operations of that project, was to do with the fact that ESCOM failed to supply sufficient electricity for operations there).

On the other hand, how many ordinary Malawians’ lives have been improved by the building of a Fifty million dollar football stadium in Lilongwe, or the building of presidential villas there?

The construction of white elephants should be seen asdangerous and unwelcome, and should not be praised at political rallies or in the media as we have seen party cadets do at the top of their voices. These projects are simply a redistribution aimed at influencing the outcomes of elections. The political motivation behind white elephants is clearly a DPP legacy though, and we must be as suspicious of such projects as the road currently being constructed in the Lilongwe old airport area, or Peter Mutharika’s promises to build even more football stadiums in the future, as we must be of the DPP’s apparently great idea to even start paying national football team players’ salaries from the public coffers!

The main reason why it is so difficult to privatise, much less reform, certain of Malawi’s public sector enterprises is because the central regime does not believe it is in its own political interests to reduce their size and scope. I do not need to present any evidence to demonstrate the common knowledge that in Malawi, even parastatals have traditionally been used as a way to distribute patronage.

DPP’s politics favour only a certain tribal group, as we all know.

When politicians represent specific tribal groups, a particular politician who values the welfare of the beneficiaries of a loss making project may find it optimal to keep operating it when a politician from a different group, who only values the revenues, cannot.

This explains why somewhat valueless projects like a new football stadium or a new university at Ndata can be politically attractive. They affect voting behaviour.

The trade-off is between efficient projects, which generate revenues and promote investment, and inefficient ones, which influence political outcomes. In this trade-off inefficient projects are more attractive to the DPP, particularly because the value of remaining in power is large.

By what tortured logic does Peter Mutharika justify building roads in Kasiya and promising football stadiums when the country desperately needs electricity and water services that actually work, and structures that improve government service delivery? By what logic do those that praise the DPP’s white elephant ideas justify this kind of foolishness?

Is remaining in power really more important to Peter Mutharika than giving Malawian homes reliable running water and electricity?

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