The age-old sharing economies of Africa -- and why we should scale them | Robert Neuwirth

Translator: Reviewer: Daban Q. Jaff

So what I'm doing

is a thought experiment.

Now you may know of or have read

this book by this guy.

It's probably the first and maybe the only bestseller

ever written about economics.

And you probably know a bit about what it says.

It talks about how nations all over the world will prosper

through the individual pursuit of individual profit.

Individual profit will be the mechanism for the prosperity of the world.

But the funny thing about Adam Smith

is that he was a stay-at-home kind of guy.

He actually never went further from Edinburgh

than France and Switzerland.

So my thought experiment is to imagine

what would have happened if Adam Smith had visited Africa.

And fortunately, there's actually an easy answer,

because the Arab lawyer and traveler Ibn Battuta

traveled down the east coast of Africa in the 14th century,

and what he found when he got to Mogadishu was a market,

and he wrote about it.

And basically, merchant ships came to the harbor,

and they weren't even allowed to land.

They had to drop anchor in the harbor,

and boats came out to them,

and locals picked them and said, "You are my guest, I am now your broker."

And they had to do business through the local broker,

and if they went around that and didn't do business through the broker,

they could go to court, and the deal would be canceled,

and they would be thrown out of town.

And through this mechanism, everyone prospered.

And so if that was Adam Smith, he might look like this guy

and say, "Ah! That's a mutual aid society.

That's a share-the-wealth free market."

And when I put this question to Christian [Benimana],

who had the stage at the beginning of this session,

he responded that if Adam Smith had come to Africa,

there would have been a sharing economy long before Airbnb and Uber.

And that's true.

So if we put this to work today,

it would be very interesting.

There would be a lot of money flowing into the countries.

These are just figures of 10 percent of exports in these countries.

So the interesting thing is that this mutual aid economy still exists,

and we can find examples of it in the strangest places.

So, this is Alaba International Market.

It's the largest electronics market in West Africa.

It's 10,000 merchants,

they do about four billion dollars of turnover every year.

And they say they are ardent apostles of Adam Smith:

competition is great, we're all in it individually,

government doesn't help us.

But the interesting reality is that when I asked further,

that's not what grew the market at all.

There's a behind-the-scenes principle

that enables this market to grow.

And they do claim -- you know, this is an interesting juxtaposition

of the King James Bible and "How To Sell Yourself."

That's what they say is their message.

But in reality, this market is governed by a sharing principle.

Every merchant, when you ask them, "How did you get started in global trade?"

they say, "Well, when my master settled me."

And when I finally got it into my head to ask, "What is this 'settling?'"

it turns out that when you've done your apprenticeship

with someone you work for,

they are required -- required -- to set you up in business.

That means paying your rent for two or three years

and giving you a cash infusion

so you can go out in the world and start trading.

That's locally generated venture capital. Right?

And I can say with almost certainty

that the Igbo apprenticeship system that governs Alaba International Market

is the largest business incubator platform in the world.

And there are other sharing economies that we look for --

merry-go-rounds, which are found in almost every shantytown.

They have different names in other cultures; this is the Kenyan name.

It's a way of generating cash.

It's a kitty -- people throw money into a pot once a week,

and once a week, one member of the group gets the money,

and they can spend it on whatever they need to.

And there's also something called "acequias,"

and that is a Spanish word, but it comes from the North African Arabic;

"saqiya" means "water wheel."

And what the acequia is is a sharing system for scarce water.

It's migrated from North Africa to Spain,

and from Spain to the west of the United States,

where it still is used.

And it shares water by need

rather than by who was there first.

And contrary, with all due respect, to what Llew [Claasen] said

when he talked about blockchains and cryptocurrencies yesterday,

there is no tragedy of the commons.

People in acequias have been commonly managing scarce water resources

for hundreds and hundreds and hundreds of years.

So taking this thought experiment, I wanted to go a little bit further

and suggest that these things are managed communally,

and they are taking care of scarce capital, scarce cash

and scarce resources.

And it seems to me that we have actually two kinds of capitalism.

We have the capitalism of the top up.

And these are really interesting statistics,

because three one-thousandths of one percent of the Nigerian population

controls wealth equal to one-fourth of the GDP of the country.

One one-hundredth of one percent of the Kenyan population

controls wealth equal to 75 percent of the GDP of the country.

That's the capitalism of top up.

And everyone else is with this guy,

selling board games and bodybuilding equipment

in a go-slow on the highway in Lagos.

And when you're selling board games and bodybuilding equipment in a go-slow,

that traffic jam is really, really, really bad, right?

Those of us in this sphere of the economy

are caught in what I call "the capitalism of decay,"

because there's no way to rise up and get out of it,

because they're lacking the resources that we talked about

in those sharing economies.

And they're tripped up

by the thesis of cassava and capitalism,

that cassava has to be processed in order not to be poisonous,

and I would argue that, similarly,

the market economy needs to be processed in order to be fair to everyone.

So we have to look at what I call the "bottom down economy."

These are these sharing models that exist out there

that need to be propagated and used and scaled.

OK?

And if we propagate these things,

we can begin to bring infrastructure to everyone,

and that will ensure that communities

are leading their own development,

which is, I believe, what we need in the world,

and, I would suggest, what we need in Africa.

I wanted to quote Steve Biko,

and I thought it was really important to quote Steve Biko,

because next month, September 12 to be exact,

is the 40th anniversary of his murder by the South African state.

And you can read the quote.

He basically said that we're not here to compete.

And I love this quote: "... to make us a community of brothers and sisters

jointly involved in the quest for a composite answer

to the varied problems of life."

And he also said that "the great powers of the world

have done wonders in giving us an industrial and military look, ..."

and we don't have to copy that military-industrialist complex,

because Africa can do things differently

and restore the humanity of the world.

And so what I want to suggest here

is that we have an opportunity,

that we are all here in the mutual landscape

to be able to do things,

and that the journey starts now.

Thank you very much.

(Applause)