Thinking Development

Tom Sangala January 25, 2020

490 3 minutes read

By Christopher Guta, PhD

I whetted the appetite of readers of this column three weeks ago by promising to propose actions needed to increase the level of trust in the economy from whatever level it is currently. In my mind, the importance of trust for Malawi’s development has increased since then following what the UN Secretary General said in his address to the UN General Assembly in September last year.

I quote: “Trust is at a breaking point. Trust in national institutions. Trust among states. Trust in the rules-based global order. Within countries, people are losing faith in political establishments, polarisation is on the rise and populism is on the march.”

On the local front, the action by Chief Justice Andrew Nyirenda, SC, to inform the Anti-Corruption Bureau (ACB) of the intention by interested parties to bribe the five judges expected to deliver judgement on the disputed presidential elections case contributed to raising further the importance of trust for Malawi’s development.

A reading of some of the global knowledge and understanding of the instrumentality of trust for economic development points to the criticality of actions related to three areas namely, efficiency and effectiveness of formal institutions, the extent of income inequality and social distance. These three factors, among others of course, when harnessed positively, can collectively foster building of trust in Malawi.

In this entry, I focus on institutions which, as the UN Secretary General alludes to above, relate to rules-based behaviour of economic actors. I will attend to income inequality and social distance in the next two entries respectively.

Conventional discourse recognises institutions as comprising the generally accepted ways of doing things. Thus, organisations are not necessarily institutions. To be sure, while the Malawi Police Service is an organisation, policing is an institution because it has accepted ways of accomplishing its intentions. Institutions constitute the ways that regulate interactions among economic actors. To bring the term closer to trust as a factor of development, institutions define the contexts where the interests of one party, and the effectiveness of the actions of that party, are strongly influenced by what other parties do. It is on this account that I am so inclined to accepting that institutions are social technologies if you accept technologies as embodiments of knowledge that enable generation of outputs from given inputs.

I was thus not surprised to learn from the global knowledge base that, in a country, the quality of governance is a factor that determines the extent to which trust can flow like a river. Governance is understood as the traditions and institutions by which authority in a country is exercised and relates to: (1) the processes by which governments are selected, monitored and replaced; (2) the capacity of government to effectively formulate and implement sound policies; and (3) the respect of citizens and the state for the institutions that govern economic and social interactions.

In order to improve governance, it is essential to attend to indicators that relate to voice and accountability, political stability and absence of violence, government effectiveness, regulatory quality, rule of law; and control of corruption. These are huge issues, so I will highlight just three and cite contemporary examples of actions.

I would be untrue to myself if I did not cite the example of the basis for the Chief Justice’s complaint to ACB. The basis, at heart, is the institutions regarding how our governments are selected. Continued national soul-searching on this matter will do us good in terms of governance as a generative mechanism for trust.

I hope I am not waddling in troubled waters by asserting that to the extent that the Human Rights Defenders Coalition is a platform for citizens’ voice aimed at engendering accountability of economic actors – not just politicians – the coalition’s actions, when taken according to the rule of law, contribute, as time goes by, to improving governance and emergence of trust.

When governments allocate resources to enable organisations that preserve public order and safety to operate efficiently and effectively, they are investing in governance with emergence of trust as a dividend. The effectiveness of the Malawi Police Service regarding traffic control has been on my mind for a long time. The safety of road users is not going to be enhanced by the multiplicity of roadblocks where officers ask drivers for ‘water’ but also by civic education of all citizens. The importance of improving the manner in which traffic regulations are monitored and enforced was identified at a national trade facilitation meeting I attended recently.

I was encouraged to read that countries with a history of British influence, such as ours, should be associated with good governance and, therefore, higher levels of trust. To this end, I hope Malawi can extract a higher dividend from Brexit beyond attending the London UK-Africa Summit.