By Kellys Kaunda
PRESIDENT HICHILEMA WORRIED THAT SOCIAL MEDIA CONTENT COULD AFFECT INVESTMENT, CAN IT?
IT was at the event where he made his first cabinet appointments when he lamented about the content on social media in Zambia.
He wanted Zambians to know that such content had the potential to scare away investment, especially foreign investment.
Of course most of the content these days is about this year’s elections. Specifically, the netzens are engaged with what the Zambian government has done.
In other words, they are debating the raw material courtesy of government itself, the number one content creator!
There’s enough data to support the theory of a causal relationship between media content and foreign investment or, as most people love to call it, foreign direct investment.
This is the theory the President was referring to. However, as the President has equally stated on several occasions, there are also exogenous (external) factors that can affect investment in any country.
Some of these exogenous factors usually cited include wars and hike in oil prices. But while these factors have widely been accepted as indeed related to investment decision-making, accepting them uncritically is ill-advised.
Here is something to think about. Global investment trends confirm that major capital flows run across the major economic regions of the world – the developed west and the east.
Factors such as political stability, strong and qualitative judicial institutions, fully developed financial and capital markets, populations with buying capacity, skilled populations and well-developed infrastructure, are among the major pull factors.
To see where things are happening, just take a look at how the United States and China are fiercely facing off on the economic global stage with the EU and Russia serving as supporting acts! The dominant sector is currently AI.
Zambia, like most African natural-resource nations tend to speak in exaggerated terms regarding their geopolitical position in current global affairs. They speak of their natural resource endowment like the developed world doesn’t have them.
Both the US and China as well as Russia have all the natural resources we have and much more. In fact, their technological advancement means that they can make do with what they have if Africa decided not to make them available to them.
Both the EU and the US rely heavily on Chinese rare earth minerals to power modern electronic goods which include weapon systems.
There isn’t much of these in Africa to the same level as China. So, we need not get ahead of ourselves.
One major obstacle to economic growth and diversification within African countries is the inability by our political leaders to deepen regional and continental trade. The current scale of economic activity and organizational structures of our markets are too small and underdeveloped to attract the level of foreign investment comparable to the volumes in developed regions of the world.
We still have countless non-tariff barriers that our leaders have failed to confront head on and unlock the economic growth potential that currently is going to waste.
Instead, they all look to the west where our products are subjected to standards they have set for us.
In other words, social media posts are nothing in comparison with policy failures of Africa’s leaders. In fact, social media content reveals the very evidence of the poor policy environment that is the creation of our political leaders.
No one threatens foreign investment in Zambia and Africa as a whole more than the very people we elect to do otherwise. That is the paradox of foreign investment in Africa.