President Kagame's inauguration

I was honoured to be invited by President Kagame for his inauguration last week. It was an amazing event that filled the Stadium to its capacity of 40,000 with 10s of thousands more watching on screens outside. The Event was attended by 14 Heads of State from across Africa, Ministers, Private Sector Leaders and representatives of International NGOs and Agencies.

The Event was not just the inauguration of Rwanda’s President but the inauguration of a new African Statesman, demonstrated by the level of support shown by visiting Heads of State.

President Kagame dedicated much of his speech to responding to his Critics on Human Rights and discussing the development successes in Rwanda. Anyone that has seen the changes in Rwanda over the last 10-15 years cannot fail to be impressed with the level of progress and development.

While NGOs and the International Media have a right to discuss Rwanda’s Human Rights, I hope they do it within the framework of the Development successes. Leaders like Kagame have to be engaged in Dialogue with constructive criticism rather than publicly hung.

Africa is changing, progress is being made on democracy and economic development and the continent should be engaged in recognition of its potential to be the next BRIC. Africa will be one of the key drivers of global growth over the next century. Let’s not miss this opportunity by failing to create mutually beneficial dialogue and consolidate our partnerships with the continent.

Rwanda and one size fits all development

I was pleased to see President Kagame respond to his critics in the international media via a strong article in the FT last week. It is important that we pay vigilant attention to Human Rights issues across the globe, but President Kagame makes an important point that there is no ‘one size fits all’ path to development and democracy.

Given Rwanda’s recent history, we should praise the country’s success on the path to competitive democracy and continue working with the country to help them strengthen it.

President Kagame also argued that Africa must take responsibility for its own future, that Africa must devise its own solutions to its problems and that partners that work with Africa in this way will benefit. Africa Forging its own path is important for the future of the continent and President Kagame is an important advocate of this.

Africa the next BRIC

Sub Saharan Africa can be the next BRIC; from 2000 to 2010 Sub Sahara grew at a faster rate, in nominal dollars terms, than both India and China and is predicted by the IMF to grow at a faster rate than Brazil between 2010 – 2015.

Sub Sahara has much going for it and conditions are improving constantly. Between 2002 and 2008 the continent achieved a growth rate of 5.2% a year on average, and only dropped a single percentage point since the global economic crisis – still a higher rate than the developed world is expected to achieve.

Africa’s population had grown to 820 million in 2008, and the percentage that can be considered ‘middle class’ has grown astronomically since the 1990s. Africa is now both ready to take its place as a market of consumers for global products and as an attractive investment destination for global business looking for new opportunities. I would suggest Commonwealth countries to potential investors as they make up 17 of the top 20 places to do business in Africa, according to the IFC.

To achieve this jump, to become the 5th BRIC, Africa needs to deal with a number of persistent issues such as the infrastructure and power deficit, increasing access and the quality of Education and enhancing business competitiveness, these will have to be achieved along with progress on democratization and good governance. To succeed on both economic development and good governance simultaneously African will need more strong and dynamic leaders. Rwanda and President Kagame are a case in point; it is unfortunate to see the international media running negative stories about one of Africa’s best success stories.

Paul Kagame has been one of the most ambitious and successful African leaders in fighting poverty and driving growth in his country. This year the IFC named Rwanda the best business reformer in the World, likewise Paul Kagame is recognised by many western leaders as one of Africa’s Best, Tony Blair described him as ‘visionary’ a sentiment I agree with.

While there are concerns about the current election in the Rwanda, we must not forget the impact that Kagame has made on the development of his country. Democracy is hugely important but it will not be achieved without economic development, democracy on empty stomachs will not succeed –this needs to be more widely recognised.

While raising the issue of Human rights, we should be supporting leaders like Paul Kagame that are driving progress in their countries and the continent. Africa is also making progress on democratisation, Kenya’s recent peaceful referendum that aimed the settle the country’s political disputed is a good example. These stories and there like should be the ones that the international media focus on as Africa strives to become a BRIC. A more balanced approached to reporting on the continent, that helps encourage Africans, will benefit us all in the end.

David Cameron in India

David Cameron's visit to India last week could well turn out to be one of the most important diplomatic trips of his time in number 10.

The commitment by both Governments to transform the nation’s relationship over the coming years is most welcome. Both leaders agreed that the India-UK relationship has great room for growth, in the political, cultural, security and economic realms that would be of benefit to both countries.

I am particularly pleased to see the commitment to significantly increase trade and investment between the 2 countries. I have long been calling for the level of interaction between the countries private sectors to be raised and am delighted that the UK-India CEO’s Forum is being set up under the Peter Sands of Standard Chartered and Rattan Tata of Tata Group (both CBC members of long standing) to provide the private sector perspective on strengthening the economic relationship. I look forward to working with the Forum in the future.

Hon Kamal Nath, India’s Minister for Road Transport speaking earlier this year at our India Infrastructure Forum (IIF) said the next 10 years will be India’s Infrastructure Decade. The opportunities offered by this are enormous, tackling India’s infrastructure deficit will require cooperation between the Indian government and the national and international private sector, and the UKs business should be leaders in this. To help push this Lord Adonis, the then UK Secretary of State for Transport, initiated a MoU between the Indian Government and the UK at the IIF to work together on road development, a process that was continued during the Prime Minister’s visit last week.

It is great to see the New British Prime Minister taking such an interest in strengthening the Bi-lateral relationship between the 2 countries, in a report we produced in 2008, and are currently in the process of updating, we found that the UK was India’s most significant investor, a trend we hope continues.

And finally I was delighted to see the strong commitment made by both Prime Ministers during their meeting to work together to ‘strengthen the Commonwealth’ as an important global body.

Singapore a world leader

Further evidence of the global economies shift to the East has emerged. Singapore, one of the Commonwealths most developed nations, has released record breaking growth rates, for the second quarter of this year the country grew at 19.3%, the fastest rate of growth since records began in 1975. Singapore's remarkable record in the IFC’s Doing Business Index is not merely coincidental to its exceptional level of growth. The city state is the most business friendly county in the world, this is an example that both developing and developed countries will need to follow if they want achieve any level of growth let alone 19.3%.

Following Singapore's example of how a small state can grow to become a world player is an aspiration I have seen a lot in the commonwealth's developing nations aim to become regional players. Singapore is a financial hub for Asia and can act as a gateway for other Commonwealth countries to access its non-Commonwealth neighbours in the region, this is an example countries would like to replicate.

When Singapore is displaying growth rates of this level and many of its regional neighbours are growing at rates of 10% or more, it is no wonder that Asia is of ever increasing importance to the global economy.

CBC - ICICI Dinner

Last week I had the pleasure of Hosting Ms Chanda D Kochhar, Managing Director & CEO of ICICI Bank for a dinner with leading Indian and British business leaders in London. She made a series of extremely interesting points during her speech.

Firstly it was noted that now was the time for India to take centre stage, that its annual growth rates exceeding 8% put the country at the forefront in the Global economy and that Indians themselves believe it is there time. Ms Kochhar also argued that for the current growth rate to be sustainable over the coming years the Indian banking sector would have to grow by about 20% a year, this would mean the banking sector increasing in size by 2.5 times over the next 5 years.

Ms Kochar also drew an interesting parallel between the western economies and India. She suggested that the while stimulus packages had been needed in the west to preserve growth and stave off recession, in India all the investment is demand led. "as bridges and roads are completed they are filled with traffic" she said. 'The need for infrastructure for a development is currently a real opportunity, but left un-tackled will become a serious bottle neck to Indian growth', she added.

Ms Kochar made one final 'mind boggling' observation, that by 2020 India would be home to 25% of the world's work force. India will continue to benefit from the demographic dividend until 2040, which will be the first point at which the median age of the population exceeds 32, a benefit China does not share. With such a large part of the population in the working age group, India can expect to enjoy a long period of increasing domestic consumption and prosperity.

The strengths of the Indian economy Ms Kochar highlighted, clearly demonstrate just how important India is becoming to the global economy. And indicate the level of opportunity available to the international investor looking to invest.

India, Africa and employment

An interesting report by the Oxford poverty and human development inactive was recently released that found that there were ‘more poor’ in India than Africa. This doesn’t surprise me as much as it seems to have others, while India has made improvements it has never rated highly on the UN’s Human Development Index, India ranked 134th out of 182 countries in 2009.

What occurs to me, is the similarities between the areas of high poverty in India and Africa. Outside of the urban poor, the areas with high levels of poverty are predominantly regions with large deposits of natural resources and areas of with high levels of agricultural fertility, that still operate some form of feudal system.

The reasons for poverty are the same the world over and many of the solutions can be applied globally. Investing in agriculture will allow farmers to move away from subsistence to commercial viability. Resource companies are not ‘good’ job creators, so they must be pushed to downstream and help create the support industries that will provide employment in resource rich regions.

Poverty will only be tackled successfully where government works in partnership with the private sector. Government must provide a regulatory and tax environment that stimulates economic activity. While the private sector must take advantage of this and provide employment along the length of the value chain.