
«Screw poverty alleviation!
I want prosperity!»
Bureaucracy and overregulation are the greatest hurdles Africa faces on the path to prosperity, says the entrepreneur Magatte Wade. Western states should open their markets, instead of sending development aid.
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Magatte Wade, you have started several companies in Africa that sell their products worldwide. What was the biggest obstacle to success?
It’s a constellation of regulations. In any African country, starting and running a company basically means swimming through molasses to try and do business. The main problem is regulation – or to be more precise: overregulation.
What kind of regulations?
If I explained all the regulations in my home country of Senegal alone, I’d be talking for the next ten years. But to give you one example: Suppose I want to hire a lab technician. He has a PhD in German, but I don’t care about that, and because of his experience, I am convinced that he has the necessary skills for the job as lab technician. We agree on a salary and want to sign a contract. However, the state requires us to use a contract designed by the government. And since he has a PhD in German, they require me to pay him a salary five times my budget for this job. They also define the hours he can go to work, although we had agreed that he would work 40 hours in four days to have Friday off.
This sounds rather complicated …
That’s not the end of it. Once we have signed a contract fulfilling all these restrictions, we have to bring it to the labor inspection office, a government agency. There, some government official who doesn’t know anything about my company gets to decide if we can sign this contract. This can take two weeks, a month or even more, after which they might decide that the technician also needs to provide a medical certificate or some other document. Naturally, every time we need to provide or get a document, we need to physically travel to the capital city or the regional capital, which means two or three hours in my case, because these government agencies don’t respond to emails. And their attitude is always against employers, even though employers and employees sit in the same boat. That’s the problem with governments: They simply don’t understand how markets work.
How do you deal with these kinds of obstacles? What’s your advice for would-be entrepreneurs?
How did I overcome these obstacles? Simple, I happened to be very well connected. I won’t pay bribes. But the truth is that many will pay bribes. But I was able to go and see the head of customs and help myself that way. As to my advice for would-be entrepreneurs, I tell them not to start a business in Senegal or other African countries at the bottom of the World Bank’s Ease of Doing Business Index.
«That’s the problem with governments: They simply
don’t understand how markets work.»
Why did you do it, then?
Because I want people to understand the obstacles in our way to prosperity. I want them to know why poor nations stay poor. If you look around the world, you see that prosperity has been created in only one way: through entrepreneurial value creation. Other people call it capitalism. And for that you need free markets. It’s plain and simple. I am a natural entrepreneur: if I see a problem, I want to fix it. Entrepreneurs are those who criticize by creating. If we want to build prosperity in Africa, we need to create jobs, and entrepreneurs create these jobs. Ultimately, you’re poor because you don’t have enough money to take care of your basic needs. And where does money…

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