In a recent piece published in Foreign Affairs, Francis Fukuyama and I argue that, post global economic crisis, we are witnessing a shift away from the Western free-market or neo-liberal economic model in the developing world. In an essay in our forthcoming book (New Ideas on Development after the Financial Crisis), I suggest that developing country political leaders, particularly in low-income countries, could turn to more state management of the economy and more autocratic political systems as a result of the crisis. Will the leadership of Africa’s unconsolidated democracies not envy the apparent ease with which China managed the economic crisis compared to, say, India? Will these leaders—as Rwanda’s President Kagame did even before the crisis—increasingly look to Singapore rather than South Africa or Indonesia? What model will the more consolidated democratic Ghana look to as its oil income continues to rise?
Put another way: now that American style capitalism has fallen from its pedestal, will more autocratic political systems with greater top-down state management of the economy—as in China and Singapore—look more attractive?
I think yes, even despite the recent wave of democratic revolutions occurring against authoritarian regimes in the Middle East. One reason is the tendency to conflate more authoritarian politics with more effective implementation of economic policies. As Fukuyama points out in a recent WSJ piece, China’s authoritarianism has been of high quality in economic terms. Similarly so has Singapore’s, and now Rwanda and perhaps Ethiopia. But those relative successes are exceptions to the poor record of Mubarak, Ben Ali, Gbagbo and Mugabe (as some economists have long argued).
I hope I’m wrong. We shall see. For now China, Singapore, and Rwanda may yet seem to developing countries the political guides to economic policy—if for the wrong reasons.