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From the boardroom to the ballot paper: African business leaders move into politics

By Patrick Smith, Nicholas Norbrook and Crystal Orderson
Posted on Wednesday, 24 January 2018 20:15

As companies and money-­brokers reinforce their influence over governments, a newish breed of businessman-politicians barrel their way into contention. In its most extreme form, the phenomenon has delivered the likes of Silvio Berlusconi, owner of Italy’s biggest media company, and Donald Trump, whose family’s real-­estate business sponsored a mercurial rise, via reality TV, to the White House.

Berlusconi and Trump are attracted to uber-nationalism and populist politics, mixed with a strong dose of misogyny and racism. Beyond such instincts, both men revel in being anti-ideological, willing to trade positions for political advantage at short notice.

There are plenty more players in the business-politics club in Africa, Asia and Latin America. They are generally smarter and less crass than Trump and Berlusconi, but the message is the same: if you can run a business and make a profit, then you can run a country.

For the most part, it is a new thing. Until recently, Africa’s political leaders have been mostly military officers, guerrilla commanders, lawyers, teachers and the occasional medical doctor. The dominant view has been that government’s role is to provide public goods such as high-quality education and healthcare, water and power. More interventionist governments would run industrial policies and use other development strategies.

But businessman-politicians shrug all that off, preferring to speak in managerial clichés about the need for a level playing field, corporations wanting regulatory predictability, and a sensible – that is low – regime of taxes and royalties. That agenda has encouraged businesspeople to get stuck into the political scene – with very mixed results.

Africa’s business stars like Nigeria’s Aliko Dangote, Sudan’s Mo Ibrahim, or Egypt’s Naguib Sawiris, are received reverentially on the conference circuit. All of them billionaires, their commercial successes are contrasted with the continent’s economic travails.

Diplomacy or governance

Both Dangote and Sawiris assume a studied diplomacy towards governments, not wanting to incur partisan wrath that might jeopardise their corporate interests. Ibrahim, who sold his mobile phone business a decade ago and launched his foundation to promote better governance, takes a different tack. He is sceptical about business skills in politics – whether in Africa or the US. “Africa doesn’t need a new business model […], it needs stronger governance and more accountability,” he tells The Africa Report. Ibrahim’s eclectic career may give him a more nuanced view of the business-politics nexus.

Some company bosses push their influence by sponsoring politicians and parties. Others see themselves as national leaders. Hakainde Hichilema, the leading opposition politician in Zambia, is backed by the Brenthurst Foundation, which is funded by the Oppenheimer family in South Africa. Hichilema’s record of building up businesses in his country is part of his campaign. After his recent detention on treason charges that were later dropped, he comes across as a campaigner against an unjust system headed by President Edgar Lungu. But Lungu’s allies claim that Hichilema’s associations with Brenthurst are a liability.

Business-politics relationships are in flux. For years in Southern Africa, the Oppenheimer family, with holdings in the De Beers and Anglo American mining conglomerates, financed parties, politicians and even journalists who promoted its interests. This arrangement offered big money great influence under the apartheid system. It also shielded the mining companies from an overt association with politics under apartheid.

That arrangement would no longer work after liberation in 1994. Then, the mining companies vied with other businesses, such as Western arms companies BAE Systems, Dassault and Saab, to buy influence with the African National Congress. Since the ascent of Jacob Zuma to the presidency in 2009, the Gupta family has taken that model to the next level.

Different skill set

Herman Mashaba rose to prominence as a self-made entrepreneur who became a top official in South Africa’s opposition Democratic Alliance. But he has not been a roaring success as mayor of Johannesburg. Running a complex municipality in Africa’s most modern economy takes a lot more than gung-ho commercial skills.

Nigeria has a claim to being the headquarters of business-political ­alliances. Apart from Senate president Bukola Saraki, other top political players with a business background are former vice-president Atiku Abubakar and former Lagos state governor Bola Tinubu. Both men are stupendously wealthy and they share a political understanding. Tinubu runs an extensive real estate empire in Lagos and Atiku’s Intels company has benefited from several favourable government contracts.

Atiku is loudly preparing a run for the presidency in 2019. Should President Muhammadu Buhari decide to run for a second term, the two men would compete directly for the same core support in the northern states. Not entirely coincidentally, it seems Atiku’s companies are falling out with government regulators. Meanwhile, Tinubu is keeping his head down, perhaps looking over his shoulder at the federal revenue authorities.

If businessman-politicians are struggling to win power in Nigeria that does not augur well for their chances elsewhere. As a Lagos banker told The Africa Report: “If a business operator as sharp as Aliko [Dangote] doesn’t see the point of running for the presidency […] why should any of us waste our time?”

Cyril Ramaphosa, Deputy president, South Africa – Back in government through the revolving door:

The firebrand union leader built a multimillion-dollar business empire and has joined the race to become South Africa’s fourth president in 2019. Ramaphosa’s supporters put it all down to his hard work and commitment to the cause; his detractors dismiss him as spineless and indebted to white businesses. In August 1987, as leader of the National Union of Mineworkers, Ramaphosa led 340,000 workers in a strike to win big concessions. But once it was clear that he would not succeed Nelson Mandela as president he left politics to build up a business empire. He returned in 2012 as President Zuma’s deputy president. Most estimates put Ramaphosa’s personal wealth at $450m-$500m. Most of his fortune came from the Shanduka Group he started in 2001. Shanduka’s stake in the British-owned Lomnin mining company during the 2012 Marikana massacre was politically toxic for Ramaphosa.

Moulay Hafid Elalamy, Trade and industry minister, Morocco – A driving force in two arenas:

In a country where business and politics are intertwined all the way up the flagpole, Morocco’s Moulay Hafid Elalamy still manages to stand out. With a day job as trade minister, he nevertheless finds time to manage Saham Group, the insurance, pharmaceutical and offshoring company he founded, which has subsidiaries across the continent. Smooth-talking and with an easy manner, Elalamy has survived several reshuffles and a change in government as he pilots the Kingdom’s industrial revolution. He is not shy about the spectacular growth of the automobile sector around Tangier: “We are trying to build an ecosystem of companies around Renault,” he says. “We are going to create hundreds of thousands of jobs. We will be a world-beater in the automotive industry.” But Elalamy was not always an ambitious politician. Back in 2009 he told Jeune Afrique magazine that he would never enter into the political ring: “Never! You need specific skills for that, and I don’t have them.”

Ken Ofori-Atta, Finance minister, Ghana – Banking on politics:

With his quiet and considered speech, and usually dressed in an unadorned white tunic, Ken Ofori-Atta looks more like an adherent of a puritanical religious sect than either businessman or politician. His tradition of starting official meetings with a prayer reinforces this sense of otherworldliness. Yet Ofori-Atta is as serious a player in either field as you are likely to find in Africa.

Having founded Databank, one of Africa’s most successful regional banking groups, in 1990, Ofori-Atta built a business empire with a strong portfolio of agricultural and transport projects. After fundraising for the New Patriotic Party (NPP) in the 2008 and 2012 elections, both of which it narrowly lost, in 2016 he doubled down and set up an election strategy team, recruiting a Ghanaian IT specialist to head it.

It was not a foregone conclusion that Ofori-Atta would take a job in the new government. Insiders say he was persuaded once he saw the wreckage of state finances close up. Since then, he has engineered a kind of cultural marriage, bringing in young technocrats from his banking group and replacing the civil service ethos with a more focused corporate one.

Moïse Katumbi, Former governor, Katanga Province, DRC – Digging deep for popular support:

When Moïse Katumbi, politician, magnate and owner of top football club Tout Puissant Mazembe, hits the conference circuit, it is to bang the drum for radical change. He wants free elections and an end to the serial looting of Congo’s rich resources. In October, Katumbi promised to return to his country to do political battle after 18 months in exile. There is no soft landing in prospect. After announcing a raft of criminal charges against him, the government says it will arrest Katumbi as soon as his plane touches down. To run for the presidency, as he insists he will, Katumbi will have to navigate the political chaos. As President Joseph Kabila extends his tenure, rebel groups are taking up arms.

Katumbi, who started in the family trucking and mining services business in Lubumbashi, was tasked by Kabila with fixing the mining industry. He became governor of Katanga in 2007. He and Kabila were allies until the point when Katumbi started talking about the need to respect presidential term limits. Then relations soured rapidly.

Bukola Saraki, President of the Senate, Nigeria – Empire building, policy making:

They are the quintessential power couple in Nigeria: Senate president Bukola Saraki and his wife, Toyin née Ojora, a lawyer and founder of a charity. With a network of regional and international allies and contacts, as well as astute tactical sense, Saraki is one of the foremost contenders for the presidency in the 2019 elections, should Muhammadu Buhari not seek a second term.

Conversations with Saraki about government usually turn towards his forthright views on economic strategy, based on his own business experience. Sceptical about state-owned enterprises, Saraki argues the government could use proceeds from the sale of oil and gas assets to boost critical health and education budgets, as well as supporting investment in growth areas such as agricultural production and processing.

During the years of military rule Saraki qualified as a doctor at London’s King’s College and practised in Britain for a few years before returning to Nigeria to manage the family’s holdings, spanning real estate, banking, pharmaceuticals and trading conglomerates. On the return to civilian rule in 1999, President Olusegun Obasanjo looked around for young technocrats from business to help shape his new government. Saraki was brought in as a budget adviser in the presidency. He was drawn to the political arena, fighting battles around the presidency and the ruling People’s Democratic Party. A combination of high-level government connections, business acumen and backing from his father, a political kingmaker in the region, helped Saraki win two terms as governor in Kwara State.

That propelled him into the top political echelon. But it earned him several enemies, who swooped when Société Générale bank, in which the Saraki family had a substantial stake, had its operating licence suspended in 2007 after incurring heavy losses.

Saraki has fought back hard, establishing a reputation as a canny political operator, first as the architect of the Governors’ Forum, and, in 2013, teaming up with his friend Rotimi Amaechi, governor of Rivers State, to establish a new opposition party, the All Progressives Congress, in alliance with Buhari.

Elected Senate president in 2015, Saraki is again showing political imagination. As he nurtures relations with the Buhari presidency, Saraki is widening the traditional role of the Senate to contribute much more to policy-making and government strategy. Few in Abuja are counting out Saraki just yet.

This article first appeared in the December/January 2018 print edition of The Africa Report magazine

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