What The ‘Mona Lisa’ Teaches us About Economic Development

A few weeks ago, I travelled to San Diego, California to attend my brother Peter’s 50th birthday party. I was intrigued by how many people at the party had fallen under the spell of the Mona Lisa. In case you think my brother somehow stole Leonardo Da Vinci’s masterpiece from The Louvre in Paris and brought it to his party, that’s not what actually happened [although that would make for an interesting sequel to the ‘Ocean’s 11’ movie!]. No--the ‘Mona Lisa’ I’m referring to is a catchy song by two Nigerian musicians called Lojay and Sarz. When the song came up, the party goers--most of whom were white Americans from suburbia—began gyrating excitedly on the dance floor.?

Throughout the world, African music is hot. Justin Bieber collaborated with WizKid & Tems to remix their hit song ‘Essence’.?Sam Smith teamed up with Burna Boy to record ‘Oasis’. During the pandemic, Master KJ’s ‘Jerusalema’ possessed everyone from Italian beach bums to KLM flight crews to post dance routines on YouTube which received millions of views. Burna Boy, Davido and Wizkid routinely sell out global venues like New York’s Madison Square Garden and London’s 02 Arena. Tems and Tiwa Savage are topping global charts. ‘Love Nwantiti’ served as an anthem for the pandemic, sang not by African teenagers on TikTok, but by American, European, and Asian teenagers performing funny dance routines on the global social media app.

What does all this have to do with economic development, you may wonder? Well, I have a somewhat controversial view on how economic development occurs, and African music is a perfect illustration of my view.?

I believe that there are ultimately two options for societies to get wealthy.?

The first option is to steal from another society—usually by brute force. This is what The Romans did when they stole from the Greeks. The Ottomans pillaged much of Southeast Europe, Western Asia, and Northern Africa between the 14th and early 20th centuries and contributed to the wealth we see today in modern-day Turkey. The Vikings pillaged Europe. Portugal and Spain stole billions from their colonies in Latin America. The UK stole from its colonies in Africa, India, and the Caribbean. And the United States was built on 300 years of stolen labour from Africa.?

The second option is much nicer and doesn’t involve trampling others’ human rights. In this option, nations get wealthier by producing things for $1 and selling those same things to wealthier nations for $10 or $20, making huge profit margins and ploughing that back into their local economies. It’s called “trade”. This is what China has done for the last 30 years by manufacturing almost everything under the sun for the world and selling it for multiples of what it costs to manufacture in China. This is what India has done by leveraging its pool of 5.8 million software engineers to produce software which it then exports at a high margin, adding $220billion to India’s GDP each year.?

Israel has also figured this out. The ‘Startup Nation’, today houses over 6,000 technology startups and has the largest number of unicorns per capita in the world. I was surprised to learn when I visited Israel a few years ago that they do not consider a company a ‘startup’ if it serves the local market. Only tech companies serving global markets are considered legit in Israel. The recognize that their market in Israel is small, and so to grow wealthy, they have to serve larger and wealthier markets.

So Africa’s musicians (and increasingly film makers who put content on Netflix etc.) have figured this out. Simply put, purchasing power in Africa is extremely low. The average African lives on less than $3/day. So producing music and selling it only in Africa would mean producing catchy tunes?for $1 and selling it for 10 cents, thereby impoverishing Africa further. Instead, Burna Boy earns millions of dollars for a concert at Madison Square Garden and then ploughs that money back into Nigeria, creating jobs for thousands of young people who serve as sound engineers, producers, entertainment lawyers, social media strategists etc for the star.?

What are the implications of this for developing regions like Africa? It’s inhumane to pursue option 1 (colonizing and pillaging more developed countries). This leaves us only with option 2. We need to replicate what our musicians are doing—produce locally and sell globally at a massive multiple of the cost of production—in many other sectors like agriculture, tourism, carbon, talent, fintech, fashion, sports, oil, gas, and so many other competitive advantages we have. Otherwise, I’m afraid Africa will forever remain poor.

Our track record so far is dismal. For example, Tesla cannot manufacture its cars without cobalt for its batteries. 70% of the world’s cobalt comes from the Democratic Republic of Congo (DRC), yet the DRC gets only 5 cents on the dollar for each car Tesla sells. Maybe we can’t manufacture the full Tesla car (yet!). But let’s at least make the battery! Similarly, Ghana, Ivory Coast and Nigeria produce about 80% of the world’s cocoa. Yet we don't have any major global chocolate brands from Africa. Instead Cadbury, Mars, Lindt, and Ghirardelli's make boatloads of money while the African nations without whose cocoa chocolate cannot be made remain poor.?There is no excuse for not processing the cocoa into chocolate and building global chocolate brands so we can capture more of the value in Africa and thereby grow our economies.

To turn this situation around, Africa needs two things:

1. Excellent human capital (developed through education and training) who will leverage innovation and creativity to produce outstanding products that the rest of the world is willing to buy at good profit margins.
2. Capable leaders who do two things: 1. Create effective policies and 2. Get out of the way so that young African entrepreneurs and innovators can create great products locally, sell globally, and bring wealth into their nations.

The first is easier to do than the second. But both are possible. The original Mona Lisa heralded a new era for Europe—the so-called ‘Renaissance’—which led to incredible technological advancement and economic development for Europe. Let our modern-day ‘Mona Lisa’ be the harbinger of a new era of economic development for regions like Africa.?