Data-informed Economic Transformation

By Rob Floyd

Often policymakers are torn between taking bold decisions that can lead to transformative change or taking less risky ones that may only lead to incremental change.  While such decisions may sometimes be made based on political considerations, the best policy decisions will be made with abundant evidence and data. Evidence-based decision making is even more critical in Africa where policy decisions are also trade-offs between where to invest scarce resources and how to deploy limited capacity.  Yet, in many cases policymakers do not have access to the data they need, nor the tools to use data effectively.

On the sidelines of the UN General Assembly in New York on September 26, Good Governance Africa (GGA), a research and advocacy non-profit organization based in South Africa and focused on improving governance across the continent, launched Africa Survey Digital. The Africa Survey is an annual compendium of more than 4000 indicators for the African continent that is collated from big data sets drawn from UN Agencies, multilateral development banks and other institutions.  This year, for the first time, Africa Survey will be made available to the public on a digital platform that allows for country comparisons, data mashups, and time series data visualization.  It focuses particularly on child and youth development, natural resources, security, government performance, governance and demographics.

At ACET, we are also trying to provide policymakers with data tools to inform policy choices. In 2014, we developed the African Transformation Index to track how countries are transforming their economies.  The index focused on a composite of five elements that included diversification, exports competitiveness, productivity, technology and human economic well-being improvements. The index is now being updated with 22 indicators that will better reflect the changing nature of African economies, data availability, and the needs of policymakers. It will also include more countries.  We will focus on six high-level variable components including overall environment for growth and transformation, domestic resource mobilization, infrastructure, skills and technology, agriculture, industry and gender equality.  We expect the revised index to be launched in the first quarter of 2020.

These efforts are alongside initiatives such as Open Data for Africa (AfDB), World Bank Open Data, UNdata, the Global Partnership for Sustainable Development Data, Open Data Watch, Development Gateway, etc.  At the same time, more emphasis is being given to “evidence-informed” policymaking based on robust empirical research and reliable data. The Africa Evidence Network; foundations such as the MasterCard Foundation, Hewlett Foundation and the Gates Foundation; and organizations such as the Overseas Development Institute (ODI) have championed initiatives to ensure reliable and well-researched analysis and data.

But even with all these efforts, policymakers in Africa often have little data on which to make informed policy decisions. The panel discussion at the launch of Africa Survey Digital during the UN General Assembly addressed some of these challenges. First, while the international community is making more data readily available, it is often not the disaggregated, country level data that is needed by a ministry of health or agriculture. Efforts to build local capacity for sustained data collection and utilization are clearly needed. In many instances, data initiatives are development “projects” that end after a few years, leading to a short spike in good data, but then the data collection process is not continued. Likewise, given the enormous changes in global business models, the private sector now holds the key to big data – from consumer preferences to finance to communications.  This data could, if used appropriately, inform national policy and directly contribute to improved governance.  It is an area fraught with challenges such as data security and privacy, but one that should be pursued within certain parameters. Likewise, governments can do a better job of using the data they have to help inform business decisions, particularly for start-ups, social entrepreneurs, and small enterprises.

Most importantly, development actors must work together to ensure that existing data is made available to decision makers. Data gathered but not used will not lead to economic transformation.  ACET’s African Transformation Index will allow countries to better understand why some countries have made more progress on transformation than others. In fact it is the only index that deals comprehensively with economic transformation in Africa.  As with the Africa Survey Digital, we must get the African Transformation Index in front of policymakers, help them understand how it can be used to inform policy, and urge them to use it for economic transformation.

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