International factors affecting the choice of technology and employment in Africa: report No. 3

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UNITED NATIONS

AB,RICAN INSTITUTE FOR ECONONIC DEVJ.:lLOPMENT AiJD PLANNING

DA KA R

52nd SENINAR ON

CS/2673-24 INSTITUTE OF DEVELOPMENT

UNIVDRSITY OF SUSSEX

B R I G H T 0 N

;fli &Jesr-

STUDIES @

INCREASING PRODUCTIVE EiviPLOYr-1ENT IN AFRICAN COUNTRIES

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(Dakar 10 November - ¹² Deccmber.1975)

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NOVEfii13ER 197 5

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Page 1.

Internationa}J.actors Affecting the Cho~ç_~

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Tecm1~~~ ~~d Employment in Africa

The principal speaker and the dÎscussant presente~ a comprchcnGivc and penetrating review of international factors affecting the choice of technology and employment in Africa.

It was noted first that the nature of technology employed in a country has profound impact on the type of goods produced, per unit oost of production the pattern of convention and demand, and the type and level of employment. Consistent with the strategy which has been recommended for meeting the basic need of the rœ.jority, it is important that developing countries must choose and develop technologies 1-1llich an appropriate to meet the real need of these countries.

DEFINITION O.l!, TECHNOLOGY

Technology can be broken down into three pa.rts:

1. Hard technol0.gy, in, mecha.nical apparatus, equipment, etc. 2. Soft technology, i .e. knowledge, or~ization skills, research

and development communication ~stems, etc.

3.

Technological systems combining hard and soft technology. Historically, most of the technological transfer have been from developed to developing countries. Even at the moment this the still the case, and the trend is likely to continue because

95%

of global resea.rch and development is conducted in the developed countries the dangers of this trend are twofold; first, because the technology developed in the developed oountries is gea.red to the dermnd patterns a.nd resource endow- ment of the developed countries and hence inappropria.te to the needs of the developing countries and secondly because tl1e ri~n.jor vehicles of the

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technolog~cal transfcr are MNC's which, bccauso of tho nature of thoir objec- tives and operational procedures, are incapable of ada.pting technology to meet tho noods of the dcvoloping countries.

In tho pa.st MNC' s ha.vG put ompha.sis on tra.i1sfor of hard tcchnology₁ they a.ro no\v incrensingly putting Ol.Iphasis on tra.nsf,or of soft tochnology and tochnologica.l system. Becauso MNC's have monopoly control in certain' key clements of a tochnological system, notably in the form of knowlodgG imbodicd in thcir key m.nagerial a.nd technical persona.~, organizational ability, Gtc.₁ they arG in a position to insist on selling tochnological packages, al though sorne of tho compononts of tho package may be ava.ilablo

but

in the dovoloping countrios. lï'urthormoro, bocauso of the nature, sizo, and intorlocking org;.:.nizational structure of MNC' s they arc able to rig priees both of inputs and outputs in thoir favour and to the: detriment of the devo-

loping countrios. Finally, by virtuo of thcir monopolistic control arc sorne key componont of tochnologic.:al packages ₁ the transnational compor;:;.tions arc able to porpctuntc dopondency of tho dcvoloping countries on the de-a:eloped countries,

In ordor to reduco the dependoncy of tho dovoloping countrics on thG tochnology, of tho dovclopod countrios, it is important, first and foromost for the dovoloping countrios tcb exorcise nationC~.l control on thoir nn.tional and financial rosources. This will be consistent with tho Dakar Declaration of 1974, which omphél.sisod the imperative neod of cloveloping countrios to control thoir economies. With effective control on thcir resources, the dovolopod countries will be able to formula.to ma..npov.rer developmont plans, without national technologica.l dcvclopmont programmes, including rGscarch and dovolopmont, é1nd fit theso programme within over-all national dovolopmont plé1ns. Socondly, tho dovoloping countrios shoulcl ignore thcir knowlodge on · tochnological mattors, and thGroby onha.nco thoir ncgotiatioll ekills vis-,a-vis the MNC's~ In ~•rticular, tho dovoloping countriGs should insist on disaggrc- gation of tochnological packages into thoir individu2.l componcnts, idcntify thoso componcnt which can be produccd locally, CJ...Yld import only what they

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cn.nnot producc. FU.rthormorc ₁ the dovcloping countrics shoulcl rovicw the existing codes in patents, t rades nnrks, etc., and have thon chct.ngcd. Finally, tho dovcloping countrios should estn.blish regional nnd sub-

rcgional tochnologica.l co-opor~.tion in a way of rosoarch and dcvolopmcnt institutions regional consultn.ncy institutions ote.. They should a.lso eliminnto tho intormodi2.tion of dovolopod countrioc tochnological coo- peration among dcvoloping countrics.

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The report of the French Speaking Group had as its subject

"Changes in .Agricultural Technology and Employment".

It was noted in the report that the food situation in .ll.f:tican countries continued to deteriorate resulting in hqg~ imports of foodstuffs with use of foreign exchange and resultant trade im- balance.

In the circumstances, it was felt that a strategy of increased food production leading to food self-sufficiency was necessary for African countries.

To this end African countries should engage upon controlled mechanisation by use of suitable farm equipment and introduction of

other formcrs' inputs c.nd innovation.

Sorne members expressed the appreciation that modernisation un- less controlled and based to>vards the small peasant >vould resul t in the big farmers taking advantage of all the new facilities to the disadvantage of all small farrnei's .

It was however, agreed that differential mechanisation should be the emphasis on mechanisation₉ promoting mechanisation >vhere there vras acute short age of labour in the agricul tural s ector as 9 say 9 in the Niger-Mali .area.

The discussion of the question of transfer and choice of techno- logy was continued wi th one partie ipant expressing sharp disagreeme'nt vri th the employment bias of choice, transfer and development of tech- nol ogy in African countries. Taking the example of India, he urged

african countries to aggressively import technology if they meant to build the ir national economy as soon as possible. .And a policy

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conference participant also exprossed tho viu1r that th0 division of labour-intons ive:' and cnpito.l-intons ivo tochnologios as bo ing appropriate for dovGloping and doveloped countrius rospoctively was misleading. In his view· a single projoct likc: r oad building could simul taneously requiro both labour- intensive and capital intensive oquipment.

Tho Policy confJroncG p2..rticipant laid doun the following im- per atives for tochnological transfor:

i) Sprcad of informat ion on availablo tuchnology.

ii) Dovolopm-:..nt of rosoarch c~_paoi t;y in Juvvl oping countrios .

iii) Creation of capital goods industries in devel oping countrius.

iv) Thorough ruviow of polioies which favour use of capital- intonsive tochnol ogy.

v) Establishment of a unit or machinory in tho duvoloping countri:)S to identify aroas of appropriato tochnol ogy use.

It was then pointod out t hat though it is truc that nearly

all exponditures for rosoarch and development t nke pl ace in dov0l oped countries, a largu pnrt of thoso oxpundituros is dovotod to rosoarch and dovolopmont for military purposus; moroovor, on the oth.::Jr hand much valuable but unmoasurod dovvl opmont of ncnv- techniques and pro- ducts goes on in undordevoloped countrios in tho inforrnal sdctor.

In any case tho quostion of l:rhothe:r tho UIŒP shoulà. financu tho devolopmont at tho internati onal lvvol of appropri2.to t t:: chnol ogies .!for -third-lvorld countrivs must be raisod.

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Tho viow was thon cxpressod that whilo capital-intensive tochniquos arc ofton adopto.:Jd in tho modern suctor in third ;-Torld countries dospite the abundanco of labour r0lativo to capital in such countri s₉ ovorall - all soctors combineû - labour intvnsity docs correspond approximatoly to factor cndo1~ents. Accordingly₉ the roal question is how to ovoid excessive concentration of scarce capital rosourcos in tho modern sector. Howover₉ the thesis of ovurall adaptation to givon factor endowmcnts was challengod sub- sequently.

At this point it was pointod out that the critical processes of doveloping and adopting appropriato technology was seriously con- strainod by thu inappropriatuness of the educutional system₉ ospocial- ly ut the highor l0vels. The problem is compounded by the fuct that in african countries the toachors arc often oxpatriates. It was notod that african governments too often lack confidence in their own aitizons profex~ing to rely on foreign "experts ¹¹; qualifiod

nationals are often used inappropriately and are so widely scattored as to be ineffective. Tho fear that reliance on oxpatriatas may be self-perpetuating was also oxpressod.

A participant pointod out that the "consumption of t echnology"

in african countries was gencrally determined by the needs or dvsiros of devolopud countrios. The example of tho utilization of bauxite deposits was cited.

Tho extont and power of pressures brought to bear on ~ffiC 's

in their home countries was pointed out as also the pressures placed by MNC's on the govornments of african countries. However, it was also suggested that MNC's are not as ubiquitous or omnipotent as is . som c-t irnc:s .Sl:lp.:p-os·C'd,.

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In rosponso t o tho vari ous comments rocuivod t ho principcù spoakor distinguished botwoon meroly training pGoplo t o oporat~

oxist ing tochnol ogy and training thom t o maint ain₉ repr ocluc.a, and adapt existing tochnol ogy and to dev.:;l op n..:w tl:3chnol ogy. So f lll' as aid t o tho dovel opmont and transfor of appr opriato tochnol ogy is C011C0rnecl i t was notod the UNI:DO ¹s r olu has not boen particularly constructive élllcl it •·ras qu0stion"d whetht:lr thu UN should be th0 only channel for transfor of technol ogy among underclov~loped coun- trios.

The pr incipal speaker roiter ated his svntim0nt that by al tering the fr amo1wrk within which entorprises chooso t0chniquus of produc- tion it is possible to influunce that choice. In particular the local bourgooisio is not commendocl a priori to tho us0 of th~ most modern equipmont. Tho dangurs of supposing onus0lf pov10rless wGr8 also notocl. Fin~lly it was pointed out t hat dependencu on MNC's is mu ch moro s0v0ro in conne; ct ion vri th ox-port-ord.ontud act ivi tius, as thero market ing know-how₉ market .lq:fow·lGclgu, brand nctiikJS₉ and. so on often critical.

Tho fol lowing obs0rvat ions were thon mado :

( 1) that whilo as is obvious l abour- intonsivi:J pr oduct ion mot hods n.ro wid8-spread in t hird-vrorld this is t he conse-- quence rather than t he caus.J of tho internat ional divi- s ion of labour,

(2) while in sorne countries a protra.ctocl w2.r of l ibGrat ion weakenod tho l ocal bourgl::!oisiu, in otlwrs vlh"-'re t hero was no or only a briof war a loc2.l bourgvoisie clov'-'l oped éllld t~nds t o be closoly· linkod t o H.G:JC 's? thes0 links bo twoon th0 local bourge; ois iG and i·ŒJC ¹s are c~.mtral

t o tho pr oblom of establishing national control ovor natural r~.Jsourcos.

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The Report of the cnglish language study seminGX discussion group was thon presented. It str0ssod in particular:

( 1) thv noed to oxarnino carofully th8 num(;:jrous tcchnical choic0s that are n.vailabl~:;~;

(2) tho importance of dev.._.:..vJ?i~g aJ,>!ll.'Uj!.L.J.a:toly trg.inocl

high~lov0l manpower ;

(3) tho importance of osta~lishing tirn8 dimension f or obj0ctivcs and priorities ~

( 4) tho implications for th<3 choice of tJchnology of tho choice of products ~

(5) tho dosirability of finding a way to force multinationals to contribute to the d-..:volopment of appropri:'..to tvchnologios.

(6) tht: possible r ole of t he UN in aclcling african t o devEJlop and adapt appr opriate technol ogies.

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