The strategy of Regional Development Poles (RDPs) places emphasis on accel erating the economic transformation of the few large African countries that can largely industrialize on their own efforts, based on their tremendous natural and human resources, and large domestic markets (Yongo-Bure 2014). The creation of "regional development poles" within Africa could lead to the estab lishment of diversifed industrial economies on the continent, which may in turn lead to faster diffusion of economic development to the surrounding African coun tries. The building of intra-African highways, railways, long-distance power transmission lines, ports, and direct communications links could accelerate this diffusion, making it cheaper and faster for the rest of the smaller Afri can countries to import development inputs from the neighboring develop ment poles. The need to earn foreign exchange from the established hard currencies will be less desperate than at present, as it will become rela tively easier to acquire the currencies of the neighboring development poles and import from them. And as African economies become increasingly more industrialized, diversifed, and integrated, and intra-industry trade becomes signifcant, even smaller economies will be able to establish capital goods industries.
The strategy of regional development poles draws lessons from the strate gies of big push or balanced growth and unbalanced growth of the 1960s.
It advocates large investment in capital goods industries on the premises that lack of capital goods industries or inability to import them because of bot tlenecks with foreign exchanges frustrates development efforts of most African countries. The structures of African industry have been unbalanced with bias towards the manufacture of consumer goods. This imbalance in industry has to be urgently addressed. But since most African countries are so small such that all cannot establish such large industries characterized with indivisibilities, the few large African economies with huge natural and fnancial resources as well as large potential domestic markets should undertake such manufactures. Com bined with intra-African transportation networks, the few large African capital goods manufacturing countries will act as African Industrial Workshops. The cost of supplying capital goods to most African countries from within Africa will be less than the importation of capital goods from outside the continent. Moreo ver, both formal and informal importation from neighboring countries is pos sible given ease of contacts and acquisition of foreign currencies of neighboring countries. For example, South Africa’s neighbors can easily acquire the rand and import from South Africa.
While the arguments against Rosenstein-Rodan’s big push (1943) and Nurkse’s balanced growth (1953) were based on the subsistence stages of the economies at their earlier stages of development, this is no longer the case with many African economies (Chapter 3). Moreover, African countries have reac tivated the development of intra-African infrastructure as refected in regional infrastructure development programs and the Program of Infrastructure Devel opment in Africa (PIDA, Chapter 8). What will be taking place will be replace ment of some capital goods from outside Africa with African manufactures. Hence, the African demand is available. Supply is feasible as many African coun tries such as Nigeria have been generating large investable resources from oil since the 1960s. Since the beginning of the twenty-frst century, Ethiopia has been generating huge resources and investing in massive energy generating programs. The Democratic Republic of Congo has all the resources a country needs for a massive industrial development. What is lacking is a developmental political leadership.
While Hirschman (1958) believed that the preferable unbalanced path is the one led by investment in directly productive activities (DPAs) so that social infrastructure responds to pressure created by excess capacity of DPAs, many African countries and the African Union Commission are investing in infrastructure. Moreover, most African countries have already substantial amounts of human capital and can quickly train more from the many university and sec ondary school graduates. However, it is important to encourage DPAs along the infrastructure networks. Presence of infrastructure does not mean that DPAs will spontaneously sprout along the network. Action has to be taken to encour age productive activities along the infrastructure networks. Hence, the regional development poles strategy will mainly focus on creating the capital goods industries, although in many cases it will have to create some infrastructure, especially in the feld of energy development.
What the regional development poles strategy really advances is a new import substitution strategy focusing on manufacture of capital goods rather than the earlier strategy that concentrated on manufacture of consumer goods. Capital goods manufacturing has more impactful backward and forward linkages than the manufacture of consumer goods. Moreover, the supply and demand constraints African countries experienced at independence have been substantially reduced. Experience has been gained and lessons can be learned from similar recently underdeveloped but now industrializing economies such as Brazil and South Korea.