"After college, I joined the Peace Corps to become a teacher in Kenya. I then went back to graduate school where I took African politics at Columbia Graduate School. I then joined a Wall Street Bank in their Africa division. So I was a banker attached to Africa- Kenya, Zambia, Angola, etc. After doing that for six years I joined a consulting firm that had been started by Michael Porter in order to learn how to become a consultant and to do strategy. I did not want to do corporate consulting. I wanted to do advisory work with developing countries because that was my background. So I started in Latin America in Colombia, then I did work in Peru, Bolivia and many other places. Then finally, I got the opportunity to come back to Africa. By that time, I had worked in dozens of other countries in the world."
Kenya RPCV Michael Fairbanks is a a member of President Paul Kagame’s Presidential Advisory Council
Kagame, leader who listens
Wednesday, 28 January 2009 19:57 By The Independent Team
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[President Kagame] Michael Fairbanks founded OTF Group and SEVEN Fund to find enterprise solutions to poverty. He authored Harvard’s landmark book, “Plowing the Sea, Nurturing the Hidden Sources of Advantage in Developing Nations,” and “In the River They Swim: Essays from Around the World on Enterprise Solutions to Poverty.” He is now a member of President Paul Kagame’s Presidential Advisory Council (PAC).
How did you meet President Kagame?
The leaders of the World Bank, Jim Wolfensohn, and the country director for Rwanda, his name was Emmanuel Mbi, introduced me to President Kagame in 2001. We arranged to go and give a five-day forty-hour seminar for President Kagame’s entire cabinet. I spoke for 40 hours from Monday morning till Friday evening.
It was such an extraordinary time in that he had just become president and he was looking for ideas. We were working very hard, we would take all our meals in the room, brainstorming and going through frameworks that other countries had done. When a cabinet member got up to use the restroom we would stop talking until he came back. We had agreed that nobody should miss anything. It was an intense and productive environment.
What was your first impression of him?
I thought that he was quiet. It’s funny now that I look back: he is such a charismatic leader, but I thought he was reserved. You would not know what he was thinking, or whether he was interested in what I was saying or not.
Did this impression change over time?
The first instance that made it change was when I was giving a lecture to the group based on my experience from other countries on the importance and of a predictable regulatory environment and a stable cabinet. I spoke of how many poor nations and some African countries change their cabinet too often. One really needs to be careful since the private sector needs a predictable environment. When we had a break, President Kagame came over to me, held up his finger and said, sometimes this has to happen. He had fire in his eyes and his finger was up in the air. I knew I was talking to a major general of the Rwandan defense forces that created a revolution that stopped the genocide. I felt his strength, his power and even though he was very slim in a business suit, right then, I felt his will and I realized you don’t play with this gentleman, you don’t. I realized that the sort of arrogance I had, as a foreign advisor in other countries, wasn’t going to work in Rwanda.
How did you come to advise governments in Africa?
After college, I joined the Peace Corps to become a teacher in Kenya. I then went back to graduate school where I took African politics at Columbia Graduate School. I then joined a Wall Street Bank in their Africa division. So I was a banker attached to Africa- Kenya, Zambia, Angola, etc. After doing that for six years I joined a consulting firm that had been started by Michael Porter in order to learn how to become a consultant and to do strategy. I did not want to do corporate consulting. I wanted to do advisory work with developing countries because that was my background. So I started in Latin America in Colombia, then I did work in Peru, Bolivia and many other places. Then finally, I got the opportunity to come back to Africa. By that time, I had worked in dozens of other countries in the world.
How many African leaders/governments have you worked with closely?
I worked with the South Africans in the year leading up to Mandela’s presidency, a little bit with Julius Nyerere, and with the Senegalese, and in Gabon, Burundi, but nothing like the intensity of Rwanda.
Earlier, you had contacted President Museveni of Uganda when he was a rebel leader in the bush. How come you never finally worked with him?
Yes, I was a banker at that time. I met most of the cabinet in Uganda. In fact, many members of the cabinet had come to Boston and spent a whole week with me in my offices there. We agreed to go forward with the programme on export competitiveness, but the Ugandans decided to seek the funding from USAID. Once USAID got involved they told us they hired the consultants based on the lower price. (By the way, USAID did an amazing job of building washing stations for coffee in Rwanda when no one else would.)With President Kagame, the World Bank had promised to fund our project, but when they didn’t move rapidly, the president decided not to even bother with the foreign aid aspect of it. He funded our work from the funds he had received from privatization of Rwandan parastatals.
Did you try to go back to Museveni to offer your services?
No, but senior people from the Ugandan government later saw what we were doing with Rwanda and they said, ‘if we knew this was what you meant, we would have just worked with you instead of wasting our time‘. Over the years, many of them have expressed this to me.
Why is it that most of your work has finally been in Rwanda? Why didn’t you move to other countries like South Africa, Burundi and other countries?
Well, we are in many countries around the world; Afghanistan, Serbia, Trinidad, Jamaica; we have worked in 35 countries. As for Rwanda in Africa, it’s because of President Kagame. When we did that 40-hour seminar, he understood our proposition. That man didn’t leave the room for 40 hours. We took our meals in that room. The only time he left is to go to the restroom and come back. You tell me another country in Africa where the chief of government is going to do that? That’s your answer right there. He did not leave the room for 40 hours.
What impression did that create in your mind?
I thought, we can help with this country. These are serious people.
His attitude of staying in the room is a proxy for something. What key elements did it represent to you?
He realized that nobody was going to do him a favour. He was not going to get foreign aid because the French were not going to give it, the Americans were not. No one wanted anything to do with Rwanda. Few believed Rwanda was going to come up, so nobody would put their money and faith in Rwanda. He knew this since he did not get any help during the revolution. He said he was going to do this himself. He said, “I am going to raise my own money from privatized state funds, and if no one is going to help me, I better be in that room.” This must have come from his military experience. The future of Rwanda rested in the people in that room. No fatalism in that room, they had the self-determination and confidence that they could make their country better.
What are the elements of his character traits?
The number one thing is self-determination. He takes responsibility for his own future. He does not blame anybody else for the problems and he does not expect anybody else to help him. I have worked for many presidents and prime ministers and they expect me to make the strategic decisions, like who we are going to help in the economy. Rwanda has never said that. They said to me “you will be our advisor, and we will do all the hard work”. Other things that are consistent with this are tolerance for doing things in a brand new way, self-confidence, trust in the leadership group, all had a shared vision to move to the future together, no expectation that anybody else was going to help them, no assumption that they even deserved help.
Many presidents of poor countries have a self-righteous perspective based on colonialism and other mean things-- that other countries have do for them, that these people were obliged to help them. Some even tell the people that ‘you are poor, but it’s not your problem, it is someone else’s fault and we are going to get them to give us the money. We are going to get debt forgiveness, we deserve charity.’ President Kagame is the exact opposite. He tells the people that they should be embarrassed to depend on aid. He would say, “Nobody owes us a favour.”
What are the specific things you did for tourism in Rwanda that led to the sustained increase in wages?
We created brand new experiences. The tourism product is an export that is locally consumed. It’s in foreign currency. It is not a product like an automobile. It is an experience that has to start with how an individual hears about your country, how they plan to make a choice to visit there, what are their experiences when they are on the ground, and what do they say when they leave the country. That is the tourism product. We re-designed that for them not only with the Gorilla trek but also with the historical and archaeological experience, and a safari type of experience. We found new distribution systems; we packaged the product and re-priced it.
What do you mean re-priced?
We raised the price. Other countries think that they should lower the prices until enough tourists come, then start to raise the prices. It never works because you are educating the market that you are a low-price destination. When you lower your prices, you lower your ability to pay a living wage to the people who work in that industry. It is a trap and a race to the bottom. When countries begin to compete on price, you are actually competing on low wages. When you are competing on low wages, you are actually saying that your country can stay the poorest the longest, until one of our societies disintegrates. We were able to convey that to President Kagame and he understood strategy. He is, after all, one of the greatest military strategists of the 20th century.
Why do you say that?
I did not say that. Military leaders like Romeo Dallaire, and Steven Kinzer in his book, “A Thousand Hills”, have said that. I suspect that he learned many things from President Museveni. Remember he had no resources and no help; he overcame a very motivated, well-supplied French-backed resistance who controlled the country, and he beat them. When you come to him and talk about business strategy, you are talking his language. When we first spoke, I saw phenomenal intuition. You never had to say something twice to him. He got it instantly the first time. Things that I said to him in April of 2001, he reminds me about today.
What about ICT?
From the very beginning, President Kagame said he wanted a fully efficient ICT sector in Rwanda. I was reluctant. He convinced me. I told him that Rwanda will never be the centre of ICT innovation and he got angry with me. He said no, we are going to be good at this. We are going to build an ICT capacity that will help other sectors. I recently said to him, you were right, Mr. President, and I was wrong.
