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Comment by dmix | Hacker News Reader

My African friend tells me stories of how his mother runs a successful rose exporting business in Ethiopia and regularly pays off bank employees so none of her (personal) money gets stolen.

In western countries it's almost unimaginable to not be able to rely on banks to store your money safely. They are typically the most conservative and reliable institutions among the chain of various business services you'd have to deal with as an entrepreneur. Without this critical underlying consumer-level infrastructure in place I'm in no hurry to be a pioneer there.

Despite my friends making similar claims about the endless low-hanging fruit opportunities there to make money.

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There are numerous opportunities there. But the deterrents may outnumber the opportunities. Examples, lack of electricity, trigger happy governments whose policies are far removed from reality, insane levies on small businesses...

For foreign investors, having an audience with the government is an unwritten requirement. If not, they run the risk of their businesses being nationalized by a new government, or their funds frozen for frivolous reasons.

However for "democratic" African countries, having too close ties with a particular ruling party could pose problems. The next government could give one hell for being for the "other party."

Recently, the Buhari administration in Nigeria restricted all funds leaving the country. Theoretically, no funds were seized. And companies could still wire out their funds but only after lengthy approval processes and were often subject to insane exchange rates.

A common question on everyone's lips is - why won't the looters invest in their countries? That's because the next government makes the seizure of money, property, and businesses the first order of business for the first half of their tenure.

In my experience, Africa metaphorically is a jungle. Only psychopath and predator minded individuals thrive there.

It sounds like the problem is government.

It's not just the government. It's also the:

1. Expectations of citizens

2. Love of Complexity

3. Culture of respect

Expectations of citizens

In Nigeria and Ghana for instance, people EXPECT government officials to steal. One who doesn't would be a laughing stock. (No joke)

Love of COMPLEXITY

Rural dwellers prefer politicians who speak using big words that often make no sense. Here's an example Patrick Obahiagbon. (Unfortunately, his words make sense grammatically. However there are those that throw out meaningless words.)

https://www.youtube.com/watch?v=I1bt-GyxiYI

https://www.youtube.com/watch?v=kSddKH1ZO-U

https://www.youtube.com/watch?v=ozxY6V-vx-0

City dwellers are not exempt. Big sounding agendas like vision 20/20, revolutionary council... fool the populace. Moneies are spent but the people are left the same

The Culture

Many African countries have an undue, almost irrational culture of respect for elders. For instance, there are differences in verbs and adjectives used when speaking to someone older than yourself in Yoruba language. Ghana and Nigeria frown upon the use of left hand for waving, writing, handshake, eating, even raising of hand for answering a question.

Many have active traditional rulers and kings. Elders typically should not be questioned, at least not without going the roundabout way of hinting and finally acquiescing to the the choice of the leader.

This respect for authority extends to the University - which should be a place for questioning of ideas. I've got lots of painful memories as someone who prefers practicality over tradition.

Here's a well documented example of the effect of cultural deference to authorities http://blogs.wsj.com/middleseat/2008/12/04/malcolm-gladwell-...

> The next government could give one hell for being for the "other party".

Many of the inefficiencies of the US government were deliberate trade-offs made to avoid examples of this pattern that fell under the general name of the "spoils system".

> "In my experience, Africa metaphorically is a jungle. Only psychopath and predator minded individuals thrive there."

I would think HN readers were a bit more enlightened that this, no? Such absolutist pronouncements remind me of Yahoo news

I'm African btw. My personal experience from my own country, neighboring countries and what I've read made me come to that conclusion.

Nice people are routinely walked over and preyed upon. On the other hand, people whose only care about you stops after collecting your money are the successful ones.

You may have found genuinely successful nice people. But I haven't.

For instance, my mum's business remained very unprofitable until my dad... One who fits the psych group above took over money matters.

I lost my own life's savings at one point and owed some more after running a joint business with some friends. The business was very successful in my point of view.

I set out to make sure that the customer experience was superb. And that our customers were always satisfied. I achieved that. The partners on the other hand were emptying the company coffers.

> In western countries it's almost unimaginable to not be able to rely on banks to store your money safely

My relative lost seven figures from Cypriot bank just a few years ago. In Greece bank will not allow you to withdraw money or transfer it to foreign country.

In Italy the government helped itself to current accounts with overnight decrees "in times of crisis", even more than once.

Your friend is likely making stuff up. This is not to say that there isn't lot of corruption and nepotism that one needs to fight against in order to setup a business there, but this is the first time I hear about bank employees stealing money from private accounts. The situation down here is pretty bad, but not that bad.

Pardon my repeating what sounds like a cliche, but Africa is indeed a big place.

I do not know of the situation on Ethiopia, but my first-hand knowledge (being originally from Ghana and now living in the US) is that banks are generally just as reliable as in the West. It would have been shocking to lose money to bank employees without recourse.

Of course a run on the bank is a different matter, but I never saw one in decades of living there.

This is one of the cases where using an "offshore" account to hold most of your money is probably justified.

It doesn't work all the time. This is because the new government really spends a lot of time tracing looted funds. As I mentioned earlier, it could dominate the first year of a four year term.

So, they travel to Switzerland, US, Dubai... And get list of properties, accounts, even companies owned by past government officials.

To prevent seizure, the incumbents go a step further and some how grab powers that even the current government can't touch. (I really can't explain it but that's how it now works.)

So, the only thing the new government can do is complain, and leak lists of properties, accounts owned by people in the outgoing regime.

Furthermore, through a gradual desensitization process, people no longer care if stolen money is repatriated because we all know that the money is only moving from one set of thieves to the other.

I wonder if this motivates some people to store their money in offshore accounts.

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