Bio- and regenera- tive Medicine as an important growth Market

26 HHL RESEARCH REPORT 2012 ECOnOMiCS And REguLATiOn 27
cHair oF MicroeconoMicS
the next economic Boom
will take place in africa
Microeconomics appears to be a collection of models – ranging from simple
optimization and market models to subtle attempts to model information and
thinking processes, which then infer participants‘ behavior according to
game theory solution concepts. The problems that can be analyzed with
micro economic modeling are very diverse: they vary from efficient allocation
of resources and the decision making process of executives to conflicts and
coopera tion in international politics. Prof. Dr. Arnis Vilks‘ research interest
is directed towards questions of basic philosophical principles of economic
sciences on the one hand and development economics on the other hand.
“Sierra Leone‘s integration in the global
economy is, in no small part, obstructed
by the ignorance and stereotypes often
found in the ‚developed‘ countries,” says
Prof . Dr . Arnis Vilks . During a research
term Vilks traveled the country for five
weeks . His conclusion: “The next and
probably last economic boom of our
time will take place in Africa .” And still
it is unknown to the broad section of
the public in Germany that this country,
which until ten years ago was suffering
through a cruel civil war, has developed
into a peaceful, politically stable and, to
a large extent, democratic country with
a low crime rate and loads of different
investment opportunities .
Vilks‘ seminar about ethical leadership
was met with wide popularity . For the
four-day long course 23 participants had
to be selected from 100 applications to
keep the group at a workable size and
not to exceed the limited budget of the
Wittenberg Center for Global Ethics
which financed the seminar . “We talked
about globalization, business ethics,
corruption, constitutional legality,
democracy and economic development,
and the participants often discussed
with such animation that it was hard to
follow what was being said,” says Vilks .
The participants were junior employees
from economics, politics, science and
non-govern mental organizations .
Decent Salaries
There are very many of the latter in
Sierra Leone‘s capital and they are
considered good employers as they are
usually financed by foreign investors
and pay their staff decent salaries .
“Decent” in this context means that a
coordinator or project leader of such
an organization can earn USD 1000 or
more per month while a police officer,
for example, earns no more than USD
50 per month . The average per capita
income in Sierra Leone converts to USD
300 or USD 760 if the higher purchasing
power of a Dollar is taken into account
in the conversion . So, Sierra Leone‘s
inhabitants have to manage with as
much money annually as a Hartz-
IV (German unemployment benefit)
recipient receives per month .
“It is hardly surprising that we kept
returning to the issue of income in our
seminar,” says Vilks . Participants asked
whether the “small” corruption of a police
officer whose salary cannot provide
for his family is surprising . Another
discussion topic was the temptation
for corruption of politicians who have
dealings with western colleagues, who
easily earn ten times as much, and with
entrepreneurs and managers, who at
times earn a thousand times as much .
Many young Sierra Leoneans are very
committed to the economic and social
development of their home country .
A prime example is Ibrahim Bangura,
a Ph .D . student of Prof . Dr . Vilks . The
young man, who grew up in Freetown,
graduated from Fourah Bay College –
the oldest University in Western Africa,
founded in 1827 – with a Bachelor in
History and Political Science, as well as
a Masters degree in “Gender Studies” .
In 2006, Horst Köhler‘s initiative
“Partnership with Africa” brought him
to a big international Africa Conference
in Wittenberg . After returning to
Freetown, he and some like-minded
people founded the “International
Human Rights and Rule of Law Training
and Research Institute” which since has
been training “Peace-Keeping Forces”
for several international organizations,
as well as police and military staff .
“His matter-of-fact but often also
humorous view on African mentalities
and problems gives reason to hope that
through the commitment of young
executives, Sierra Leone can realize
the vision of their president to become
one of the donor countries rather than
belong ing to the recipients of international
assistance within 50 years,” says
Vilks . “There are hardly any reasons why
a long-lasting economic boom like those
in China or the small Asian ‚Tiger‘ countries
should not be possible in Western
Africa . In those countries, the Chinese
and Indians especially – as well as the
Lebanese – contribute to their countries‘
development by means of entrepreneurial
activities rather than foreign
aid .” Chinese construction machinery is
everywhere, hardly any from Germany
is present . It seems as if German entrepreneurs
would rather accept a lower
return than a higher risk . “The risks here
in Sierra Leone, however, are rather low,”
says Vilks .
Business opportunities
Looking at the endless white beaches,
the Professor for Economics sees opportunities
for investment in tourism,
for example . Mosquitoes which could
spread Malaria hardly exist at those
beaches due to a constant breeze . The
fact that tourism – given the appro priate
conditions – is able to make a large contribution
to economic development can
be observed 1000 kilometers northwest
of Sierra Leone: up until 2007, the islandstate
Cabo Verde was one of the “least
developed countries” but now has a percapita
income (adjusted for purchasing
power) of about USD 3,800 and its
infrastructure already looks very similar
to that of the Canary Islands .
Besides tourism, Sierra Leone‘s natural
resources promise lucrative business
fields for investors – diamonds, gold,
bauxite, titanium and iron ore – and last
but not least, crude oil . Just off Sierra
Leone‘s coast huge fields of crude oil
have been found; drilling rights are
currently being negotiated with international
oil companies . According to Prof .
Dr . Vilks, it is more than likely that the
upcoming big investments and the public
revenue, which will, in all probability,
increase considerably from drilling
rights and taxes, will lead to long-lasting
economic growth .
cHair oF
MicroeconoMicS
cHairHolder
Prof. dr. Arnis vilks
core coMpetencieS/
reSearcH intereSt
• philosophical foundations of
economic sciences
• development economics
contact
www.hhl.de/microeconomics