African Entrepreneurship Record

”In response to the needs of East Africa’s economic development, the East African Planning Economy Commission was established to coordinate nationwide construction in industries like agriculture, energy, technology, and engineering.”

”The main reason for establishing this agency is to formulate national medium- and long-term development plans, maintain the stability of development policies, and design a more scientific path for East Africa’s independent economic development. This involves coordinating the work of state-owned enterprises, various public institutions, and government departments at all levels, formulating production plans, and improving the production capacity of agriculture and industry.”

In a country like East Africa, which is dominated by a state economy and a collective economy (mostly in agriculture), relying on Western traditions or capitalist economic development models is clearly impractical.

Therefore, in October 1895, Ernst officially promoted the establishment of the East African Planning Economy Commission, drawing elite forces from various government agencies in East Africa to form this economic policy body drastically different from the Western world.

The establishment of the East African Planning Economy Commission does not imply a denial of market economy in East Africa but aims to more scientifically guide the development of state and collective economies in East Africa.

Of course, the main private economy in East Africa is the royal enterprises, so in practice, they also conform to government requirements to formulate local development strategies.

However, within East African internal government, the nickname for this agency is ”Economic Cabinet.” After all, unlike the Ministry of Finance, most work is completed within the department. Instead, it can directly intervene in the work of all departments related to the national economic field, naturally headed by Ernst.

”In the composition of our national economy, state and collective economies dominate. Therefore, for convenient management of state-owned enterprises and collective economies, the Planning Commission is a necessary institution. Our economy was long in a wild state of development, lacking connectivity in communication and collaboration among various departments and enterprises, and was also unfavorable for the formulation of national economic policies. Thus, the East African Planning Commission’s task is to implement the grand principle of nationwide economic integration, setting government economic work tasks and development directions to provide guidance for enterprises and economic groups.”

For what Ernst described, many officials in East Africa felt unclear but impressive, as there was no precedent for this in other countries of the world.

However, it did not cause too much of a stir either, as East Africa was previously also an ”planned” economy, with major national development policies completely decided by Ernst alone.

Of course, Ernst alone definitely did not have the capability; it mainly relied on a think tank team to complete specific work, with Ernst giving final approval by signature.

Therefore, the current East African Planning Commission is practically the same as Ernst upgrading his think tank team into a formal government agency. In a ”changing the soup, not the medicine” scenario, everyone naturally felt uneventful.

After the East African Planning Commission was established, the Ministry of Finance’s power was greatly reduced, but it remains an important economic department of the government. After all, theoretically, the Planning Commission doesn’t have real power, while executing tasks costs money, which still needs the Ministry of Finance to review and sign off.

After the department was established, Ernst said: ”In the blink of an eye, the century turn is approaching, and in four years, it will be the 20th century, which also signifies the arrival of a new era. So within these four years, the Planning Economy Commission must fully take over the formulation of national economic development strategies, familiarize itself with relevant work, and establish comprehensive economic development goals before 1900. There’s no need to set goals too high; we should work pragmatically to improve the existing national economic system.”

Because the Planning Economy Commission is newly established, whether it can achieve Ernst’s demands is still under examination. Thus, the period from 1895 to 1900 is its adjustment phase.

It’s impossible for them to draft detailed plans; instead, they will formulate a rough development plan. By 1900, its effectiveness will be observed, and then major adjustments and changes can be made.

In Ernst’s view, East Africa’s planned economy should not be rushed. Although it can easily yield results, it also easily overlooks potential drawbacks.

It’s essential for subordinates first to familiarize themselves with each task, understand the national economic development and the global economic development trend, then only can they draft relatively scientific development plans according to East African countries’ specific conditions.

This leads to the first national development plan formulated by the East African Planning Economy Commission being quite conservative:

At least fifty new state-owned enterprises should be established, steel output should surpass three million tons (with East Africa currently at just over two million tons), cultivated land should exceed 1.5 billion acres, grain output should exceed two trillion (currently at over 1.17 billion pounds), and railways should stretch over seventy thousand kilometers (which is three thousand kilometers less than the Ministry of Railways’ original plan)...

Moreover, in some economic sectors, the targets set are quite reserved, as within a short time, the Planning Economy Commission doesn’t have a thorough understanding of East Africa’s national conditions and doesn’t possess detailed data.

Therefore, the focus can only be directed towards encouraging development across industries, promoting industrial upgrading and transformation, and significantly developing defense military industries... Such uncertain topics.

Ernst understands this relatively well because there is no experience. Hence, Ernst’s expectations are not high. He estimates that after four years, The Planning Economy Commission will be familiar with related work. By then, it won’t be as ”helpless” as it is now.

This also made other government departments in East Africa laugh, as the unfamiliarity with work made the Planning Economy Commission seem quite strange, and its economic development goals even fell short of the plans set by original governmental departments.

Among them is the Ministry of Railways, whose original design was for the total railway mileage to exceed one hundred thousand kilometers before 1900, which was directly cut by the Planning Economy Commission, losing the entirety of France’s national railway mileage.

Of course, the initial task of the Planning Economy Commission is mainly to adjust and learn, so its formulated economic policies only have guiding significance. If the Ministry of Railways can complete the tasks in excess, all the better.

However, the seventy thousand kilometers figure provided by the Planning Economy Commission is not entirely unreasonable, as it is based on past railway construction data in East Africa. Considering East Africa’s railway construction has both peaks and troughs, according to their estimation, the railway construction in East Africa in the next four years is unlikely to reach the scale seen in the seventies and eighties due to economic crises.

The dispute between the two parties can only be resolved over time. Until then, the Ministry of Railways naturally continues to plan national railway construction according to its original plan.

Therefore, the establishment of the East African Planning Economy Commission between 1895 and 1900 almost has no significant impact on the economic development of East African nations.

In fact, even without this department, in the global economic recovery cycle, the pace of economic development in East Africa cannot be exceptionally slow.

At the end of the 19th century, during the explosion of the Second Industrial Revolution, as long as the country can maintain overall stability, even the current government of the Far East Empire can achieve decent political performance.

Indeed, the economies of various Far Eastern countries and East Africa are quite similar, which is the state enterprises initiated by the government during the Westernization Movement, which are actual state-owned enterprises, and this period is precisely when the Far East Empire is rapidly developing its military industries and other sectors.

Certainly, the government of the Far East Empire seems rather hesitant in industrial investment compared to East Africa, which invests boldly in all aspects, largely due to differences in national conditions.

Especially after the Far East War, it can be seen as one of the turning points in the Far East Empire’s national destiny. After more than a decade of peaceful development, the Far East war also signifies the restart of regional turmoil.

In contrast, East Africa is likely to remain in a state of peace and stability for the next decade due to the South African War. In such circumstances, East Africa is very likely to rapidly narrow the economic gap with the Far East Empire.