The Zambian Economist at the Crossroads of Global Business

Here is another superb article by for The New York Times in which he shares his conversation with Dambisa Moyo. To read the complete article, check out others, and obtain information about deep-discount subscriptions, please click here.

Credit: Guerin Blask for The New York Times

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Dambisa Moyo has the ear of top business leaders. But there are no simple answers to complex problems.

For policymakers and business leaders seeking simple answers to complex problems, Dambisa Moyo is a valuable sounding board. With a Ph.D. in economics from Oxford, a master of public administration from Harvard, and experience serving on the boards of companies like Chevron, 3M and Barclays, Ms. Moyo has the kind of broad exposure and macroeconomic knowledge that is often lacking in the upper reaches of siloed organizations.

But Ms. Moyo recognizes the complexity of thorny issues like climate change, inequality and the erosion of democracy, and resists the temptation to offer pat solutions. She is adamant that climate change is an existential crisis, but wary about rushing to limit fossil fuel use given the energy needs of the developing world. She is a champion of diversity, but worries that focusing on racial equity distracts from the threat of automation. She understands that unchecked capitalism can create inequality, but is careful not to dismiss the importance of economic growth.

“I am at the crossroads of many different perspectives,” she said. “I’m on the board of a large global energy company. I serve on the board of the Oxford University endowment. I also was born and raised in Africa, and there’s still 1.5 billion people on the planet who have no access to cost-effective energy, including my parents, who still live in Zambia.”

Ms. Moyo currently serves on the Chevron and 3M boards, and this year published her fifth book, How Boards Work.

When you look at the pace of the global economy’s transition away from fossil fuels, do you believe it’s happening fast enough?

It’s urgent. Climate action is necessary. What I worry about is that there are so many different fragmented conversations going on. There’s no doubt in my mind that to actually drive reductions and get to net-zero targets, and at the same time create sustainable investment, we will need solar, wind, geothermal, battery, nuclear, that whole list. But that is going to require policy. It’s going to require technology. It’s going to require changes in customer preferences.

And I worry that when we start to go down the policy angle with haste, it can actually encourage misallocation of capital in particular, and resources more generally. There is a risk of ignoring second-order knock-on effects. This idea of defunding the energy companies might be appealing in the here and now, but it doesn’t adequately reflect the fact that over a billion people have no access to energy. The implications of that is disorderly migration, geopolitical risk.

Where is the haste inside the boardroom of a company like Chevron?

I do not know any energy company that is not taking this seriously and understanding that this is about survival. This an existential crisis. The good news is companies like Chevron have been around over 100 years. They’ve gone through their own transition. The bad news is that a lot of the science that’s required, the innovation that’s required, the innovation of business models, is a challenge.

When you look at the disruption being caused by climate change, do you believe the effects are unevenly distributed?

Yes. And this gets at one of my bugbears, which, for better or worse, is economic growth. There’s been massive pushback against growth, against globalization. And I feel more and more like a lone voice on the issue of growth, the importance of growth and not losing sight of the importance of growth. When I say, “Hey, guys, we really do need growth — if we’re not going to expand, this leads to considerable problems,” I get comments like “OK, boomer” on social media.

OK, boomer. Why is growth so important?

At least three reasons. One, living standards. If governments cannot have enough money in their coffers from taxation to fund education, health care, infrastructure and national security, you end up with political unrest. So to my mind, first and foremost, how do you improve people’s living standards? You’ve got to have growth.

The second point is around politics. There’s a lot of research in what we used to call the political science area. One of my favorite papers is on what’s the minimum per capita income in a country to make sure democracy survives. At low levels of per capita incomes, you’re always going to have factions. You’re going to have government bad behavior at certain levels. You need a minimum in order for there to be a middle class to hold the government accountable. We see that even in a place like the U.S. The voter participation rates of people who are earning $30,000 and less are very low.

The third point is just innovation. Look at the problems we’re dealing with. It’s not a surprise that innovation around Covid and the vaccines came from developed economies. We can’t expect poor economies to be thinking about that when they are talking about essentially survivability in the here and now. It’s not going to happen. Innovation and technology in education and health care and life sciences require growth.

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Here is a direct link to the complete interview.

David Gelles writes the Corner Office column and other features for The New York Times’s Sunday Business section, To learn more about him and his work, please click here.


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