Richard Dowden: On offer: a huge prize in a land of poverty

Today a small, cheerful, energetic ball of a man from Sudan called Mohammed Ibrahim is going to try to change the governments of Africa. In the past that would have meant organising a coup, but instead Mo - as he is known - is announcing a prize for presidents in the form of a stupendous pension.

The prize goes to an African leader who has been democratically elected, steps down when the constitution demands and has made life better for his fellow citizens. The staggering thing is the amount. The Mo Ibrahim Foundation Prize is $500,000 a year for 10 years with another $200,000 a year for his - or her - charitable activities during that period. After that the former president gets $200,000 a year for life. That is many times the going rate for a Nobel Peace Prize. Mo swears he has never paid a single bribe in Africa. Now it seems he is prepared to bribe its leaders to rule well then leave on time.

Some may be outraged that all this money should be offered to the very people who preside over Africa's poverty - and the sumptuous wealth of its ruling classes. African countries fill all the bottom places in the league tables measuring the quality of human life, and in Transparency International's Corruption Index. Surely the money would be better spent on schools and hospitals or training people as teachers and doctors?

But there is a growing consensus that the heart of Africa's problems is about "governance" - as the development industry calls it. Others call it Africa's greedy and incompetent rulers. The prize could add impetus to the good governance movement which is spreading across Africa, providing the tipping point for presidents who would like to do good - but not yet.

While the G8 leaders struggle to try to change Africa through aid - a route that has proved spectacularly unsuccessful in the past - Mo is going a more direct route. Like many business people, he sees aid as providing bandages, not solving the fundamental problems. But he does not see Africa's poor leadership as a random coincidence. He points out that it goes back to the colonial borders. "Very few countries have national identities and they all have weak institutions. That allows a strong man to come up," he says.

Many African leaders rule for themselves, their families or ethnic groups. Love of power, fear of being indicted when they leave, and Africa's traditions of respect for old age, kings and chiefs make presidents stay on and on. Today there are fewer ex-president living than presidents ruling, an indication, perhaps, of their long reigns - although in many cases, departure was fatal. Almost all the 53 current African presidents have been elected, but their elections have not always been free or transparent. Almost half of them have been in power for more than 10 years and 15 have been in power for more than 15 years. This is what Mo hopes his prize will change.

Mo Ibrahim is possibly Africa's most successful businessman. Born 60 years ago in northern Sudan, he came to Britain in 1975 to study telecommunications and then joined British Telecom just as it was beginning to use new telecom technologies. Mo wrote the textbook then left BT to set up Mobile Systems International which designed GSM networks all over the world. He sold MSI for $900m.

Two years later he set up Celtel to bring mobile phones to Africa. Investors thought he was crazy to even think that Africa could afford mobile phones, but he had in fact grossly underestimated African demand. Between 1999 and 2004 there was a tenfold increase in mobile phones users in Africa - 7.5 million to 76.98 million - far faster than anywhere else on the planet. No one saw that the demand was at the bottom of the pyramid, not just at the top. This was because there are no other effective forms of transport or communication in Africa.

You see mobiles every in Africa now: taxi drivers with the most battered automobiles have the most up-to-date mobiles. Market women at open stalls use them to check the prices in rival markets. Fisherman coming to land their catch check fish prices on different beaches and harbours. Nomads check the price of sheep, goats and camels before coming to town.

The next task is to establish a Mo Ibrahim Foundation index to measure good governance according to standardised criteria. Mo has brought together a team of people including Robert Rotberg of the Kennedy School of Governance at Harvard, Mary Robinson, the former president of Ireland, and Graca Machel, the consort of two African presidents. They will be debating the criteria at a meeting at the School of Oriental and African Studies in London tomorrow.

The author is director of the Royal African Society