Academic discourse and development policy debates have grappled with the contentious issue of the state–market interactions in Africa’s development agenda and processes, particularly since the 1960s independence era. At the heart of this debate has been the contestation over the agency for development. The global wave of democratisation that swept through most parts of the developing world in the late 1980s and early 1990s revived this debate on the linkage between democracy, sustainable development, and state capacity in Africa (Leftwich 1996). The twenty-first century is witnessing a resurgence of confidence in a new type of activist state: democratic and developmental in character and content. The fundamental concern of this study is whether the exigencies of globalisation can be reconciled with democratisation and sustainable development. This provokes further questions such as: how can fragile democratic regimes improve their prospects for consolidation at a moment when the distributive impact of concurrent programmes of economic liberalisation and adjustment are highly contestable? Are the economic reforms prescribed by Bretton Woods Institutions (BWI) and bilateral donors compatible with democratisation and developmental processes? How can the state’s systematic loss of capacity to manage the economy be reconciled with demands for a more democratic polity? Finally, this paper examines the strategies for building the capacity of the African state as agent of development and partnership in the democratisation process.