THE BURDEN OF AFRICA

Man…born free, yet everywhere in chains – Roussea

 ave you ever wondered why in Africa there is perpetual poverty, underdevelopment, and constant debt burden? Let us face it, Africans are hard workers, and African governments are not lifeless. Yet, however hard work and industry they put in, the African scale just seem not to balance.

     For a long time I have pondered on this tantalizingly enigmatic scenario. The answer, though, does not come that simply or uncomplicated. What I offer below is only a critical analysis of the historical context in which Africa has found herself. I call upon emerging African leaders to consider the issues raised and discussed in this chapter in tackling and deliberating future African economic and political affairs. Here is my submission.

Battle of Interests

 

     Africa has been at the centre of world economic survival. During slavery, Africa supplied ready but cheap manpower, and in the colonial era, raw materials for major industrialized nations. Africa has always played a key role in the world economy. Nation-states do not just cooperate; they do so at a prize. That prize is usually in the form of the balance of power. Powerful and rich nations want to dominate the world. Weak and struggling ones desire to break free from the grasp of dependency.  

Domestic verses Foreign Policy

 

     Nation-states have to battle their own home economies against the interests of the opposition. Failure to deliver at home in terms of the economy affects the incumbents and threatens their continuation. The balancing of state interests, domestic and foreign policy is a complex process.

     This is normally reflected in the institutions of the world economy. Thus, there can never be total submergence into the economic activities of another nation by a foreign entity even if good faith is the promise. This is not to downplay the efforts by some multinationals in their attempt to help struggling economies.

     Africa cannot blindly hope that her challenges will be alleviated by activities in the international community. International communities are equally absorbed in their own challenges at home. The powerful as well as the weak do wrestle with national debts and deficits in their own countries. And as a matter of survival, they cannot leave their own problems to come and rescue Africa, however genuine their wish to be altruistic. Nations only cooperate if their interest is involved.  Self-interest is the ultimate motivation.

The Economic Burden of Africa

 

     We are living in interesting times. We are faced with an epoch of mixed blessings. Globalization is making all but one, and the world but a global village. Does Africa have a fair share of the global cake? The optimists will say yes. The people on the ground, the women, children and the hard working servants of Africa may answer that with a heavy heart.

      Globalization has not yet benefited Africa. While movements of goods and services, money and people, and ideas have been relatively easy, it seems that all move in one direction only. Baskets do leave Africa full, and so are wallets! Increased economic interdependence among states has not helped Africa, if the trend in the last few decades is anything to go by. Emerging African leaders, undoubtedly, do have a huge burden.

 

     The International Monetary Fund (IMF) was created in 1944, and its sister organization, the General Agreement on Tariffs and Trade (GATT) came in 1947. GATT was eventually replaced by the World Trade Organization (WTO) in 1995.

      Generally, states desire to pursue independent domestic economic policies. At the same time, these same states want to benefit from an open international economy. The role of the IMF and the WTO is to try and balance these two ambitious goals. In doing so, IMF and WTO not only avoid the interwar and postwar protectionism, but also contribute to the avoidance of the economic doldrums which could potentially harm the whole world.

     Protectionism restricts trade at the expense of other countries. Since November, 2008 seventeen out of the twenty G20 nations have talked about or have introduced measures that could be considered protectionism in the wake of the global economic recession. The World Bank has, however, focused that the 1930-style protectionism is not possible given the historic lesson already learned.

     Neither the World Bank nor the WTO may allow protectionism to materialize. Protectionism causes a reduction in trade. Trade, generally, is good for all countries involved. To do this the World Bank should direct the rich nations not to use tariffs to promote their local producers. Rich nations should, however, subsidize local producers so that local consumers have to pay for local goods as well as foreign equivalents.

     The 1930-style slugfest can be avoided when the World Bank does the following. It should strengthen international supply chains so that countries become much more dependent on each other. This is possible if export interests are made more influential than import competition groups.

     Moreover, both the World Bank and the WTO should act as international trade police. In this role they can acquaint nations to the norms of national treatment and fair play for international traders. If these institutions fail to do this, Africa will be adversely affected, worsening the economic situation which is already weak.

     Africa has a role to play as well. She can strengthen her regional trade associations to ensure that barriers that may restrict trade are removed. This will enable African states to trade among themselves. Trade is beneficial to African states because it allows the nations to specialize in activities in which they have a comparative advantage, such as copper in case of Zambia.

Economic Colonization

 

     No student is greater than her teacher. A borrower is always slave to the lender. In international relations, lending is so much a prerogative of domination as it is a catalyst of imperial advancement.

     In capitalistic terms lending is a planned operation of economics, and aid is its instrument. In other words, aid is never free. The World Bank, formerly the International Bank for Reconstruction and Development, was formed to assist in post World War II recovery. However, as everyone now knows, it has since become the primary source of international aid to developing states, Africa being the quintessential hub of the developing world.

     Interest defines demand, and pressure preempts decisive action. African governments are bombarded with insurmountable conflict of interest and pressure. On one hand, they must cooperate with the rest of the world in the world economy. On the other, they must meet the developmental needs of their own nations.

     In theory, the developed capitalists favour free economy, even China has embraced this so far. They tend to allow the free movement of goods, services and capital. But is it always so? Especially in the agricultural sector, exceptions loom large. Here they prefer strong domestic protectionism. The developed world can easily play the free market economic game to its rules because they do have enough institutions and a culture to sustain it. As we saw in the October 3 Bailout Bill in the US, free market has its own limits. At present, Africa lacks both.

     Having attained independence rather so recently, most African states lack the machinery to participate fully in the world economics. In fact, they have risks to contend with. This fear is founded. Because when they have privatized their economies or asked for aid, African governments have tended to lose authority to foreign actors.

     Moreover, if the current trends are to predict the future, foreign investments in Africa have not benefited African states. Foreign investment brings paradoxical sentiments. Others might even deem it an oxymoron. It is, as it were, bittersweet.

      Foreign capital can undoubtedly aid development. Yet it brings enormous challenges in foreign loan repayment. The practice has been, due to the enormity of this foreign debt, African governments have been pressured to follow certain economic policies preconditioned on them. To be fair, most of these policies have helped the affluent in Africa get richer. Overall, the majority of the poor Africans have not, sadly, benefited from these conditional policies.

Domestic Crisis

 

     The burden of Africa is a domestic crisis. Those who lend foreign investments to Africa demand that African governments repay their loans at an acceptable cost. The result has been a complicated but inescapable dilemma. In order to reassure foreign lenders that their money is safe, African governments have resorted to cutting development spending.

      When development spending is cut, the result is exactly the precarious situation African economies are in right now. In addition, African governments have been forced to cut on subsidies and spending on public services and infrastructure. This is what I call the economic colonization of Africa.

Impact on Manufacturing Sector

 

     The major economic stay of the developed world is the manufacturing sector. Even India and China are becoming powers in their own right due to advanced manufacturing industries, making them with the developed world, big competitors in the world economy.

     The story of Africa is different. Existing patterns of relations have left Africa far behind others in building modern manufacturing capacity and locking her thereby into a subordinate position which translates in her continuing to function as a source of raw materials or low-value commodities supplier.

Economic Boost and Democratizing

 

     The history of the world is the history of resolving conflicts. All the schools of political and economic thought agree that the economy is one of the most important instruments of transforming a nation into a habitat of freedom, democracy, and human rights enhancement. Although China is under a communist regime, she, however, embraces a free market economy which seems to be the hallmark of liberal democracy.

     In the 1960s most African nations acquired political independence. In other words, they became sovereign states, and by the Westphalia model, are entitled to personalized national image by international law. Since the end of the Cold War, most countries have embraced liberal democracy. Africa stands a better chance to gain from the ideals of liberal democracy with its emphasis on personal freedom and equality of rights, consent of the governed and free market economy. The challenge still remains if Africa can attain to this standard with a struggling economy.

     The developed world and the multinational corporations have always insisted on Africa to democratize as a precondition for further aid. As mentioned before, this insistence brings bitter sweetness. Democratizing and economic development are related reciprocally – each causes and is caused by the other. Thus, to insist on democratizing against a backdrop of poverty, debt and a mentality of business as usual, defeats the intention and destroys the foundation on which aid is promised.

     China has proven that ideology alone does not negate economic impact; preconditions do, and have done so for Africa! Cuts in developmental potential in order to repay loans have adversely affected African economies.

      If Africa is to truly democratize, the West and developed nations must think of cancelling the debts Africa owes them, promise to provide grants to boost infrastructure and public sector development. They should inculcate a culture of democracy through education (this is what OZAFO intends to do), and provide assistance in strengthening democratic institutions such as courts, legislatures, human and civil rights, etcetera.

 

Homework for African Leaders

 

     Africa should impose herself on world affairs in terms of trade and diplomacy. The road will not be smoother, the perils will rage, but determination and consistence will win the day. Africa cannot cancel out her history (for all nations and continents have their own as well), but she can endeavour to rewrite it. Globalization may be a challenge to Africa but at the same time it is opening up fresh and viable possibilities for Africa.

     Emerging African leaders can take advantage of this and start to envision an Africa built on dignity, democracy and economic emancipation. The mistakes of the past can be transformed into future ideas. Nevertheless, this will not be done by the current mentality of fear, failure and insubordination. The age of being at the receiving end is slowly coming to an end. Now, a new-look African leadership must emerge. A leadership schooled in the intricacy of domestic welfare, international economic cooperation, diplomacy and liberal democratic ideals.