Africa: It's the Economy Stupid!
Hey again everybody! Most of you by reading the title of this essay
might be wondering the same question I was just a few hours before I typed
this up. Why is Sub-Saharan Africa poor? Is it due to race? Colonialism?
Corrupt leaders? Well, what is it?
Well, as Bill Clinton once said. It's the Economy, stupid! As in
regards to race, this claim can easily be shut down. After all, humans are the
most homogenous mammalian species on the planet. I believe modern
Human beings only left East Africa 120,000 years ago. The only difference
Separating the difference between a West African and a Western European
Is that the Western European will have a lighter skin tone because whiter
Skin tones can absorb more vitamin D from the sun in northern latitudes,
That and nutrition, but I'll get to that eventually.
Let's compare two countries which were granted independence from
Same nation, within the same year. Ghana and Malaysia. Of course they're
very different. One being in West Africa, the other being in South East Asia.
However, their economies were nearly the same if not looking better from a
Ghanaian outlook. Then something happened. Ghana remained fixed on
agriculture and mining, while Malaysia switched to manufacturing. Well,
Malaysia attracted foreign investment and Ghana clearly did not. It became
a large producer of electronic devices, its infrastructure was constructed to
Meet the demands of the growing economy and now it's five times GDP in
1980. While Ghana is about five times lower than Malaysia' current GDP
without about 60 billion dollars. What happened to Ghana? Malaysia had
Tin and rubber and Ghana had cocoa, timber and gold. What went wrong?
Ghana's first president set the precedent for things to come in that
Nation. Kwame Nkrumah destroyed the economy of a nation that had
so much to go for. More so than Malaysia which had to deal with Chinese
Communists at the time. This man decided to put a dash of socialism
(not very good for a developing country which had young citizens) and
random industralization schemes ranging from shoes to mangoes. Dreams
Of post-colonial grandeur instead of investing in schools, roads and maybe
even some tariffs for simple products like shoes meant that Ghana's
Economy was to collaspe. His control economy brought things that Ghana
didn't need at that moment of time instead of what the market demanded..
that being more cocoa and even that proved to be disastrous to Ghana.
Ghana only had basic, basic infrastructure at independence. No factories or foundries were found in that nation at independence.
After all, why would a colony need any. Ghana was merely a mine, in which
Its products would be produced in the UK, then shipped around the world at
a fast clip. Ghana didn't have the industrial strength to do so. It could've by
The 1970s had the factories need to manufacture its agricultural and mineral
Products but controlled economic planning derailed that. With its economy
Already geared to shipping raw products abroad. It was at the mercy of
Commodities are a curse on African nations. With no industrial
Infrastructure, prices would often fluctuate concerning their goods. For
example, Nigeria had an oil boom in the 1970's but as soon as the 80's came
About. The price of oil crashed and the subsequent 90's didn't help the
Situation either. Sadly, oil went from being 40 of the countries exports in
The 50's to about 90 by this decade. A nation being handcuffed to the
Mercy of the markets is never a good thing. The cyclical booms and busts
Are evidence for such.
The economic volatility is made worse by the nations own military. In
The colonial past, the armed forces are seen as a force of stability but
African militaries after the Europeans go usually turn into corrupt sleazy outfits who think they can do a better job of managing a nation than a
corrupt leader. Most of the time, an Air force colonel as what happened to
Ghana can do a much worse job. Military juntas scare away investors and
Are pretty much useless with regards to the economy as often they will
Plunder it than try to improve it. Also, who's behind this coup. More
Often than not, it's a dominant ethnic group.
In Europe, Germany is for the Germans. France is where the French
live, and Italy is an Italian abode. Such, is not the case for Africa. Colonial
Borders were drawn to minimize cost. Why have a tiny colony with 500,000
People when you could have a large one with 5,000,000. But of 10 different
Ethnic groups. Economically volatile, supranational nations don't do well.
The only European nations who have supranational populations are Spain,
Russia and the UK. I believe all 3 have faced armed insurrection for this.
Africa is no different. Moving a society in a hundred years from a medieval
One to a modern one does leave some 'growing pains' . Civil war is
Ethnic war. Fighting over those commodities, driven wild by the stock
Market is worth it in those countries. War is far more damaging than a crazy
Autocrat though. Just recently, the Second Congo was has caused 5.4
Million to die and I believe the Congo shall never recover in my lifetime
or in yours. Rebel armies loyal to Tutsis and Hutus prowl the volcanic
Rainforests of the Eastern Congo. Killing, maiming, raping, exploting gold
and coltan found there. With combining an autocrat, no infrastructure, a
Military which is clearly too large for your nation and on average 20
Different peoples in your small nation. You're pretty much guaranteed
To have a crappy economy.
It doesn't mean you're never going to recover though. The People's
Republic of China, Vietnam and South Korea are success stories but the
Great European exception of one people for one nation exists here. Well,
Except for South Korea but that's a tale for later. However, aid can make
It worse. For example, you own a small shoe factory in Kumasi, Ghana.
Aid comes in because they believe your people are shoeless. They are
But they're not helpless. Soon, people are wearing cheaper made, foreign
Shoes instead of your homemade shoes. Your factory and your 50
Employees are now poor and have to resort to farming cocoa. But cheaper
Brazilian cocoa means you can make 30 dollars of year's worth of farming.
Isn't free trade and aid a twisted bitch?
I personally believe every developing nation needs tariffs. Free trade
Only benefits countries who have the huge industrial capacity to export their
Cheap goods (like shoes) into poor nations (like Ghana). If you are a
Economic minister in a 3rd world nation, try a tariff on some manufactured
Goods your country could easily make. After all, the US only stopped
Tariffs not too long ago.
Is the future bright for Sub-Saharan Africa. Sort of. Only 13
African nations are truly democratic and that helps provide rule of law and
More investment for your country. War still goes on in the Congo, Sudan
And elsewhere. Zimbabwe has hyper inflation not seen since 1920's
Germany. Yet Ghana, is getting richer! Not as rich as Malaysia. But if
It keeps this up, it could get there in 40-50 years. it's a hard long road
Of progress, and in Africa things are never easy. However, the road still
lies there. If you choose to follow it.