The development of Africa has been a hot topic ever since the end of the colonial period. Although a substantial effort from the international community is continuing to be made, poverty disease, illiteracy and inefficiency are still rife, marking the lives of a billion Africans. Moreover, almost all of the countries in Africa are in effect undemocratic or semi-democratic and thus most of the gains of their developmental process have mostly gone to individuals rather than the social body. This article will argue that the prevalent model of resource extraction, foreign aid and large-scale international investment has largely been unsatisfactory as it fosters inequality within profoundly undemocratic regimes. Furthermore, this paper will emphasize, that a new balanced developmental approach is needed for the poorest continent, one where economic development is not at the expense of democratic development and equality. And for this approach to be achieved there needs to be a balance between capitalist enterprise and democratic participation.So far the development of sub-Saharan Africa has been revolving around three themes:
· Natural resources extraction;
· Foreign aid;
· Large-scale foreign investment.
None of these has been especially good for democracy. The case of resource-led development is probably the most extreme, one as natural resources and their expropriation tend to produce the so-called ‘resource curse’. This simply means that as a country’s economy becomes dependent on natural resources (e.g. oil, gold etc.) its political actors are able to buy favours from one another and from sections of the population in a fundamentally undemocratic way by using the income generated from the export of these resources. This means that the government in power is fundamentally independent from its citizens and therefore unaccountable. And such unaccountable governments do not have incentives to actively develop a more diverse economy as this would in effect empower their citizens as potential taxpayers.
Resource Curse: Sub-Saharan Experience
A particularly good example of a developing country in sub-Saharan Africa experiencing the effects of the ‘resource curse’ is Equatorial Guinea. It is a small country in West Africa which in 2012 had GDP per capita of roughly $26 000, almost the same as Malta ($ 26 500). The latter however is a developed, democratic EU member state with much more egalitarian social arrangements. In contrast, Equatorial Guinea is still an underdeveloped African country that is also a net recipient of foreign aid. This small West-African polity is also an undemocratic society, where the regime of Theodoro Obiang, one of the richest people in Africa, is expropriating oil revenues for itself while the vast majority of people live in abject poverty. Thus we can see how a very resource wealthy society could, due to its dependence on natural resources revenue become profoundly undemocratic and thus unequal.
Democratic Republic of Congo – An Example
Other, perhaps even more extreme cases of a ‘resource curse’ befalling a developing country could also be found in the Democratic Republic of Congo, Angola, Nigeria, until recently Sierra Leone and many others. In most of these there even were destructive violent conflicts over the control of resources. However, all of these cases are in their own ways unique but one point is clear – the combination of valuable natural resources and development tends to lead to undemocratic governance that has no incentives to redistribute the proceeds of these resources to the wider population, thus not actually fostering development.
Foreign Aid & Development in Africa
Another more general theme in the development of sub-Saharan Africa has been its relation to foreign aid. Ever since the end of the colonial period foreign aid has being used as a political tool of Western diplomatic interests that has evidently not produced much in terms of sustainable economic, social and political development. On the contrary, foreign government aid is rarely just ‘donated’ to a country that needs it. Rather it is dispatched in order some diplomatic goal to be achieved. For example, during the Cold War Western foreign aid was used as a tool against Soviet influence or vice versa. Distinct cases of this were to be found in Ethiopia, Somalia, Mozambique and Angola. Today world foreign aid is again given in order political favours to be bought. In the case of Egypt, a net foreign aid receiver, it is used as a tool for indirect control over the government and its military affairs. In regard to foreign aid has and its effects on a country’s development we can see that it either never trickles down to the people who actually need it or is used to relief a government of its expenditure. The latter has the effect of the ‘resource curse’ as a government which is recipient of foreign aid becomes dependent on the good will of whoever is dispatching it, not on the tax revenue of its citizens. Consequently such government has little incentive to foster the development of these citizens.
Development & Foreign Aid
The third theme in Africa’s development is the large-scale foreign direct investment. It is important for the purposes of this article to outline that the process of foreign investment in Africa, although undergoing a significant transformation, also does rarely improve the lives of ordinary people. And this has much to do with the undemocratic nature of governance in much of Africa as well as the nature of global capitalism. This is say that is a given multinational company wants to invest in a tightly regulated and reasonably democratic Western country it has to adhere to a range of administrative, ecological and economic norms. Moreover if the project this company is hoping to be accomplishing is big enough, the company would also have to win a certain amount of public and therefore political support. In contrast, in an undemocratic country the company in question would only have to ‘buy’ the support of the ruling regime.
This has few important implications for the citizens of the target country of this foreign direct investment. First of all, their leadership, thanks to the ‘support’ of the investor becomes even more entrenched and undemocratic.
Second of all, such company has no incentive to adhere to any ecological and labour regulations, even if they exist. And third of all, it is often the case that the overall utility that a country receives from such a corrupt contract is much lower than it would have been in a democratic and tightly administered country. The way cocoa is produced in the Ivory Coast or zinc extracted in Zambia are good examples of this. However it is important here to say that foreign direct investment is the only way in which a poor country could achieve a capital-intensive projects, most notably when it comes to infrastructure. The major problem is how this process is governed.
Development & Free Market: Inevitable Outcome of Globalization
So far this paper outlined the three modes of development in Africa, emphasizing on how they impede democratic developments. It is also important to notice that they all have one thing in common – they all in one way or another incorporate Africa in the system of the global financial markets. Oil extracted in Equatorial Guinea will be used to power a power station in Spain, investments in infrastructure in Malawi will enable Western companies to sell their products to new markets and the system of foreign aid will ensue that this system is preserved. Thus capitalism is already a part of the development of sub-Saharan Africa, the quest for ordinary Africans now is how to govern their part in it to the greatest utility. This is what the next part of this article will be concerned with.
Capitalism and Democracy: The Relationship
Is undoubtedly an interesting one. On the one hand, it is virtually impossible to find a reasonably democratic country that is not a capitalist one as well. This is, as the orthodox liberal economic theory goes, because as countries grow richer they also develop middle class, education, public services, civil society etc. – institutions fundamentally important for democracy. This is not to say that capitalism automatically produces such institutions, it does not. Democracy-fostering institutions are the product of a long socio-economic process that is fundamentally political, not just economic. Historically the role of capitalism in this process has been to provide the material basis for it.
Democracy & Inequality
On the other hand, and probably even more important, capitalism also produces material and thus political inequality. This is a problem even for advanced countries that are already democracies and needless to say this inequality is sharper in Africa. So now in front of Africa there is a huge dilemma – how to become not just more capitalist but also more democratic at the same time, overcoming the huge inequalities that capitalism will surely produce in the process. Therefore now this paper will outline a short and rather simplistic vision of what a positive developmental process may look like.
Approaches to African development already listed in this paper have been concerned with the relationship between governments and capitalism. This is a distinctively top-down approach that has produced rather dubious results. In contrast one may also argue that what Africa now has to try is a more grassroots approach to its development, an approach empowering its people. And a good starting point for this approach may be the idea of microcredit that has already produced positive results in countries in Asia, most notably Bangladesh. From the Western point of view it may not seem as much but for people living in extreme poverty to be able to buy basic tools, basic medicine, suitable crops and to ensure basic education for their children makes a huge difference. This also would mean that these people would be more empowered in their relation to governments, as the latter would not be able to so easily buy them with part of the proceeds from natural resources export or the redistribution of foreign aid. Moreover the long-term process of empowering citizens will also have the effect of producing more accountable and probably even democratic governments.
However, what is crucial here is for people to be able to see that a purely economic process is not going to bring prosperity to them. What they also need to do is to actively take part in the wider political process. And for this a change in the mind of the African people is needed. The poverty-stricken African farmer will have to become a citizen.
As the paper already outlined this would be a rather long process that may eventually lead to a clash between people and the regimes that rule them. This does indeed sound too idealistic but there is a brighter perspective to it – in order for people to become active citizens they do not necessarily need to engage in large, national-level politics. It is remarkable what even local-level activism could achieve in terms of improving people’s lives. Thus what poor people in Africa should be concerned with is institution-building, on both local and regional level. This may not seem of vital importance from a Westerner’s perspective as the institutions of civil society have been created long time ago and are often taken for granted. But in the much less developed African countries the creation of grassroots organizations is a much more straight-forward process as the state is at most places non-existent and there is a space in the social sphere as well as the need for such institutions. Finally, this is a process that may eventually change the very nature of the African polity, leading to a more accountable, legitimate and democratic governance. And it is such governance that is needed for the solution of the bigger African problems such as lack of infrastructure, ethnic conflict and pandemic diseases.
This article argued that the natural resources export, foreign aid and the large-scale foreign investment have not produced a sustainable development for sub-Saharan Africa. Actually they have significantly facilitated in the short-term to the development of undemocratic regimes that make a development in a positive direction difficult.
Moreover our analysis has also argued that in order a sustainable development for Africa to be achieved there has to be a balance between the power of modern capitalism and the democratic governance of the polity.
Finally, we have emphasized that in order such balance to be found ordinary Africans have to engage in grass-roots institution-building.
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