Some arguments made today on why Africa cannot catch up with the West were also made 100 years ago when Africa was under European colonization, with the colonizers blaming everything but imperialism as the root cause of underdevelopment. The world economic structure has not changed, no matter the rhetoric of globalization. Africa remains semi-colonial: increasingly dependent on developed countries for overvalued manufactured goods while exporting raw materials at prices determined by commodity markets in the West.
This essay argues that Africa is undergoing changes in its economies in the 21st century, not only because of the role that China is playing but owing to intense competition from other Western countries and the Middle East. China’s role is within the capitalist world economy and within the patron-client model of integration that the Europeans followed after African countries achieved their formal independence from colonization. During the second half of the 20th century, northwest Europe remained the conduit for African integration into the US-centered global economy, despite the role of US-based multinational corporations. According to Pew Research Center polls of African nations, the issue concerning the vast majority of the people remains the gap between the rich and poor. This is directly related to the international competition for market share in Africa as well as the security issue intertwined with local rebels groups and what the US labels Islamic-inspired “terrorism”, or another form of guerrilla warfare. This essay examines many of these issues for a deep understanding of Africa today and its future prospects.
Part I: Structural obstacles to development and social justice
Decades after the decolonization of Africa and after Frantz Fanon (Wretched of the Earth) depicted the social, economic, political and cultural problems associated with the legacy of colonialism there has been no structural change in the political economy of the 54 African nation-states any more than in ending endemic poverty as the UN and other organizations have been promising for decades or closing the rich-poor gap. It is misleading and a remnant of imperialist political labeling to lump all African countries under one category, just as it is misleading to place all of Latin American countries in a single category, although they do have common characteristics and a common legacy of colonialism and the current reality of foreign control of resources and market share.
There is a huge difference between South Africa now part of the BRICS (Brazil, Russia, India, and China) economy, and Somalia ranking as one of the world’s poorest nations with political instability and dim prospects for economic growth. It is just as difficult to make comparisons between Islamic North Africa with sub-Sahara Africa, despite political instability that is a common characteristic in most as the continuation of foreign economic dependence after the end of colonial rule. With this caveat in mind, for purposes of this very short essay I will address some common features and note differences as well in development models.
Apologists of capitalism argue that Africa’s current problems are strictly cyclical because the prices of metals, oil and other commodities, especially coffee and cocoa, have been declining amid a deflationary international climate. While it is true that the slowdown in commodities demand in China has obviously impacted Africa, the majority of the people were not better off when prices were rising. Regardless of capitalism’s expansion and contraction cycles, from the 1950s to the present, living standards for the African people have not improved, no matter the lofty claims from Western governments, NGOs and other organizations about helping Africa become self-sufficient.
In the second half of the 20th century, Africa’s division of labor and national institutions – everything from military to banking and foreign trade - was largely determined by the core countries - US and northwest Europe - with the considerable assistance from the International Monetary Fund (IMF), World Bank and its affiliates, African Development Bank and a number of United Nations agencies, and of course, the explosion of NGOs some of which are fully funded by governments trying to peddle political and economic influence. In short, the external mechanisms of Africa’s dependence became stronger and more solidified in the last six decades than they were during the era of colonial rule.
In fact, there has been a downward trend in living standards for the vast majority of Africans from 1990 to 2015, despite the remarkable uptrend cycle in commodity prices and massive new investment from China. This is evident by examining all indicators from life expectancy to access to clean water and sanitation. There are those who point to periodic drought primarily in Ethiopia, Kenya, and Somalia; local wars and rebel conflicts in the drought-stricken countries as well as others especially where Muslims have influence such as Sudan, Nigeria, and Libya.
Besides endemic poverty that creates fertile grounds for Islamic or community inspired rebel movements throughout many parts of the continent, the population explosion, corrupt politicians, contraband and informal economy, absence of infrastructural development, and modern technology to help the continent achieve capitalist development comparable to that of the West are obstacles to progress. It is noteworthy that some of the arguments made today on why Africa cannot catch up with its Western counterparts were also made one hundred years ago when Africa was under European colonization, with the colonizers blaming everything but imperialism as the root cause of underdevelopment.
One cause for the systemic underdevelopment of Africa has been and remains that more capital flows out than comes in, invariably foreign loans having the role as catalysts to the process of de-capitalization. The cycle of public foreign debt and de-capitalization continues across the continent under the watchful eye of the International Monetary Fund and foreign financial institutions that represent big banks in the US and Europe and large corporate interests.
It is, indeed, a monumental step forward that Africans have served as heads of the United Nations and in key positions of international organizations. From a symbolic perspective, it was great to see Kofi Annan as the UN secretary-general, but was Africa better off when he left the UN than when he came in; or was there any structural change in the political economy of the entire continent from Egypt to South Africa, from Nigeria to Kenya? Inordinate dependence on the foreign–dominated and outward-oriented primary sector of production owing to failure to diversify the economy remains the major obstacle to raising living standards.
Many observers of the African political economy argue that there have been success stories, among them South Africa freeing itself from white minority political rule though keeping white minority economic hegemony. With the exception of Israel and rightwing elements in the US, the entire world celebrated the end of South Africa’s apartheid a generation ago. Nelson Mandela became a symbol of freedom and self-determination for Africans. However, high unemployment, low living standards among blacks, lack of upward mobility, and the rich-poor divide persist, with the country occupying the world’s last place for life expectancy.
Although South Africa was on its way to catching up with Brazil, India and Russia, enjoying 38 per cent GDP growth in the last decade, this was not indicative of social mobility but rather capital concentration. In 2015, South Africa suffered unemployment at the same level as Greece that has been under IMF-EU austerity since 2010. Socioeconomic and political conditions are worse in the rest of Africa, and this includes Muslim northern Africa that has suffered US-NATO direct and indirect military interference in its social uprisings during the Arab Spring revolts that once represented the promise of a democratic Africa free of dictators linked to large domestic and foreign capitalists.
Judging from the unemployment statistics in Africa’s two largest economies, Nigeria and South Africa, both dependent on extractive industry exports, there is not much difference between them, with all of those natural resources, and Greece suffering five consecutive years of IMF-EU-imposed austerity and downward socioeconomic mobility. One could argue that 26.4 per cent unemployment for South Africa and 24 per cent for Nigeria are understandable owing to the cyclical nature of the commodities market – both gold and crude oil are sharply down from their highs, along with all commodities. However, the core issue is not capitalism’s cyclical contraction, but the high levels of structural unemployment and underemployment in the continent’s richest countries, as well as the vast income gap between the very few wealthy individuals and the vast majority of the masses.
Obstacles to development account for a division of labor that has remained about the same in the last half-century. This is despite reductions in extreme poverty (under two dollars a day category) in the last two decades. By all indications, globalization has accounted for the downward mobility of most Africans, although this may not be as clear when looking at GDP statistics of certain countries, including South Africa and Nigeria. The world economic structure has not changed, no matter the rhetoric about globalization and neoliberal policies uplifting all economies across the world. Just the opposite, the overall economic picture of Africa is one of steady decline since the 1980s. The continent’s share of global trade was 3.1 per cent in 1955 and in 1990 it was a mere 1.2 per cent.
Largely because of China as a major new player in the region’s trade, there was a rise after the recession of the early 1990s, but this too was limited to the primary sector of production. The China factor did not help the continent lift its GDP amounting to under $300 billion in 1997 while the debt was $315 billion. This allowed the IMF to impose austerity and neoliberal measures of privatization, corporate tax reductions, and trade barrier removals that further weakened the national economies. The austerity measures not only prevented upward socioeconomic mobility, but actually drove more people into lower living standards.
In December 1993,UN secretary-general Boutros-Boutrros Ghali argued that the solution for Africa’s socioeconomic problems rested with greater integration. In an essay on this issue, Robert J. Cummings noted that: “From the 1950s to the present, more than 200 organizations have been founded on the continent of Africa for the purpose of fostering regional and sub-regional integration and economic cooperation. The performance record of these myriad organizations historically have not been sterling.” (R. J. Cummings “Africa’s Case for Economic Integration” (www.HU Archives.net )
The efforts on the part of the UN, World Bank and other Western institutions and governments to forge African integration have not altered the dependent structure of the economy based on the primary sector of production nor have such efforts resulted in higher living standards and upward social mobility despite some reduction in poverty in the last two decades. Integration on the patron-client model is at the core of neo-colonialism in Africa and favors the multinational corporations, thus perpetuating external dependence and underdevelopment.
The most significant challenge for Africa in the next few decades will be to transform itself from a largely "dependent outward-oriented" economy (primary sector production exports) providing cheap raw materials for the advanced capitalist countries to an inward-looking (producing to meet domestic demand through import substitution industrialization) integrated via an intra-continental model and developing more equitable terms of trade with developed countries. The uneven terms of trade, the inherent lower value of African exports vs. its imports from the developed countries has been and remains a core problem in development.
To achieve the goal of self-sufficiency Africa would need more than NGOs and UN intervention that only target emergency areas during war and famine. Africa would need more than China funding infrastructural development intended to accommodate extractive mining and agricultural regions, and more than regional integration that the World Bank has been advocating and without success by its own admission, and only intended to strengthen the role of multinational corporations trying to dominate key sectors of the raw materials economy.
In the absence of a systemic political change, just as took place in England (1689) and France (1789) that paved the way for economic modernization, Africa cannot achieve its goal of self-sufficiency no matter the rhetoric by politicians on the continent or Western organizations like the World Bank and corporations employing the self-sufficiency rhetoric but operating as imperialists not much different in results than the colonialists of the 19th century.
Part II: China’s economic role in Africa
Is China threatening to displace the Europeans from Africa at some point in the second half of the 21st century, as the mass media in the US has been hinting since the global recession of 2008? Or is EU-Chinese capital so intertwined that what may be counted as China’s market share in Africa could very well be yielding profits for French, British and German multinational corporations? If capitalist China is such a threat to the West, why has the very Western World Bank been collaborating with China on a number of fronts? Is it merely the fear of the US that China as the inevitable number one economic power in the world will corner the most abundant and cheapest markets in Africa?
In 2010, Wikileaks published the US concern about China helping to develop the infrastructure strategically in those countries in Africa where it plans to do business. Two things alarmed the US: a) no strings attached to infrastructural development, at least no direct strings as the US and EU always impose on the recipient country; and b) the clever way the Chinese are including the World Bank and European governments and EU-based multinational corporations. In short, China’s multilateralism as a strategy of securing market share has been upsetting to American unilateralists who see a fiendish plan that would entail Africa transferring its historical dependence from the West to East.
Another issue regarding China is the scope of its role in Africa in 2015, considering that the Western media present it as hegemonic and potentially threatening to “US and Western interests”, thus invoking national and trade bloc capitalism as a populist tactic. In reality, as we will see below, China currently has a small role while the Europeans, US and wealthier Gulf Arab states enjoy the lion’s share of the market.
What has alarmed the Western capitalists and politicians is the reality that African exports to China went from a mere 1 per cent of world share in 2000 to 15 per cent in 2012, and are likely to continue rising for the indefinite future. Despite the inevitable cyclical economic slowdown in China, it is just as inevitable that by the 2030s we can safely predict much closer trade, investment and overall economic dependency of Africa on China. This in itself poses not just a threat to Western capitalism but to Western geopolitical designs on a continent very rich in natural resources. Because the US does not compete with China in Africa using the same tools of economic integration, about the only response the US has is to flex its military muscle and secure as much as it can for US-based multinational corporations.
Before we assume China’s role is benign, the issue of China as the panacea for Africa is one that many have emphasized, given that European and US economic, military and political roles throughout Africa have not resulted in improvements as judged by standards the West has been proclaiming – democracy, freedom, economic development and higher living standards. Some observers in and outside of Africa believe that China’s integration model, which starts with infrastructural development that would help the domestic economy as well as forge greater regional integration while stimulating the export sector, is promising. After all, the European imperialists had done nothing but pillage Africa from the start of the trans-Atlantic slave trade in the 15th century when the Portuguese landed until the more subtle late 20th century policies of assisting corporate exploitation of natural resources. Moreover, if China is so well integrated into the global economy and it is helping to forge a new integration model in Africa, this presents new opportunities for African counties, at least for those rich in natural resources.
The bottom line is whether China will help Africa develop or merely perpetuate underdevelopment as did the Europeans and the US. Underdevelopment is a process, just as development, that takes place amid domestic and international political economy dynamics. Development is not a matter of a country having a surplus labor force, or having near self-sufficiency in minerals and raw materials, or enjoying an infrastructure that can accommodate rapid development to buttress the capital-intensive export sector mostly of extractive industries. Africa is one of the richest continents on the planet in natural resources and it certainly has a surplus labor force at the lowest cost on the planet in comparison with the other continents. Can Chinese investment do something with these cheap assets to help itself while also helping Africa?
In order to secure a segment of Africa’s natural resources for its own growth and development at the lowest possible cost, China has been investing in the continent and counting on it for rapid export growth in the 21st century. Despite its rich resources and new investment from China as well as Gulf Arab countries, Europe and US, the persistence of underdevelopment in Africa defies logic at least on the surface beyond the GDP growth numbers and marginal decline in extreme poverty. Why is there reason to believe the Chinese will change a history of five centuries of colonialism and neo-colonialism?
One could argue that the structural causes have everything to do with the corrupt and incompetent political regimes combined with the uneven development complicated by the periodic famines and droughts in a number of sub-Saharan regions. Another argument that the apologists of globalization and neoliberal politics make is that Africa has not fully integrated into the world capitalist economy, leaving much of its productive capacities underutilized or outside the domain of international trade owing to persistence of tribalism. Is Africa’s problem underutilization of natural resources, or uneven terms of trade, chronic exploitation of low labor values, massive capital concentration in the hands of very few comprador bourgeoisie linked to foreign capital, and of course corrupt politicians that foreign corporations bribe to secure contracts?
Another issue that Western analysts are constantly making is that there is instability owing to civil conflicts in a number of countries, from Sudan and Nigeria to Central and East Africa where rebels are an obstacle to stability and development. In the Islamic countries north of the Sahara, there is the instability caused by jihadist elements as there is in the East; activities which also impact Africa more broadly. However, jihadist conditions, as we will see below, are of fairly recent origin and even so a reaction to neo-colonial conditions, among other causes related to tribal and religious differences. If we were to sum up, the Western analysts conclude that the fault for the absence of development in Africa rests squarely with internal dynamics and has absolutely nothing to do with Western imperialism as a chronic presence.
When we examine the lofty promises of growth and development by the UN, World Bank and Western governments whose only interest is to assist corporate control of Africa’s resources and market share the result is that by 1995, 25 per cent of the people in the sub-Sahara region had no job and were homeless. Even more alarming, Africa’s agricultural growth rates have been declining since 1965. From an annual average of 2.2 per cent (1965-1973), to 0.6 per cent (1981-85), per capita food production continued to decline throughout the 1980s and 1990s, necessitating four times as much food aid. Why is anyone surprised that there is the level of rebel activity, including jihadist as of late, when the question really ought to be why is there not more such activity given these conditions that people in the West would not tolerate and demand change?
There are those who argue that China’s presence actually helps to tame the sociopolitical mood throughout the continent. China is investing in everything - hydro-power, dams, water and sanitation, ports, railroads, roads, mining, timber, fisheries and agriculture. At the same time, France and the rest of Europe as well as the US and the rich Arab countries have been competing with China and want to maintain their market share. What exactly this entails for the people of Africa and the development model that would eventually lift the majority of the people from abject poverty is another story.
The Chinese are not in Africa to lift living standards for the population but to strengthen their global competitive position. China will need Africa’s raw materials, everything from foodstuffs to minerals, in order to remain a global economic power in the 21st century. China accounts for about one-fifth of the planet’s population, but it only has six percent of the planet’s water and nine percent arable land, forcing its government to look outside its borders to sustain its growth and development. Just as Africa provided cheap raw materials and cheap labor for Europe and the US from the era of colonialism until the rise of China as a global economic power, in the 21st century it will play a similar role with China competing for Africa’s cheap raw materials and labor. Investment has risen from a mere $210 million in 2000 to $3.17 billion 2011 and it is expected to skyrocket.
Africa is the world’s fastest growing continent for foreign direct investment (FDI), but it starts out at such low levels that it can only go higher. While historically FDI went primarily to the extractive industries, there is new emphasis on manufacturing, with energy as a key industry where revolutionary methods could make a difference in bringing electricity to more people than ever and make manufacturing even cheaper. The continent’s global share of FDI rose from around 3 per cent in 2007 to 5 per cent in 2012, a period of global recession. But among the top 25 countries in the world with the highest incoming FDI, Africa is nowhere to be found; and if it were not for South Africa, the continent as a whole would be at the very bottom along with some of the Eurasian countries. As miraculous as it may appear, China’s share of overseas direct investment in Africa is a mere $26 billion, while France and UK continue to lead in this category. On the other hand, few would argue that China is poised to impose economic hegemony of some type over Africa under an integration model presumably better than what the French and the British had imposed after decolonization.
By extending concessional loans – more generous terms and longer term – to the tune of $10 billion amid the global recession of 2009 to 2012, China bought itself enormous influence without literally dictating terms down to the minute detail as do the IMF and World Bank. Chinese President Xi Jinping doubled the concessional loan commitment to Africa from $10 billion to $20 billion in the 2013-2015 period, and the Chinese Export-Import Bank announced an ambitious financing program of $1 trillion by 2025; something that could be scaled back owing to the slowing Chinese economy in 2015.
Although Africa accounts for such a small percentage of Chinese global investment, Africa has been a top foreign aid recipient. Aid donors have always used it as a policy instrument and leverage in every respect to influence not only investment and trade policy of the aid recipient but defense and foreign policy as well. In providing various types of aid to Africa, from medical and humanitarian to debt relief and development, China is in fact investing in good will diplomatically as well as economically for the future market share that it wants in Africa.
Can we expect from China what we have seen on the part of the European and US companies in Africa since the 1960s? From the early 1960s to the present, large foreign companies secure public financing for privately operated projects that have been uneconomic across Africa. However, the foreign firms risk no capital of their own because their loans to finance their operation are guaranteed by their governments or development banks, as are interest and profits. Because most of the investment is invariably in mining and commercial agriculture, involving multinational companies like Monsanto, the Carlyle Group, Shell, and other Wall Street and EU giants, the goal is to strengthen the export sector by taking advantage of cheap labor without much benefit for the broader economic diversification in a continent desperate for greater self-sufficiency.
Although China has followed this pattern, its focus on developing the infrastructure in a number of African countries has the potential of laying the foundations for a sustainable diversified inward oriented economy. After all, China has provided assistance for schools and some textile factories, but it often labels loans as “aid”, and most of its investments go to those countries rich in natural resources.
Foreign investment in Africa under terms no developed country would permit is virtually unregulated, thus constituting a drain of natural resource wealth. Suffering the lowest labor values on the planet, Africa attracts foreign capital investment because it is the next frontier to realize high profits. Moreover, foreign capital flows because foreign businesses demand that African countries provide local financing under government-guaranteed loans and very generous terms that include profit repatriation, liberal terms on the environment, and minimal labor protection.
According to the World Bank that has partnered with China on many projects, the goals in Africa include (i) accelerating industrialization and manufacturing; (ii) making special economic zones (SEZs) and industrial parks work; (iii) infrastructure and trade logistics, including regional integration; (iv) creating the conditions to accelerate responsible private sector investment, (v) skills development for competitiveness and job creation, and vi) improving agricultural productivity and expanding agribusiness opportunities.
These are indeed lofty goals, and one could argue that all countries undergoing industrialization had to suffer, so must Africa, despite its unique relationship with industrialized nations. If we analyze each of the above points that the World Bank has outlined, we conclude that the goal in Africa is to create a climate conducive to foreign corporate investment under the best possible terms. There is nothing about protecting workers’ rights, collective bargaining, livable wages, appropriate affordable housing, hospitals and schools, and above all under a political regime that respects human rights and civil rights pursuant to principles of social justice. The only concern of the investors, governments, and international organizations assisting them in Africa is the investment itself not the social, cultural, economic and political welfare of the people.
Part III: The new scramble for Africa, narcotics and human trafficking
There is a 21st century version of "the scramble for Africa", a continuation of what started in the 19th century (1880-1914) by the Europeans who pillaged the continent's resources, systematically exploited its people, caused community and regional wars, destroying its culture; and all of it by invoking social Darwinism and other Eurocentric theories, including ethnocentrism and 'exceptionalism', to justify white hegemony. The new round of neo-colonial race to carve up Africa's lucrative agricultural lands, mineral wealth, fishing rights within its territorial waters also extends to its geographical location that makes it so convenient for South American cocaine trade through West Africa and heroin-cannabis trade through East Africa.
According to the World Bank (September 2010), more than 110 million acres of farmland (the size of California and West Virginia combined) were sold during the first 11 months of 2009. This was all in a mad rush of foreign private and government investors to secure cheap land (and labor to work the land), and all during the most serious economic recession in the postwar period. Between 1998 and 2008, the World Bank provided $23.7 billion for agribusiness around the world, much of it in Africa promoting what it calls 'efficient and sustainable' agriculture. Along with the erosion of subsistence farming that sustained families, there is the corresponding erosion of subsistence fishing owing to competition from European and Asian commercial fishing operations in coastal Africa. All of this is an integral part of the corporate control of Africa with the support of governments in the advanced capitalist countries and with the backing of the IMF and World Bank Group’s subsidiary agencies like the International Finance Corporation (IFC).
In 2010 the IFC invested an estimated $100 million in agribusiness in sub-Saharan Africa, compared with merely $18 million per year in the previous decade. Naturally, IFC and World Bank investments which run into the billions focuse solely on corporate agriculture that displaces the small farmer. This despite the advice from experts in sub-Saharan countries who argued that the best use of farmland is to distribute it to villagers (about 12 hectares per family) and give them the means to cultivate it to end hunger while also generating a potential surplus for trade. Foreign-owned agribusiness backed by their governments and international financial organizations such as the IFC produce commercial crops for export, while the native population remains poverty-stricken. It should be noted that foreign aid for Africa's agriculture dropped by 75 per cent since 1980, thus creating the need for private foreign investment in the sector. This is all in the name of furthering the goals of privatization that Western neo-liberals push across the world with devastating consequences for workers and peasants.
In the last one hundred years, agriculture in the industrialized countries has undergone a revolution that has resulted in just a small segment of the labor force earning its living from farming, animal husbandry and fishing. Technology and science applied to the sector has raised production and made agriculture less labor intensive just as specialization and concentration has resulted in higher productivity. Modernization of the primary sector of production entails that large commercial operations in the primary sector of production, backed by favorable government policies, have taken over the sector that requires expensive agrochemicals and machinery, and a distribution network to secure steady profits. In Africa’s case, only large invariably foreign-owned commercial enterprises are able to operate under this model of development, forcing the small farmers and peasants into poverty.
With each recessionary cycle more small farmers in Africa and around the world are squeezed out of business, while neo-liberal apologists not just in the corporate boardrooms and the media, but in government and UN continue to sing the praises of large scale commercial operations as the panacea for capitalism. The transition from subsistence to commercial agriculture first in Western Europe and then in US freed the surplus labor force for the manufacturing and service sectors of production. In the case of Africa, however, there is no manufacturing or service sector large enough to absorb the surplus labor force that is uprooted from subsistence farming and animal husbandry.
The assumption by governments, banks, and mainstream economists is that commercial agriculture in the form of agribusiness is a necessary development of modernization. Another assumption is that only large-scale agribusiness, which is subsidized by government and international organizations like the World Bank and IFFC among others, can meet the world's rising food demand while keeping costs low. After all, manufacturing is just around the corner for Africa, although it promises to be the kind of manufacturing we have seen in Bangladesh and other south Asian countries, where living standards are very low and working conditions very poor.
Given the trend toward corporate agriculture, in the last fifteen years, governments and private firms from around the world have been investing in sub-Saharan Africa because corporations chase the highest return for the lowest possible investment under the most favorable conditions to capital possible. Besides agribusinesses acquiring more land, banks, hedge and pension funds, commodity traders, foundations and individual investors have been buying land as part of portfolio investments for an average of $1 per hectare. This is in an attempt to cash in on low-cost land and labor amid a growing demand for raw food products and bio-fuels.
The EU is hoping to reduce carbon emissions by using at least 10 per cent bio-fuel of all fuel products by 2020. The US is aiming to reduce its foreign dependence on oil by 70 per cent in the next 15 years. With the help of the World Bank and IFC, the EU and the US have been looking to Africa - more than 700 million hectares appropriated for agribusiness - as the continent to invest in bio-fuels; this at a time that the Europeans have also been eyeing Africa as the next frontier for solar energy. Latin America is also a target for bio-fuel and other agrarian investment, but Africa offers even more attractive prospects in part because of the Arab and Chinese interest as well.
In the past decade, India, China, Japan, and Arab countries have joined the 21st century scramble for Africa, in some cases because governments are concerned about soil, water, and natural resources conservation in their own countries. Private investors and governments are aggressively seeking to partition Africa's rich agricultural land as the cost of agricultural commodities is expected to rise once the current recession ends. Saudi Arabia has set aside $5 billion in low-interest loans to Saudi agribusinesses to invest in agriculturally attractive countries. Another reason for the new scramble for Africa is because of what the UN Food and Agricultural Organization calls 'spare land', areas not under cultivation, or underutilized.
Developed countries have used Africa for its raw materials and as a consumer of imported manufactured products and foreign business services, but not as roughly equal trading partners as is France and Germany. Rather, Africa has been the victim of unequal terms of trade, and external control of its key extractive sectors. In short, Africa remains semi-colonial and continues to become increasingly dependent on developed countries for overvalued manufactured products and services while exporting raw materials at prices commodities markets in the West determine based on speculative interest.
One is favorably impressed by the rhetoric regarding “sustainable development” that the media, governments, the World Bank and even corporations promise as though such development translates into social justice. After all, the hypocrisy of corporate responsibility regarding the eco-system has been exposed repeatedly not just by oil companies operating in Nigeria, but even by Volkswagen as its flagrant scandal regarding emissions manipulation proved in October 2015. The EU and US quest for bio-fuel development in Africa, and for that matter in Latin America, has nothing to do with 'sustainable development' or engendering greater 'self-sufficiency' or helping to 'develop' Africa - rhetoric that the UN, World Bank, western governments and multinational corporations are using to make 'the new scramble for Africa' more palatable to the world. The rhetoric is obligatory to placate the masses to retain their trust in the corporate world.
Will the people of Africa solve the chronic problems of poverty and disease as a result of the exploitation of land and labor to satisfy the demand for food and bio-fuels in Western nations? Africa's food requirements will double in the next two to three decades, a point that foreign agribusinesses, governments and IFC and World Bank are using to justify the commercialization of agriculture under foreign ownership. In the process of the neo-colonial land-grab, evictions of peasants and small farmers, entire villages uprooted, civil unrest, and citizens' complaints of 'land grabbing' have been common. Protests owing to social injustice do not stop governments from approving agribusiness deals backed by powerful forces. One common justification used for the new scramble for Africa is that the acquired territories are not utilized or 'wasteland'. Governments often do not charge agribusiness for the water they use. Just a single agribusiness belonging to an Arab investor in Ethiopia, for example, uses as much water as 100,000 people - water of course is the most precious commodity in many parts of Africa. This is the reality of agribusiness and its role in drought-ridden East Africa.
One reason for the rise of the informal economy that includes everything from hand-carved wood statues to cocaine from Colombia and heroin from Afghanistan using West and East Africa as hubs before sending the product to Europe is that the neo-liberal model of development has failed. In fact, it has failed so miserably that young impoverished Africans join rebel groups inspired by radical Islam or community loyalty. At the same time the combination of rebel activity, and violence linked to narcotics as well as human trafficking and weapons, also linked to radical Islam and tribal allegiances in some cases, is a reflection of a neo-colonial system, no matter the lofty claims by Western governments, NGOs, media, the UN and World Bank that they are looking after the interests of African people.
Narcotics trade in Africa
Africa's structural problems have contributed to a thriving narcotics trade through the Western and Eastern areas because of geographical considerations. Given that in sub-Saharan countries the percentage of labor force involved in agriculture, animal husbandry and fisheries ranges from 50 to 75, the result of agribusiness is to create a larger percentage of wage laborers instead of engaged in the subsistence economy. A percentage of this population will choose to make a living in illegal activities – human trafficking, weapons, and narcotics trade; others in piracy, still others in the thriving teenage prostitution business that has a ready market around the world.
All of this is an integral part of an informal economy that according to the African Development Bank contributes 55 per cent of GDP in the sub-Sahara region and accounts for 80 per cent of the labor force. “Nine in 10 rural and urban workers have informal jobs in Africa and most employees are women and youth. The prominence of the informal sector in most African economies stems from the opportunities it offers to the most vulnerable populations such as the poorest, women and youth.”
The UN Office on Drugs and Crime has been warning for many years that a number of West and East African countries are now immersed in the international drug trade, a reality that has consequences for criminal activity and the overall subterranean economy and politics of Africa. Because the drug trade is so lucrative, the income it generates is often larger than the entire GDP of some African countries. This is the case with Guinea-Bissau where the cocaine trade amounts to more than $2 billion and where violent crime in this former Portuguese colony has been rising steadily. The situation is not very different in Senegal where the airport at Dakar has been used to transport cocaine from Latin America to Europe.
While West Africa is a hub for cocaine from Colombia and Peru, East Africa is a hub for heroin and cannabis coming to the region from South-East and Southwest Asia by air and sea, often onboard vessels that transport legitimate commodities, and often owned and operated by European shipping tycoons and of course European banks to launder drug money. A number of Greek shipping tycoons have been linked to the illegal narcotics trade in Africa, but they invariably enjoy European connections for distribution and laundering of enormous amounts of money considering the street value is 20 times higher than its original value when the products land in Africa.
While the drug trade may appear that it is outside the mainstream of economic activity, it actually operates under the same laws of capitalism and in practice under similar routines. The laws of supply and demand apply as does the cooperation of government, albeit at a sub-level of illegality through bribery no different from when a multinational corporation bribes officials. Moreover, just as the extractive industries drain Africa of capital so does the narcotics trade. People involved in this business are in fact businessmen running operations of an illegal product but observing all other rules of the market within which they operate and which makes no distinction between drug money and corporate money. The bottom line for Africa is that both the corporate and drug businesses result in taking capital out of the area and leaving behind all the social and political problems.
The process of de-capitalization, especially amid recessionary cycles in the world economy as in the current case of depressed commodity prices, only increases the problems with the informal economy that is a mere extension of the overall outward-oriented dependent economy and a colonial remnant that gives rise to illegal activities. East Africa around the Gulf of Aden is already the pirate center of the world, and this in addition to the weapons and human trafficking trade. Everything from illegal handicraft items to diamonds and gold are illegally traded. West Africa is slowly transforming itself into the new world center for South American narco-traffickers. Guinea, Mauritania, Guinea Bissau, Ghana, Benin, Sierra Leone, and Senegal are among the most significant intermediary narco-traffic countries linked to the Colombia-Venezuela coca trade.
In the absence of official cooperation, everyone from custom officials, port authority, police, army and navy, all the way up to cabinet officials, the drug trade would not be possible. In short, the drug trade in Africa is an integral part of the political system and informal economy that enjoys protection from a wide variety of players. This makes transport low-risk in comparison with the Caribbean. With Russia as a new player in the international drug trade and oligarchs behind the regime, the activity has increased in the last decade.
During the "just say No!" campaign of the Reagan era the US had the highest per capita use--US population was around 4 per cent but consumed 25 to 40 per cent of the world's illegal drugs--and this is not to say that a legal pill-for-everything panacea in the US is not at its root a cultural trait. Today, however, both UK and Spain surpass the US in per capita use of cocaine, and both countries along with Portugal and France are the major destinations for coca that comes from Latin America through West Africa.
Anecdotal evidence suggests that Somalia, currently in the process of establishing a central authority, is host to widespread illegal transactions, including drug and arms trafficking. There are two important international airports in the region, servicing the capitals of Ethiopia and Kenya, which are used as transit points for drugs. Both airports have connections between West Africa and the heroin producing countries in South West and South East Asia. There is also an increasing use of postal and courier services for cocaine, heroin and hashish.
Heroin trafficking from Pakistan, Thailand and India to East Africa has been rising in the last two decades. Some of this heroin finds its way to West Africa that also exports to Uganda, Tanzania and Kenya through Ethiopia. Increasing numbers of Tanzanians and Mozambicans are involved in the trafficking of heroin from Pakistan and Iran, given the limited options in the formal economy. West African and East African drug syndicates are inter-connected as they are to smugglers from Latin America and South Asia, reflecting high level of organization.
Considering that multinational corporations from Shell Oil to Siemens have a long history of bribing African officials as they do non-Africans, narcotics traffickers' mode of operation is no different than that of "legitimate" businesses. And if the opportunity presents itself to make a living why is "dirty money" any less valuable than "clean money," the latter of which seems to be less than $500 a year for most Africans? Judging on the basis of postwar recessions when per capita income has dropped as much as 50 per cent, this means that in this current crisis Africa will not only suffer greater impoverishment than the rest of the world, but its economic problems will cause more ethnic and community conflict, more epidemics, more intra- and inter-continental emigration, and more political turmoil than any developed nation can expect.
Such a climate is ideal for more piracy, more weapons and narcotics transfer, more human trafficking, and all of it part of the colonial and neo-colonial legacy of outward oriented economy benefiting the developed countries. Though the continent is in need of debt-relief and development assistance for the short-term, the solution for a small segment of unemployed and destitute young Africans is drugs, guns, and human trafficking that generates money, although most of that money does not stay in the region and creates violence that disrupts legitimate economic activity.
The social fabric disrupted yet again by 'the new scramble for Africa', continued political instability is a guarantee as much as a rise in crime and social unrest. Amazingly, the same institutions that contribute to Africa's devastation claim that they are acting in the name of progress, sustainable development and efficiency, helping to raise productivity and exports, to create jobs by bringing foreign investment,' etc.; the modern versions of "The Whiteman's burden".
The 'politically palatable' rhetoric of 'efficiency and sustainability' has resulted in an outward-oriented agrarian sector catering to foreign markets instead of inward-oriented economy designed to meet the rapidly rising population's food needs. In 16th century England, farmers switched to animal husbandry owing to rising demand for wool textiles. Peasants starved as the cost of grain increased, thus "sheep ate people". In this century, 'agribusinesses will be eating Africans'.
Apologists of agribusiness justify their support by various arguments including ‘no country has developed’ with two-thirds of its labor force living off the land and dependent on extractive industries. It is an interesting coincidence that just as sub-Sahara Africa has been targeted by drug lords in the last few years, it is also targeted by corporate farm investors whose mode of operation is to use the low-valued land and labor and corrupt public officials in order to serve foreign market demands. Rural poverty will rise as a result of foreign corporate investment in African agriculture. Will the 'new scramble for Africa' by corporate investors and drug lords result in the elimination of famine and disease; will it result in higher rising living standards for the native population, or will it be another form of neo-colonialism in the name of progress?
Using the pretext of “terrorism”, a guerrilla movement under the flag of jihadists in recent years, the West and pro-West regimes default all problems on such fanatics in Nigeria, Chad, Sudan, Somalia, Kenya, Niger, Cameroon, Mali, Uganda and Mauritania. In other words, the US and its European partners would have the public believe that for decades when there were no Islamic jihadists, sub-Sahara Africa under colonial and neo-colonial rule enjoyed social justice and upward social mobility under democratic regimes. Even more insulting is the implication that the Islamic militants are the cause and not the symptom of Western exploitation of Africa and that if they are eliminated the continent would have no problems. As counterproductive as jihadist warfare has been, and as futile in achieving its goals, it is not the cause but one more symptom of the neo-imperialist structure in the continent from Libya to South Africa, from Nigeria to Kenya.
Besides defaulting Africa’s problems on Islamic ‘terrorism’, there are also the advocates of the neo-Malthusian theory - too many people too few resources, rather than unequal income distribution. It is true that drought is a cyclical natural disaster in parts of Eastern and Southern Africa and generally a problem in a few other parts as well. However, does drought justify Malthusianism and does it explain structural impediments to African development? This is not say that a form of managed population control is not desirable, but this is a matter of resources and education for the general population.
Uniting and organizing at the grassroots to end racist neo-colonial exploitation whether in the form of the formal economy based on mineral and agricultural exports or in the informal economy that includes narcotics is the only solution for Africans. Working toward sustainable development can only come from indigenous movements that first change the externally-dependent political regimes and then undertake to change the social order that would engender economic growth under an inward-oriented model. Given the deep historical ethnic antagonisms in Africa for which westerners are partly to blame, and the even stronger western neo-colonial foundation the prospects of any of this taking place in the forthcoming decades is highly unlikely. Africa will remain the continent of contradictions with the world's poorest people, but some of the world's richest natural resources.
* Jon V. Kofas, Ph.D., retired professor of history, is author of ten academic books and two dozens scholarly articles. Specializing in international political economy, Kofas has taught courses and written on US diplomatic history, and the roles of the World Bank and IMF in the world.
* THE VIEWS OF THE ABOVE ARTICLE ARE THOSE OF THE AUTHOR AND DO NOT NECESSARILY REFLECT THE VIEWS OF THE PAMBAZUKA NEWS EDITORIAL TEAM
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