African Development Practice• Today’s News Presentation• Upcoming class events • Africa in the Global Economy• Strategies for Development• Role of “Civil Society” and NGOs

Africa in the context of globalization

• Continent largely on side lines• Have Wallerstien’s predictions come true?

– Decline in nonessential exports– Increase food crises– Social and economic disintegration

• Even the so-called prosperous take on debt• But are things changing now?

Africa’s role in the global economy

• Trade in extraction industries to former colonizer

• Aid, Debt, and Adjustment• Transnational Corporations and African

underdevelopment– Human Rights Accountability– What about China’s role now?

Trade in extraction industries to former colonizer

• Non-Diversified economies often dependent on single commodity for export with prices set abroad– Priceinelstic- declines in prices do not mean increase in demand– Prices set in London, New York and other metropoles– Prices continue to decline

• Some countries diversified– Kenya, IC then doing badly, in 2007 doing well– Attempts to diversify across continent in Agriculture and

manufacturing • Most do the opposite

– Nigeria becomes dependent on oil• Africa mostly still involved in extraction with processing

done elsewhere

Transnational corporations and African Development

• Relatively small compared to other places• Primarily in the extraction industry with some

exceptions mostly in South Africa – De Beers, Royal Ducth Shell, Anglo-American, Lornho – Exceptions: Kenya’s industrial area EPZ, South Africa

as continent’s processing zone, Nestle and unilever factories

• Most corporations headquartered and supported by former colonizer (France and Britain)

• What about Human Rights and corporations?

What about Human Rights and corporations?

• Talisman oil in Sudan aiding genocide against southerners for oil

• Royal Dutch Shell in Nigeria with Ken Saro-Wiwa

• Chad/Cameroon pipeline and Niger Delta• Firestone slavery in Liberia• Today because of pressure from HR activists

many western companies cleaned up, but Chinese companies extracting resources across Africa

• Profits repatriated out of Africa

China and Africa

Human Rights and China– “See no evil” policy for doing business in Sudan– Chinese cheap labor undercuts African wages– Chinese forced labor and mine accidents in Zambia

Potential Development benefits• Because interest is resources, African leaders

can negotiate without strings attachedChinese interest comes at a time when the West

has turned away.

Africa as a market• Mobile phones• Consumer Goods and expansion of S.A retail to

“Africa”• AID• Micro-finance

– Kenya’s recent credit crunch• Back up at the ports and problems getting goods in

and out of Africa. – E.g. Tanzama RR, and 2008 Mombasa backup

Aid, Debt, and Adjustment• During Good Times after colonialism massive debt

occurred– Some debt funded ruler’s Swiss bank accounts while

others went to public welfare programs– Most debt financed “pre-conditions” of growth

• Remember Rostow

• Even under the best conditions what does Aid system what does this do for indigenous knowledge and in worst case what did it do…..

Aid, Debt, and Adjustment• By 1970s need to finance debt became

paramount • By 1980s WB and IMF collected more in

debt repayment than dispersed in loans• Structural Adjustments Programs

implemented as condition of aid or loans • Aid requires donor’s equipment, consultants • ODA declines after end of Cold War,

despite rhetoric

Structural Adjustments Programs• Policy directions of Saps

– Massive currency devaluation– Reduction of internal and external deficits – Liberalization of economy for comparative advantage– Encouraging foreign investment– Removal of high tariffs and quotas to let “market work”– Elimination of price controls and subidies– Cuts in state sector – Cost recovery fees (user fees)

• Designed to make economy more efficient and reduce debt, but in many cases increased debt load

SAPS CONTINUED

• Conditions meant – User fees for health and education– Privatization of state run enterprises – Reduction in public sector employment

• Encouraged foreign investment, but again extraction no investment occurred.

• Reduction only occurred where oil found, but even there poor did not benefit

• But today NEPAD and MDG change focus to HC

Background to Development ideologies

• Optimism from both East, West, and South• 1960s, the development decade projected 5% growth

– East (Warsaw pact) saw independent Africa as part of the master plan for Communism

– West particularly USA excited because of new markets to be opened and spread its way of life

– South (continent) to taste the fruits of Africa’s wealth

• Capitalist Development paths• Popular Socialist Development Paths• Afro-Marxist Development Paths

Capitalist Development Paths• Economic mode prior to independence

– Most sectors controlled by Europeans although Indians, Arabs and some Africans allowed to participate in small capitalist ventures

• Commonly referred to as “liberal/free market”• After Independence pattern continued with foreign and

domestic investment as development strategy in some countries– Kenya, – Cote’d’Ivoire, – Nigeria, – Gabon

Capitalist Development Paths

• In some cases capitalist ventures become part of state and other cases regulation inhibits business

• On the other hand, where regulation did not exist wealth simply transferred to former colonizer and local elite

• Problems with this path fall under Rodney’s thesis

Popular Socialist paths• Several countries believed that capitalism was

incompatible with Africa’s communal lifestyle• Popular (African) socialism as alternative by

– Ghana’s Pan Africanist socialism– Tanzania’s Ujamaa

• Emphasis on rural development and eliminating disparities between classes

• Some state driven projects and enterprises• Ended due to coups, SAPS, and inability to finance

itself

Afro-Marxist paths• With Support of Warsaw Pact massive state driven

Marxist projects from a command and control economy

• Top down development• Ignored Indigenous Development• State Farms and Factories modeled on Soviet

system– Ethiopia’s Mengistu Dreg govt– Angola– Burkina-Faso– Benin

Afro-Marxist paths

• Propped up by Soviets and Warsaw pact• Very popular in former Portuguese colonies and

in Ethiopia due to lack of social services with Feudal history

• “Frontline” states unable to implement development plans due to heavy military spending to combat S.A. backed insurgency

• When Soviet Union collapsed, economic liberalization made a condition of aid and loans

End of Development Ideologies?

• SAPs become mandates that destroy choice• Cold War ends• But current debate between “pro-poor”

human capital and “Pro-growth” neo-liberal ideologies

• Is the war on terror a new ideological frame work after the end of the cold war?

• NEPAD and MDG?

Development at the local level in Africa

• Human Development schemes– Development from below->development from within-

>Participatory Development-> now the HR approach to development

– Sometimes criticized as development from “without” and disconnected “nexus of relationships” and scale

• Local development– IK as method of doing things– Local associations , HTAs, now AIDS support and NCPs in

Brody’s discussion– But often puts other “duty bearers” e.g. govt, int’l orgs off

hook with “development on the cheap”• Remittances from abroad as development?

NGOs, CBOs, HTAs, CSO, ect

• Grassroots or new form of top down– HTAs, vs. donor funded CBOS– $$$$$$

• Is the dominant civil society truly people local driven?

• Who is the community, Who benefits? HTA?• Opposition to civil societies?