From Predation to Altruism_ Recasting the G8’s Commitment to Africa’s Development in a...

8/12/2019 From Predation to Altruism_ Recasting the G8’s Commitment to Africa’s Development in a Historical Light

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International Relations and Diplomacy, ISSN 2328-2134

December 2013, Vol. 1, No. 3, 202-223

From Predation to Altruism: Recasting the G8’s

Commitment to Africa’s Development

in a Historical Light

John Fobanjong

University of Massachusetts Dartmouth, Dartmouth, USA

Cutting extreme poverty in half, ensuring universal primary education, and stemming the AIDS pandemic by 2015

were among the Millennium Development Goals (MDGs) approved by world leaders in 2000. Making Africa the

focus of the G8 summit in 2005, the world’s leading industrialized nations pledged to double development aid. But

as 2015 draws close, none of the Group eight (G8) member countries has kept the pledge, and not a single country

in Africa is on track to meeting the Millennium Development Goals. The present study examines the failed pledges

from a historical perspective, drawing parallels with instances of failed pledges, and casting doubt on the much

vaunted sense of altruism that has since the onset of the colonial conquest been used to presage great power foray

into Africa.

Keywords: Group eight (G8), Africa, development, resources, Europe

Introduction

Not too long ago, almost all of today’s Group of Eight (G8) member countries were colonial predators in

Africa. Of interest for them in the late 19th century was the extraction and control of Africa’s natural resources.

Promoting development in Africa was not on their agenda. Yet, they were able to successfully market their

predatory exploits as a “civilizing mission”. Recently, many of the same nations that failed to live up to their

pledge of “civilizing Africa”, again sought to presage their current foray into Africa in yet another altruistic

term —“millennium development goals”. How genuine is this new commitment to Africa’s development. Can

lasting development in Africa be actually spearheaded by the very forces that were responsible for Africa’s

underdevelopment? The author attempts to address these and other questions in this paper.

The author argues in the paper that even though the G8 may have been founded in the 20th century, the

conceptual conditions that led to its founding can be traced back to the founding of the 19th century

organization of most industrialized nations that met in Berlin in 1884 to plot the colonial conquest of Africa.

More revealing is the realization that, though founded during two very different historical periods, the two

organizations have some similarities. An analysis of that composition will reveal that the 1975 Rambouillet

Conference that gave birth to the modern G8 had curious parallels to the 1884 Berlin Conference that gave birth

to the earlier “G8” that masterminded the partitioning of Africa.

John Fobanjong, professor, Department of Political Science, University of Massachusetts Dartmouth.

DAVID PUBLISHING

D



FROM PREDATION TO ALTRUISM: RECASTING THE G8’S COMMITMENT 203

Retracing the Conceptual Roots of Today’s G8 to the 19th Century “G8”

Prior to 1884, intra-European relations were characterized by rivalry and hostilities. By the late 19th

century, European powers realized that to be effective in the conquest and control of non-European societies,

European states needed to organize and act as a bloc. The 1884 Berlin Conference provided a forum for thearticulation and implementation of this harmony. Organized by Germany Chancellor, Otto von Bismarck, the

Conference was called to harness the competition and tame the escalating and potentially explosive rivalries

that characterized the scramble for Africa. Primordial for the Chancellor was the need to deescalate the frenzy,

and preempt potential hostilities among competing European powers. Had the frantic scramble continued

without an agreed upon set of rules, it possibly could have escalated into an all out intra-European conflict.

Bismarck, the convener of the confer ence himself noted that “let the Maritime Powers play with Africa and

Asia to their hearts’ content… it will keep them out of mischief nearer home…” (Edward, 1988, p. 395). When

the group of Western nations, who were also the group of the most industrialized nations at the time, came

together in Berlin to iron out the ground rules for partitioning Africa, it gave birth to the first G8. The

partitioning and colonization of Africa went so well that the “group” concept was henceforth going to later

become the new operating paradigm. It is this paradigm that eventually led to the conception and establishment

of today’s G8.

Member states of the 19th century G8 included Belgium, Britain, Germany, France, Italy, Portugal, Spain,

and the United States. US participation at the conference was mainly as an observer. An invitation to the US to

take part in the colonial occupation of Africa was politely turned down. America’s refusal to take part meant

that only seven of the participants at the conference effectively ended up with colonial possessions on the

continent (de Blij & Muller, 1997, p. 340). They included: (1) Great Britain: which acquired Egypt, Sudan,

Uganda, Kenya, South Africa, Zambia, Zimbabwe, Botswana, Nigeria, and Ghana; (2) France: which acquired

Senegal, Mauritania, Mali, Niger, Burkina Faso, Benin, Togo, Cote d’Ivoire, Guinea, Chad, Gabon, Cameroon,Central Africa Republic, and Congo; (3) Belgium and King Leopold II: which acquired the Democratic

Republic of Congo (Belgian Congo), Rwanda and Burundi; (4) Portugal: which acquired Angola, Mozambique,

Cape Verde, Guinea Bissau, Sao Tome & Principe; (5) Italy: which acquired Italian Somaliland and Eritrea; (6)

Germany: which acquired Burundi, Cameroon, Namibia, Rwanda, Tanzania, and Togoland; and (7) Spain:

which acquired Equatorial Guinea (Rio Muni) and the Western Sahara.

While it may be more accurate to refer to the group of nations that effectively acquired colonial territories

in Africa as the Group of Seven (G7), it is important to note that America’s status as observer at the Berlin

Conference and as an ex officio member of the group of most industrialized nations at the time, effectively

makes it a G8.

As with the 19th century’s Berlin Conference G8, today’s G8 equally started out as the G7. With the

addition of Russia, it later became the G8. Russia’s membership had more to do with its ex officio status as a

military power than with its status as an industrialized nation. A majority of the seven core nations actively

maintain direct and indirect economic ties with Africa through such various bilateral and multilateral

organizations as the IMF and the World Bank. The agenda of today’s G8 includes the coordination of the

seemingly altruistic activities of these Western institutions. Looking back, we notice that Russia was not a

player in the 1884 scramble for Africa and not an active player today in the IMF, World Bank and other

Western institutions that continue to exercise influence in Africa. Russia has the smallest economy of the G8




nations; and even though it has been granted membership in the modern G8, it does not have executive

membership and therefore does not have a decisive say in discussions on the global financial and economic

policies that are regularly on the Group’s agenda. Financial and economic policies remain the exclusive reserve

of the core G7 member-states, just as colonial policies in 19th century Africa were the exclusive reserve of the

core G7 member-states. For this and other reasons, we can continue to describe Russia’s status in the G8 simply

as “an observer”.

Economically, Russia’s background and characteristics do not match those of any of the other member

states. The only reason why it may have been co-opted and granted G8 membership may have to do with the

need to silence and/or preempt potential criticisms of G8 policies by a militarily powerful non-Western state.

Excluding or deliberately leaving Russia out of the G8 posed the risk that a militarily powerful nation would be

out there probing, criticizing, and possibly rallying international public opinion against the predatory

neocolonial practices of the modern G8. Inherent in the harmony that was established in the 1884 Berlin

Conference and the 1975 Rambouillet Conference was a tacit understanding that the members were bound

together by a “code of silence”. As a member of this exclusive club, albeit with observer status only, Russia issimilarly bound by the “code of silence”.

It would also be proper to argue that the coming together of major world powers at the 1884 Berlin

Conference may have helped delay the onset of the First World War. As indicated above, it was a conference

that helped competing European powers to direct their hostilities to Africa and away from one another. Europe

in and before the 19th century was characterized by a balance of power system in which European nations

formed military alliances in anticipation of war or to wage preemptive wars. Indeed, Kropotkin wrote 100 years

ago that war was the normal condition of Europe. Until the 18th century, warfare was seen as an utterly

unavoidable part of the international order. European nations frequently fought against one another — devoting

most of their disposable resources to this purpose. No more than six or seven years lapsed without that at least

one major European power was at the war.1

Religious rivalry and imperial ambitions were among the principal triggers of intra-European wars

—including the 100 Year War, the 30 Year, War and the Napoleonic Wars. The European scramble for

territories in Africa was triggered primarily by imperial ambition. What kept the ambition in check, were the

rules that were set at the 1884 Berlin Conference. Without the Conference, World War I could possibly have

occurred in 1884 rather than in 1917.

Ominous Parallels Between Today’s G8 and the 19th Century G8

Today’s G8 most industrialized nations were founded at the behest of France in 1975, in Rambouillet,

France. Present at its founding were six nations: Britain, France, Germany, Italy, Japan, and the United States.One year later, in 1976, membership was extended to Canada; and in 1998, 23 years later, Russia was admitted

as member. As with the US in 1884, Russia’s initial status was as an observer. Besides being the most

industrialized nations, the core members of the G8 also have controlling shareholders in major international

financial institutions, including the IMF and the World Bank. Seven of them (Belgium, Britain, France,

Germany, Italy, Japan, and the United States) are former colonial powers in Africa.

Behind the founding of both organizations (the 19th century Berlin Conference G8 and the 20th century

1 Retrieved August 6, 2011, fromhttp://www.latimes.com/news/opinion/la-op-bell28jan28,0,3764261.story?coll=la-opinion-center.

http://www.latimes.com/news/opinion/la-op-bell28jan28,0,3764261.story?coll=la-opinion-center

http://www.latimes.com/news/opinion/la-op-bell28jan28,0,3764261.story?coll=la-opinion-center




Rambouillet Conference G8) are challenges that were brought about by the quest for the acquisition and control

of global resources. While the global challenge in the 19th century was colonization and the scramble for

landed resources in Africa, the challenge in the 20th century was and continues to be the scramble for resources,

and particularly energy resources, in Africa. Other stated goals of the second G8 include the ability to better

tackle the global economic recession of the mid-1970s, strengthen the global economy, promote peace and

democracy, prevent and resolve conflicts.2

Unlike the 19th century G8 which was launched in one session, the 20th century G8 has since its

launching become an annual event where member-states come together to address global challenges through

discussion and action. The modern G8 has the ability to influence other global policymaking institutions such

as the World Trade Organization, the World Bank, the International Monetary Fund, NATO, and the U.N.

Security Council, as its core members also belong to these various organizations. Had the 1884 Berlin

Conference gone on to become an annual consulting summit for its G8 founding members, it very possibly

could have prevented the outbreak of World War I by providing a forum for the various World War I

protagonists to diffuse their differences through diplomacy and civil dialog rather than through armed conflict.

As was the case, the imperial and globalizing ambitions that were behind the launching of the 19th

century G8 were temporarily derailed (but not tamed) by the outbreak of World War I. At the end of the War,

the member states regrouped and came back together, excluding Germany and other World War I aggressors.

Germany’s indignation over her forcible exclusion soon led to the eventual outbreak of World War II.

Today, whatever differences there may be in the global ambitions of the 19th century and 20th century

G8, it is in nomenclature. What is referred to today as globalization could in many ways be seen as the 21st

century expression of the ambitions that led to the colonization of Africa. While colonial rule in Africa

involved the physical presence of the institutional resources of the G8 — its bureaucracy, military and corporate

resources — globalization is a lot more subtle and sophisticated in its push for the acquisition and control ofglobal resources. In lieu of the direct commitment of its institutional resources in Africa, the 20th century G8

chose to contract out the economic management and control of Africa to such international financial institutions

as the World Bank and the IMF. The control of Africa now takes the form of seemingly benign but

economically debilitating policies. Euphemistically referred to as Structural Adjustment Programs, the policies

perpetuate the underdevelopment of Africa through the imposition of trade restrictions and what is literally

referred to as debt bondage. Constrained by such trade restrictions, Africa is forced to specialize exclusively in

the production of mono-crop or single resource commodities such as gold, diamond, coffee, cocoa, and copper.

Burdened by debt bondage, the continent is forced to redirect resources away from the development of health,

education, and road infrastructures into interest payment on IMF and World Bank loans that were knowingly

granted to corrupt government officials. This may explain why Abroise Soren sees debt as “a political

instrument, one that traps countries in the snare of conditions and never lets go, subjecting millions to national

policies that must please corporate interests before their own”, and sees debt cancellation as the most effective

way to make funds available for developing nations.3 Without that, the playing field between today’s G8 and

Africa will remain as unequal as it was in the 19th century, and globalization would only but further embed

those inequalities.

2 Retrieved from http://newsvote.bbc.co.uk/mpapps.pagetools/print/news.bbc.co.uk/2/hi/americas/country. 3 Retrieved December 5, 2011, from http://www.50years.org/cms/updates/story/346.

http://newsvote.bbc.co.uk/mpapps.pagetools/print/news.bbc.co.uk/2/hi/americas/country_

http://www.50years.org/cms/updates/story/346


http://newsvote.bbc.co.uk/mpapps.pagetools/print/news.bbc.co.uk/2/hi/americas/country_




G8 Policies and Their Impact on Development in Africa

Walter Rodney’s classic text, “How Europe Underdeveloped Africa”, represents not just a historical

account of the negative impact of European colonialism in Africa, it is a literal indictment of the G8. From the

perspective of Africa, today’s G8 is the reincarnation of imperial Europe. Even though it has evolved to includenations that are outside Western Europe, its descriptive characteristics remain the same. As in the 19th century,

membership in the Group is reserved to the most industrialized nations in the world. Even though the group

includes two non-Western nations — Japan and Russia — it remains an organization whose objectives are based

on the Western concept of imperialism, now called globalization.

Whatever its composition and however the G8 chooses to refer to itself, its policies towards Africa are

driven primarily by the aggregation of the national interests of member-states. Raw materials are the primary

resources that spin the machinery of industrial production. They are indispensable for the sustenance of the

industrial economies of the West. Africa has them in abundance. Not only do the G8 nations badly need them,

but also they need them at depressed and dead-cheap prices. The most effective strategy to making sure that

raw material prices stay cheap is debt. Trapped and burdened with international financial obligations that it

cannot meet, Africa is forced to cut back on investments in education, healthcare, and other social services that

produce the skills and talents that propel development. Unable to produce the necessary human capital that it

needs for its development, Africa is forced to continue to depend on the outside world for development

assistance. It a cycle so vicious, it has appropriately been referred to as the “debt trap”. In essence, debt and aid

are instruments that essentially perpetuate underdevelopment. Nations exist primarily to promote their national

interests. Like most nations, the primary goal of the G8 nations, like most every group of nations, is the

aggregation and promotion of their national interests. That the Europe that was indicted by Walter Rodney for

under-developing Africa has suddenly transformed itself from a predator to an altruistic crusader for the

development of Africa is a reality that Africans have failed to ponder. It is because Africa has failed to ponderthis reality that it continues to expose itself to the same predatory practices that have been responsible for its

underdevelopment in past centuries.

Paradoxically, the organizations that were mobilized to expose and stem the predatory practices of the G8

in Africa were largely Western nongovernmental and civil society organizations. Even though the increased

transparency of international intercourse had made the use of “the civilizing mission” and “the white man’s

burden”, and other vindicating and self-redeeming coded phrases less likely, the G8 drivers of global economic

policy have with some sophistication managed to market “globalization” and economic liberalization as the

21st century panacea for economic development in the Third World. Equally sophisticated are critiques of the

G8 who, with clairvoyance, properly see globalization as a well thought out design to embed global economic

inequalities by continuing the implementation of colonial policies through the IMF, World Bank, and other

seemingly innocuous institutions for international development.

The G8 Exposed

Normally, one would not expect the annual meetings of organizations that are genuinely committed to

equitable global development to be shrouded in secrecy. But since the launching of globalization — the new

economic order that is supposedly going to produce global economic growth — the annual summits of the G8,

World Bank, IMF, World Trade Organization, and other drivers of globalization have been shrouded in secrecy.




to $50 billion by 2010, its pledge to HIV/AIDS treatment universally accessible by 2010 had a yearly funding

shortfall of $10 billion. Maxine Frith and Nigel Morris indicated that the G8 ’s failure to deliver on its pledges

left millions of Africans to die.16

In reaction to G8 backtracking on its fair trade pledges, and especially on the pledge to end farm subsidies,

three West African countries—Burkina Faso, Cote d’Ivoire, and Mali staged a “Poor People’s Summit” in the

summer of 2006 in Mali, to draw global attention to the plight of the African producer. Among the concerns

raised there were subsidies that G8 member nations continue to give to their domestic producers while pushing

for the forced liberalization of African economies.17

In an article entitled “Africa Falls Off the IMF Agenda (Again)”,18

Sameer Dossani and Soren Ambrose

found that not only have most of the pledges made in 2005 gone unfulfilled, poverty continues to deepen in

Africa, and international financial institutions have returned to business as usual. While the voting shares of

four middle income countries—China, Mexico, Turkey, and South Korea—were increased at the 2006

IMF/World Bank Summit in Singapore, Africa’s voting shares which were already at a low 5% were cut in half.

Such juggling of votes, the authors argue, is an indication that countries that are most impacted by donor nation policies have the least say, while countries that are least impacted by the policies control the most power and

the most influence. In reducing Africa’s votes and influence, the IMF fails to recognize that much of the

institution’s revenues came from loan repayments by the developing countries. It also means that the institution

will continue to impose trade and investment liberalization, public sector layoffs and budget cuts, withdrawal of

subsidies, high interest rates, reduced budgets for health and education, and privatization, and other policy

demands for which the IMF is notorious.19

Eschewing the G8’s Aid Culture

Africa’s relations with the West are marked by three failed pledges over three centuries — the “civilizing

mission” pledge of the 20th century, and the debt cancelation and Millennium Development Goals of the 20th

and 21st centuries. When it was all said and done, Africa and the world realized that Europe had misrepesented

its real intentions in Africa. If Europe is known to have misrepresented its true intentions in Africa, why should

Africa today believe that Europeans are now telling the truth, or that its programs for Africa are with good

intentions? In 50 years of foreign aid, Africa has nothing to show but a graveyard of indebtedness. Just as in the

75 years of the “civilizing mission” (the years of colonial rule), Africa had nothing to show but a graveyard of

cultural extermination. Not too many financial institutions in the West will continue to grant new loans to a

business that has had a 50-year record of failure. But this is exactly what the West has been doing to Africa. It

has been granting loans to African countries, knowing fully well that these loans were creating no positive

impact on the ground, and knowing fully well that many of the countries were not in a position to repay. Justweeks ahead of the 2005 G8 Conference that had Africa been at the top of its agenda, the IMF itself presented a

report cautioning that “Aid Will Not Lift Growth in Africa”,20

therefore, the various stakeholders should be

modest in their claims that increased aid will solve Africa’s problems. Despite these cautions, no serious efforts

have been made to wean Africa off aid, and redirect the continent away from this vicious cycle. Even after the

16 Retrieved September 9, 2011, from www.commondreams.org/headlines06/0626-01.htm. 17 Retrieved March 2, 2011, from http://www.christian-aid.org.uk/news/stories/060719s2.htm. 18 Retrieved April 9, 2011, from http://www.50years.org/cms/updates/story/332. 19 Retrieved April 9, 2011, from http://www.50years.org/cms/updates/story/332. 20 Retrieved August 9, 2010, from http://www.imf.org/external/np/vc/2005/070805.htm.

http://www.commondreams.org/headlines06/0626-01.htm

http://www.christian-aid.org.uk/news/stories/060719s2.htm



http://www.imf.org/external/np/vc/2005/070805.htm

http://www.imf.org/external/np/vc/2005/070805.htm



http://www.christian-aid.org.uk/news/stories/060719s2.htm

http://www.commondreams.org/headlines06/0626-01.htm




very intensive debt-relief campaigns of the 1990s, African countries still pay as much as $20 billion in interest

on debt every year.

In a rather piercing Wall Street Journal article on “Why Foreign Aid Is Hurting Africa”, Dambisa Moya

blames the cycle of corruption, slower economic growth and poverty in Africa on foreign aid. Cutting off the

flow, she argues trade would be far more beneficial as “evidence overwhelmingly demonstrates that aid to

Africa has made the poor poorer, and the growth slower ”. The insidious aid culture has left African countries

more debt-laden, more inflation-prone, more vulnerable to the vagaries of the currency markets, and more

unattractive to higher-quality investment. It has increased the risk of civil conflict and unrest (the fact that over

60% of sub-Saharan Africa’s population is under the age of 24 with few economic prospects is a cause for

worry) (Moyo, 2009).

In 2008, Americans had a taste of two of the policies that the IMF and the World Bank had been

aggressively pushing on Africa for more than a half century—debt and deregulation in the housing industry.

The aggressive lending practices that granted sub-prime mortgage loans to unqualified homebuyers in the

United States were exactly the same practices that were used to impose debt burden on Africa. In theConfessions of an Economic Hit Man, John Perkins exposes some of the strategies that have been used by the

West to entrap less developed countries into a vicious cycle of debt. The cycle begins with a solicited invitation

to resource-rich Third World countries to obtain loans from the West. Once the loan is obtained, US

corporations are invited to bid for contracts to execute the loans. When the loan is exhausted, the US

government and international financial institutions start to demand repayment. Countries that are unable to

repay with currency are cajoled to open up their natural resources for exploitation by American companies

(Perkins, 2006). For countries which opt to repay, just keeping up with interest payment often means sacrificing

vital basic human needs such as education and health. From the mid-1990s to the mid-200s, as much as 40% of

Cote d’Ivoire’s gross national product went into making payments on the country’s foreign debt.21

It is hard to

imagine how a country can develop, if close to half of its gross national product goes to debt servicing.

Countries that cannot keep up with repayment are quickly granted new loans to allow them to keep

making interest payments on the principal. It was a debt cycle so vicious that, in the late 1990s, the

international civil society, led by U2 Singer Bono, was forced to mount a relentless campaign for debt

cancellation.22

By the mid-2000s, Western financial institutions had moved to provide debt relief that was very

much similar to the relief Western financial institutions received from their governments in the fall of 2008.

Just as credit card companies make money by loaning money, initially there was money to be made by

loaning money to African countries. From the 1970s through to the 1990s, it was common to find credit card

companies on college and university campuses, soliciting credit card applications from18-year-old students.

Newly away from home, and tasting the independence and freedom of living alone for the first time, credit cardcompanies saw them as easy targets for the lifelong vicious trap of “spend now and pay later ”. Usually with

usurious interest rates, the earlier a person gets drawn into this lifestyle, the more money credit card companies

stood to make over the person’s lifetime. With mom and dad not around to advise or warn their children about

the pitfalls of owning credit cards, college was the most ideal environment to market this addiction. Still rather

immature to understand the long term financial implications of loans and interest repayments, the kids were

maxing out credit card after credit card. Before long, some of them were spending more time working to pay

21 Retrieved February 1, 2012, from http://www.economywatch.com/economic-statistics/country/Ivory-Coast/. 22 Retrieved March 2, 2012, from http://www.atu2.com/news/bono-still-hasnt-found-what-he-is-looking-for-debt-relief.html.

http://www.economywatch.com/economic-statistics/country/Ivory-Coast/

http://www.atu2.com/news/bono-still-hasnt-found-what-he-is-looking-for-debt-relief.html

http://www.atu2.com/news/bono-still-hasnt-found-what-he-is-looking-for-debt-relief.html

http://www.economywatch.com/economic-statistics/country/Ivory-Coast/




credit card bills and less time studying.

This was equally the case in Africa, where some countries were spending more time raising revenues to

make payments on foreign loans than in providing educational services to their citizens. For the IMF, World

Bank and other Western financial institutions, Africa was that ideal environment to entrap the newly

independent states into a life cycle of debt. The rulers had the immaturity and naivety of the American college

student. The colonial power was no longer there to provide the parental advice that foreign loans were a trap

into a lifetime of interest payments. For Western financial institutions, there were hundreds of billions of

dollars to be made from giving out these loans, and the sooner they got Africans trapped into the debt trap the

better. Even if some of countries defaulted, just as some individuals default on their credit card payments, on

the aggregate there was still money to be made. In a hearing before the US Senate Committee on Foreign

Relations In May 2004, Jeffrey Winters, professor at Northwestern University, revealed to the US Senate

Committee on Foreign Relations that the World Bank had participated in the corruption of approximately $100

billion of the money it loaned out for the development of Africa.23

Prior to that, a 2002 report by the African

Union, an organization of African nations, estimated that corruption was costing the continent $150 billion ayear, as international donors were apparently turning a blind eye to the simple fact that aid money was

inadvertently fueling graft.24

These loan tactics have led revisionist scholars to come to the rather cynical conclusion that the World

Bank and the IMF are institutions of neocolonialism. As colonial powers were forced to give up the direct

control of their African colonies, they quickly had to find subtle ways to continue their rule on Africa.

International financial institutions provided a convenient medium. He who controls a country’s finances

controls that country. The IMF and the World Bank are seemingly doing to Africa in the post-independence era

what Britain and France did to Africa in colonial times. The strategy may not be the same, but the end result is

the same— perpetuating underdevelopment and extracting profits in the form of interest payments on loans that

have driven Africa into debt bondage and endemic poverty. If these two financial institutions were genuinely

committed to helping promote sustainable development in Africa, they should have by now realized that money

is not what will make it happen. It is apparent therefore that these institutions are not seriously interested in

cutting off the umbilical cord that keeps the South permanently dependent on the North. If they were, they

would have long worked to come up with alternatives to foreign aid.

In any case where a sizeable percentage of the money that is needed to run a country comes from foreign

donors, rulers of that country will give allegiance to that foreign donor, and would most likely show disregard

for domestic constituencies. In other words, if your source of power is external rather than internal, there will

be no reason for you to honor the will of your domestic constituencies. So should foreign aid be eliminated,

African governments will be forced to show greater respect and allegiance to domestic economic actors, asthese actors will through the taxes they pay, become the principal sources of government revenues. Thus,

instead of promoting government policies that are predatory on the domestic private enterprise, governments

will begin to promote policies that are friendly and nurturing to internal economic growth.

In an article on “Foreign Aid and Underdevelopment in Africa”, the Gambian journalist/writer, Mathew K.

Jallow laments that as much as $500 billion, the rough equivalence of four Marshall Plans, was granted to

Africa between 1960 and 1997. Despite this massive injection of aid over the past half century, rather than

23 Retrieved August 31, 2011, from http://www.isegoria.net/2009/03/why-foreign-aid-is-hurting-africa/. 24 Retrieved August 31, 2011, from http://www.online.wsj.com/article/SB123758895999200083.html.

http://www.isegoria.net/2009/03/why-foreign-aid-is-hurting-africa/

http://www.online.wsj.com/article/SB123758895999200083.html

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http://www.isegoria.net/2009/03/why-foreign-aid-is-hurting-africa/




achieve economic growth and development, Africa became more dependent, with a net decline in living

standards. It is widely known that cash foreign aid, when given in monetary transfers, has gone to pay for the

bloated and ill-conceived policies of corrupt African regimes. Citing a study by The Oxford International

Group, Jallow goes on to point out that the external stock of capital held by Africans in foreign banks was

between $700 billion and $800 billion in 2005. Between 1981 and 1991 alone, as much as $20 billion was

provided by the World Bank for structural adjustment programs in Africa. As much as 40% of Africa’s

aggregate wealth was stacked in overseas bank accounts (Jallow, 2010).

Instead of producing economic growth and improved living conditions, Africa is perennially ridden in

poverty and economic misery. From 1975 to 2000, the continent’s per capita GDP declined by an average of

0.59% each year. This caused a variety of think tanks, including the Heritage Foundation to come to the

conclusion that foreign aid is not the answer to Africa ’s economic problems. In 1985, the Heritage Foundation

pointed out that aid was actually contributing to the underdevelopment of Africa (Jallow, 2010). It has retarded

and continues to retard the process of economic growth and the accumulation of wealth. The findings were

confirmed by the United Nations Conference on Trade and Development, which admitted that despite many

years of aid and policy reform, no Sub-Saharan country has completed its adjustment program or achieved any

sustained economic growth. The Foundation argued aid dependency pulls entrepreneurship and intellectual

capital into non-productive activities, thereby blunting the entrepreneurial spirits of many Africans. In her book

titled “Dead Aid”, Dambisa Moyo, a Zambian economist, similarly argues that reducing aid radically would

force governments to ease curbs on business, develop better relations with emerging powers, such as India and

China, and raise more money from international markets. In 2011, as British Prime Minister, David Cameron

drastically cut domestic spending, while increasing spending on international aid by as much as 34%, Mike

Kendrick, founder of the respected Mineseeker Foundation and aide to Nelson Mandela, warned that foreign

aid has not only increased the hardship faced by the poor in Africa, it has made Africa the spoilt child of the planet. In the past few decades the West has provided several trillion dollars in aid, yet the average African is

now twice as poor as he was before all that started (Jallow, 2010). He uses former Prime Minister Gordon

Brown’s project to supply £100 million of mosquito nets to Africa to illustrate how such well-meaning

initiatives can have damaging unintended consequences. The manufacturing and repair of mosquito nets is an

industry that provides employment opportunities to many Africans. A foreign aid program that sends millions

of dollars of mosquito nets to any country in Africa would not only cause layoffs, it will create unemployment,

poverty and dependence (Groves, 2011). If the West would redirect some of its African foreign aid to providing

educated Africans who currently live and work in the West an incentive to return and work in Africa, this will

definitely go a long way to promoting sustainable development on the continent. Instead, what we see are

programs that lure African intellectuals away from the African continent. Among them are the American DV

Lottery, the Canadian Citizenship and Immigration Canada (CIC) programs. At the individual/micro level, the

program has done a lot of good to individuals and families. But at the macro/continental level, it is gradually

depleting Africa’s intellectual manpower. It would be nice if foreign aid were provided in conjunction with

reputable institutions that could develop strong universities in African nations. For example, Stanford could

help sponsor a university in Chad where MIT, Stanford, or UMass professors teach one year as part of their

employment agreement. Why not go to the nation and share information including engineering and technical

skills? Building the universities in the countries and providing opportunities for professors and visiting scholars




would be a lot more helpful.

Non-aid Approaches to Development

In 2005, rich countries committed themselves to spending 0.7% of their GDP on overseas development

assistance (ODA), but by 2010, they were lagging behind by 0.34%. In 2010, the UN estimated the gap

between funds promised and funds delivered at $20 billion for the one year alone. Sixteen billion dollars of this

shortfall was for development aid that was pledged for Africa. This has led experts to cast doubts on

conventional approaches to poverty reduction. At a 2010 summit to assess progress in the Millennium

Development Goals, world leaders were quick to warn that the current approach to foreign aid needed total

rethinking (Howden, 2011).

There is virtually no correlation between the volume of foreign aid that has been given to Africa over the

years, and the development impact it has produced on the ground. As a result, revisionists in the development

community argue that the international system must work in making aid history. Their call for an end to foreign

aid is based on the wisdom that if we continue to do things the same way we have always done, we willcontinue to get the results we have always had. If aid has proven itself ineffective in bringing about

development in Africa, and if we continue to rely on it as our main policy for development on the continent,

then we would in reality be promoting failure and not success.

Global economic crises, from the OPEC-triggered oil shocks of the early 1970s to the late 1980s collapse

of world commodity prices, to the global financial collapse of the late 2000s are demonstration of Africa ’s

vulnerability to the volatility of the global economy. If Africa has learned any lesson from these crises, it is that

Africa cannot continue to depend on outside sources of funding to finance its development. Solutions to

sustainable development are not external, they are internal. Africa’s development is ultimately the

responsibility of Africans, and after 50 years of external efforts, Africa ought to know that the international

community, including avid supporters of Africa, has grown tired of the argument that Africa is too poor to

finance its own development. As the most helpless victim of repeated global economic shocks, Africa should

know better than anyone else that foreign sources and resources for development are typically volatile, and

distinctively unreliable. To continue to rely on such a source is both irresponsible and myopic. To reduce

reliance on foreign resources for development therefore, Africa would need to find ways to mobilize its

domestic resources and put them to service in the interest of Africa (Economic Report on Africa, 2010).

Ultimately, domestic resources that need mobilizing include education, healthcare, and the physical

infrastructure. Currently, in Africa, there is a serious mismatch between skills that are taught in schools, and

skills that are in demand in the economy. There is need for a permanent and ongoing collaboration between

industry and educational institutions to correct for this mismatch. Other strategies should include investmentsthat will transform the structure of African economies from capital intensive natural resource extraction to

high-employment labor-intensive manufacturing. Instead of investing in the construction of gas pipelines to

funnel oil from Chad through Cameroon to the Atlantic, from Sudan to the Indian Ocean, or Nigeria through

Algeria to the Mediterranean, and on to the world market, resources could be directed at building railways and

superhighways that will put the local labor force to work in transporting these resources.

It is evident that foreign aid, including loans from international financial institutions, appears to be

creating underdevelopment rather than development. As illustrated above, revenues that ought to be used in

building schools, healthcare facilities, and highways are directed to the repayment of foreign debt. If Africa and




the rest of the international community are interested in promoting development on the continent, it first must

seek to bring an end to the vicious cycle of debt and aid. Once that is done, they can then move on to identify

alternatives to foreign aid that can actually help promote self-reliant development in Africa. Here below are a

few practical alternatives to foreign aid that can serve as starting point.

Refining Africa’s Oil in Africa

One of the largest and most important exports from Africa is oil. This oil is largely exported crude,

denying Africa the value-added income that will come from refining the oil in Africa. Paradoxically, many of

the countries to which this oil is exported are the very countries that, after 50 years of providing aid to Africa,

have come to the conclusion that foreign aid does not work. In our effort to find alternatives to foreign aid, we

see the construction of oil refineries in Africa as one of such alternatives. Indeed, building oil refineries in

Africa could actually be much cheaper than sending foreign aid to Africa. Generally, oil refineries are built and

run by private corporations. These private corporations pay taxes, and from these taxes, donor states send

foreign aid to Africa. In our proposed option, instead of giving foreign aid to Africa, private companies will be

given special incentives in the form of tax breaks or direct financial assistance to build refineries in countries

that produce crude oil. It is an option with benefits for all, and no losses or additional cost to any. Giving

private companies financial incentive in the form of tax breaks or monetary grants is a win for these companies,

as it comes with no financial costs to them. Transforming the 0.7% GDP that rich countries pledged in the

Millennium Development Goals to spend on overseas development assistance (ODA) into tax breaks for their

foreign corporations, will be a win for various state donors of foreign aid. It allows them to achieve their stated

foreign policy goals, without costing them any extra. Finally, not only would the construction of oil refineries

in Africa produce value added income for Africa’s crude, but also it will create jobs and bring about the

stability and higher incomes that will enhance Africa’s ability to import and consume Western made consumer

goods.Transforming Cote d’Ivoire Into the World’s Largest Exporter of Chocolate

Cote d’Ivoire is unquestionably the world’s largest producer of chocolate. Cocoa is the main raw material

that is used in the production of chocolate. As the world’s number one producer of this ingredient, one would

expect Cote d'Ivoire to be among the world’s top exporters of chocolate. It is not even among the top 50. It is a

paradox that has gone unquestioned for a long time. Foreign aid donors, including international financial

institutions such as the IMF and the World Bank, whose assigned mission is to promote oversee economic

growth and development in Africa, have never cared to question the paradox. African themselves have never

cared to probe into the paradox. Meanwhile, if we take a quick look elsewhere in the world, we would see that

Asia’s economic rise was largely attributed to value-added production. For Africa to catch up with the rest of

the world, it too will have to work to transform its economy from the exporter of raw materials, to the exporter

of manufactured or semi-manufactured products.

Denying African Rulers Personal Banking Privileges in Foreign Banks

A report by Global Financial Integrity estimates total illicit outflows of money from Africa to

approximately $1.8 trillion between 1970 and 2008. Sub-Saharan African countries suffered the bulk of illicit

financial outflows. Among countries with egregiously high outflows there were Nigeria ($89.5 billion), Egypt




($70.5 billion), Algeria ($25.7 billion), Morocco ($25 billion), and South Africa ($24.9 billion).25

Egyptian

President, Hosni Mubarak ’s family fortune alone is estimated at $70 billion, with much of it hidden in British

and Swiss banks or tied up in real estate in London, New York, Los Angeles, and in luxury properties along the

Red Sea coast.26

Overall, illicit financial outflows from the entire region between 1970 and 2008 outpaced

official development assistance going into the region at a ratio of at least 2 to 1. In a rather belated move, the

Swiss government had the Deputy State Secretary of the Swiss Federal Ministry of Foreign Affairs, Pierre Helg,

declare in Abuja in June 2010 that it was going to henceforth make it difficult for people who loot state

treasuries to save their looted funds in Swiss banks.27

The looting of state funds has substantially contributed to underdevelopment in Africa. It smacks of

double standards for Western countries to label African leaders as corrupt, while at the same time providing a

safe hideout for Africa’s looted funds. One of the major democratic reforms that the West has called on Africa

to carry out has been transparency in the conduct of public affairs. Besides its tradition of neutrality in world

politics, Switzerland is also one of the most democratic countries in the world. That its banking secrecy laws

stand squarely in the face of the very transparency that the West has been trying to impose on Africa defeats the

push to transform Africa from Kleptocratic states to democratic states.

The most important foreign aid that the international community can give Africa is to deny or prevent

African rulers from banking or stacking away Africa’s stolen wealth outside the continent. If all aid is to be

given, it should come to be given in the form of technical not financial assistance. When aid is given in the

form of tractors, bulldozers, training in road or railroad construction, airlines management, computerized

payroll management, it cannot be stolen and hidden away in secret offshore banks accounts. The Swiss are yet

to come up with a secret banking system that can hide away a tractor, bulldozer, or skills that have been taught

to an African indigene.

Since gaining independence, Africa’s dilemma has been one in which its rulers travel out of the country todeposit the continent’s wealth in secret foreign bank accounts. On their way home, they often would stop by the

World Bank or the IMF to apply for development loans. The amount of money that leaves Africa annually in

the form of ill-gotten wealth far exceeds the amount that comes in as foreign aid. Just as the West has put in

place sophisticated mechanisms to prevent the laundering of drug money in Western banks, it equally has the

ability to set up a mechanism that will prevent Western banks from becoming safe havens for Africa’s stolen

wealth. Indeed, tracking down Africa’s stolen wealth should actually be easier than tracking down money that

is generated from drug trafficking. If the West can actively pursue and track down laundered drug monies; and

if it can arrest heads of states like Panama’s Emmanuel Noreiga for corruption and drug trafficking, it can

equally track down and prevent European and American banks from accepting deposits from African heads of

states. Western intelligence services knew where the Mobutus, the Ferdinand Marcuses, and the Abachas hid

their loot. In the 1990s, intelligence provided leads to the tracing of Jewish assets that were looted by the Nazis

and hidden in Swiss banks. Banking laws in the United States require that any deposits over $10,000 be

reported to the US government. If American intelligence services do not know which African rulers are

banking in the United States, and how much money they have in their accounts, then these services are not

25 Retrieved November 8, 2011, from http://www.gfip.org/index.php?option=com_content&task=view&id=300&Itemid=75. 26 Retrieved June 3, 2011, from http://www.guardian.co.uk/world/2011/feb/04/hosni-mubarak-family-fortune. 27 Retrieved August 12, 2011, from http://www.allafrica.com/stories/201006080152.html.

http://www.gfip.org/index.php?option=com_content&task=view&id=300&Itemid=75

http://www.guardian.co.uk/world/2011/feb/04/hosni-mubarak-family-fortune

http://www.allafrica.com/stories/201006080152.html

http://www.allafrica.com/stories/201006080152.html

http://www.guardian.co.uk/world/2011/feb/04/hosni-mubarak-family-fortune

http://www.gfip.org/index.php?option=com_content&task=view&id=300&Itemid=75




doing their work. African rulers are basically public servants. For an American or European bank to knowingly

accept deposits in the millions of dollars into the private account of an African ruler, it makes the bank an

accessory to the theft.

Paying Fair Market Prices for Africa’s Natural Resources That as much as two-thirds of the world’s natural resources lie in its subsoil, this makes Africa too rich to

depend on foreign financial aid. It is a continent with the most youthful population of any continent. If at all

Africa should receive any foreign aid, it should come in the form of fair terms of trade and training in

extraction and processing capabilities. The first order of duty at independence should have actually been the

development of Africa’s extraction and processing capabilities. After a half century of independence, Zambia

should by now be able to transform its abundant copper ore into electrical cables and plumbing fixtures. The

workers who work in Western and Asian factories transforming copper ore into industrial and household

fixtures are primarily in their 20s and 30s. Had Zambia at independence invested in developing extraction and

processing skills in its youth, the country would by now be exporting finished copper fixtures rather than raw

copper ore to the outside world. From minerals to oil and timber, instead of continuously depending on foreign

know-how, Africa should be able to extract and export them to the international marketplace herself. Instead of

exporting raw timber, Africa should be exporting finished furniture. And instead of exporting cocoa bean, raw

coffee bean, palm oil, cowhide, or cotton, Africa should by now be exporting chocolate, instant or ground

coffee, detergent, leather accessories, and textile.

In lieu of financial assistance and World Bank loans, countries that are truly interested in “aiding” Africa

should be paying, and campaign for others to be paying fair market prices for Africa’s raw materials. So far,

only a handful of Western businesses, such as Starbucks, have adopted such an initiative. Factoring in for

inflation, the price African producers receive for their produce today is much lower than the price they received

in colonial times. Of course, in colonial times, African economies were foreign extensions of the nationaleconomies of colonial powers. The mines and plantations were largely owned by European companies. Today,

the mines and plantations are owned either by Africans, or by foreign companies that are in partnership with

Africans. Instead of earning 40% for their minerals, some African countries receive as little as 4%. This may

explain why some of the richest mineral producing countries such as Niger and the Democratic Republic of

Congo are inexplicably among the poorest countries in the world.

Niger has one of the largest reserves of uranium in the world, and the Democratic Republic of Congo has

such a vast and wide variety of rare earth minerals that, should it decide at any time to put an embargo on its

export, the global economy will be severely hurt. When news leaked in October 2010 that China was

contemplating limiting the export of its rare earth mineral reserves, it sent chills through the spines of Western

industrialists. Much of the rare earth minerals were reserves that were mined and exported to China from the

Democratic Republic of Congo. But as China is growing rich and globally powerful from the acquisition and

control of these minerals, the country that is the source of the minerals vegetates in grinding poverty. And as

the price of everything else that is produced outside of Africa continuously rises, the price of resources that are

produced in Africa continues to decline. No doubt therefore that the outside world has been developing while

Africa has been under-developing.

Hyundaing Honda/Samsuing Sony

Modern inventions and creative works are generally protected by strict patent and copyright laws. At the




same time, some of the most successful inventions and creative works have become benchmarks or industry

standard. There are no patent or copyright laws against striving to attain the industry standard. Among the most

disturbing of Africa’s failures is Africa’s failure to try. Africa does not need to reinvent the wheel. It simply

needs to adapt the existing wheel to conditions that are on the ground and unique to Africa. Africa has had half

a century to do so, but has not.

Development in other parts of the world has come about not from reinventing the wheel, but from refining

and readapting the wheel to conditions that are uniquely local first, and then universal when the product has

attained the benchmark that makes it marketable globally. Up until the 19th century, for example, Japan was

still behind the West in industrial development. Determined to catch up, Japan gradually began emulating the

West in a process that I here refer to as “hyundaing honda/Samsuing Sony”, From automobiles to electronics

and household appliances, Japan started an industrialization process that was largely based on copying and

perfecting American and European technologies. In the 1970s, Japanese products that were exported to the

United States were initially ridiculed and summarily dismissed as plastics. Japanese cars were pejoratively

described as cardboard boxes. Through persistence and perfection, they found a niche and gradually won ashare of the American market. By the 1980s, not only had Japan caught up, it had actually overtaken the West

and went on to set benchmarks in electronics and automobile production. Honda, Toyota, Sony, and Panasonic

became the new standard bearers that producers around the world, including the West, sought to meet. Among

the countries that modeled their production after Japan was Korea. For one of its production car lines, it even

gave a name that was closely similar to the Japanese standard bearer, Honda. Korea’s long term goal was not

just to simply catch up with Japan, it was to surpass Japan. Already, in the production and marketing of

cellphones, Korea had by the mid-2000s overtaken Japan to become one of the global leaders in the industry.

The one country that has overtaken Japan and is poised to catching up and possibly overtaking the United

States is China. Leveraging on its large domestic market and a highly disciplined workforce, China succeeded

in moving from a Third World communist economy to a global economic behemoth in less than half a century.

In the same half century, Africa has nothing to show. But had Africa adapted the “Hyundaing

Honda/Samsuing Sony” philosophy, redesigning and reproducing existing foreign goods to meet first its

domestic needs, and later try its hand in the export market, it too could by now have come close to catching up

with the rest of the world.

Maintaining Good Credit

All of the efforts that are directed at carving out a niche and attracting foreign investments to Africa would

be naught unless Africans are taught the importance of maintaining credibility. In the early years of

independence, all that a prospective African businessperson needed to go into the import/export business was a

letter of credit from a local bank. Not before long, the privilege became so terribly abused by fraud and

corruption that it ended up making life hard for everyone. Whether it is in government or in the private sector,

Africans will need to understand that in a modern economy, having credibility or good credit is sometimes

preferable and much better than having money in the pocket. All modern business transactions require

credibility. And credibility in one area, such as good financial credit, readily transfers to credibility in other

areas of business dealings. Not too many people would want to sign a business agreement with a

businessperson who has a record of defaulting or of failing to honor contractual agreements. However, a

supplier would be willing to sign a contractual agreement to supply goods and services to any individual or




government who may not have money at hand but does have good credit standing. Thus, while credit tells us

something about a person’s character, money in the pocket, even if it is in the billions, does not. The discipline

with which an individual manages his personal credit naturally transfers to other areas of discipline— personal

and professional.

It is important to point out here that credibility and good credit are not values that are totally alien to

African culture. Africans have sometimes raised business capital through individual contributions that come

with no collateral or guarantee for repayment. Generally, it works somewhat as follows: An association of say

12 members will come together once a month and contributes about a thousand dollars each, and the total of

$12,000 would be given to one member. If the process begins in January, the last recipient will have to wait

until December to become a recipient. There is no written rule or agreement. The transaction is based entirely

on faith. Yet, default seldom occurs. Not even in case where a member who has received the contribution dies

unexpectedly. His estate would generally honor the unwritten obligation and pay off the remaining recipients.

It does appear therefore that the foundations of credit and credibility are already in place in Africa. All that

is needed now is to figure how to transfer and integrate this communal sense of trust into the modern economicsystem. This may require going back and studying those core traditional values that guaranteed trust and

stability in Africa prior to the intrusion of European rule. While it may be true that Europeans failed to integrate

traditional African values into the sociopolitical system it imposed on Africa, there is no reason why Africans

cannot work on correcting this. For Africans to reacquire the traditional values that ensured harmony and social

stability prior to European colonial rule, they may have to re-embrace the element of trust that was and still is at

the core of African traditional values. Integrating such values with the modern values that have been acquired

from the West would produce a climate that is potentially more conducive to stability and growth than the

present climate.

Promoting Regional Trade

African rulers have on the whole been faithful guardians of the status quo they inherited from colonial

rulers — colonially imposed boundaries, mono-crop and export oriented economies. They have done nothing to

change this. Countries whose economies are dependent on the mono-commodity legacy that was left behind by

colonialism remain vulnerable to the vicissitudes of the global economy. And economies whose key

infrastructures, from rail systems to highways, are directed at the promotion of the export industry will by

default neglect the domestic and regional economies. Imagine that the 27 European member countries were not

allowed to trade among themselves, and imagine if members of the North American Free Trade Association

(Canada, Mexico, and the US) were not allowed to trade among themselves, either because of the lack of a

road/rail infrastructure, or because they were all forced by their colonial legacies to produce the same

commodity (mono-crop). This is Africa’s plight.

Internal African markets are too small to permit the development of sustainable economies. This means

that African systems must look beyond their restrictive borders to develop regional markets that will enable the

development of sustainable economic projects. This is going to imply the embrace of cultural and linguistic

diversity. It would also imply increased communication—the free movement and circulation of peoples across

national borders. Essentially, Africa does need to learn to compete regionally before it can compete globally.

To qualify to play in the Olympics, players have to first qualify in regional competitions. It was not until 1989,

almost 30 years after independence, that the World Bank and the United Nations Economic Commission for




Africa began arguing that African producers meet Africa’s demand for food and for industrial semi -products

and capital goods, and that the external trade of African countries be conducted with one another.

The economic version of the Olympics is globalization. Several years prior to the globalization of the

international economy, many countries, including influential economic powers, knew that effective

participation in the new global economic system would require an economic clout that is greater than that of the

single nation-state. As Europe worked to bring together various European states to form the European Union,

North America negotiated an agreement that brought Canada, Mexico, and the United States under on regional

trading bloc. In Asia and Latin America, regional economic rearrangements were equally underway to

consolidate and prepare these various regions for the upcoming global economic Olympic.

As in everything else, Africa remains structurally unprepared for the emerging globalization of the

international economy. Compared to other regions around the world, the volume of trade among African

countries is very low. Yet, they are expected to compete in the emerging global economic Olympic that is

called globalization. Individually, the economies of African states are so infinitesimally small, they can barely

stand on their own. The average African country has less than 15 million people. Some, like Gambia,Equatorial Guinea and Sao Tome have populations of less than one million. Several dozen others are

landlocked and have no immediate access to the open sea. For the shipment of goods, they have to depend on

countries with access to the sea, and then overland transportation along partially unpaved highways. The extra

costs that are incurred for overland shipment through neighboring countries are revenues that could be directed

to more meaningful economic development activity. Yet, it seldom occurs to African states that they develop

and promote trade with one another, or work in integrating their economies into regional economic blocks.

There is no faster way to economic development than regional trade. Yet, the International Monetary Fund and

the World Bank have never cared to emphasize this in their structural adjustment programs for Africa. If

European countries did not trade with one another, and if the United States, Canada, and Mexico did not freely

trade together, these countries would never have evolved to become major players in the global economy today.

In failing to actively promote such regional arrangements in Africa, it gives is reason to doubt how well

intended the policies of the IMF and the World Bank really are.

For African countries to trade with one another, they will have to learn to specialize in the production of

the goods and services for which they have a comparative advantage. It will require the discontinuation of the

current economic system where neighboring countries produce the same products — products that make it

impossible for them to trade with one another. It will also require the creation of regional currencies to facilitate

intra-African trade. Ghana and the Ivory Coast, for example, are two neighboring African states that produce

virtually the same cash crops—cocoa, coffee, and timber —and have two different currencies. Unless the two

countries would agree to jointly reform their economies and create a common currency, trade between themwill remain limited. In bilateral trade, the largest trading partners in North America are Canada and the United

States. In Europe, they are France and Germany. If these countries produced exactly the same goods and did

not share a common currency, it will be cumbersome for them to trade.

Until the economies of African states are seriously restructured, it is going to be impossible for them to

pull themselves out of underdevelopment. As indicated above, reordering these economies will require

specialization and trade. It will also require common regional currencies. But for now, these countries need to

begin by working on specializing in the production of the goods and services for which there is local and

regional demand.




The UN Economic Commission on Africa reported in its 2002 “Annual Report on Integration in Africa”

that trade among African countries only accounted for about 10% of their external trade. To grow this trade,

African countries do need to diversify trading partners and conduct more trade with their neighbors. Senegal

and Gambia are good examples of African countries that really need to do more to diversify and increase

regional trade. Even though Gambia is entirely surrounded by Senegal, there is minimal economic activity

between the two countries. Senegal’s largest trading partner remains France, and Gambia’s remains Britain. In

other parts of Africa, the promotion of regional trade is going to first require investments in road and railway

infrastructural development, and the diversification of the African economy from raw material production to

the production of finished and semi-finished consumer goods.

Many of the major roads and railways that are Africa today are developments that were put in place by

European colonial powers. Developed to advance the interest of the colonizer, the roads and railways all lead

away from the continent. Today, after more than half a century of independence and self rule, these roads and

railways continue to lead away from the continent. With poor or no intra-African transportation networks, there

is no doubt that intra-African trade remains at a paltry 10%. Where there are no roads, there certainly can be notrade. Luckily, today, there is a slow but steady realization among African states that to increase intra-African

trade, they will have to start by developing an intra-African transportation infrastructure. Just as the

trans-American railroad system produced unprecedented economic growth in the United States, a trans-African

highway or railway system that goes from Cairo to Cape Town and from Dakar to Nairobi will produce

unprecedented economic growth in Africa.

That much of the economic activity in Africa remains focused on the export of raw materials and the

import of finished processed goods further explains why Africans are unable to promote trade among

themselves. Since almost every country on the continent produces the same raw materials, there is no incentive

in importing from one another. To go beyond the current level of intra-African trade, which has stagnated at

10% for the past several decades, African countries will need to work to diversify their economies by

developing finished products that can be sold to neighboring countries. Countries that produce the same basket

of goods have little incentive to trade. So without a push to diversify their economies, the quest to promote

intra-African trade will remain a distant cry.

Globally, Africa has a comparative advantage in labor intensive industries such as clothing and textiles.

An average 17% tariff, imposed by the World Trade Organization, and policed by the World Bank and the IMF,

is so low that it makes it cheaper for African countries to import from non-African countries than to produce at

home. Structural support and World Trade Organization rules have precluded import substitution policies that

impose high tariffs designed to protect infant domestic industries. An example of the adverse impact of

IMF/WTO rules on manufacturing in Africa was seen in Ghana in 1993, where employment fell in themanufacturing sector from 78,700 in 1987, to 28,000. In Egypt, a USAID report in 2004 “ projected that the

textile industry would lose 22,185 jobs and about $203.9 million in shipments, a figure that represented roughly

4% of the countr y’s non-oil sector exports”. In addition to revising tariffs to help increase intra-African trade,

there may be need for more state intervention to nurture infant industries. African nations must find a way to

integrate the informal sector which is responsible for a large portion of production, trade, and services with the

formal sector.

From every perspective, the most effective way to promote growth in extractive and mono-crop economies

is to promote manufacturing. Manufacturing produces economic diversity, and diversity increases




for two years as farmers. Those that complete the service and decide to stay on as career farmers will be given

start-up capital that will include land, tractors, and outreach technical support. The stable life that young

Africans will find in such an opportunity would certainly allow them to settle, get married, raise a family, and

possibly pass down the opportunity to their offspring. In the long run, this newfound love in farming could very

well be the epiphany that will re-launch Africa as a remarkable global economic player.

Conclusion

This paper sets out to prove that the roots of today’s G8 can be traced back to the 1884 Berlin Conference

where the idea to organize the world’s most powerful countries in a common European front was first adopted.

We have found that not only is today’s G8 traceable to the 19th century, its policies are a vivid re -harsh of the

policies of the 19th century G8 that met in Berlin in 1884. As they set out in their quest for the acquisition and

control of global strategic resources, not only did the Berlin Conference G8 succeed in forestalling conflict

among a group of nations historically known for their ambition and rivalry, it also succeeded in ending the

escalating imperial conflict that was provoked by the scramble for colonial territories in Africa. Moreimportantly, the Berlin Conference G8 organization succeeded in redirecting the rivalry and hostilities that have

historically characterized intra-European relations away from Europe. In light of this, we can lead us to

conclude that no matter how deftly coated, the goal of the 1884 G8, the 1975 G8, and the Millennium

Development donor-states is not a “civilizing mission” in Africa, debt cancellation for Africa, or halving

development challenges by 2015, but the promotion of harmony and prosperity in the domestic economies of

G8 member-states.

That the 2005 Scotland G8 reluctantly agreed to put Africa on its agenda should have come as no surprise.

Its founding mission was to advance the aggregated self-interest of its members and not the economic interest

of Africa. It is utterly naïve therefore for anyone, and especially for Africa which has experienced firsthand the

predatory policies of the Berlin Conference G8, to see the pledges of aid and debt cancellation that were made

by the G8 in Scotland as a genuine demonstration of altruism. Disappointment over the G8’s reluctance to undo

the harm it caused Africa is not only disappointing (British PM Tony Blair himself acknowledged the

“disappointments” in a June 26, 2006 article in The Independent ), it also has been infuriating to many of the

nongovernmental organizations that worked so hard in Gleneagles to put Africa on the G8’s agenda. The

expression of frustration is captured in the words of Soren Ambrose, who writes:

The G8 is an exclusive, illegitimate club of the people running the world, with no official legal status and thus

accountable to no one. With a varying degree of democratic constraints, these people control a dominant portion of the

world’s money and military force. However much success activists may have in building a “movement”, we remain far

from being the sort of force that can determine the G8’s positions. Whatever lip service the G8 leaders may pay to

activists’ demands, their actions are politically determined, and ordinarily prioritize the interests of the most influential

constituencies—the business sector and the wealthy individuals who can fund political parties. Any time they depart from

those priorities, we should look at what political forces are making that happen.28 While G8 nations frequently call for

transparency and democratic accountable in Africa and other regions of the world, their summits do not live up to these

same standards. They are in no way accountable to their constituencies or to the international community. If anything, G8

summits are characterized not by transparency but by secrecy. Whatever their agenda is, it is obvious that it is not in the

best interest of Africa.

28 Retrieved March 8, 2010, from http://www.50years.org/cms/updates/story/270.



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