Africa is not rich.
On a per capita basis, this results in:
- Oceania: $225,000
- North America: $174,438
- Europe: $107,962
- Asia: $19,000
- South America: $18,913
- Africa: $3,000
I will say it again.
Africa is not rich. Once you understand that, everything else fits together. Many of their problems can simply be attributed to a lack of resources – a problem that corruption does not solve.
So this is the first half of your question done and dusted.
In my opinion, misunderstandings about Africa can be traced back to two phenomena: assumptions and extrapolation.The first, like the assumption that Africa is rich, leads to miraculous expectations. The second is Africa as a country phenomenon:
- Egypt gained its independence in 1922.
- Egypt is located in Africa.
- This means that Africa has been independent for 97 years.
- But that’s not how it works.
First of all, the colonial heritage was a state that was authoritarian but fragmented and poor.Excluded are jewels such as South Africa, Ghana and the Ivory Coast. But the divergence of African countries began at the beginning of independence and economic performance. The colonial situation in West Africa was relatively free of fighting, with the exception of Guinea. In North and East Africa, where violence often occurred, this was less the case. The “winds of change” stopped in southern Africa. While some new independent states – the Democratic Republic of Congo – have immediately fallen into war and multi-statehood, others have proven to be one of the fastest-growing nations in the world.
But we also find divergences in the sources of growth.
Take Botswana; in independence, it was a sparsely populated and enclosed country with an economy that was totally dependent on livestock farming. At 80 dollars per capita, it was one of the poorest countries in the world. Less today. Its wealth can be traced entirely to a prudent management of diamonds, but its low population density and seclusion, which at first glance seem to be disadvantageous, turned into advantages because they made it to the government secured the mines and benefited the state. In Sierra Leone it was the other way around (Emmanuel-Francis Nwaolisa Ogomegbunam’s answer to Who is the infamous figure in African History?).Part of a trend in Africa where conflicts fueled by resources flared across the continent. This was part of a general conflict trend in Africa. Unlike most Asian countries, which had their last internal wars in the 1950s, many African countries were still trapped in civil war until the early 21st century.
Apart from the conflict, there was the question of economic decisions.In the early stages of the postcolonial era, issues of economic justice and reform of the economic system ultimately brought two systems to a standstill:
- Export-oriented economies.
- Economies focused on import substitution.
African countries in independence were primarily commodity exporters who associated industry with prosperity and had less of an industrial base than their Asian counterparts, pursuing the policy of import substitution in order to industrial base from scratch.
Then as now, the world’s industrial engines were bundled in Western Europe, East Asia, and North America.
Carrying out the transfer required the exchange of dollars for machines. They decided to plunder the agricultural sector – a successful exporter. Through market associations that bought crops from farmers at lower market prices, the government was able to channel the surplus dollars into production. It worked until it stopped working.
This was due to rising oil prices.First by increasing the cost of production, and then by tempting states to top up debt. Oil exporters built large surpluses that the big banks passed on to willing lenders. As the debt rose, maintenance costs rose to other expenses. This, in turn, required more debt until the IMF had to be confiscated. The resulting structural adjustment has undone an entire generation of economic progress.
At the beginning of the millennium, African states that were not at war were in debt, so…..
Then came China, the birth of the success of export-oriented industrialization by the East Asians.
Along with the end of the Raj license, India and China became new sources of global growth, and especially for African countries (and Australia and Brazil) the demand for raw materials. Crude oil, gold, diamonds, food, names of the goods, the Chinese and Indians want it, and are willing to pay for it. In addition, technologies such as mobile communications and the Internet offer hope of making a leap to Africa. therefore…..
I hope I have explained the delay in the post-colonial catching-up process: conflicts and a bet on the wrong economic model.
That brings us at this stage. You know what’s coming…..
These covers are like clockwork.
The question now is whether Africa will develop?
I will add a number, 15%.
China’s share of global GDP currently generated. Africa must reach this level in order to be considered developed. Will it? That is too early to say. Steps to achieve this, however, require understanding exactly what the rise of Africa was.
Economic cycles are waves of happiness that are beneficial to countries that manage to catch and ride them without smashing them.A positive example of this is the East Asian countries, which are witnessing and participating in the wave of globalisation. Greece, which is using the surpluses of oil producers/East Asia, European credibility and low lending rates to increase its deficit, is another example, albeit less positive. The USSR successfully industrialized its economic performance in an era of global economic barriers when they fell.
Africa, which is rising, has gone through such an economic cycle.The Asian giants’ demand for raw materials increased the treasury and enriched politicians, bureaucrats and the few in the top positions of commodity-producing companies. In addition to the employees of banks and communications companies that helped increase productivity, they became faces of a new class of conspicuous consumers.
They exist, but then also these types.
And so here.
Asian economies brought their populations out of poverty by using global value chains.
Their prosperity, in turn, led to an increasing demand for raw materials, whose higher prices played a role in Africa. This cycle now seems to be over. A combination of the increasingly negative assessment of fossil fuel extraction and mining, as well as the ageing population in the richer world. Increasing automation also reduces the ability to replicate the extensive production chains that have driven the Asian wonders.
The danger is not to recognize that the global economy of 2001-2008 was a temporary phase.One cycle ends and another begins, only the risks remain. Risks ranging from uncertainty to climate change remain, and African countries will have to deal with them, but with fewer resources than the world as a whole can control. Some will do better than others.