Lost Continent or Land of Opportunities?
Decade after decade, politicians and international organizations have failed to reduce poverty. Nor have they been able to help Africa generate growth or build basic infrastructure. Worse, between 1975 and 2000 it was the only place on earth where poverty has intensified. It's only recently that the situation started to slowly improve.
In fact, there has been some growth since 1995 but it's been mostly in the very new services sector so it created only a few jobs whereas manufacturing and agriculture could have done much better.
However development economists and experts from all boards are now approaching the problem from new angles to provide innovative ways to fight African poverty.
Better yet, some African countries are now emerging as real economic powers thanks to better leadership and deals with foreign investors to build infrastructure. Let's see how all that improves our understanding of poverty in Africa, the plague of a continent.
Aside from political and social reasons (e.g. corruption, ethnic violence), many economists argue that the absence of economic growth is in part due to a detrimental geography that impacts on the economy.
But in many cases, oil-rich African countries are also more likely to be exploited by other countries or powerful corporations who always find a way to not pay much-needed taxes (billions and billions of dollars).
In most developing countries, disparities pose the problem of redistribution of wealth, but many African countries are simply too poor to redistribute anything. The average income level is sometimes so low that even working people live under poverty. So, how do you fix that?
Free trade agreements against the African continent
International trade policies, for example, are incomparably more important than international aid to end African poverty and help its countries to integrate the global market. Surprising ? Not that much considering the global competition that the continent has to face: not only are the US, the European Union protecting their key industries (especially those that Africa could compete with, like agriculture), but now Asian countries also got in the game, spearheaded by India and China.
With each of them seeking to protect their benefits, the international community should rather give preferential market conditions to poor countries (e.g. for export or agricultural development). This would provide them a path to fast development, and hopefully diffuse the benefits to inner regions. In that way the internal market could also thrive and help alleviate poverty in African countries that are landlocked. Read here how African farmers have finally won their case at the World Trade Organization (WTO).
So far local governments, international aid and market reforms had only a minimal effect on the population. Consequence: folks have had to solve their problems on their own, outside the system. It is only recently that new international policies, such as the United Nations’ Millennium Development Goal (MDG) in Africa, have stopped overlooking the effect of politics on local economies: transparent and accountable government, rule of law, public resources management, free and fair election combined with an active civil society are now recognized as a vital factor of poverty alleviation. This whole forms what specialists now call “good governance”.
International aid - more transparent, less corrupt
Another issue is that of international aid. Aid donors obviously want to make sure that their money is put to the right use, rather than to building palaces for individual use. Now how things have changed is that foreign aid has become demand-driven with local communities, governments and NGOs competing to receive the funds. This should help foster competitiveness and efficiency of development projects as well as transparency. In other words it should radically reduce corruption and embezzlement.
This model was field tested and can help avoid the case of the African Millennium Villages, blindly “shooting” money in every direction in a local community, like a crazy action hero who doesn't believe in nuances and complexities of real life. What is needed is targeted funding that provides new opportunities and incentives for people to participate in the development of their country. Humanitarian aid remains way too opaque, only the most concrete and effective programs should remain. In particular those that help local entrepreneurs, not multinationals.
Recently specialists have increasingly taken into account the role of geography to explain the absence of economic growth and the aggravation of poverty in Africa. Whereas in many developing countries there are disparities that pose the problem of redistribution of wealth, Africa is simply too poor to redistribute anything.
Well that's not totally true. Africa is full of natural resources, but to give just one example many multinational companies that extract these resources don't even pay any taxes to the country where they operate. In other cases, it's simply that the local aristocracy keeps all the revenues to itself.
The African paradox: it's both rich and poor
So poverty in Africa is paradoxical: the continent is made of 54 countries of low population density and rich in natural resources. Of course, as usual the resources are not evenly distributed between regions, countries and within local populations.
The countries are separated into resource-rich and -poor and into coastal and landlocked ones. Across all categories, most countries have remained stuck with a GDP per capita below $2000 for the past six decades.
The need for tailored development
Unlike other continents, a great share of the population in Africa lives in landlocked, resource-scarce countries which accounts for 1% of its overall growth rate. Another consequence of this is that policymakers need to start thinking in terms of context-based development strategies rather than continent-based ones.
In particular concerning the resource-poor landlocked regions which will remain the very core of the African poverty puzzle. A puzzle that year after year became obviously unsolvable in a day. These very countries are the ones that would need a sort of targeted, continuous aid flow in order to steadily raise consumption levels, therefore consistently reducing poorness in Africa. Nevertheless, today's aid flows only focus on short-term emergencies.
Read here about the influence of oil on poverty in Sudan and Darfur
Diseases - threat to development
Diseases in Africa – and in particular HIV-AIDS – are another major threat to economic development. As an academic (Whiteside 2002) puts it: “one of the main consequences of the disease is that it impoverishes individuals, households and communities”, thus further entrenching the roots of poverty in Africa.
This is a vicious cycle by which poverty boosts the spread of HIV which in turn increases poverty. The case of the poor in South Africa shows that despite the country's substantial growth, that wealth is still too concentrated in the hands of an "uninfected" minority. That way the gap between the rich and the poor only gets bigger and bigger, making it harder for impoverished populations to catch up with the well-off.
Starting to feel slightly overwhelmed? We're just talking about everyday life poverty here! ... So, not only does proper education help eradicate a great deal of diseases (STIs, sanitation, etc), but there is also a direct link between levels of education and poverty.
Authoritarian rule in most countries has only made the situation worse, deepening both levels of education and poverty in Africa. For that reason, although some argue that authoritarian regimes can better spur development in some cases (China, Singapore,…), but in this case democracy seems more appropriate for the case of Africa.
Is democracy better suited to Africa?
Experts who hold this argument ground it on several factors including: the multi-ethnics nature of most countries (better representation of everyone’s interests), the need for better governance and redistribution of the riches in absence of strong political will, and pervasiveness of corruption that drives people away from the legal and institutional life.
But the experience of democracy in the West has also resulted as we've seen with the protests in 2011 that most of rich countries' wealth eventually ended up in the hands of a very small elite.
Education to gain skills first and foremost
Even though many fancy universities tend to forget it, education is in general about teaching people skills (duh), thereby enhancing productivity, creativity, and exchanges.
Higher education is crucial to bring Africa back into the world system (yes it’s been kind of left aside) and bridge the digital gap with other continents. What we need is then consistent education in ICTs on top of developing the infrastructure (optic fiber, antennas, electricity grids,...) so that people can benefit from an advanced use of ICTs and harness their economic potential.
Fighting on all fronts
Obviously on a priority list of fighting poverty in Africa, this comes after meeting the most basic needs such as food, water, health, energy,... How could you possibly charge a computer's battery without electricity in your town? Yet they did that mistake a few years ago and sent thousands of laptops.
On the other hand just as many countries - a dozen - were suffering from sharp rises in under-nutrition. The worst case is that of poverty in Ethiopia which left over a million people underfed. The plight of hunger is undoubtedly one of the most severe effects of poverty in Africa, where it is incomparably harsher than in most other places.
(Action Plan, United Nations Water Conference, Mar del Plata, 1977)
History has shown that despite technical, financial, economic and institutional support in water-related projects, poor governance has been a major factor in ruining those efforts and resources.
The way out of poverty in Africa is therefore hardly imaginable without the constructive and appropriate help and cooperation of the international community, along with (increasingly) that of private businesses from other countries.
Get a better grasp of African poverty by checking out our Africa Facts page.
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