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Africa in the 1990s: What the West Can Do
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17050 |
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CURRENT ISSUES
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8 / 1990 |
2,177 Words |
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Peter Duignan
Peter Duignan is a senior fellow at the Hoover Institution. |
Africa's future in the 1990s need not be as bleak as its past. The African continent has great natural riches in minerals, hydroelectric potential, and other resources. Above all, there is the potential wealth of its peoples - black, brown, and white. In solving Africa's problems, foreigners can play only a modest role. But foreign counselors and aid givers can at least avoid giving bad advice.
The rapid collapse of socialism and communism in Eastern Europe and the Soviet Union has been a major shock to Africa. The failure of central planning and state-owned industries, of collective farming and subsidies, force African governments to reconsider their systems and turn to market economies. One-party states can no longer look to Eastern Europe for legitimacy. The rise of opposition parties in the Soviet Union, moreover, will force Africa's dictators to allow opposition parties to exist. Demonstrations in Zaire and Gabon are early indicators of such change. Foreign aid and military equipment from communist countries will decline and force Africa's tyrants to negotiate with armed resistance groups - for example, in Angola, Mozambique, and Ethiopia. To compete for foreign aid and investment, African states will have to denationalize their economies and restore peace.
The West, including the United States, can best contribute to African development by lowering trade barriers against African exports. Such barriers restrict markets, impede foreign contracts, inhibit productive investment, exacerbate unemployment, and restrict the spread of skills. When preferred, Western aid should take forms that make it possible to identify costs and benefits. The West must insist on full accountability. Aid should not be in untied cash grants. The so-called multilateral approach should favor governments that promote a free-market economy and eschew central planning and state ownership. Aid, moreover, should be confined to specific projects and should reward balanced budgets, not deficit spending.
The fact remains that public enterprise has performed poorly in Africa in nationalized industries, marketing, and agriculture alike. By contrast, academics and public planners have consistently underestimated the indigenous African entrepreneur; the underground economy sustains many states. Even dedicated African communists such as the leaders of Mozambique have been forced to adopt an African variant of Lenin's New Economic Policy. The late President Samora Machel denationalized retail trade, and a 10-year old development plan begun in 1981 sensibly gave first priority to agriculture, a policy already pursued with some success by neighboring Malawi.
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