NOV. 20, 2012 VOLUME 6, NUMBER 22 PAGES 521-548 WWW.GLOBALRESEARCHER.COM Booming Africa IS AN EAST ASIA-STYLE BOOM UNDER WAY?

nce considered hopeless, much of sub-Saharan Africa is booming. Seven of the world’s 10 fastest-

growing economies currently are in Africa. High prices for the continent’s oil and mineral exports

have brought a surge of government revenue and investment, but the growth is occurring in O commodity-poor countries as well. Better governance, less war and the rapid spread of cell phones and other communication technologies are fostering growth even in nations with few natural resources. Debt for -

giveness and the rise of China, India and other emerging markets as trading partners and sources of investment also

have spurred economies forward. Demographers say that with the continent’s working-age population projected to

expand by a third by 2020, Africa could

benefit from a “demographic dividend”

that would fuel sustained economic growth,

even as populations in developed coun -

tries and Asia are growing older. Yet, the

population boom also poses challenges:

Africa’s economies must provide enough

jobs for the growing number of workers

with expectations of a better life.

Construction cranes punctuate the skyline of Luanda, Angola’s capital, where a building boom is being financed in part by high world prices for the country’s oil exports. As in other oil-exporting African countries, a flood of petro-dollars has fueled Angola’s robust growth — more than 14 percent annually in recent years — despite a sluggish global economy.

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THE ISSUES Africa Among Fastest- 525 Growing Regions • Can African economies Growth of African output is Nov. 20, 2012 523 diversify away from natural second only to Asia’s. Volume 6, Number 22 resource production? Miners’ Strike Deepens MANAGING EDITOR: Kathy Koch • Can Africa provide 526 [email protected] enough jobs for its fast- South Africa’s Woes growing population? Vast gulf between rich and CONTRIBUTING EDITORS: Thomas J. Billitteri poor bedevils the economy. [email protected]; Thomas J. Colin • Is Africa about to under - [email protected] go an East Asia-style boom? Poor Governance Hinders 528 CONTRIBUTING WRITERS: Brian Beary, Africa’s Progress Roland Flamini, Sarah Glazer, Reed Karaim, BACKGROUND Foreign investors are wary Rob ert Kiener, Jina Moore, Jennifer Weeks about investing in Africa’s 532 Colonialism industrialization. SENIOR PROJECT EDITOR: Olu B. Davis European rule undermined ASSISTANT EDITOR: Darrell Dela Rosa African economies. Africa’s Workforce to 529 Surpass All Others FACT CHECKER: Michelle Harris Independence and Working-age population 535 Stagnation could exceed 1 billion by Independent countries faced 2040. huge economic challenges. Chronology 533 Key events since 1807. African “Renaissance” An Imprint of SAGE Publications, Inc. 537 Most African countries have The High Cost of Nigeria’s 534 VICE PRESIDENT AND EDITORIAL DIRECTOR, embraced market reforms. Fuel Subsidy HIGHER EDUCATION GROUP: Love of low-cost fuel costs Michele Sordi dearly. CURRENT SITUATION DIRECTOR, ONLINE PUBLISHING: 536 Rapid Oil Exploitation Todd Baldwin Hope and Change Fuels Africa’s Boom 537 African economies are Oil production rose faster Copyright © 2012 CQ Press, an Imprint of SAGE changing. than in any other region. Publications, Inc. SAGE reserves all copyright and other rights herein, unless pre vi ous ly spec- At Issue i fied in writing. No part of this publication may 539 Is Africa poised for an East be reproduced electronically or otherwise, OUTLOOK Asia-style economic boom? without prior written permission. Un au tho rized re pro duc tion or trans mis sion of SAGE copy right- Chinese Challenges 541 548 Voices from Abroad ed material is a violation of federal law car ry ing State-owned Chinese Headlines and editorials from civil fines of up to $100,000. companies are competing around the world. aggressively in Africa. CQ Press is a registered trademark of Con - gressional Quarterly Inc.

FOR FURTHER RESEARCH CQ Global Researcher is printed on acid-free paper. SIDEBARS AND GRAPHICS Pub lished twice monthly, except: (Jan. wk. 5) (May 544 For More Information wk. 5) (July wk. 5) (Oct. wk. 5). Published by A Continent on the Rise Organizations to contact. SAGE Publications, Inc., 2455 Teller Rd., Thousand 524 Seventeen countries are Oaks, CA 91320. Annual full-service subscriptions Bibliography start at $575. For pricing, call 1-800-834-9020. To part of the so-called 545 Selected sources used. African Renaissance. purchase a CQ Researcher report in print or elec - tronic format (PDF), visit www.cqpress.com or call The Next Step 546 Additional articles. 866-427-7737. Single reports start at $15. Bulk pur - chase discounts and electronic-rights licensing are Citing CQ Global Researcher also available. Periodicals postage paid at Thou - 547 Sample bibliography formats. sand Oaks, California, and at additional mailing offices. POST MAST ER: Send ad dress chang es to CQ Re search er , 2300 N St., N.W., Suite 800, Wash - ing ton, DC 20037. Cover: AFP/Getty Images/Stephane de Sakutin

522 CQ Global Researcher Booming Africa BY JASON MCLURE

a five-screen cinema; in the THE ISSUES high-tech, deep-water oil drilling platforms off Ango - ust two decades ago, la’s coast; and in the sharp destitute Mozambique reductions in infant mortality J could have been the in countries such as Ethiopia poster child for the eco - and Rwanda. nomic basket case t hat was Analysts bullish on the con - much of sub-Saharan Africa. tinent’s future see indications More than a million people that sub-Saharan Africa is set had died in a 17-year civil war, for a sustained period of eco - and up to a third of its 15 nomic growth that could million people had fled their raise many of its countries to homes. With much of its middle-income status. “Africa farmland sown with land - could be on the brink of an mines, the country had to im - economic takeoff, much like port grain to feed itself. And China was 30 years ago and the war’s $15 billion cost — India 20 years ago,” said a about seven times Mozam - recent World Bank report. 4 bique’s annual economic out - The growth is attributable put — had virtually bank - in part to a boom in oil rev - t

1 r

rupted the country. a enues stemming from high d Today, the Texas-sized d global prices and increased pro - o t S country bordering the Indi - duction in petro-states such as m o

an Ocean is rising from the T Angola, Chad and Equatorial / s

ashes. Newly built resorts e Guinea. Yet, significantly, be - g a

offer $600-a-night rooms m tween 1996 and 2008 a star I

y t

along the 1,550-mile coast - t group of 17 emerging African e

line. Vast coal deposits and G economies produced per capi - the discovery of natural gas A young mineworker in South Kivu province in the Democratic ta income growth of more reserves twice the size of Saudi Republic of Congo (DRC) helps to extract cassiterite and coltan, than 2 percent per year — and valuable minerals used to manufacture sophisticated electronics. Arabia’s could make Mozam - More than 90 percent of the DRC’s export income comes from another seven nearly reached bique one of the world’s largest diamonds, minerals and oil, leaving the economy vulnerable to that milestone, which econo - energy exporters in the next fluctuations in global prices. Many African countries are trying to mists say is a significant mea - decade, and a new aluminum become less dependent on such commodity exports. sure of rapidly rising living smelter is one of the biggest standards. None of the 24 coun - in the world. ago. As recently as 2000, The Econ - tries were oil exporters. Mozambique’s turnaround has been omist labeled Africa “the hopeless con - “Thailand in 1960 looks a lot like mirrored across much of sub-Saharan tinent.” The misperception “represents Ethiopia or the Democratic Republic of Africa, where per capita income has . . . a chasm between perception and Congo today,” says Susan Lund, di - risen 132 percent over the past 15 years. reality,” said a report this year from rector of research at the McKinsey Seven of the world’s 10 fastest-gr owing Ernst & Young, an international ac - Global Institute, a subsidiary of the economies currently are in sub-Saharan counting firm. 3 “The facts tell a dif - international consulting firm. “South Africa, which is projected to grow by ferent story — one of reform, progress Korea in 1965 looks like Senegal, Tan - 5.3 percent next year, compared with and growth.” zania or Ghana. When you look back - 2.1 percent in the United States and The fruits of Africa’s recent growth wards you think Africa could capture 0.2 percent in eurozone countries, ac - are visible across the continent: in the this potential.” cording to the International Monetary polished marble floors of the 205,000- And while it may seem far-fetched Fund (IMF). 2 square-foot Accra Mall, an American- to compare Africa’s rise to that of Yet many outside of Africa still think style complex in Ghana’s capital city emerging economic giants like India, of the continent as it was 20 years featuring Apple and Nike stores and China or Brazil, consider the following:

www.globalresearcher.com Nov. 20, 2012 523 BOOMING AFRICA

than India’s, and six sub-Saharan coun - A Continent on the Rise tries have greater income per capita than China. 7 In the past 20 years, 17 sub-Saharan countries are experiencing what some • While African countries are con - are calling an African Renaissance. These “emerging” countries have sidered more difficult to do business in embraced democracy and economic reforms — such as slashing regulations, than other developing nations, eight sub- tariffs and the cost of starting a business — and saw per capita income rise Saharan countries rank ahead of Rus - more than 2 percent per year between 1996 and 2008, according to Steven sia on the World Bank’s “ease of doing Radelet, chief economist at the U.S . Agency for International Development. In business” index; 12 were ahead of his 2010 book Emerging Africa , Radelet also identiÞed six “threshold” Brazil and 13 ahead of India. 8 economies, with growth rates under 2 percent but showing signs of a Several changes have fueled sub- turnaround. Ten oil exporting countries have economies and politics that are Saharan Africa’s growth since the dark heavily inßuenced by oil revenues, and 16 others are neither oil exporters nor days of the 1970s and ’80s. First, coun - tries across the continent have signif - considered “emerging,” according to Radelet. icantly improved governance and ex - Economic Status of Sub-Saharan Africa panded democracy. Though many Emerging Africa countries are still dominated by a sin - gle party or governed by authoritarian rulers — such as Rwanda’s Paul Kagame or Uganda’s Yoweri Museveni — corrupt, unaccountable despots like Zimbabwe’s Robert Mugabe are an in - creasingly rare species. Major civil wars such as those that damaged the economies of Sudan, Angola, Mozam - bique and Liberia in the 1980s and ’90s Cape have ended or quieted significantly. Verde “Africa has reached the point that the Scandinavians got to 100 years Seychelles ago, when they decided they are tired São of fighting each other and said: ‘Let’s Tomé put everything down and work to - Comoros wards a more peaceful region,’ ” says Ifediora Amobi, director of the African Institute for Applied Economics in Emerging Enugu, Nigeria. “More stability will Threshold translate into growth.” Second, African central banks and fi - Oil Exporting Mauritius nance ministries have become better eco - Other nomic managers. In the late 1970s and ’80s, Ghana was hit by low prices for cocoa, its main export, and high prices Source: Steven Radelet, Emerging Africa: How 17 Countries Are Leading the Way (2010) . Map by Lewis Agrell for oil, which it imported. The govern - ment responded by controlling consumer • Between 2010 and 2020, some cording to McKinsey. prices, paying artificially low prices to 122 million young people will enter • Although most of Africa is viewed cocoa farmers and expanding the civil Africa’s labor force, providing a massive as corrupt, 28 sub-Saharan nations are service nearly 10-fold. As a result, the “demographic dividend” that will give considered less corrupt than Russia, budget deficit ballooned, inflation reached the continent a larger labor force by 2035 and six score better than India on 120 percent and cocoa production plum - than any country or region, including Transparency International’s Corruption meted. Since the reversal of some of the China or India. 5 By 2040, 1.1 billion Perceptions Index. 6 harmful policies, Ghana’s economy has Africans will be of working age, ac - • Africa’s income per capita is greater become one of the strongest in Africa,

524 CQ Global Researcher with growth averaging more than 5 per - cent over the past 25 years. 9 Africa Among Fastest-Growing Regions In addition, Africans have benefit - Africa’s gross domestic product (GDP) — a measure of economic output — ed enormously from technological ad - grew at an average rate of 5.1 percent from 2000 to 2010, second only to vances, particularly in communications emerging Asia (top). Angola, which has been exploiting its newfound oil reserves, and information technology. The In - ternet provides more information — had the world’s fastest-growing GDP during the decade ending in 2010. For the ranging from scientific research to en - current Þve-year period, seven of the world’s fastest-growing economies (below, in gineering designs to financial data — red) are expected to be in Africa, with Ethiopia ranked just behind booming than the continent’s largest research li - China and India. braries, and it is increasingly available, even in rural areas. Moreover, on a Compound Annual GDP Growth by Region, 2000-2010 continent where phone service was 10 8.6% once rare and expensive, mobile phones have become ubiquitous, even 8 6 5.1% in remote areas of the Sahara Desert. 4.5% “Africa had no connectivity, and now 3.7% 4 3.1% 2.8% everyone is connected by mobile 1.5% phone. That has just changed things 2 everywhere,” said Jacko Maree, chief 0 Emerging Africa Middle Latin Central and World Developed executive officer of South Africa-based Asia East America Eastern economies 10 Standard Bank Group. Europe Finally, international lending insti - tutions have forgiven many African World’s Fastest-Growing Economies, countries’ foreign debt, which has freed by Annual Average GDP Growth up government revenues to be spent on education, health care and infra - 2001-2010 2011-2015 structure. Interest on foreign debts fell from 16 percent of Africa’s export earn - Angola 11.1% China 9.5% ings in 1995 to 8 percent today . 11 China 10.5% India 8.2% To be sure, growth has not occurred Myanmar 10.3% Ethiopia 8.1% evenly across the continent, and even Nigeria 8.9% Mozambique 7.7% some of Africa’s fastest-growing economies Ethiopia 8.4% Tanzania 7.2% still face corruption, inequality and eth - Kazakhstan 8.2% Vietnam 7.2% nic strife. Long-running conflicts con - Chad 7.9% Congo 7.0% tinue in Somalia and the Democratic Mozambique 7.9% Ghana 7.0% Republic of Congo, discouraging for - Cambodia 7.7% Zambia 6.9% eign investment, hindering efforts to Rwanda 7.6% Nigeria 6.8% build infrastructure and prolonging instability. Sources: “Africa’s Impressive Growth,” The Economist , January 2011, www.economist.com/blogs/ In addition, outside of South Africa dailychart/2011/01/daily_chart; David Fine, et al. , “Africa at Work: Job Creation and Inclusive and a handful of small countries such Growth,” McKinsey Global Institute, August 2012, p. 1, www.mckinsey.com/insights/mgi/research/ as Mauritius, nearly all sub-Saharan africa_europe_middle_east/africa_at_work economies depend heavily on exports of raw materials such as oil, gas, min - Ramachandran, a senior fellow at the for governments, they have so far pro - erals or agricultural commodities. And Washington-based Center for Global vided few jobs for Africans. Many of while many commodity prices are Development. “Africa has not diversi - the jobs in these industries are filled high at the moment, export-driven fied into manufactured exports. It has by foreign workers trained by multi - economies remain vulnerable to fluc - not been able to compete with Asian national companies. The failure to de - tuations in global prices. countries.” velop labor-intensive manufacturing has “A lot of this [growth] is still being Moreover, while exports of miner - left many countries with high unem - driven by natural resources,” says Vijaya als, oil and gas generate high revenues ployment. Although the official un -

www.globalresearcher.com Nov. 20, 2012 525 BOOMING AFRICA

Miners’ Strike Deepens South Africa’s Woes Vast gulf between rich and poor bedevils the economy.

ven now, exactly how the trouble started in a dusty, middle-income country. 2 And it has not been rapid enough to brush-strewn field in Marikana, South Africa, on Aug. 16 resolve inequalities or quell discontent among a growing pop - Eisn’t entirely clear. In the end, though, the clash between ulation, where unemployment stands at 25.2 percent. about 3,000 South African police and a similar number of strik - The strike, which ended after the mine operator, U.K.-based ing platinum miners left 44 people dead, including 34 miners. Lonmin, agreed to raise wages by up to 22 percent, has served Video of the confrontation showed police opening fire with as a catalyst for other labor actions. By early October an esti - automatic rifles after tear gas failed to disperse the crowd, some mated 70,000 miners were on strike around the country, near - of whom were armed with clubs and spears. Police said they came ly a quarter of the total and a figure that included iron, gold under fire first and initially charged 270 strikers with murder. 1 and coal miners. An additional 28,000 truck drivers also went The charges were dropped after a public outcry, and the on strike seeking better pay and conditions. 3 government has opened an official inquiry into the incident. “Down with monkey salaries — down,” said Buti Manamela, Whatever the outcome, the clash exposed deep divisions in president of the Young Communist League, during a march near South Africa and frustration with a democracy that has allowed the offices of global mining giant AngloGold Ashanti in Orkney. “Di - wide disparities in income to persist 18 years after the end of vided we fall, united we stand. . . . We can never achieve Nelson the country’s hated apartheid government. Mandela’s rainbow nation if we are unequal in terms of wages.” 4 “Nothing, nothing, nothing has changed,” a Marikana man The actions have led some mining companies to threaten to close told the BBC after the bloodshed. “Democracy is just a word mines and lay off workers, dampening the outlook for an economy like a bird flying up in the sky.” hit by the eurozone crisis and slowing growth in China . 5 In late South Africa is the largest economy in sub-Saharan Africa September, the Moody’s credit rating agency downgraded South but has one of the most unequal distributions of income any - African debt, citing the government’s “reduced capacity to han - where in the world. The top 10 percent of the population ac - dle the current political and economic situation and to imple - counts for 58 percent of income, while the bottom 50 percent ment effective strategies that could place the economy on a path earns just 8 percent. to faster and more inclusive growth.” 6 The legacy of apartheid is seen as a major reason for the The move reflects doubts about President Jacob Zuma’s lead - inequity, because blacks were largely denied the opportunity ership and that of his ruling African National Congress (ANC), to gain education, land and capital. Economic growth has av - which has run the country since its transition to democracy in eraged 3.2 percent annually since 1995, a modest rate for a 1994 under President Mandela. The country’s major unions have employment rate for the continent is As analysts examine Africa’s eco - oil exports account for 60 percent of 9 percent, only 28 percent of Africa’s nomic expansion, here are some of export earnings. 14 labor force is in formal, wage-paying jobs, the questions they are asking: The gushing revenues are due to according to McKinsey. The remainder both increased exploitation of resources are in subsistence farming or informal Can African economies diversify and higher world prices. Between trades such as hawking wares on the away from natural resource pro - 2000 and 2009, oil production in Africa street — jobs the consulting firm de - duction? rose 24 percent. The continent now scribes as “vulnerable employment.” 12 Africa’s recent growth has been dri - has about 10 percent of the world’s oil “A lot of people in the West are so ven largely by production of oil, gas reserves and 8 percent of its gas . 15 impressed with our growth, but in and minerals. The so-called extractive Meanwhile, world oil prices shot Sierra Leone a lot of the growth has industries account for more than 25 per - from around $20 per barrel in the come from the exploitation of iron ore,” cent of exports in about half of the 1990s to around $100 this year — after says Omotunde Johnson, Sierra Leone sub-Saharan countries, and in some having reached as high as $148 per country director for the London -based cases the share is much higher. 13 In barrel in 2008. African commodity ex - International Growth Centre, a think Equatorial Guinea, oil production brings ports such as gold, copper and coltan tank. “The miners are all foreigners, in 98 percent of export earnings; in (a critical component in manufactur - so that is going to create a new set the Democratic Republic of Congo ing electronics) saw similar increases. of problems when these African youth more than 90 percent of export in - “Technology is changing rapidly, and who are not trained and educated are come comes from diamonds, miner - there will be more natural resource dis - not getting work.” als and oil. In petroleum-rich Gabon, coveries in Africa going forward,” says

526 CQ Global Researcher long been key allies of the ANC, but this year’s strikes have e o J largely been wildcat labor actions undertaken without the sup - r e

port of union leadership — and reflect the popular perception d n a

that ANC leaders are more focused on their own enrichment x e l

than improving the lives of the poor. A / s

That perception has been buttressed by reports that the gov - e g ernment is paying for $27 million in improvements to Zuma’s a m I

y

private home, ostensibly to improve security. “In 1994 there t t were massive problems, but there was also a massive amount e G /

of hope,” William Gumede, a political analyst, told The New P F

York Times. 7 “Now people feel hopeless. People have lost con - A Striking gold miners in Carletonville, South Africa, demand better fidence in all of these institutions they trusted will make a dif - pay and working conditions on Oct. 18, 2012. The placards read ference, like the unions and the ANC. The new institutions of “We demand 18,500 rands — silicosis the cause of death in democracy — Parliament, the courts — people have also lost mines” and “Don’t let police get away with murder.” confidence that those can protect them and help them.”

— Jason McLure 4 Rodney Muhumuza, “Facing Pressure to End Strikes, South African Miners Find Strength in Numbers, Tough Words,” The Associated Press, Oct. 4, 2012, Calgary Herald , www.calgaryherald.com/business/facing+pressure+strikes+ 1 “South Africa’s Lonmin Marikana Mine Clashes Killed 34,” BBC News, Aug. 17, SAfrican+miners+find+strength+crowd+numbers/7344234/story.html. 2012, www.bbc.co.uk/news/world-africa-19292909. See also, Faith Karimi and 5 For background, see Christopher Hack, “Euro Crisis,” CQ Researcher , Oct. 5, Nkepile Mabusi, “South African Commission Probing Miners’ Deaths Starts 2012, pp. 841-864. Proceedings,” CNN, Oct. 1, 2012, www.cnn.com/2012/10/01/world/africa/south- 6 “Moody’s Downgrades South Africa’s Government Bond Rating to Baa1; africa-mine-unrest/index.html. Outlook Remains Negative,” Moody’s Investors Service, Sept. 27, 2012, www. 2 “South Africa Economic Update: Focus on Inequality of Opportunity,” moodys.com/research/Moodys-downgrades-South-Africas-government-bond- World Bank, July 2012, p. vii, http://documents.worldbank.org/curated/en/ rating-to-Baa1-outlook--PR_256159. 2012/01/16561374/south-africa-economic-update-focus-inequality-opportunity. 7 Lydia Polgreen, “Upheaval Grips South Africa as Hopes for Its Workers 3 Devon Maylie, “South Africa’s Labor Woes Worsen,” The Wall Street Journal , Fade,” The New York Times , Oct. 13, 2012, www.nytimes.com/2012/10/14/ Oct. 3, 2012, http://online.wsj.com/article/SB1000087239639044376880 world/africa/unfulfilled-promises-are-replacing-prospects-of-a-better-life-in- 4578034271819419406.html. south-africa.html?pagewanted=all.

Ramachandran, of the Center for Glob - “After all,” he continued, “countries ber of government officials control ac - al Development. “Almost all of Africa whose major source of revenue is nat - cess to lucrative extraction licenses will be an oil or mineral exporter. The ural resources can use them to finance and contracts. question is how will they manage this?” education, health care, development • Booms caused by high world prices In the past, rising natural resource and redistribution.” 17 often spur high levels of government earnings have not been used to lift The “resource curse” is blamed on spending and borrowing, which can lead large numbers of people out of pover - several factors, including: to busts and debt crises when commodity ty. Paradoxically, developing countries • Rapidly rising energy and miner - prices tumble, as happened in the early rich in natural resources generally do al earnings tend to boost the value of 1980s in many African countries. not perform as well economically as the exporting country’s currency, mak - To enable continued growth and boost countries without oil, gas or mineral ing foreign imported goods cheaper for employment and productivity, African wealth — a phenomenon known in the local population but making it hard - nations must expand their manufactur - economic circles as the “resource er for local exports of commodities or ing and farming sectors, say analysts. curse.” 16 manufactured goods to compete with But building internationally competitive “They have grown more slowly, and countries that have cheaper currencies. industries will be a major challenge for with greater inequality — just the op - • Governance may suffer as politi - many African nations, given their small posite of what one would expect,” cal leaders focus on capturing balloon ing size and lack of roads, electricity and other Joseph Stiglitz, a Nobel Prize-winning export revenues rather than taxing citi - infrastructure. In fact, Africa’s manufac - economist, wrote recently in Britain’s zens for public services. Corruption turing sector has declined as a share of The Guardian . abounds when a relatively small num - the continent’s gross domestic product,

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falling from 15.3 percent of GDP in 1990 Poor Governance Hinders Africa’s Progress to 10.5 percent in 2008. 18 Some foreign investors are wary of investing in sub-Saharan Africa’s industrial - “Manufacturing has started on a small scale, but that has to pick up,” ization, largely because of corruption and the lack of infrastructure. The region says Johnson, the Sierra Leonean econ - is the most poorly governed in the world (top) and trails the emerging BRICs omist. “Education and training are not (Brazil, Russia, India and China) in the development of infrastructure (bottom). there. And there is a general inefficiency in investment,” he says, referring to poor World Bank Governance Ratings by Region, 2011 investment returns due to systemic prob - (-2.5 to 2.5 scale, with 2.5 being best)* lems such as low productivity, corrup - tion and lack of infrastructure that are “keeping a lot of investors out.” 1.5 1.4 African economies are not well in - 1.2 tegrated, part of the continent’s colo - 0.9 nial legacy. Many countries on the 0.6 0.4 arbitrarily divided continent are so small 0.3 0.0 they cannot generate economies of -0.3 scale large enough to compete glob - -0.3 -0.2 -0.6 ally, as China and India have been -0.9 -0.7 able to do, with their billion-person Sub-Saharan North Africa Latin Central and Industrialized domestic markets. Landlocked Burkina Africa America Eastern Europe countries Faso, for instance, has a population of 17 million — slightly smaller than Florida — and few roads to connect Comparing Africa’s Infrastructure with the BRICs, 2012 it to neighboring economies. And larger African nations must com - (kilowatt hours per person) Africa pete with Chinese and other highly 2,000 Brazil, Russia, India and China efficient Asian manufacturers. 19 In Ethiopia, a large, landlocked country 1,627 with 91 million people, it is cheaper (kilometers per 1,000 sq. km**) to buy a wooden chair made in China 1,500 than one made domestically, even after 40 39 transportation costs are factored in. 35 That’s because Ethiopian workers 30 manufacture 0.3 pieces per day, com - 1,000 pared to 4.9 in China. 20 25 Even South Africa has trouble com - 682 20 peting with Asia, despite having a highly developed infrastructure and 15 500 established access to export markets in Europe and elsewhere. Willie Van 10 8 7.4 Straaten, a chief executive officer of 5 3.2 South Africa’s Inventec, a company that designs exercise equipment and 0 0 Power Road density Rail density games, says his products are made in China because the scale of its inte - * Based on government accountability, stability and effectiveness; regulatory and legal systems grated manufacturing sector makes it and corruption levels difficult for South Africa to compete. “A lot of your Chinese factories have ** A kilometer is about six-tenths of a mile. A square kilometer is 0.39 of a square mile. got very good vendor networks around Sources: “Is Africa About to Take Off?” Societe Generale , May 2011; and David Fine, et al. , “Africa them, so they may manufacture just at Work: Job Creation and Inclusive Growth,” McKinsey Global Institute, August 2012, p. 43 one-third of the product, but two-thirds

528 CQ Global Researcher will come from the vendor network around them, and those vendors spe - African Workforce to Surpass All Others cialize in just one item,” he recently told Africa’s working-age population is expected to exceed 1 billion by 2040, giving the television station African Business News. “So in South Africa you have to the continent a larger labor force than any country or region, including China go and manufacture almost every item or India. Experts say the burgeoning labor force will attract outside investors at low volume which makes it very, because of the growing consumer market they represent, but others warn that very expensive.” 21 all those workers will need jobs. Some analysts say Africa’s growth is not all due to rising commodity ex - Size of the Working-Age Population (ages 15 to 64), 1970-2040 port earnings. Steve Radelet, chief econ - (in millions) omist at the U.S. Agency for Interna - 1,200 tional Development, wrote that although Africa India rising commodity prices “have helped China in some cases, the turnaround in the 1,000 Southeast Asia emerging countries is not solely the re - Latin America Europe 22 sult of favorable commodity prices.” 800 North America He found that between 1980 and 2006, Japan with the exception of nine oil-exporting countries, the ratio of the cost of im - 600 ported food and other goods rose as fast or faster than income from ex - 400 ports. In other words, higher prices for African exports cannot explain Africa’s growth because the prices con - 200 sumers paid for imports also rose. Others say Africa has an opportu - 0 nity to develop labor-intensive indus - 1970 1980 1990 2000 2010 2020* 2030* 2040* tries — such as horticulture, leather- working and textiles — especially once * projected labor costs in China and other Asian Source: David Fine, et al. , “Africa at Work: Job Creation and Inclusive Growth,” McKinsey Global manufacturing countries begin to rise. Institute, August 2012, p. 13, www.mckinsey.com/insights/mgi/research/africa_europe_middle_ In Lesotho about 40,000 people now east/africa_at_work work in the garment industry for com - panies that export textiles to the Unit - flower farms that have sprung up in force has stable, wage-paying em - ed States under the African Growth and her country over the past decade. Even ployment. Although that figure is up Opportunity Act, which allows duty- though she is only earning a little over from 24 percent in 2000, 63 percent free access to the U.S. market. 23 a dollar a day, working in the farm’s of the workforce is still in “vulnerable “It’s not quite as dire as you might cold room packing roses to be shipped employment” — a category that in - think,” says Lund, of the McKinsey to Europe is better than having no job cludes subsistence farming or other in - Global Institute. “We think the dynamics at all. formal sector jobs such as selling might be changing. There are two op - “There are no alternatives for those goods from market stalls and working portunities: the changing wage dynamics of us who don’t have an education,” as day-laborers. 24 and higher transport costs (because of she says. “I was dependent on my “The key thing is, are people getting oil prices) both work against produc - family. Now I cover my children’s wage-paying employment?” says Lund, tion in China.” food, clothing and school fees.” of the McKinsey Global Institute. “Are Generating jobs for burgeoning pop - they getting out of subsistence agri - Can Africa provide enough jobs ulations is one of the most vexing culture and street-hawking?” for its fast-growing population? challenges facing sub-Saharan Analysts say agricultural productivity Sisay Asrat, a 27-year-old from the economies. The continent’s 9 percent could be boosted to make farming a Ethiopian town of Debre Zeit, is happy official unemployment rate belies the more stable long-term job for millions. to have a job at one of the dozens of fact that only 28 percent of the labor Expanding large-scale commercial

www.globalresearcher.com Nov. 20, 2012 529 BOOMING AFRICA

farming on uncultivated land and mov - ing from low-value grain production to labor-intensive crops such as flower farming could add up to 14 million stable jobs in the region by 2020, ac - cording to McKinsey. Given the strong demand for African natural resources, employment and in - come could be boosted by process - ing more of those raw goods before exporting them, analysts say. “If you o

g add more value to the resource, then o n

a you can generate more jobs,” says Ra - S

f machandran, of the Center for Glob - u o s

s al Development. I / s

e For instance, Ghana and Côte d’Ivoire g a

m (Ivory Coast) together produce 69 per - I

y

t cent of the world’s cocoa, which can t e

G only be grown in tropical and subtropical /

P 25 F climates. Yet, Switzerland and Bel - A gium are famous for making expensive chocolates from that African cocoa. Star - bucks Corp. pays Ethiopian coffee farm - ers as little as $1.42 per pound, and sells some specialty beans — which the company roasts, grinds and markets — for as much as $26 per pound . 26 And Africa’s largest crude oil exporter, Nigeria, imports gasoline because it lacks refining capacity. 27

n African manufacturers are on pace o s

s to generate 8 million new jobs by r e t

t 2020, and could add an additional e P

s 7 million over that period, if govern - r e

d ments improve infrastructure, cut un - n A

- necessary regulation and ease access r e P

/ to finance. The retail sector could add s e

g up to 14 million more jobs; currently a m

I Nigeria has only six shopping malls

y t t for 19.5 million people who live in e

G its four largest cities, according to Changing Economies McKinsey. In total, the consulting firm forecasts that the continent will add Generating jobs for burgeoning populations is one of the most vexing challenges 54 million stable jobs by 2020. facing sub-Saharan governments, since only 28 percent of the region’s labor force Yet, expanding employment comes has stable, wage-paying jobs. Given the strong worldwide demand for Africa’s with costs. For instance, a wave of natural resources and commodities — such as the cocoa beans being sorted by new, large commercial farms has dis - a farm worker in Côte d’Ivoire (top) — African governments want more of the placed many existing smallholders. continent’s raw goods to be processed before they’re exported, creating more In 2009 alone, 77 million acres of domestic jobs. In Gaborone, Botswana, for instance, raw diamonds now are being African farmland were transferred to sorted and polished before export (bottom). commercial investors — many of them foreigners. Often, the land was

530 CQ Global Researcher sold out from underneath small farm - Growth averaged 5 percent a year dur - The resilience in the face of the fi - ers who lacked clear title to the land ing the decade before the 2007-08 fi - nancial crisis indicates that even stronger that their families had been tilling for nancial crisis but actually accelerated growth lies ahead, says Devarajan. He generations. 28 to 6 percent between 2006 and 2008. predicts that the region, with the ex - “All we want before they break our The growth wasn’t solely attributable ception of fragile or failed states such houses and take our fields is for them to oil: 22 non-oil exporters enjoyed as Somalia, are on the brink of a sus - to show us the new houses where we 4 percent or higher annual growth tained economic takeoff, with annual will live, and the new fields where we during the decade. growth rates of more than 7 percent. will work,” said Sekou Traoré, a 69- “Then the global economic crisis Since the 1980s such growth rates have year-old villager in Mali, about plans hit, and everyone including myself pan - been commonly associated with China, to transfer land farmed by his family icked,” says Shanta Devarajan, the Sri and from the 1960s to the 1990s with to Libyan investors. 29 Lankan-born chief economist for the East Asian “tiger” economies of “They have to modernize agricul - ture, but when you modernize agri - culture it’s a double-edged sword be - cause you kick out a lot of people from the agriculture sector,” says John - “The crisis of unemployment is a ticking time bomb, son, the Sierra Leonean economist. and if we are not careful in dealing with it Others say that despite Africa’s re - cent growth, the rate of job growth we will see another Egypt and Tunisia.” is far too slow for the continent’s growing workforce. While 54 million — Buti Manamela stable jobs may be added by 2020, the number of people in vulnerable Secretary employment is expected to grow by 67 million — and at current trends, South Africa’s Young Communist League the absolute number of people in “vulnerable” work will not decline until 2080. Thus, at current rates, many African Africa at the World Bank, “because South Korea, Taiwan, Hong Kong and nations will have large numbers of now the payoffs for the reforms have Singapore. underemployed young people, which disappeared.” Better economic governance is not can lead to political instability. In the United States and Europe, the only thing Africa shares with the “The crisis of unemployment is a some countries took measures to stave East Asian tigers prior to their take- ticking time bomb, and if we are not off depression, such as nationalizing off. Like the tigers, Africa’s growth will careful in dealing with it we will see banks and expanding deficits to as be propelled in the coming decades another Egypt and Tunisia,” said Buti high as 10 percent of gross domestic by a “demographic dividend,” accord - Manamela, secretary of South Africa’s product (GDP). With the global econ - ing to some analysts. Young Communist League, referring to omy in free fall and Western govern - The median age on the continent the legions of young people who took ments intervening to prop up ailing is 18, and there are 70 million more to the streets in 2011 and toppled Arab financial and industrial firms, it would people under age 14 than there were governments. 30 have been understandable if African a decade ago. The latter figure will governments had run-up large budget rise by 76 million over the next Is Africa about to undergo an deficits and incurred foreign debts. In - decade. 31 Meanwhile, by 2035 the num - East Asia-style boom? stead, sub-Saharan budget deficits ber of retirees and children that each During the early 2000s, many sub- widened by only 2 percent of GDP worker supports, a figure known as the Saharan African governments adopted in 2009, and economies continued to “dependency ratio,” will fall from the economic reforms, such as curbing grow by an average of 2.8 percent, highest in the world to about the same deficits, privatizing banks, freeing ex - even as European and North Ameri - level as that in Western countries. As a change rates and slowing inflation. can economies were shrinking. result, each worker will have more dis - The private sector expanded rapidly, By 2010 economic growth in the posable income to invest or spend on fueling support for additional reforms. region had rebounded to 5.3 percent. non-essential items . 32

www.globalresearcher.com Nov. 20, 2012 531 BOOMING AFRICA

“This is what happened in East Asia industries. 33 Reforms to prevent such “The escalation of the Eurozone cri - in the 1970s and ’80s, and if we can problems may be adopted over time, sis and the fact that growth rates in manage it right Africa has the demo - but in the interim they are slowing the emerging BRIC [Brazil, Russia, India graphic characteristics to experience growth. and China] economies, which have the dividend,” says Devarajan. “I’m not saying they’ll stand still been the engine of the global recov - But others are more pessimistic over the next 20 years; there will be ery after the financial crisis, are now about the prospects for a sustained progress,” says Johnson. “But when you slowing down make the current situ - boom, because corruption and un - look at the population growth, that ation particularly worrying for African predictable legal systems discourage progress will be too slow.” countries,” says Massa. foreign investment. “Africa is still not Others see growth being dampened very good at things like corruption in the near future by the European and efficiency of government,” says debt crisis and a weakening of Chi - BACKGROUND

Colonialism

eg inning in the 15th century, con - Btact with Europeans had a pro - n

o found impact on the economy of s s r

e Africans. The Portuguese, English, French t t e

P and Dutch initially sought to extract

s r gold and ivory from the continent, but e d

n by the 17th century they had shifted A - r

e their interest to a more lucrative trade: P / 34 s human beings. Between 1600 and e g a 1870 as many as 11.5 million Africans m I

y — mostly from Africa’s western coastal t t e states — were brought to work as slaves G Chinese workers construct a new railway near Luanda, Angola. Chinese companies have in North and South America. 35 invested heavily in African mines and oil wells and have provided concessional loans to The impact of the slave trade on the African governments to build roads, railways and electricity plants. Thousands of region varied. The area near today’s Chinese workers have come to Africa in recent years to build infrastructure projects. West African nations of Senegal and Gambia provided many of the slaves Johnson, the Sierra Leonean econo - nese demand for African exports like in the early years of the trade. 36 In mist. “Even some of the so-called di - oil, copper and coal. the 1700s civil wars in the area around aspora [Africans working overseas] Isabella Massa, a France-based re - modern-day Nigeria provided a large who might have $100,000 here and searcher for the Overseas Development number of slaves, who were shipped $200,000 there and together can Institute, an international development out via ports in Benin and from British come up with a million, even they think tank in the United Kingdom, says slave forts in Ghana. After the Por - are reluctant to go back and invest. Europe’s debt crisis will slow foreign tuguese banned the slave trade north The legal systems are awful. There direct investment and aid from Europe of the equator in 1815, the trade shift - are delays, there is corruption.” to Africa. Remittances to Nigeria from ed further south toward Angola and High transportation costs, which can expatriate Nigerians fell by more than the Democratic Republic of Congo. be up to six times those in southern half in 2011, and Kenya’s tourism and Bans on the slave trade in the early or eastern Asia, also block industrial horticulture industries, which depend 19th century fueled European explo - growth in Africa. A 2009 World Bank on European markets, also declined. ration of Africa’s interior. By the late study blamed monopolies and anti- Businesses in countries such as An - 19th century the major colonial powers competitive practices by trucking com - gola, Rwanda and Cameroon are re - — Britain, France, Belgium, Portugal panies, which operate with high prof - ceiving fewer loans from European and Germany — were in a “scramble it margins at the expense of other banks as well, she adds. Continued on p. 534

532 CQ Global Researcher Chronology

1960 1400s-1700s Mineral-rich Katanga province se - 2000s-Present Europeans begin trading with cedes from newly independent Improved economic governance Africa, eventually shifting from Democratic Republic of Congo with along with spread of democracy buying gold and ivory to slaves, Belgium’s s upport, sparking six years and new communications tech - taking an estimated 11.5 million of political crisis and civil war. nology spur growth . people from Africa and under - mining local economies. 1973-1979 2000 Skyrocketing oil prices hit oil-importing United States passes African Growth • African countries hard; World Bank and Opportunity Act, eliminating tar - counsels spending cuts by African iffs on hundreds of African products. governments, fueling poverty. Oil pro - 1800s Europeans begin ducers such as Gabon and Nigeria 2005 colonizing Africa. see revenues jump. International debt relief is expanded, freeing African governments to spend 1807 • more on economic development. Slave trade is banned in the British Empire, but not slavery. 2006 1980s-1990s Forty-eight African nations attend November 1884-January 1885 Heavy borrowing and economic meeting on cooperation with China European powers meet in Berlin mismanagement lead to high in Beijing. President Hu Jintao to establish rules for colonizing Africa; rates of debt; end of Cold War promises to increase Sino-African “scramble for Africa” begins. spurs reforms. trade to $100 billion by 2010.

• 1981 2009 World Bank economists warn that Global financial crisis slows many of its loans to poor countries growth in Africa but continent 1950s-1970s cannot be repaid and should be avoids recessions experienced in Era of independence begins. canceled. United States and Europe. Relative Optimism turns to stagnation. isolation of African banks helps 1991 them avoid global financial conta - 1956 Collapse of Soviet Union heralds end gion; continuing Chinese demand Substantial oil reserves are discov - of Cold War and diminishing super - for African commodity exports ered in southern Nigeria. power support for African dictators. helps fuel growth.

1957 1994 2010 Britain grants independence to End of apartheid in South Africa Number of Africans with mobile Ghana. Most British colonies be - ends international isolation of con - phones tops 500 million as Inter - come independent by 1965, in - tinent’s largest economy. net and mobile technology spread. cluding Nigeria, Uganda, Kenya, Zambia, Malawi and Gambia. 1995 2011 Foreign debt owed by sub-Saharan Oil-producer South Sudan gains 1958 governments tops $340 billion, up independence from Sudan. African Guinea becomes independent. from $11 billion in 1970. oil production tops 417 million barrels Most French African colonies gain per day, up from 328 million in 1991. independence by 1960, including 1996 Mauritania, Nigeria, Senegal, Chinese President Jiang Zemin visits 2012 Gabon, Republic of Congo, Central six African countries promising aid More than 40 South African miners African Republic, Chad, Niger, “without political strings.” . . . IMF and police are killed during unrest Benin, Mali, Cameroon, Togo and and World Bank launch debt relief over wages and benefits; anger Ivory Coast (now called Côte program for heavily-indebted poor over income inequality grows in d’Ivoire). countries. Africa’s biggest economy.

www.globalresearcher.com Nov. 20, 2012 533 BOOMING AFRICA

The High Cost of Nigeria’s Fuel Subsidy Love of low-cost fuel costs government dearly.

ost mornings, enterprising young Africans along Togo’s Moreover, the subsidy has discouraged local companies from coastal border with Benin harvest a surprising catch: building refineries, which has forced Africa’s largest exporter M jerry cans full of fuel. Wooden boats carry the con - of crude oil to import much of its gasoline and diesel from traband gasoline on a 13-hour trip from Nigeria through the refineries overseas. The subsidy system also is hugely expen - Gulf of Guinea. Then, when they are close to the coast, young sive and riddled with corruption. In 2011, the fuel subsidy ac - men swim out with empty jerry cans and fill them with gaso - counted for 30 percent of government spending. In a country line and then haul them back to shore. where more than half the population lives in poverty, the gov - The fuel is then poured into large blue barrels and dis - ernment spent $8 billion on fuel subsidies compared with $2 bil - tributed as far as Ghana, Mali and Burkina Faso, where it is lion on education. 2 often sold on the street in liter liquor bottles at a steep dis - Long-associated with misrule and public corruption, Nigeria count from the price charged by licensed filling stations. The in recent years has won praise from the International Mone - smuggling is profitable because fuel is heavily subsidized in tary Fund and others for its economic management. High crude Nigeria, selling for just 97 naira ($.62) per liter, or about prices have helped the economy grow more than 7 percent $2.33 per gallon. 1 for the past three years, and oil revenue helped cushion the Such subsidies are roundly criticized for a variety of rea - economy during the 2008 global crisis. President Goodluck sons. Not only have price supports fueled the smuggling boom Jonathan’s government has launched efforts to build electricity to other West African nations, but a disproportionate share of generation plants and increase lending to small businesses and the subsidy benefits the wealthy and upper-middle-class Nigerians agriculture to generate employment. who can afford to own cars. The government is well aware of the costs to the economy

Continued from p. 532 On the eve of World War I, Euro - modity-based economic model still ex - for Africa,” competing for huge tracts peans ruled virtually all of sub-Saharan ists in much of Africa today. of land to secure access to natural re - Africa except Ethiopia. 40 In the late World War II had a profound, long- sources such as gold and timber. In 1800s up to 10,000 independent African term impact on Africa. Nearly 400,000 the process, they sent Christian mis - political and ethnic groups had been Africans joined the British army, and sionaries, established large administra - consolidated into 40 European colonies, African units helped defeat the Italians tive bureaucracies and built railroads often with scant regard to ethnic and in Ethiopia and restore the rule of Em - and other infrastructure — primarily language groups. The French colonial peror Haile Selassie. Africans fighting to facilitate the export of raw materi - empire alone claimed 3.75 million square overseas also witnessed the indepen - als. In the process, millions of Africans miles of African territory, an area more dence movements in other colonies died from disease, starvation, overwork than 12 times the size of France. 41 such as India and Burma, which had and war . 37 The colonial powers met with armed won pledges of self-governance from In November 1884, Africa’s main resistance virtually everywhere and the British Crown. 42 European colonizers sought to for - maintained authority only by pos - The war also crippled European malize their conflicting commercial, sessing superior arms and forming economies and led to the rise of the missionary and diplomatic efforts at a strategic alliances with traditional rulers. United States and Soviet Union — conference in Berlin. 38 At the time, Financial self-sufficiency was the main emerging superpowers that opposed the moral justification for the conquest goal of European colonial govern - colonialism. Under the 1941 Atlantic of Africa was underpinned by pseudo- ments; public services such as edu - Charter between President Franklin D. scientific ideas of European racial su - cation, sanitation and healthcare were Roosevelt and British Prime Minister periority, a desire to “civilize” techno - largely left to missionaries. European- Winston Churchill, Britain and the Unit - logically primitive African societies and owned companies controlled most ed States vowed to “respect the right the hope that Europe might gain from commerce and focused on producing of all peoples to choose the form of utilizing Africa’s raw materials while cash crops such as coffee, cocoa and government under which they would selling manufactured goods to its in - rubber or raw materials like minerals live.” 43 Anti-colonialism was also a habitants. 39 and timber. The legacy of that com - key facet of Soviet communism, which

534 CQ Global Researcher i e p

of the subsidies. But there’s a major hurdle to reducing or elim - k E

inating them: Nigerians love low-priced fuel, and for many it’s i m o

the only government benefit they see. When Jonathan attempt - t U

ed to end the subsidies in January, unions called a nationwide s u i

strike, and thousands of people poured into the streets of Lagos, P / s

Kano and other cities to protest. e g a

“The doctors are going on strike, the lawyers are not going m I

y

to court, teachers are on strike, everybody is joining this be - t t e

cause the only aspect where we feel government is in the area G / P

of subsidy,” a protester told the Al Jazeera news network. “If F you remove it, then the government can as well resign.” 3 A Protesters in Lagos, Nigeria, demonstrate during a nationwide Two weeks after eliminating the subsidies Jonathan partially strike after the government tried to abolish decades-old fuel restored them, citing a “near-breakdown of law and order in subsidies in January. President Goodluck Jonathan certain parts of the country.” partially restored the subsidies two weeks later, citing a — Jason McLure “near-breakdown of law and order” in parts of the country.

1 Jaime Grant, “On the Road With West Africa’s Fuel Smugglers,” ThinkAfricaPress, and a Political Dilemma,” Brookings Institution, Jan. 10, 2012, www.brookings.edu/ March 20, 2012, http://thinkafricapress.com/economy/road-west-africa-fuel- research/opinions/2012/01/10-fuel-subsidies-nigeria-songwe. smugglers-inevitable-spread-nigeria-fuel-crisis. 3 “Nigerian Fuel Protests Turn Deadly,” Al Jazeera, Jan. 10, 2012, www.aljazeera. 2 Vera Songwe, “Removal of Fuel Subsidies in Nigeria: An Economic Necessity com/news/africa/2012/01/201219132749562385.html.

sought to replace colonial governments freedom of Africa’s remaining colonies For example, Côte d’Ivoire — in Africa with pro-communist nation - and foster continental political and eco - France’s wealthiest former West African alist ones. nomic integration. colony — rejected a plan to unify with Many of the newly independent the seven other Francophone states in countries faced enormous challenges: the region. As a result, the Ivoirians Independence and Some were landlocked, most had did not have to share their lucrative Stagnation largely illiterate and uneducated pop - coffee and cocoa revenues with their ulations and lacked basic infrastruc - poorer neighbors. The region re - eform efforts by colonial adminis - ture. Independence would come later mained divided into many small, weak Rtrations — ending slave labor, in - in southern Africa, where colonial or states susceptible to foreign econom - vesting in infrastructure and social ser - white-dominated governments ruled ic domination. 45 vices and offering Africans a larger in Mozambique and Angola until The region’s economies also were governance role — were made grudg - 1975, in Zimbabwe until 1980, in hampered by the legacy of colonial ingly. Independence came to the re - Namibia until 1990 and in South economic management. Between gion first in 1957, in Ghana, which Africa until 1994. 1945-1 960, as Western Europe prac - had a relatively well-educated elite and Still, economic optimism ruled in ticed full-blown capitalism, Britain, plentiful cocoa, timber and gold. By the 1960s. A leading development text - France and other powers shackled 1960 France had granted independence book at the time foresaw Africa as their colonies with wage and price to most of its colonies in West and having greater growth potential than controls, agricultural marketing boards, Central Africa, and by the mid-1960s East Asia, and the World Bank’s top state-owned industrial companies and Belgium had exited its territories. economist ranked seven African coun - other trappings of centrally planned In 1963, some 32 independent tries with potential to top 7 percent economies . 46 African states (including those of North annual growth rates. 44 Yet efforts at The Soviet Union influenced many Africa) gathered in Ethiopia to form economic integration were abortive — post-independence African leaders in the Organization of African Unity with consequences for the continent’s an effort to export communist ideol - (OAU), with a mandate to support the long-term development. ogy to the developing world. Some

www.globalresearcher.com Nov. 20, 2012 535 BOOMING AFRICA

cy. During the period between inde - Rapid Oil Exploitation Fuels Africa’s Boom pendence and the fall of the Berlin Wall, many of Africa’s large countries African oil production rose by about 30 percent between 2000 and 2010, experienced horrific civil wars or in - faster than in any other region. The increase is due to higher global demand terstate conflicts, including Mozam - for oil and a surge in oil exports from Africa, which has about 10 percent of bique, Angola, Nigeria, DRC, Zim - the world’s reserves. babwe, Chad, Sudan, Ethiopia, Somalia, Uganda and Tanzania. These protracted

(in percentage) i

Growth in Oil Production 29.6% r a conflicts stifled investment and infra - 30% g by Region, 2000-2010 n o structure development and kept liv - L

25 o

c ing standards low. r 18.2% a

20 M By the 1980s, bad governance and / s

e ongoing conflicts had fueled massive g

15 a

m external borrowing by governments I

y

10 7.0% 7.6% t and state-owned companies. Foreign t

5.3% e G 5 / debt in sub-Saharan Africa had in - P

F creased from around $11 billion in 0 A -0.1% 1970 to $340 billion in 1995. Many -5% North Asia Latin Middle Europe Africa countries had borrowed heavily during America America East a period of high interest rates in the 1970s, much of it from multilateral in - Source: “Oil Production,” BP Statistical Review, 2012, www.bp.com/sectiongenericarticle800.do? stitutions such as the African Develop - categoryId=9037169&contentId=7068608 ment Bank and IMF, but when com - modity prices plummeted in the 1980s African leaders saw the relatively sta - Foreign business interests often fu - the fall undermined their ability to repay ble communist economies of 1950s eled resentment because their eco - the loans. Eastern Europe as good models for nomic practices were viewed by some Often, the borrowed money was development. In the three decades after as neo-colonialist. After the Democratic diverted for private use. For instance, Ghana’s independence, at least 16 coun - Republic of Congo gained indepen - the Mobutu regime in Zaire may tries in sub-Saharan Africa would dence in 1960, the copper-rich Katan - have stashed up to $18 billion in adopt socialist policies or mold their ga region, backed by Belgian troops foreign banks, a significant portion economic systems along socialist lines, and European business interests, tried of which likely came from external according to World Bank economist to secede from the new state. 48 After loans to the government. 49 Other John Nellis. Yet the Soviet Union was two years of fighting, the effort failed, borrowing was used for consumption hardly the only force pushing Africa’s however, and the United Nations sent or white elephant development pro - newly independent states away from troops to fight on the side of the Con - jects, such as the administrative capi - the free market. In many countries, golese government. tal city of Yamoussoukro, built by government ownership of resources In fact, conflict and bad governance Côte d’Ivoire’s late President Félix was seen as a way to prevent an elite played no small role in stifling eco - Houphouët-Boigny in his birthplace few from dominating the economy. nomic growth. And the two problems — complete with a $300 million Additionally, without capital mar - were exacerbated by ethnic tensions Catholic basilica. kets to finance large businesses or ed - and Cold War rivalry. The United States As a result, many countries found ucated business classes to run them, and the Soviet Union often backed themselves in a “debt trap,” in which African leaders as well as Western rival armed factions in sub-Saharan they could not even pay the interest donors saw a need for governments Africa, which helped to extend civil on their foreign debts, causing them to fill the gap. In some cases, resent - wars. It also led to support for au - to spiral ever higher. In oil-exporting ment of colonial domination led to thoritarian “Big Men,” such as Zaire’s Nigeria, for example, a disastrous four- nationalization of some foreign-owned [now the Democratic Republic of year period of borrowing in the 1980s companies. Revenues from state-owned Congo (DRC)] Mobutu Sese Seko, during a period of low world oil prices companies were considered a source who relied on foreign aid and sup - has haunted the country for more than of funds for building infrastructure and port to buttress his corrupt rule rather 20 years. As late as 2003, its external other parts of the economy. 47 than good governance and democra - debt was equivalent to 71 percent of

536 CQ Global Researcher its gross domestic product, and inter - After the collapse of the Soviet were not shared by the majority of est payments on government debt alone Union in 1991, the continent embraced the population. were equivalent to 7 percent of the economic reforms — particularly in Despite these setbacks, by the late country’s entire economic output. 50 17 countries now classified as “emerg - 1990s South Africa’s then-Deputy Pres - The combined effects of corrup - ing Africa” by Radelet, the chief ident Thabo Mbeki had heralded the tion, conflict, poor economic policies, USAID economist. Countries slashed dawn of an “African Renaissance” over-borrowing and unfair trade prac - regulations and tariffs and cut the costs built on popular government, eco - tices by wealthy nations — which of starting a business. 52 nomic growth and poverty allevia - subsidize their domestic farming and Democratic reforms slowly ad - tion. 54 By 2009 the idea had gained light-manufacturing industries — left vanced as well. After decades of strug - such currency that Senegal began work sub-Saharan economies in tatters by the gle, South Africa’s apartheid govern - on a “Monument to the African Re - early 1990s. ment permitted multiracial elections naissance,” a 170-foot sculpture (taller From 1965 to 1987, as Asia’s in 1994. And in a “second liberation,” than the Statue of Liberty) of a man, economies were growing annually long-serving autocrats such as woman and child meant to symbol - by 4 percent and Latin America’s by Benin’s Mathieu Kérékou, Zambia’s ize Africa’s rise. 55 2.1 percent, African per capita GDP Kenneth Kaunda and Malawi’s “Life grew by only 0.6 percent. The dif - President” Hastings Banda were voted ferences in growth rates had dramat - out of office. The number of African ic effects over time. For instance in leaders leaving office due to coups, CURRENT 1965, Zambia’s per-capita income was assassination or other violent means higher than that of South Korea. But declined sharply. by 1998 South Korea’s was more than By the late 1990s, reforms in Radelet’s SITUATION 17 times larger. 51 17 emerging countries — a group that A host of other statistics detailed excludes oil exporters — had begun the stagnation. Food production in the to pay off. Per capita income began to 1980s was 20 percent lower than in rise at more than 2 percent per year, Hope and Change 1970, even as population soared. Per an important threshold for sustained capita incomes fell by almost 2 per cent growth. Farm productivity in the ith 49 countries in sub-Saharan a year. Primary school enrollment de - emerging countries rose 50 percent be - WAfrica as diverse as South Africa clined from 79 percent to 67 percent. tween 1996 and 2006, and investment and Somalia, it is difficult to make gen - By the 1990s, widespread pes - and trade nearly tripled. 53 Meanwhile, eralizations about the vast region. Here simism abou t sub-Saharan Africa’s a series of debt-relief measures by West - are overviews of African economies prospects abounded. “The economic ern banks and governments in the 1990s by sub-region: failure is undercutting a drive for po - and early 2000s freed up cash for ed - litical liberalization, raising ethnic ri - ucation, health and infrastructure. East Africa valries to a dangerous level and forc - The political and economic gains Cars are banned on the cobble - ing countries to impose politically of the late 1990s and early 2000s weren’t stoned streets of Lamu, a medieval inflammatory austerity programs, often universal. The Democratic Republic of stone city on Kenya’s Indian Ocean under the dictates of Western financial Congo, Sudan, Sierra Leone and Liberia coast. The town, a UNESCO World institutions,” John Darnton, a foreign spent parts of that period embroiled Heritage Site where tourists mingle with correspondent, wrote in The New York in horrific civil wars. Life expectancy load-bearing donkeys and souvenir Times in June 1994, as Rwanda was in parts of southern Africa declined salesmen, may soon lose some of its convulsed by a genocide that left at during the period amid an AIDS epi - tranquil atmosphere. least 800,000 dead. demic. A number of countries, such Construction began this year on a as Somalia, the Central African Re - $23 billion port project and oil refinery public and Eritrea remained fragile — the jewel of a new transport corri - African “Renaissance” states with limited growth prospects. dor meant to link landlocked South Others, such as Angola, the Republic Sudan and Ethiopia to the sea via Kenya. uch gloomy assessments didn’t give of Congo and Equatorial Guinea en - “I am proud to say this is one of the Sa full picture of some of the joyed rapid increases in their GDP, biggest projects that we are carrying out changes underway in sub-Saharan fueled by oil exports and rising glob - in Africa,” Steven Ikuwa, a manager of Africa. al petroleum prices — but the gains the project, told the BBC . 56

www.globalresearcher.com Nov. 20, 2012 537 BOOMING AFRICA

khat, which is chewed. 58 In Septem - ber, the economy’s long-term prospects brightened after African Union peace - keepers and Kenyan soldiers captured Kismayo, the last city held by al- Shabaab, a radical Islamist militia. 59 South Sudan, which gained inde - pendence from Sudan in 2011, has only 100 miles of paved roads in an area larger than France. 60 Ethnic con - flict and sporadic cross-border clashes with Sudanese soldiers have left South Sudan as one of the world’s least- developed countries. Yet the new port in Kenya — and a pipeline that will connect South Sudan’s oilfields to it —

n is cause for hope. The project will ease a d r South Sudan’s dependence on export o J

e pipelines through Sudan, with which it v e t

S fought two destructive wars. / s e g a

m Central Africa I

y t

t Gabonese President Ali Bongo e G

/ doesn’t lack for places to sleep. The P F president, who took power in 2009 A A power plant rises near Libreville, Gabon, on Oct. 11, 2012, part of a $20 billion infrastructure after the death of his father Omar, plan financed in part by the country’s abundant oil revenues. But critics complain that much of owns dozens of houses around the the country’s oil wealth has been diverted to the family of President Ali Bongo, who owns world, including three in Beverly Hills, dozens of houses around the world. By one estimate, the Bongo family has stolen up to 25 percent of the country’s gross domestic product during its four-decade rule. one on the French Riviera, and a $120 million, 14-bedroom mansion in Paris. By one estimate, the Bongo With economic growth of more is roaring ahead, 18 years after geno - family has siphoned off as much than 7 percent from 2003 to 2008, East cide left 800,000 people dead. Eco - as 25 percent of the oil exporter’s Africa was one of the world’s fastest- nomic growth lifted more than 1 mil - gross domestic product during the growing regions prior to the global fi - lion people — nearly 10 percent of family’s four-decade rule. nancial crisis. Growth dipped in 2009, the population — out of poverty be - “There’s absolutely no shame,” said partly due to post-election violence in tween 2006 and 2011, while Kenya’s Jack Blum, a United Nations’ consul - 2007-08 in Kenya — the region’s busi - investments in an advanced fiber op - tant and expert on offshore banking. ness and transport hub — and the ef - tics network has attracted such com - “The people running the country are fects of the global slowdown. But panies as Visa, along with top-flight guilty of grand theft nation.” 61 since then growth has bounced back, educational institutions like Carnegie Indeed, oil has been a blessing for and the region is expected to grow Mellon University. the leaders of Central African nations by 5.1 percent this year and 5.6 per - Meanwhile, much of Somalia has such as Gabon, Equatorial Guinea and cent in 2013. 57 not had a stable central government Chad. But, for ordinary people, it has However, East Africa is marked by since 1991, and investment has been brought fewer benefits. Wealth began political instability and wide dispari - dete rred by an Islamist insurgency. flowing into Equatorial Guinea in the ties in development among countries. Ne ver theless, the economy has managed late 1990s as it expanded offshore oil The skyscrapers and landscaped of - to stave off collapse — nine mobile production. Today the country is the fice buildings of Kenya’s capital, Nairo - phone companies compete for busi - eleventh most corrupt in the world, bi, house the local offices of multina - ness, and demand in neighboring Kenya according to Transparency International. tional firms such as Google, Samsung is strong for Somali exports such as Just 0.7 percent of its GDP is spent and Pfizer. In Rwanda, the economy meat and the widely used narcotic leaf Continued on p. 540

538 CQ Global Researcher At Issue:

Is Ayes frica poised for an East Asia-style economic boom?

G. PASCAL ZACHARY OMOTUNDE E. G. JOHNSON PROFESSOR OF JOURNALISM , A RIZONA SIERRA LEONE COUNTRY DIRECTOR , STATE UNIVERSITY ; A UTHOR , HOTEL INTERNATIONAL GROWTH CENTRE AFRICA : T HE POLITICS OF ESCAPE LONDON

WRITTEN FOR CQ GLOBAL RESEARCHER , WRITTEN FOR CQ GLOBAL RESEARCHER , NOVEMBER 2012 NOVEMBER 2012

hen I visited Ghana in June, I met dozens of former f Africa is to embark on an East Asian-style economic U.K. residents — well-educated offspring of Ghanaian take-off, it needs drastic improvement in economic gover - w immigrants to Britain — who’d recently returned to i nance and management. This in turn requires much better their ancestral home in West Africa in pursuit of better opportuni - leadership and cooperation than exists at the present time. The ties. With Britain’s economy contracting and Ghana’s expanding, prospect of this happening in the near future is not good. thousands from the African diaspora are now working in Africa, African countries now face three overarching policy chal - in jobs and companies that need their professional skills. lenges: raising investment, boosting the efficiency of invest - What an historic reversal. Throughout much of sub-Saharan ment and increasing technological change and innovation. To Africa, economic conditions are better than at any time in do that, African citizens must be willing and able to design more than 50 years and have been excellent since the begin - and implement appropriate economic policies. ning of the 21st century. The obsession of the U.S. media and As everyone knows, investment — in equipment, research foreign-aid lobby with disaster, disease and mayhem in Africa and development and education and training — is good for has long distorted the continent’s image. But with commodity growth. Such investment, relative to domestic product, is cur - prices high, low levels of debt by global standards, expanding rently low in Africa, on average, compared to what Asian coun - domestic mayrkets and neare-record levels s of foreign investment, tries were able nto attain during thoeir years of rapid growth, as Africa’s economic strength is impossible to dismiss. well as today. From 2000 to 2010, six of the world’s 10 fastest-growing The efficiency of investment in Africa is low by world stan - countries were in sub-Saharan Africa: Angola, Nigeria, Ethiopia, dards — a symptom of underlying factors, such as government Chad, Mozambique and Rwanda. In eight of the past 10 years, inefficiency, low education and training, poor operation of mar - sub-Saharan Africa has grown faster than Asia. While many of kets, weak institutions (rules), corruption and political instability. the region’s growth stars rely in part on oil exports, Ethiopia The policy failings in Africa come mainly from weaknesses — which has no oil — saw its economy grow 7.5 percent in in governance arrangements (rules, processes and organization) 2011. In 2012, the International Monetary Fund expects Africa which in turn come from weaknesses in leadership and coop - to grow at 6 percent — about the same as Asia. eration. The role of institutions in the development process And Africa’s boom is benefiting a broad swath of African has come to be greatly appreciated over several decades now. society — reversing the continent’s brain drain, reducing rural Institutions are rules governing behavior in human interaction. poverty, enabling governments to broaden access to free edu - But institutions are themselves outcomes of cooperation. In cation and improving Africans’ technological sophistication. other words, they are elements of the order that cooperation Will the boom continue? With robust commodity prices, brings about. Hence, countries succeed in the development tangible productivity gains due to the mobile communications process when they are able to cooperate to bring about ap - revolution and the fledgling expansion of African agriculture, propriate political, legal and social institutions that favor eco - the answer is surely yes. Meanwhile, an astonishing 50 percent nomic development and growth. of Africa’s under-25 population is fueling household formation To embark on an East Asian-style economic take-off, African and growth in personal consumption unmatched in the world. countries need more cooperation. Trust and self-interest will The problems aren’t those touted by Afro-pessimists: That play major roles in bringing that about. Leadership is also Africa remains dependent on imported goods, corruption flour - crucial. The vast majority of African countries can benefit ishes and women are unempowered. While these concerns are from transforming leadership at all levels: political, civil society considerable, they co-exist with an Africa that’s generating and business. wealth at an unprecedented rate. The challenge for African In building institutions, legitimation processes matter. Indeed, leaders is no longer coping with the scourge of scarcity, but one of the operational requirements for institutions to be effective rather managing prosperity by reducing inequality and expand - is legitimacy. Institutions that are not legitimated by the populace ing opportunity, especially for women. The big political ques - at large will not be willingly obeyed and promoted by the tion is no how to ensure that all Africans benefit from the boom. people; there will be no sense of loyalty to the institutions.

www.globalresearcher.com Nov. 20, 2012 539 BOOMING AFRICA

Continued from p. 538 The shift is emblematic of Botswana’s are different from those exported to on education, compared to the aver - rise from being one of the world’s the European Union. age elsewhere in Africa of 3.9 percent, poorest nations at independence to a “While South Africa’s export profile and more than half the population middle-income nation today, with per to Europe is fairly balanced, the same lacks access to basic services such as capita income of $14,560. Experts at - cannot be said for China and other clean water and electricity. 62 tribute the rise to political harmony large emerging market partners,” said Still there is cause for hope. The and wise management of the coun - Simon Freemantle, an economist with Democratic Republic of Congo, cen - try’s diamond reserves. Johannesburg-based Standard Bank. 67 tral Africa’s most populous nation, is Botswana and other southern African In 2011, 90 percent of South Africa’s gradually recovering from two wars, nations comprise sub-Saharan Africa’s exports to China were made up of com - modities, he says. Strong demand for commodities has fueled growth elsewhere in southern Africa. New oil exporter Angola grew Oil exporter Angola grew by an average of more than by more than 14 percent per year on 14 percent per year in 2003-2008. Yachts in the harbor average between 2003 and 2008. Its economy slowed during the downturn, of the capital, Luanda, must steer through garbage and when oil prices fell but is expected to grow again by 8.2 percent this year and debris as they come and go. A one-bedroom apartment 7.1 percent next year. 68 The rest of the country’s economy has struggled to in the center of Luanda rents for $12,000 a month, keep up with the tide of petrodollars pouring in. Yachts in Luanda’s harbor leading one British tabloid to declare it must steer through garbage and debris as they come and go. A one-bedroom “the most expensive city in the world.” apartment in the center of the capital rents for $12,000 a month, leading one British tabloid to declare it “the most expensive city in the world.” 69 the last of which officially ended in wealthiest region. They also are the Meanwhile, Zimbabwe’s economy 2003. Though conflict simmers in the most economically integrated, through is slowly recovering from a spectacular eastern Kivu reg ion, the DRC’s econo - the 15-nation free-trade bloc known swoon, when it shrank by half between my will grow by more than 7 percent as the Southern African Development 1998 and 2008 after President Robert this year and 8.2 percent in 2013, ac - Community. Their economies are Mugabe began seizing land mainly cording to the IMF. 63 Foreign direct closely linked with that of South Africa, from white farmers and held onto investment increased more than four - the regional giant. power through violence-riddled elec - fold from 2010 to 2011, fueled by tele - However, integration can also have tions. The United States and Europe com companies seeking to expand mo - disadvantages. South Africa’s advanced responded with sanctions, further crip - bile communications in the heavily economy is heavily reliant on exports pling the economy. populated country. 64 to Europe. The European Union is After a national unity government South Africa’s largest trading partner was forged in 2009 between Mugabe’s Southern Africa and buys one-third of its manufactur - ruling party and the opposition, the econ - In August the De Beers diamond ing exports — making South Africa omy began slowly growing. Zimbabwe consortium announced it had begun vulnerable to the eurozone crisis, as dropped its devalued currency and re - sorting rough diamonds in Botswana’s Europe’s slowing economies buy placed it with the dollar. But growth capital, Gaborone, a process it had fewer South African goods. 66 has been stunted by a government di - previously done in London. The move Fortunately, strong demand from rective last year that all foreign-owned to Botswana, the world’s largest pro - Asia has helped counteract some of companies cede 51 percent ownership ducer of diamonds, will transform the the slowing demand in Europe. South to black Zimbabweans. 70 This year the southern African nation into a major African exports to China alone were economy is projected to grow 4.4 percent, gem-trading hub, with about $6 bil - worth $12.4 billion last year, although according to the African Development lion in gems handled annually. 65 the South African goods China buys Bank, rising to 5.5 percent next year.

540 CQ Global Researcher The 88-year-old Mugabe remains pres - president in March, and radical Islamists 2000 to $160 billion in 2011. This year ident, though he is in frail health, and have taken control of the northern part China is expected to become the con - the country is slated to hold elections of the country, where they have insti - tinent’s largest export destination. 76 next year. tuted Islamic law. 73 In October, the In addition, Chinese companies have United Nations’ Security Council de - invested heavily in African mines and West Africa clared its “readiness” to aid the gov - oil wells and have provided conces - Niger is among the world’s poor - ernment in a military effort to dislodge sional loans to African governments to est countries, ranking 186th of 187 na - the Islamists. “There is no alternative,” build roads, railways and electricity tions on the U.N.’s Human Develop - Jack Christofides, an official in the U.N.’s plants. “Their investment ideas are ment Index. One in eight children dies Department of Peacekeeping Opera - backed by finance,” says Ifediora Amobi, before age 5, and 60 percent of the tions, told The New York Times. “It’s director of the Nigeria-based African population lives in poverty, according going to take military force. 74 Institute for Applied Economics. “Even to the World Bank. In addition, a decade-long politi - when the Chinese say we’ll come Yet shoots of hope are sprouting. cal crisis that divided Côte d’Ivoire build it and put it together, it still is The country’s economy may expand between north and south ended in a a good model for most countries.” as much as 15 percent this year on brief civil war last year after disput - Chinese companies have provided higher production of uranium from the ed e lections. Once one of Africa’s African governments with an alterna - country’s mines and the beginning of wealthiest countries, Côte d’Ivoire has tive to foreign aid and multinational its first oil production. Foreign aid and seen foreign investors flee and devel - corporations. The competition has al - government efforts have helped in - opment of its all-important cocoa lowed African governments to strike crease life expectancy from 42 in 1992 sector stall. The economy shrank by better deals than they otherwise would to 54 in 2010, while the percentage 5.9 percen t in 2011, as forces loyal to have obtained, say some experts. of children in primary school has dou - President Alassane Ouattara battled “You’re finding the big Chinese state- bled to 71 percent over the last those of former President Laurent owned companies competing very ag - decade. 71 Gbagbo. Projected economic growth gressively on the continent,” said Maree, Niger’s growth is emblematic of a of 8.2 percent this year and 6.2 per - of South Africa’s Standard Bank, which transformation underway in West Africa. cent next year could be hindered by is 20 percent owned by a Chinese The region is expected to grow by further unrest when members of state bank. “Our view is that general - 6.9 percent this year and 6.4 percent Gbagbo’s government are put on trial ly China has been a huge force for next year, led by strong growth in re - for alleged atrocities committed dur - good and for growth and develop - gional powers Nigeria and Ghana and ing the civil war. In September the ment in Africa.” 77 a rebound in Côte d’Ivoire following government briefly closed its borders Others see the relationship as car - a decade of political instability and with Ghana after attacks by Gbagbo rying risks as well as reward. Even on civil war. ( See sidebar, p. 534. ) Oil dis - loyalists based in Ghana left at least concessional terms, African govern - coveries in the Gulf of Guinea, which 10 dead. 75 ments could risk being overburdened stretches from Ghana to Sierra Leone, by debt. In addition, China’s authori - also have boosted growth expectations. tarian government’s willingness to do Nigeria had been the region’s only business with unsavory regimes such major oil exporter until 2007, when OUTLOOK as Zimbabwe and Sudan can under - U.K.-based Tullow Oil made a large mine needed governance reforms, says discovery in Ghana. Massa, the France-based economist for “What you’ve had since then was the Overseas Development Institute. an increasing number of finds show - Chinese Challenges The Chinese economic juggernaut ing that there are oil systems in the is a challenge for Africa as its economies region,” British oil analyst John Marks seek lift-off in a more competitive told a reporter, after the announce - s sub-Saharan African countries global economy than other emerging ment of discoveries off Sierra Leone Astrive for an East Asian-style trans - countries faced in previous decades. and Liberia. “Announcements like this formation in the coming decades, much “The East Asian countries didn’t have will only raise the excitement.” 72 will depend on their relationship with to face competition from China,” says Political instability continues to pose the world’s most important emerging the World Bank’s Devarajan. “China risks for growth, however. In Mali, sol - economy: China. Africa’s trade with didn’t have a China to compete with diers ousted the democratically elected China has risen from $10 billion in in global markets.”

www.globalresearcher.com Nov. 20, 2012 541 BOOMING AFRICA

Others worry that China will con - “I would find it hard to envision” CAR101212B.htm . See also “World Econom - tinue to dominate manufacturing — dis - an East Asia-style takeoff for Africa, ic Outlook: Coping With High Debt and Slug - couraging the development of African says Ramachandran, of the Center for gish Growth,” International Monetary Fund, manufacturing — and that Africans aren’t Global Development. “The Asian cost October 2012, www.imf.org/external/pubs/ft/ benefiting enough from the commodi - advantage will still be significant. Ten weo/2012/02/index.htm . For background, see Christopher Hack, “Euro Crisis,” CQ Researcher , ties-for-infrastructure deals with Chinese years from now I can see better man - Oct. 5, 2012, pp. 841-864; and Sarah Glazer, firms. “The stream of cheap Chinese agement of resources that could trans - “Future of the Euro,” CQ Global Researcher , exports to Africa may reduce incentives late into more service [jobs] and back- May 17, 2011, pp. 237-262. for African firms to build productive ca - office operations.” 3 “Building Bridges: Ernst & Young’s Attrac - pacity or make their products less com - The fact that hundreds of millions tiveness Survey 2012: Africa,” Ernst & Young, petitive in foreign markets,” says Massa. of workers in sub-Saharan Africa will www.ey.com/ZA/en/Issues/Business-environ “Finally, there is a risk that African coun - still be doing subsistence agriculture ment/2012-Africa-attractiveness-survey . tries endowed with natural resources or other vulnerable types of work in 4 “Africa’s Future and the World Bank’s Role in are seeing their resources drain slowly the decades to come does not neces - It,” World Bank, Nov. 15, 2010, http://web.world away without profiting enough from sarily mean their economies will not bank.org/WBSITE/EXTERNAL/COUNTRIES/ Chinese deals.” attain annual rates of 8 percent growth AFRICAEXT/0,,contentMDK:22765606~pagePK: 146736~piPK:226340~theSitePK:258644,00.html . The lack of strong growth in high- or more, says Devarajan. 5 “Africa at Work: Job Creation and Inclusive employment industries such as manu - “We have to accept the fact that Growth,” McKinsey Global Institute, 2012, www. facturing will lead to deepening politi - even under the best of circumstances, mckinsey.com/insights/mgi/research/africa_ cal tensions and instability in countries a large number are going to go into europe_middle_east/africa_at_work . with growing numbers of underem - the informal sector,” he says. “So we 6 “2011 Corruption Perceptions Index,” Trans - ployed and “vulnerable” employed peo - have to acknowledge that rather than parency International, 2011, http://cpi.transpar ple, says Johnson, the Sierra Leonean fight it. Informal is normal, at least for ency.org/cpi2011/results /. economist. Such instability will make it the next 20 years. Then we should 7 “GNI Per Capita Ranking, Atlas Method and difficult for many countries to enjoy the ask the question about how we can PPP based,” World Bank, 2012, http://data.world sustained period of growth needed to improve their productivity.” bank.org/data-catalog/GNI-per-capita-Atlas-and- improve living standards. Devarajan predicts that by 2025 all PPP-table . Also see Vijay Mahajan, Africa Ris - ing: How 900 Million African Consumers Offer “What will change is the nature of of sub-Saharan Africa, except fragile More Than You Think (2009), p. 29. the conflict,” he adds. “Right now a states such as the DRC, Somalia and 8 “Doing Business 2012: Economy Rankings,” lot of conflict is for control of the state. South Sudan, will be middle-income World Bank, Oct. 20, 2012, www.doingbusiness. The fight [in the future] will be over countries with per capita income above org/rankings . jobs and income.” $5,000. Development will no longer 9 Steven Radelet, Emerging Africa: How 17 Coun - Africa’s wealthiest economies may be measured by the percentage of tries Are Leading the Way (2010), pp. 71-72. be able to avoid such an outcome, children completing primary school but 10 “The Economic Rise of Mozambique,” Al says Lund, of McKinsey. “For the most secondary education and college. Some Jazeera English, Aug. 18, 2012, www.aljazeera. diversified economies you are seeing sub-Saharan countries, in his view, com/programmes/countingthecost/2012/08/ this tipping point,” she says. “But then may even become “manufacturing 201281714514039254 .html . 11 for the rest of the African countries, powerhouses.” Radelet, op. cit. , p. 96. 12 “Africa at Work: Job Creation and Inclu - they’re in the opposite situation, where “In 2025 it will look like what East sive Growth,” op. cit. , p. 2. the number of vulnerable [people] em - Asia looks like today,” he says. 13 “Natural Resources Can Spur Growth But ployed will continue to grow.” Need Good Management,” International Mon - Others see the challenges to in - etary Fund, March 30, 2012, www.imf.org/ dustrialization for African nations — Notes external/pubs/ft/survey/so/2012/POL033012A.htm . small size, lack of regional integration 14 Data on oil exports from U.S. Energy In - and poor infrastructure — as major 1 “Landmines in Mozambique,” Human Rights formation Administration database, www.eia. stumbling blocks. Natural resource Watch, February 1994, www.hrw.org/sites/ gov/countries /. See also “Democratic Repub - wealth may also prove a hindrance if default/files/reports/MOZAMB943.pdf . lic of Congo,” RevenueWatch , www.revenue 2 revenue management does not im - “Africa’s Impressive Growth,” The Economist , watch.org/countries/africa/democratic-republic - prove. As Chinese labor costs rise, rival Jan. 6, 2011, www.economist.com/blogs/daily congo/overview . chart/2011/01/daily_chart . Also see “Sub-Saharan 15 “What Has Contributed to Growth?” Soci - developing nations, such as India, could Africa Maintains Growth in an Uncertain World,” ete Generale Groupe, May 10, 2011, www. emerge as the next low-cost center of International Monetary Fund, Oct. 12, 2012, societegenerale.com/en/node/11823 . manufacturing. www.imf.org/external/pubs/ft/survey/so/2012/ 16 For background, see Jennifer Weeks, “The

542 CQ Global Researcher Resource Curse,” CQ Global Researcher , Dec. 32 “Africa at Work,” op. cit. , p. 2. 47 For background see: J. McChesney, “Pri - 20, 2011, pp. 597-622. 33 Supee Teravaninthorn and Gaël Raballand, vatization: Third World Moves Slowly,” Edi - 17 Joseph Stiglitz, “Africa’s Natural Resources “Transport Prices and Costs in Africa: A Re - torial Research Reports , 1988, available at CQ Can Be a Blessing, Not an Economic Curse,” view of the International Corridors,” World Bank, Researcher Plus Archive. The Guardian , Aug. 6, 2012, www.guardian.co. 2009, www.infrastructureafrica.org/system/ 48 Oliver and Crowder, op. cit. , p. 260. uk/business/economics-blog/2012/aug/06/africa- files/WP14_Transportprices.pdf . 49 “Debt Sustainability: Oasis or Mirage,” United natural-resources-economic-curse . 34 Basil Davidson, The African Past (1964), Nations Conference on Trade and Develop - 18 “Economic Development in Africa: 2011,” pp. 176-177. ment, 2004, pp. 5-16, http://archive.unctad. United Nations Conference on Trade and De - 35 Philip Curtin, The Atlantic Slave Trade: A org/Templates/WebFlyer.asp?intItemID=3246 velopment, July 11, 2011, http://unctad.org/en/ Census (1969). &lang=1 . docs/aldcafrica2011_en.pdf . 36 Roland Oliver and Michael Crowder (eds.), 50 “The Burden of Debt,” PBS Online News- 19 For background, see Karen Foerstel, “China The Cambridge Encyclopedia of Africa (1981), hour, July 2003, www.pbs.org/newshour/bb/ in Africa,” CQ Global Researcher , Jan. 1, 2008, pp. 146-148. africa/nigeria/debt.html . pp. 1-26. 37 Foerstel, op. cit. 51 Malcolm McPherson, “Restarting and Sus - 20 “Africa at Work: Job Creation and Inclusive 38 Thomas Pakenham, The Scramble for Africa: taining Growth and Development in Africa: Growth,” op. cit. , p. 34. White Man’s Conquest of the Dark Continent A Framework for Improving Productivity,” 21 “South Africa: Challenges in Manufacturing,” from 1876 to 1912 (1991), pp. 239-255. U.S. Agency for International Development, African Business News , Nov. 9, 2011, www.you 39 Jason McLure, “Sub-Saharan Democracy,” CQ http//:pdf.usaid.gov/pdf_docs/pnack931.pdf . tube.com/watch?v=hGxlz89ADd8 . Global Researcher , Feb. 15, 2011, pp. 92-94. 52 Radelet, op. cit. , pp. 71-79. 22 Radelet, op. cit. , p. 44. 40 Parts of South Africa were under inde - 53 Ibid. , pp. 27-38. 23 Caswell Tlali, “U.S. Saves 40,000 Jobs in pendent white rule at the time. Liberia, es - 54 Thabo Mbeki, “The African Renaissance: Lesotho,” Sunday Express (Lesotho), Aug. 5, tablished as a homeland for freed U.S. slaves South Africa and the World,” Speech at the 2012, http://sundayexpress.co.ls/?p=7152 . in the 1840s, was functionally a U.S. pro - United Nations University in Japan, April 9, 1998, 24 “Africa at Work,” op. cit. tectorate despite being granted indepen - http://archive.unu.edu/unupress/mbeki.html . 25 Isis Almeida, “Ghana, Ivory Coast’s Cocoa dence. 55 “Dakar’s African Renaissance Monument Areas Seen Getting Improved Rainfall,” 41 Martin Meredith, The Fate of Africa (2005), Project Has Detractors,” Voice of America, Bloomberg News, Sept. 13, 2012, www.bloom p. 2. Nov. 1, 2009, www.voanews.com/content/a- berg.com/news/2012-09-13/ghana-ivory-coast-s- 42 Ibid. , p. 8. 13-2008-08-22-voa64/405373.html . cocoa-areas-seen-getting-improved-rainfall.html . 43 “The Atlantic Charter,” Aug. 14, 1941, U.S. 56 “Lamu Port Project Launched for South Sudan 26 Marianne Stigset, “Yirgacheffe Has Starbucks’ National Archives, www.archives.gov/education/ and Ethiopia,” BBC News, March 2, 2012, Number in Coffee Brand Row (Update 1),” lessons/fdr-churchill/images/atlantic-charter.gif . www.bbc.co.uk/news/world-africa-17231889 . Bloomberg, April 17, 2008, www.bloomberg. 44 William Easterly and Ross Levine, “Africa’s 57 “African Economic Outlook 2012: Eastern com/apps/news?pid=newsarchive&sid=aLB6dr Growth Tragedy: Policies and Ethnic Divisions,” African Countries,” African Development Bank, YEOTF8&refer=home . World Bank Policy Research Working Paper , 2012, www.africaneconomicoutlook.org/en/ 27 Jessica Donati, “Nigerian Fuel Shortages Loom August 1995, http://papers.ssrn.com/sol3/pap countries /. as Suppliers Drop Out,” Reuters, June 1, 2012, ers.cfm?abstract_id=569226 . 58 Damina Zane, “Somalia: 20 Years of Anar - www.reuters.com/article/2012/06/01/nigeria- 45 Meredith, op. cit. , p. 64. chy,” BBC News, Jan. 26, 2011, www.bbc.co.uk/ fuel-subsidies-idUSL5E8GV9WI20120601 . 46 John R. Nellis, “Public Enterprises in Sub- news/world-africa-12278628 . 28 For background, see Jina Moore, “Resolv - Saharan Africa,” World Bank Discussion Paper , 59 Lucas Barasa, “Kibaki Commends Kenyan ing Land Disputes,” CQ Global Researcher , 1986. Forces Over Kismayo Victory,” Daily Nation Sept. 6, 2011, pp. 421-446. 29 Neil MacFarquhar, “African Farmers Displaced as Investors Move In,” The New York Times , About the Author Dec. 21, 2010, www.nytimes.com/2010/12/22/ world/africa/22mali.html?pagewanted=all . Jason McLure is a New Hampshire-based correspondent for 30 “Unemployment a ‘Ticking Time Bomb,” Thomson Reuters. Previously he was an Africa correspondent for The Times (South Africa), May 27, 2012, www. Bloomberg News and Newsweek and worked for Legal Times in timeslive.co.za/local/2012/05/27/unemployment- Washington, D.C. His writing has appeared in publications such a-ticking-time-bomb-ycl . For background, see as The Economist , The New York Times and Businessweek. His last Roland Flamini, “Turmoil in the Arab World,” CQ Global Researcher , May 3, 2011, pp. 209-236. CQ Global Researcher was “Russia in Turmoil.” His work has been 31 Linah Moholo, “Africa’s Millions of Young honored by the Washington, D.C., chapter of the Society for Pro - People Must Add Up To Demographic Divi - fessional Journalists, the Maryland-Delaware-District of Columbia dend,” The Guardian , July 17, 2012, www. Press Association and the Overseas Press Club of America Foun - guardian.co.uk/global-development/poverty- dation. He is also coordinator of the Committee to Free Eskinder matters/2012/jul/17/africa-young-demographic - Nega, a jailed Ethiopian journalist. dividend .

www.globalresearcher.com Nov. 20, 2012 543 BOOMING AFRICA

(Kenya) Sept. 28, 2012, www.nation.co.ke/ News/Kibaki+commends+KDF+over+Kismayu+ victory/-/1056/1520274/-/10jb9e2z/-/index.html . FOR MORE INFORMATION 60 “One-Year Old South Sudan: Potential to Be African Economic Research Consortium , P.O. Box 62882 00200, Nairobi, Kenya ; Harnessed,” NPR, July 9, 2012, www.npr.org/ +254 20 2734150 ; www.aercafrica.org . Researches management of sub-Saharan 2012/07/09/156491044/1-year-old-south-sudan- economies. potential-to-be-harnessed . 61 Brian Ross and Anna Schecter, “Obama In - African Institute for Applied Economics , 54 Nza St., Independence Layout, vites Ali Bongo to White House,” ABC News, Enugu, Nigeria ; +234 706 209 3690 ; www.aiaenigeria.org . Think tank that provides June 8, 2011, http://abcnews.go.com/Blotter/ research and policy advice with a West African focus. obama-invites-ali-bongo-white-house/story?id= 13791159#.UGYPwhiy83Q . African Union , P.O. Box 3243, Addis Ababa, Ethiopia ; +251 11 551 77 00 ; 62 Joseph Kraus and Jonathan Hershon St. Jean, www.africa-union.org . Mediates election disputes and seeks economic and political “Equatorial Guinea No Place to Hold a Human cooperation among 53 member nations. Rights Summit,” The Guardian , Aug. 24, 2012, www.guardian.co.uk/global-development/pov Center for Global Development , 1800 Massachusetts Ave., N.W., Third Floor, erty-matters/2012/aug/24/equatorial-guinea- Washington, DC 20036 ; www.cgdev.org . Independent think tank studying aid effec - tiveness, education, globalization, health, migration and trade in developing nations. human-rights-summit . 63 “DR Congo Economic Growth Seen at 8.2 McKinsey Global Institute , 1200 19th St., N.W., Suite 1000, Washington, DC 20036 ; Percent in 2013 — IMF,” Reuters, Sept. 28, 2013, 202-662-3100 ; www.mckinsey.com/insights/mgi . International economics research http://af.reuters.com/article/commodities News/ arm of the McKinsey consulting firm. idAFL5E8KS75820120928 . For background, see Josh Kron, “Conflict in Congo,” CQ Global Overseas Development Institute , 203 Blackfriars Road, London SE1 8NJ, United Researcher , April 5, 2011, pp.157-182. Kingdom ; +44 20 7922 0300 ; www.odi.org.uk . A leading think tank that seeks to shape 64 “African Economic Outlook 2012: Central policy on economic development and poverty alleviation in the developing world. African Countries,” African Development Bank, 2012, www.africaneconomicoutlook.org/en/ South African Institute of International Affairs , P.O. Box 31596, Braamfontein countries /. 2017, South Africa ; +27 11 339 2154 , www.saiia.org . Think tank that studies African 65 “Botswana: De Beers Moves Diamond Sort - governance, parliamentary performance and natural resources governance. ing to Gaborone,” BBC News, Aug. 14, 2012, www.bbc.co.uk/news/business-19268851 . co.uk/news/article-2183616/Luanda-The-capital- 74 Adam Nossiter, “The Whiff of Conflict Grows 66 “South Africa Urges G20 Summit to Tackle Angola-expensive-city-world.html . in Mali,” The New York Times , Oct. 23, 2012, Eurozone Crisis,” Xinhua, June 17, 2012, http:// 70 “Zimplats Happens,” The Economist , March 17, www.nytimes.com/2012/10/24/world/africa/an- news.xinhuanet.com/english/world/2012-06/18/ 2012, www.economist.com/node/21550289 . aura-of-conflict-grows-in-a-divided-mali.html? c_123295579.htm . 71 Philip Baillie, “Niger Economy to Grow 15 pagewanted=all . 67 “South Africa Must Protect Competitive Ad - Percent in 2012 — President,” Reuters, June 12, 75 Ange Anboa, “Ivory Coast Closes Frontier vantages as BRICs Build Ties With Africa,” 2012, www.reuters.com/article/2012/06/12/ With Ghana After Border Attack,” Reuters, Standard Bank, March 29, 2012, www.standard britain-niger-growth-idUSL5E8HCGC120120612 . Sept. 21, 2012, http://uk.reuters.com/article/ bank.com/Article.aspx?id=-177&src=m2012_ 72 Alphonso Toweh and Simon Akam, “UP - 2012/09/21/uk-ivorycoast-attacks-idUKBRE88 34385466 . DATE 2 — New Discoveries Raise West African K1AS20120921 . 68 “African Economic Outlook 2012: South - Oil Hopes,” Reuters, Feb. 21, 2012, http://af. 76 “Africa and China’s Growing Partnership,” ern African Countries,” African Development reuters.com/article/liberiaNews/idAFL5E8DL1D Africa Progress Panel, April 2012, www.africa Bank, 2012, www.africaneconomicoutlook.org/ E20120221?sp=true . progresspanel.org/index.php/download_file/ en/countries /. 73 “Northern Mali Islamists Reopen Schools view/1754 . 69 Barbara Jones, “Luanda: The Capital of An - With Girls in Back,” The Associated Press, 77 Al Jazeera English, op. cit. gola, the Most Expensive City in the World,” Sept. 28, 2012, www.usatoday.com/story/news/ The Daily Mail , Aug. 4, 2012, www.dailymail. world/2012/09/28/mali-islam-women/1600117 /.

544 CQ Global Researcher Bibliography Selected Sources

Books French , Howard , “The Next Asia Is Africa: Inside the Conti - nent’s Rapid Economic Growth,” The Atlantic , May 21, 2012 . Ayittey , George , Africa Unchained: The Blueprint for A former New York Times ’ Africa correspondent travels to Africa’s Future , Palgrave MacMillan , 2006 . Zambia to see how African societies are changing as they A prominent Ghanaian economist is unsparing in his criti - grow wealthier. cism of modern African governance, 50 years after the end of colonialism. Freeing African economies from their gov - Grant , Jaime , “On the Road With West Africa’s Fuel ernments’ shackles would raise living standards for the con - Smugglers,” ThinkAfricaPress , March 20, 2012 . tinent’s poorest, he argues. The trade in smuggled fuel from Nigeria has led to the creation of what the author calls “micro-petro-states” in Benin Easterly , William , The White Man’s Burden: Why the and Togo, where local officials and enterprising teenagers West’s Efforts to Aid the Rest Have Done So Much Ill alike profit from sneaking subsidized Nigerian gasoline into and So Little Good , Oxford University Press , 2007 . other West African countries. In this seminal critique, a development economist examines why the tens of billions in aid spent in the past 50 years have Smith , David , “Wikileaks Cables: Shell’s Grip on Nigerian done so little to alleviate poverty in the world’s poorest na - State Revealed,” The Guardian , Dec. 8, 2010 . tions. Easterly was fired by the World Bank for his earlier Royal Dutch Shell’s top executive in Nigeria, where the critiques of the ineffectiveness of Western aid. company produces about 800,000 barrels of oil per day, told U.S. officials the company had placed company loyalists in Mahajan , Vijay , Africa Rising: How 900 Million African relevant ministries within the Nigerian government so the Consumers Offer More Than You Think , Pearson Edu - company could keep tabs on its deliberations. cation Inc. , 2011 . A marketing professor offers a detailed argument for greater Straziuso , Jason , “Unexpected: Africa’s Hotel Boom,” The private-sector investment in Africa. Mahajan says the conti - Associated Press , Oct. 1, 2012 . nent is richer than most people outside Africa realize, and Marriott, Hilton and Radisson are scrambling to build hotels its rapidly growing population is the next big market for on a continent they have long ignored. The hotel boom is multinational companies. a symbol of the growth of African trade and wealth.

Miguel , Edward , Africa’s Turn? Massachusetts Institute Reports and Studies of Technology , 2009 . A University of California economist argues that the end to “Africa At Work: Job Creation and Inclusive Growth,” major civil wars and trade with China has bolstered African McKinsey Global Institute , August 2012 . growth, though the continent still faces threats from climate Africa’s recent growth record is good, but the continent change and fragile states. Nine guest experts also critique will have to produce many more salaried jobs to reduce the his narrative of African growth. share of its fast-growing population that remains in subsistence agriculture and other vulnerable forms of employment. Radelet , Steven , Emerging Africa: How 17 Countries Are Leading the Way , Center for Global Development , 2009 . “African Economic Outlook: 2012,” African Development Now the top economist for the U.S. Agency for Internation - Bank, Organisation for Economic Cooperation and De - al Development, Radelet says that since 1995 a group of 17 velopment, U.N. Development Program and U.N. Eco - African countries has plowed ahead economically without the nomic Commission for Africa (joint publication), 2012 . benefit of oil. From South Africa to Tanzania to Ghana, these The annual publication synthesizes economic statistics and countries are raising living standards due to better governance, forecasts from a range of international agencies to describe improved technology and international debt relief. the current and future economies of Africa.

Articles “Building Bridges Africa: 2012 Attractiveness Survey,” Ernst & Young , 2012 . Fox , Killian , “Africa’s Mobile Economic Revolution,” The Many international businesses have outdated perceptions Guardian , July 23, 2011 . of Africa’s economies, leaving many opportunities for in - From mobile banking to dissemination of agricultural prices, vestment on the continent as yet unexplored. To accelerate the rapid spread of mobile technology in Africa is revolu - growth, however, African governments must invest more in tionizing the continent’s economies. roads, ports, electricity generation and other infrastructure.

www.globalresearcher.com Nov. 20, 2012 545 The Next Step: Additional Articles from Current Periodicals

Economic Boom Makhanya , Mondli , “Digging Ourselves a Deep Pit With the Mining Crisis,” Sunday Times (South Africa), Oct. 21, 2012 . “Africa Must Break Barriers,” Times of Zambia , Nov. 9, South Africa’s mining strike has caused damage to the country’s 2012 , www.times.co.zm/?p=18766 . image and its standing as an attractive investment destination. Zambia’s finance minister says Africa will have trouble at - taining meaningful development as long as significant eco - Petersen , Francis W. , “Mining Needs to Remain Com - nomic barriers stand in the way. petitive,” Sunday Times (South Africa), Oct. 28, 2012 . South Africa’s mining sector needs inspiring leadership more “World Bank — Africa Growth Not Enough to Reduce than ever because market conditions have not been favorable Poverty,” This Day (Nigeria), June 1, 2012 , allafrica.com/ to the industry, says a columnist. stories/201206011131.html . Africa’s favorable economic growth rates are still not enough Polgreen , Lydia , “Platinum Company Fires 12,000 Striking to pull the growing population out of poverty, says a World Miners in South Africa,” The New York Times , Oct. 6, 2012 , Bank director of economic policy and poverty reduction. p. A7 , www.nytimes.com/2012/10/06/world/africa/ 12000-striking-miners-are-fired-in-south-africa.html . Dugan , Emily , “Economic Growth Stirs Hope in African The world’s top platinum producer has fired 12,000 South Economy,” The Independent (England), June 10, 2012 , African miners who refused to return to work before a stated www.independent.co.uk/news/world/africa/economic- deadline. growth-stirs-hope-in-africa-7834230.html . Africa is projected to have the fastest-growing economy Rowley , Emma , “Toyota Closes Its South Africa Works Over over the next five years compared to any other continent. Unrest,” Daily Telegraph (England), Oct. 5, 2012 , p. 4 , www.telegraph.co.uk/finance/newsbysector/industry/958 Freeland , Chrystia , “As the Rest of the World Slows, 8274/Toyota-closes-its-South-Africa-works-over-unrest.html . Africa Accelerates,” The New York Times , Oct. 18, 2012 , Turmoil in South Africa’s mining sector has spread to other www.nytimes.com/2012/10/19/world/africa/19iht-letter parts of the economy, causing Toyota to close its local fac - 19.html . tory due to an illegal pay strike. Experts say Africa may follow in the path of economic de - velopment recently set forth by countries such as Brazil, Rowley , Emma , and Jessica Winch , “Troubles in South India and China. Africa’s Mining Sector Start to Affect the Economy,” Daily Telegraph (England), Oct. 15, 2012 , p. 6 , www. telegraph. Miriri , Duncan , “The Underside of the African Boom,” co.uk/finance/commodities/9607801/Troubles-in-South- Reuters , Jan. 31, 2012 . Africas-mining-sector-start-to-affect-the-econo my.html . Africa’s consumption boom has been fueled by excessive Worries over South Africa’s mining strike have brought the credit and plagued by inflation and trade deficits. country’s rand to a three-year low against the dollar.

Muir , Andrew , “Balance Growth, Sustainability,” The Her - Natural Resources ald (South Africa), May 30, 2012 . Africa should pursue economic growth by reducing harm “Are Africa’s Rich Natural Resources Utilized for Economic to the environment as much as possible, says a columnist. Transformation?” Ethiopian Press Agency , Oct. 24, 2012 , allafrica.com/stories/201211070175.html . Miners’ Strike African countries have done a better job in recent years of exploiting their natural resources and boosting their Dixon , Robyn , “S. Africa ‘Strike Season’ Takes Toll,” Los economies. Angeles Times , Sept. 27, 2012 , p. A6 , articles.latimes. com/2012/sep/27/world/la-fg-south-africa-strikes-20120927 . “Investors Continue to Ambush Africa’s Natural Re - The prospect of more violence among South African min - sources,” Ghanaian Chronicle , Nov. 1, 2012 , ghanaian- ers has left many investors wary of doing further business chronicle.com/investors-continue-to-ambush-africas- in the country. natural-resources /. Opportunities in Africa’s oil and natural gas industries con - George , Zine , “Zuma Urges Business, Labour to End tinue to attract a broad spectrum of investors, says an Ernst Strikes,” Daily Dispatch (South Africa), Oct. 12, 2012 . and Young report. South African President Jacob Zuma has urged business and labor leaders to end the mining and trucking strikes “Sub-Saharan Africa Urged to Strengthen Natural Resources before the country reaches a crisis point. Management,” The Independent (Uganda), April 3, 2012 ,

546 CQ Global Researcher www.independent.co.ug/rwanda-ed/rwanda/5519-sub- Anaro , Blessing , “Fuel Subsidy Transactions May Hurt saharan-africa-urged-to-strengthen-natural-resources- Credit Ratings, Reserves, Economy,” Leadership (Nigeria), management . June 25, 2012 , www.leadership.ng/nga/articles/28119/ The International Monetary Fund has urged Sub-Saharan African 2012/06/25/fuel_subsidy_transactions_may_hurt_credit_ nations to strengthen the management of natural resources to ratings_reserves_economy.html . promote inclusive economic growth in the poorest regions. A lack of transparency in fuel subsidy transactions will under - mine the little success made in developing Nigeria’s economy, Gerety, Rowan Moore, “New Coal Giant Mozambique Faces says a columnist. Rising Public Anger,” The Christian Science Monitor , April 27, 2012 , www.csmonitor.com/World/Africa/2012/0427/ Look , Anne , “Nigerian Legislators Call for Prosecution New-coal-giant-Mozambique-faces-rising-public-anger . in Fuel Subsidy Corruption,” Voice of America , April 26, Coal has made Mozambique one of the world’s fastest- 2012 , www.voanews.com/content/nigerian-legislators-call- growing economies, but its government is not managing natural- for-prosecution-in-fuel-subsidy-corruption-149042685/37 resource projects effectively. 0042.html . Nigerian legislators say high-level officials should be prose - Keeton , Gavin , “Mining Remains Important to Africa’s cuted for alleged theft and mismanagement of the country’s Growth,” Business Day (South Africa), Aug. 20, 2012 , fuel subsidy. www.bdlive.co.za/opinion/2012/08/20/mining-remains- important-to-africas-growth . Nwakanma , Obi , “FG Is Playing Chicken With Oil Subsi - Natural resources remain important to Africa’s economy be - dies,” Vanguard (Nigeria), Dec. 18, 2011 , www.vanguard cause of rising global commodity prices, says an economics ngr.com/2011/12/fg-is-playing-chicken-with-oil-subsidies /. professor. Nigeria’s government keeps talking about ending oil sub - sidies but never follows through, says a columnist. Maendaenda , Cathreen , “Renewed Mining Contracts Good for Africa,” East African Business Week (Uganda), Aug. 25, Ogbu , Ahamefula , “Jang — Only Haters of Economic Re cov - 2012 . ery Oppose Subsidy Removal,” This Day (Nigeria), Jan. 5, Industrial expansion in China, Brazil and India largely de - 2012 , www.thisdaylive.com/articles/jang-only- haters-of- pends on Africa’s vast natural resources and mining operations. nigeria-economic-recovery-oppose-subsidy- removal/106511 /. Fuel subsidies are key to helping Nigeria’s economy re - Moyo , Dambisa , “Beijing, a Boon for Africa,” The New cover, says one of the country’s governors. York Times , June 28, 2012 , p. A27 , www.nytimes.com/ 2012/06/28/opinion/beijing-a-boon-for-africa.html?_r=0 . Ohene , Seth , “Goodluck Jonathan and Petrol Subsidy China is ramping up investments in Africa to exploit the Reforms,” Ghanaian Chronicle , Feb. 3, 2012 , ghanaian- continent’s oil and natural resources, says a columnist. chronicle.com/goodluck-jonathan-petrol-subsidy-reforms /. Subsidies in Nigeria are meant to help those in poverty, Vollgraaff , Rene , “Africa Too Reliant on Resources,” Sun - but they often end up in the pockets of those in the pe - day Times (South Africa), Nov. 4, 2012 , www.bdlive.co.za/ troleum industry. businesstimes/2012/11/04/africa-too-reliant-on-resources . Africa should rely less on natural resources and start in - CITING CQ G LOBAL RESEARCHER vesting more in manufacturing, says a managing director of Sample formats for citing these reports in a bibliography the asset management firm Carlyle Group. include the ones listed below. Preferred styles and formats Oil Subsidies vary, so please check with your instructor or professor.

“Nigerian Unions Call for Nationwide Strikes Over Fuel MLA STYLE Subsidies,” DPA Press Agency (Germany) , Jan. 4, 2012 . Flamini, Roland. “Nuclear Proliferation.” CQ Global Re - Nigerian trade unions have called for nationwide strikes in searcher 1 Apr. 2007: 1-24. the wake of a fuel subsidy removal that caused gas prices to double. APA S TYLE Flamini, R. (2007, April 1). Nuclear proliferation. CQ Global Ahmed , Idris , and Kate Da Costa , “IMF Pushing the Coun - try to End Subsidy,” Daily Trust (Nigeria), Dec. 30, 2011 , Researcher , 1, 1-24. allafrica.com/stories/201112300791.html . CHICAGO STYLE The International Monetary Fund is asking Nigeria and other African countries to remove fuel subsidies, responding to Flamini, Roland. “Nuclear Proliferation.” CQ Global Researcher , claims that government officials are trying to deregulate the April 1, 2007, 1-24. petroleum sector.

www.globalresearcher.com Nov. 20, 2012 547 Voices From Abroad:

BEN SEAGER -S COTT Sunday Times (South Africa) assets. . . . New niches for The youth opportunity October 2012 new products in new mar - “With over 40 percent of Analyst, BestinvestEngland kets have to be found, and the population below 15 years, CLIFFORD SACKS these should be aligned Africa is by far the continent Economic potential with our indigenous skills with the largest global youth - “The continent sits on huge CEO, Renaissance Capital, and strengths. We have to ful population. Sixty percent natural resources and has a South Africa invent new Africa-sourced of Africa’s population is young and growing popula - products, and fast.” below 24 years. If managed tion, which can drive de - The next success story well, this demographic rep - Sunday Times (South Africa) mand as economic develop - “The emerging markets, resents Africa’s best devel - March 2012 ment progresses. Major and Africa in particular, are opment asset over the com - problems remain over gov - attracting unprecedented at - ing decades.” ernmental integrity and polit - tention as capital shifts from PETER ESELE ical interventions, as well as developed to growth mar - President General, Trade Financial Gazette (Zimbabwe) the lack of infrastructure, kets. With the highest con - February 2012 both of which are vital for centration of fast-growing Union Congress, Nigeria supporting economic growth.” economies, Africa will be the ROB DAVIES Jobs for a growing popu - investment success story of Daily Telegraph (England) lation Trade and Industry the next decade.” April 2012 “[African] governments at Minister Accra Mail (Ghana), May 2012 all levels should embark on South Africa MTHULI NCUBE core principles that can create Vice President, African RICHARD JENKINS the much-needed business The next frontier environment for our indige - Development Bank Chair, Black Creek “It’s widely and increas - nous companies to thrive ingly recognised that Africa Tunisia Investment Management and generate employment is the next growth frontier. Canada opportunities for the teem - The whole world is being Unacceptable stagnation ing populace.” battered by the headwinds “The continent is experi - Questions remain This Day (Nigeria), June 2012 of the global economic crisis encing jobless growth. That “The big question is if I’m and (also) battered by the is an unacceptable reality on going to invest in South Africa NTHONY ONGWE headwinds from the slow - a continent with such an im - and deal with some of the A J down in Asia.” pressive pool of youth, talent economic and political issues Principal consultant and creativity.” there, and I’m going to buy WeekendPost (South Africa) Global Workforce Solutions August 2012 New Times (Rwanda), May 2012 a gold mining stock, why wouldn’t I own one in Aus - Zimbabwe KATHRIN TRUMPELMANN tralia or Canada instead?” Executive manager, DAV Financial Post (Canada) July 2012 Professional Placement h t

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