I wrote this paper few years back arguing why the West should Trade Aid for Trade for an International
Relations class. “Poverty and conflict are not unrelated,” have a read.
With
approximately one billion people, Africa is the second largest continent and
home to the earliest human discoveries. The continent is so diverse in many
ways. Former U.S. Secretary of State Edmund S. Muskie once said it best, “It is
dangerous to generalize about Africa. It is a complex of diverse cultures and
traditions, countries that are comparatively wealthy and countries that are
desperately poor” (Muskie, 1989). Africa is famous for its infamous peripheral
state and unmistakably identified with extreme poverty (Kegley, 2009). There
are a lot of problems and failed policies in the way of African development,
from the deadliest AIDS epidemic, internal political instability, droughts and
child malnutrition.
This
paper will mainly focus on economic problems and it will argue to prove that
the idea and study of trade based policies will bring the needed development,
rather than foreign aid based funds to eradicate the unprecedented poverty in
Africa. This paper will also provide a solution proposal for the U.S foreign
policy towards Africa. African nations need comprehensive trade reform
policies, in exchange of the aid focused funds they receive from those
industrialized nations of the world. Such revised policies will assist Africans
drag themselves out from the current economic dependence of the core states.
It is
true that, as Africa’s one of her own write, Nigerian author Chinua Achebe once
wrote, “One shining act of bold, selfless leadership from the top, such as
unambiguous refusal to be corrupt or to tolerate corruption at the fountain of
authority, will radiate powerful sensations of well-being and pride through
every nerve and artery of national life” (Albright, 7). Africa awaits her
children to rise to Achebe’s optimism, but for now Africa begs at the door of
industrialized nations for a long term scope of comprehensive strategic
solutions, that focuses on bringing Africa from the dark shadows to the
brighter path where the industrialized east and western countries travel. It
seeks for leaders and their act of selfless leadership. Strategy that creates a
win situation instead of distributed bargaining by international leaders. Of
the many problems facing Africa few of them stand as great destruction in the
way of Africa’s development and progress. These great notable obstacles on
Africa’s economic progress are political instability, aid based funds and
unfair trade and exploitation.
Political Instability
The UN
under secretaries Nitin Desai once said, “Poverty and conflict are not unrelated,”
(Kegley, 2009). As it is stated
above when there is poverty conflict rises and it is in fact inseparable as
humans try to survive by whatever means. Africa has been torn apart from
internal conflicts, such as deep rooted ethnic civil wars, dictatorial
leadership, paramilitary operations and proxy wars. Within the past six years
global south which is dominated by African nations accounts for 90% of the
worlds casualties and 90% of the worlds inter-and intrastate conflicts.
Africa’s turmoil has created a high political instability. It is indeed a major
hold back for the continent’s development (Kegley, 2009). Africa faces problems
of political and economic integrations issues. Ambassador Andrew Young to the
UN once said, “The conventional wisdom is that political integration has to
come first…” (Ambassador Young's African
trip, 1977).
Africa
is constantly at a crossroads of chaotic political scene. The lack of
education, ethnic conflict, fight for power, guerilla warfare, dictatorial
leaderships, limited resource competition, religious view, cultural and
language barriers are few of the causes to Africa’s internal instability. Such
re-occurring entropy has slowed the rate at which the continent could follow
the rapid evolving industrialized world. A democratic influence of American
leadership is crucial in order to construct a peaceful and stable environment.
Stable and peaceful conditions in the continent would increase the confidence
of foreign investors in Africa. The U.S has to show a persistent and reluctant
democratic influence and help to protect the continent from other countries
that interfere and escalade problematic situations within Africa.
Aid Based Funds
Ironic
as it might be, aid based assistance is part of Africa’s big problems rather
than its economic solution. Africa continues to face a constant extreme poverty
draw back. The growth of a developing country depends not on aid but on its
economic policies. Various studies found that, foreign aid has not raised poor
countries economic growth.
(Burnside and Dollar, 2000).
Let it be clear though, it is not to say aid is always
counterproductive. It is true that, aid comes in handy at times and save many
lives, as Kenneth Hackett, Regional Director, sub-Sahara Africa, Catholic
Relief Services describes his experience before the Subcommittee on Africa to
the U.S Representatives Committee on Foreign Affairs; he shares about his visit
in 1983 to the famine swiping African countries’ conditions. The following paragraph, is evident of
the fact that aid indeed could be undeniably life saver at times while
providing prove aid is a short term solution.
In Ethiopia says Hackett, “tens of
thousands of people are moving to main towns …in search of food…during my visit…I talked with many of
the women in the shelters in and around Mekelle in Tigray province” (Hackett,
1985, p. 48). Hackett speaks about
his experience interacting with those women facing despair, who walked for days
“when they had absolutely nothing left to eat in their house or village”
(Hackett, 1985, p. 48). Families
were separated and torn apart unwillingly, hopeless mothers in search of, a
meal, a day having no control of their own destiny; mourn for the loss of their
children and separation from their husbands. Hackett continued his witness describing, “As I walked among
this group, I found emaciated mothers, marasmic? children and great despair. In
those long days in Mekelle, we found virtually the same levels of starvation as
Ghana, about 7-10% of the children dying. Little hope and great despair.”
(Hackett, 1985).
Although
this is a quarter of century old the African conditions remain indifference
today. Perhaps not in the same exact geographic locations; but in general the
vivid extreme poverty that Africans face remains unchanged. I do not turn a
deaf ear and a blind eye to these re-occurring extreme poverty situations and
pretend to swiftly brush of the problem and argue that aid is not helpful but
is part of the problem. I myself was born and raised few miles from “Mekelle”
and actually lived in Mekelle the very city described above and was affected
directly by the extreme poverty as was the whole region and huge part of the
country. Even thought I was too young to realize it. I was back in my birth
country Ethiopia this recent summer of 2008, and the poverty still exists at
large. Just this fall the World Food Program (WFP) had appealed for $460
million funds to support approximately 10 million Ethiopians who are in need of
food relief. (Kostova, 2008).
This is
concrete evidence, that aid is a short term solution and in order to minimize
or eradicate poverty and fair and modified trade, modernized agricultural
cultivation, educating the people as well as other comprehensive policies ought
to be implemented. In trying to reduce and paralyze the deep rooted poverty
Africa faces as a continent, long-term focused solutions are needed as oppose
to a short term hand to mouth feeding type of problem solving.
Unfair trade and exploitation
Africa’s
third obstacle is the effects of industrialized nations’ unfair trade and
exploitative relationship. The expansionism and colonial empire philosophies of
the world have been destroyed.
Peripheral countries have achieved their independence, what remains the
same is the zero-sum economic system relationship. These poor countries still
have with the developed countries. Of course the industrial nations who have
the upper hand in deciding and establishing the rules and regulations to their
favored one way gain (Shannon, 1989). The rich countries devise a system that
is most beneficial to them. In his book Shannon states, “…from the colonial period, peripheral
countries function primarily as sources of raw materials and agricultural
commodities for the wealthy countries and serve as markets for the core’s
manufactured goods” (Shannon, 1996). The outcome of this zero-sum and
distributed bargaining type of economic systems, has sunk Africa deeper into an
immense poverty and continued to exploit the continent’s resources. Those problems above must be addressed
and resolved simultaneously in an urgent time manner; to build a politically
stable Africa, with a firm and steady economic growth.
Africans and the international community
whose committeemen are to reducing poverty in Africa must focus on the following
three main problems; eliminating aid, trade aid for trade and reforming a
comprehensive relative gain trade.
Eliminating aid dire
According
to studies by Christopher Preble, Cato Institute’s director of foreign policy
studies and Marian L. Tupy Policy Analyst, Center for Global Liberty and
Prosperity, “In recent decades, of
each dollar given to Africa in aid, 80 cents were stolen by corrupt leaders and
transferred back into Western bank accounts" (Preble and Tupy,
2005). Corrupt leaders are
estimated for $140 billion aid funds in the past 40 years. Leaving the citizen
with a massive public debt they cannot afford to pay off. William R. Cline,
senior fellow at the Institute for International Economics and the Center for
Global Development, estimated a comprehensive trade would save the funding
countries $141 billion per year and deliver the seeking countries with $87
billion a year. The average income per person has decreased by 11% today than
it was about 50 years ago. We have seen the ineffectiveness of a continuing
state-to-state geopolitical based aid and World Bank projects fail time after
time. “In 2000, for example, the bipartisan Meltzer Commission found that the
World Bank's aid projects failed 55 to 60 percent of the time….” (Preble, and Tupy,
2005).
Ugandan
famous Journalist Andrew Mwenda in his “Let's take a new look at African aid” speech presentation to the Technology, Entertainment,
Design (TED) conference attendees on Sep 2007, asks a
provocative question, “Ladies and gentleman, can anyone of you tell me…any one
that you know…who became rich by receiving charity?...holding a begging bowl
and receiving arms?...does any one of you know a country that developed because
of the kindness and the generosity of another?” (Mwenda, 2007). Like Mwenda, Burnside and Dollar also
found on their studies and advocate that one’s growth of economies developing
does not arise from aid rather it depends to large extent on one’s own policies
to achieve it. (Burnside and Dollar 2000)
Mwenda
states that the western donors are characterizing the African problem the wrong
way. In other words, their generous funding does not make much difference in
Africa; because donors see Africa as a place of despair that needs poverty
reduction rather than a challenge of hope and take on the challenge of creating
wealth. The funds of the aid going to various aspects of the people including
but not limited to medicine, peace keeping, schools, and hospitals might be
helpful, but it does not create wealth that breeds wealth. Therefore aid is
treating the symptoms and not curing the causes of the fundamental problems
that exist in Africa. Wealth is a function of income, says Mwenda “…and income
comes from you finding a profitable trading opportunity or a well paying job.”
(Mwenda, 2007). Therefore the emphasis should be placed on wealth creating
agents in the society, such as entrepreneurs, domestic and foreign investments
and research institutions. Attaining solutions through aid funded money is not
competent to neither eradicate poverty nor create wealth. Mwenda reminds his
audience about some aid facts, “It is important to note, over the last 50
years, Africa has been receiving increasing aid from the international
community…over $600 billion…and we are still told there is still a lot of
poverty in Africa. Where have the aid gone?” (Mwenda, 2007).
Richard
Kozul-Wright, an economist with the UN’s economic and social affairs department
also says “In the 21st century this is an unacceptable way of
handling international development aid…” (Morris). African countries already
had paid their donors back more than what they initially borrowed and yet they
still owe those rich countries another $250 billion. (Morris). Africa needs
help in solving the fundamental problems in order to achieve its economic
independence.
Trade aid for trade
Africa can gain the much needed economic progress by
focusing first and foremost trading aid for trade. In other words, the donating
countries can provide the aid in a form of trade, investment, expertise and
business partnerships. Teaching Africans help themselves, by building and
creating wealth. The African
Development Bank Group (ADBG), World Trade Organization (WTO) and United
Nations Economic Commission for Africa (UNECA) have laid a basic ground track
of recommendation on their “Mobilizing
Aid for Trade” focus on Africa report and recommendations. It commends the
growing openness of regional and global economic integrations by many of the
African regional organizations. The recommendations guide to foreign donors and
African nations to utilize effectively and efficiently for a maximum and rapid
growth of economics (Mobilizing Aid for Trade, 2007).
China
launched a $1 billion equity investment fund to focus on African development,
which is planning to increase and reach $5 billion “eventually”; and have no
national investment quotas unlike most counties’ government assistance, which
comes with quotas and interest rates. (China-Africa, 2008). The U.S also created the Millennium
Challenge Corporation (MCC). The
largest source of U.S funding for trade related programs; supporting many of
the sub-Sahara countries that meet the eligibility requirements (Millennium
challenge corporation, 2006). Those kinds of efforts and aid have far greater
outcome than aid and loans. Aid simply funded to the hands of those nations’
government leaders who have ended up stealing it from the public that needs it
the most (MCC, 2006).
Comprehensive relative gain
trade
Although,
it is imperative that trade agreements focus primarily on fair and balanced
exchange of trade, it is also important to notice that “The periphery remains
the primary location of coerced and highly exploited low-wage labor…
exploitation reinforce the unequal exchange of peripheral products produced by
low-wage labor for those of the core produced by high-wage labor” (Shannon 1989).
The core countries buy the raw materials and resource for a low price from the
peripheries and sell them back after manufacturing and producing them with a
high-wage labor. These unequal exchange systems set by the industrialized
nations to benefit them leaves the poor African countries with a massive “debt
peonage” let alone to benefiting them, but rather leaves them falling into a
debt of a high interest rates (Shannon, 1998).
Along
with creating a comprehensive relative gain trade policies, helping and
promoting regional economic integrations within Africa have also shown to be
significantly advantageous. Such as the new deal between the three regional
organizations Southern African Development Community (SADC), the East African
Community (EAC) and the Common Market for Eastern and Southern Africa (COMESA)
their agreement to create a free trade zone signed in Kampala, Ugandan looks
promising (B.B.C, 2008). All these
regional economic integrations have been successful. For example; if we take a look at the East African Community
(EAC), that was officially created in 2001 is a “trade bloc” regional
organization consisting of five East African nations Kenya, Tanzania, Uganda,
Rwanda and Burundi. In its young age, this organization had been a great
success. The main aim of the
organization is to establish a strong regional cooperation in development,
commerce, technology, tourism and so on. Its future plans include cooperated
integrated plans political matters such as defense, security, international
affairs and judicial matters (Katembo, 2008).
African
Growth and Opportunity Act (AGOA) is
another success comprehensive trade agreement between the U.S and African
nations. African Trade Increased 115
percent since AGOA's establishment. AGOA helps Africans use the power of
trade to grow their economies and reduce poverty. U.S. Trade Representative
(USTR) Rob Portman said in a statement issued with a report. It supports
those politically and economically straggling countries. And “As these
countries open their economies and increase their capacity to trade,
opportunities are also arising for American exports to Africa." Portman
added that aid for trade helps developing those African countries participate
more fully in the global trading system. Thus the U.S is committed $199
million to trade capacity building activities in sub-Saharan Africa last year
alone. 37of the 48 sub-Saharan African countries are eligible for benefits
under AGOA, are allowed duty-free access to the U.S. market for virtually all
products. Since its inception in 2000, AGOA it has helped increase the U.S.
Two-way trade with sub-Saharan Africa by 115 percent and U.S. total exports to
sub-Saharan Africa rose 22 percent. From one year to the next this trade have
benefited both countries and shown a great deal of percentage increase to both
sides (The
United States Trade Representative, 2008).
United
States Representative Byron Dorgan of North Dakota on a house hearing said, “There
is an opportunity, I think, for us to look at countries that are cash poor, but
desperately need our food,…in exchange from those countries strategic material
they posses….Zaire cobalt; Algeria mercury; Zambia copper; and Liberia
rubber…could exchange for wheat, corn cheese, and so on…good sense for
expanding our trade opportunities (Food Crisis in Africa 1983). Africa
needs a fair trade not this type of distributed bargaining style of trade, and
the U.S have to be an example in its leadership and the way we conduct business
with those poor countries in order to lead other industrial nations by example.
Three reasons why a strong U.S-
Africa relationship is important
Market
U.S
secretary of state, Edmund S. Muskie addressed before the African-American
Historical and Cultural Society and the World Affairs Council of Northern
California in San Francisco, on December 4, 1980 stated that “a first
undeniable reality is that African nations are deeply important to the United
States. We not only want, we need good relations with them. African nations are increasingly
important to us economically, both as markets and as sources of critical
materials” (Muskie, 1980). Africa is a rich in resources and with a
technologically developed system and an educated manpower, it have a lot to
offer from unused arable land for modernized agriculture, jewelry, minerals,
oil, labor, forest, tourism and so on. Africa awaits for an exploration that is
efficient and discoveries of all its resources.
In
2006, African oil output was 467 million tons of oil and 80% of is exported to
the U.S. consumes only 33 percent (China-Africa, 2008). The AGOA has been great
for the U.S by creating new opportunities for export and investments. Since its
creation in 2001 it has been a great success to both sides. The duty free of
more than 6,000 items that can enter the U.S is one of the concrete advantages
for the African countries as well as American input, leadership and American
joint venture partnerships. Among many, AGOA’s two-way trade includes raw materials,
preserved fish, Cotton, flower, jewelry; apparel and oil are few of the items
that the U.S imports from the sub-Sahara countries. The trade agreement has
almost tripled reaching $44.2 billion for the sub-Saharan countries and double
compared for the U.S. (The U.S.T.R, 2008).
Communist China’s expanding
influence in Africa
China’s
rapidly expanding influence is another reason why the U.S needs to not only
maintain but expand its influence in the economic and political aspects of the
continent. The Chinese government has a wide spectrum of cooperation with
African nations for a variety of development. At the current rate China’s expansion strategies
across Africa seems unmatchable by any other nation from its infrastructure,
urban development, road construction, two-way trade, building ports, railways
and various investments. China’s two way trade has dramatically increased
jumping from a 10.6 billion in 2000 to $73.57 billion in 2007, and its
investment increased from about $1 billion to $10 billion in 2007. China mainly
imports from the African nations are energy such as oil and various raw
materials. Robert Zoellick, president of the World Bank, was impress the
Chinese leading role that he went on to say “China’s investment in Africa’s
infrastructure is good for Africa and…The World Bank is willing to take China
as a partner in a joint effort to alleviate poverty in Africa” (China-Africa,
2008).
Finally
With the rapid terrorism on the rise around the world, helping Africans reach
and create a stable and peaceful Africa that is politically and economically
strong as well as protecting it from foreign interferences, is not only
important the security and well being of Africans and all peaceful individual
citizens of the world. As the
world have witnessed inhuman like attacks from various radial terrorist some of
in which those attacks occurred in various U.S embassies in Africa. Terrorists’ activities and attempts
have seen a great deal of increase; most notably in the failed state of Somalia
(Dagne, 2002). Starving humans
will do anything and that is why I argue the U.S foreign policy towards Africa
continue to build an active and strong relationship, educating and empowering
the poor continent of Africa; that continues to seek the U.S.’s presence,
relative economic gain and leadership influence.
As
controversial as President George W. Bush might have been in the past eight
years of his presidency, he has initiated, established and implemented various
successful programs between the U.S and Africa. He has been active, even though U.S occupation of Iraq has
distracted President Bush’s administration away from such as the war in
Liberia, the U.S still continues to aid African countries against fight on
terror; especially, with the horn African countries where Al-Qaeda and other
radicals Muslims try to establish safe haven (Hills, 2006).
For all
the reasons mentioned above and more, Africa has been getting aid from
international donors yet the poverty has not decreased let alone eradicated.
That should serve as the evident reason why any plan to help Africa eradicate
poverty must focus on a long term goals by a means of teaching Africans to
create wealth instead of depend on the aid from the Western industrialized
nations. In the words of Father of
Taoism, Chinese Lao Tzu, "Give a
man a fish, feed him for a day. Teach a man to fish, feed him for a lifetime”.
Works
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