by M.A. Shaikh (Special Reports, Crescent International Vol. 39, No. 4, Jumada' al-Akhirah, 1431)
The report adds that countries in sub-Saharan Africa have weathered the global recession better than expected, and better than in previous, milder economic slowdowns.
International organisations, economic experts and media commentators and analysts all agree that Africa’s economy is growing and will continue to do so, and that this growth explains why developed countries, as well as China and India, are rushing to take advantage of this rare opportunity. According to the current World Bank Global Economic Prospect Report, the economy of sub-Saharan Africa will probably expand by about 4.5% this year, faster than previously forecast, as it benefits from a revival in export demand and higher commodity prices; this rate will probably reach 5.1% next year.
The report adds that countries in sub-Saharan Africa have weathered the global recession better than expected, and better than in previous, milder economic slowdowns. Not surprisingly, the World Bank report does not expose the dubious and corrupt methods used by countries scrambling to benefit from the economic growth in the world’s poorest continent. But there is little doubt that Western countries (including the US and EU states) are employing levels of corrupt practices that are even higher than those they have been accustomed to using until now. After all, the former imperial rulers of Africa, such as France and Britain, employed both excessive force and corruption to maintain their hold on a continent whose current rulers use similar methods to acquire and retain wealth and political power.
Africa has the reputation of being the world’s poorest continent, but it is also widely known that it has abundant resources. According to a comment in the Independent of London on June 11, Africa possesses 10% of the world’s oil-reserves, 30% of its mineral reserves, 80% of its chromium and platinum, and much of the cotton and uranium, all of which may well help to shape the world’s high-tech future. It also has the raw materials required by the world’s two largest economies, namely the US and China, which have increased their trade with it tenfold in the last decade. Not unexpectedly, demand for these items is expected to double by 2020.
But the world’s interest in Africa’s economy is not confined to these items only; it also extends to investment in its growing private businesses. Recently the Financial Times reported on 500 African companies that have been growing by more than 8% a year for the last decade. The invading foreign firms will not merely do business with these companies but will also aim to acquire substantial portions of their shares, not only to pocket their part of the profits but also to control whom they trade with. To succeed in their endeavours, the foreign firms will not only pay bribes but will also rely on their countries to exert pressure, partly by the use of existing foreign contracts and offers, augmented by new ones.
In fact, the Western media have recently covered in detail how Western governments and companies have been conducting their economic invasion of Africa’s resources and businesses, and the dubious and corrupt methods they have been employing to achieve their aims.
The Daily Telegraph of London, for instance, declared on June 24 that “Ethiopia’s repression is aided by the millions of pounds Britain pays to it in foreign aid. Ethiopia is one of the most repressive and corrupt countries, but the West, particularly the US, treats it as an ally and pays it large economic and military aid. Britain, for instance, has paid Ethiopia £350 million in the past two years.” It came as no surprise that British Prime Minister David Cameron felt it necessary to contradict the Daily Telegraph and defend the reputation of British governments ten days later.
On June 4, Cameron was quoted in the Guardian as saying that “our aid will hit the spot and we won’t cut spending that hits the developing world”. Having asserted the value of British aid to the “developing world”, and London’s determination to continue to pay it, he also said that Britain would not allow the aid to be misused. “We will check where the money is going,” he was quoted as saying. But the newly-minted British prime minister knows full well that a substantial part of the “aid” goes to fund the so-called war on terrorism in the Horn of Africa and East Africa, which is a misnomer for the war on Islam and Muslims in the area.
In fact, Ethiopia, ruled by Christians, has always suppressed the large number of Muslims — particularly the Somali inhabitants of the Ogaden region — who have always wanted to secede from Ethiopia in order to unite with neighbouring Somalia. This explains why Ethiopia has been alarmed by the emergence of Islamic groups, such as al-Shabab, in Somalia to the extent of sending large numbers of troops to fight them and train the forces of the weak and ineffective transitional government of Sheikh Sharif Sheikh Ahmed, who controls only a tiny part of Mogadishu, the capital of Somalia.
Similarly, neighbouring Kenya, which is also governed by Christians and has a large Muslim population, especially in the NFD Somali region, is also engaged in the “war on Islam”, partly to prevent the Somali region from seceding. Like Ethiopia, Kenya is also a close ally of the West and receives a lot of foreign aid, which unfortunately is spent on the “war on terrorism”. The West’s intervention has not only turned Somalia into a “failed state” but has also thrown the entire region into violence and chaos. Moreover, the violence is not confined to the Horn and Eastern Africa; it extends to other parts of the continent, since the “war on terrorism” is not well-defined.
It is reasonable to conclude from all this that the claim by Western politicians and companies that they are out to boost Africa’s economic development is false, or at least misleading. Not only are the funds offered as aid being spent on the wrong schemes, such as the “war on terrorism”, they are being exploited to secure the compliance of African leaders in the West’s priorities and agendas.
When, for instance, bids to expand the airport of Abuja, Nigeria’s capital, were invited in the middle of last year, Julius Berger, the country’s largest company, emerged as the winner of the contract. The company was listed in Nigeria in 1991, but its “former parent, Bilfinger Berga, Germany’s second largest construction group, retains a 49% stake” in it, as a report in the Financial Times on June 9 informed its readers. The report quoted an unpublished investigation by a committee of Nigeria’s House of Representatives, which called for the contract to be revoked. Claiming that it had seen parts of the investigators’ report, the Financial Times quoted it as saying that a presidential committee on the airport’s expansion plans had “exercised undue influence that led to a breach of due process in the award of the contract”.
The legislative investigation was confined to government institutions that had been involved, but it also criticised the aviation authorities and the public procurement bureau. However, the company was not accused of any wrongdoing, although its contract was eventually cancelled. Not surprisingly, it quickly accepted the decision, saying: “the client has the right to execute their programmes as they see fit.” It makes considerable earnings from its contracts (£515 million in 2008) and knows that it will continue to do so. Certainly its German partner does not want it to make any fuss and draw extra attention to its dubious methods.
But it must be pointed out that it is not only Western governments and companies that have set out to rob Africa of its resources. China, which has the reputation of being the world’s most corrupt country, is also heavily involved, making considerable profits. India, which is also very corrupt, is equally involved. Even South Koreans have traveled to Madagascar to import food from there, but instead of doing so ended up buying large areas of agricultural land to grow food and sell it locally and abroad. Fortunately local farmers reacted vigorously, and the ill-conceived program to rob them of their land and local businesses of their suppliers and income was halted.
In circumstances such as these, it is not unreasonable to conclude that Africa might become even more corrupt than it is already reputed to be. Resisting this trend might also have the desirable side effect of alleviating poverty and violence in the continent. What will actually happen is difficult to predict and will become apparent with time.