Root Causes of African Underdevelopment and Opportunities for Revival

Dr. Wolassa L. Kumo
Introduction

Africa is the second largest continent in the World. Africa´s massive land mass of 30.3 million km2 makes it larger than the combination of China (9,6 million km˛), the US (9,4 million km˛), Western Europe (4,9 million km˛), India (3,2 million km˛), Argentina (2,8 million km˛), and a number of other smaller countries. The continent consists of 54 countries with the population of over 900 million people.

However, sadly, Africa´s share in global wealth is insignificant. The combined GDP of the continent in 2007 was US$1.15 trillion (US $2.57 trillion based on Purchasing Power Parity (PPP)). This compares with the combined World GDP of US$65.6 trillion (PPP) and that of China US$6.99 trillion (PPP) in 2007. Africa´s share in world trade is also minimal. This has declined further since recently following the global economic down turn. Africa´s share in World trade fell to 3% in 2008.

Africa´s share in global wealth (GDP) is less than 4% while its share in global population is nearly 16%. Africa´s dismal economic performance has puzzled many analysts. Some emphasize historical factors such as slave trade, colonialism and its legacies, and geographical features as the root causes of Africa´s development disaster.

Others go beyond historical legacies and analyze the combination of geographic and demographic factors, technology, the role of state and the current challenges of globalization. There is no single root cause that fully explains the dismal economic performance of the continent particularly to the South of the Sahara with notable exception of South Africa.

This brief article is organized as follows: the next section presents an overview of some root causes of underdevelopment in Africa while the last section highlights opportunities for revival.

Root causes of African Underdevelopment

Different researches on the causes of African underdevelopment emphasis varieties of factors as the root causes of African underdevelopment. Among these the most important ones can be grouped into the following categories: (a) hostile natural environment, (b) archaic production technology, (c) demographic factors, (d) slave trade, (e) colonialism and its extractive institutions, and (f) political instability and predatory states.

a)Hostile Natural Environment

Most of the African landmass lies within the tropical climate with no access to either the Atlantic or the Indian ocean. This made the vast areas of the interior continent home to malaria and tsetse fly which afflict humans and animals respectively. This made some researchers on the causes of African underdevelopment to test the hypothesis of malaria as the dominant cause of the underdevelopment in the continent.

In particular, Bhattacharya (2009) argues that malaria and other tropical diseases have fatal as well as debilitating effects on human population in Africa. It negatively affects productivity, savings, and investments in physical and human capital and directly affects economic performance of the continent.

Using statistical method Bhattacharyya (2009) emphasizes the relative importance of malaria in Africa´s underdevelopment. He finds statistically significant relationship between low economic development and prevalence of malaria in the continent. According to this author, malaria impacts African development by increasing both mortality and morbidity. Increased mortality induces households to increase current consumption and save less for the future. Increased morbidity on the other hand adversely affects productivity reducing household income and savings. This slows down capital accumulation and economic growth shedding some light on why malaria is so persistent in Africa.

He argues further that the high incidence of malaria in sub-Saharan Africa reduces the annual growth rate of the continent by 1.3 percentage points a year and eradication of malaria in the 1950s would have resulted into a doubling of per capita income (Bhattacharyya, 2009).

Although others doubt the link between malaria and economic development, a significant number of recent studies tend to support the malaria view both at the macro as well as micro level. It is an established fact that low mortality as a result of better health contributes to economic growth.

In addition to malaria the animal disease carrying tsetse fly, which is found all over the continent and can incapacitate draught animals, may itself explain the traditional low use of ploughs and other animal-drawn implements and hence the lower productivity of the agricultural sector.

b) Archaic Production Technology

For centuries the African continent depended on archaic methods of agricultural production. Even the use of ploughs and other animal drawn implements were limited. The agricultural revolution and the use of iron tools came to sub-Saharan Africa later than to other parts of the world; indeed some have talked of a "1000-year lag" (Simensen, 2009). It is a fact that many African small holder farmers relied on wooden implements until as recently as the second half of the 20th century.

An important reason for the continent´s technological underdevelopment is the geographical obstacles to communication both internally and with the rest of the world. The Sahara has been a barrier in the north, and the Atlantic coast had no contact with the rest of the world until the first Europeans arrived around 1500. Influence from the Arab world and India came mainly via the Nile Valley and the East African coast, and had little spillover effect further inland. With the exception of the Niger and the Nile, the continent´s rivers with their large waterfalls have not provided a navigable route to the interior, in contrast to the rivers of Europe and Asia. The problems of today´s land-locked states illustrate the great importance of communication for economic and cultural development (Simensen , 2009).

c) Demographic Factors

Africa´s demographic history has been characterized by low density of population and continuous migration and settlement of new areas. The continent with a massive land mass of over 30 million km2 has inhabitants less than that of India at present. Migration has continued right up to the present day, and there is still more migration on this continent – including migration between urban and rural areas – than anywhere else in the world (Simensen 2009). This continued migration may be due to a hostile geographical environment that debilitates the livelihoods of the population.

Except the early Kushitic and Egyptian, Niger River based and Aksumite civilizations, Africa lacked stable settlements with established social structures that could form the basis for enduring states and empires of the kind that have fostered advanced civilizations in other parts of the world.

However, at present the demographic picture of the continent is totally different. Rapidly growing population with limited demographic windows of opportunity has caused further strain on the development efforts and environmental sustainability in the continent. Rapid deforestation following population explosion has further aggravated the environmental problems. The rapid deforestation is fueling desertification with its negative impacts on agricultural production in many parts of sub Saharan Africa. Consequently, Africa is more food insecure today than the era of wooden agricultural implements.

d) The Slave Trade

The slave trade theory is one of the dominant views on the historic root causes of the African underdevelopment. According to this view, Africa´s engagement in slave trade caused massive depopulation of the continent over two centuries. Inikori (1992) (in Bhattacharyya 2009) and Nunn (2008) are some of the key proponents of this view.

According to Inikori (1992), the result of engagement in slave trade was a significant slowdown in division of labour, demographic transition, human capital accumulation and long-run economic growth.

Depopulation also resulted into an implosion of the continent´s production possibility Frontier and an unambiguous reduction in welfare . The secular decline in welfare continued over more than two centuries plunging the continent into economic backwardness .

Furthermore, a Harvard economist, Nathan Nunn argues that the African countries with the biggest slave exports are by and large the countries with the lowest incomes now (based on per capita gross domestic product in 2000). That relationship, he contends, is no coincidence. One actually helped to cause the other.


Nunn (2008) reports a negative causal relationship between slave trade and current economic performance in Africa. He shows that slave trade prevented state development, encouraged ethnic fractionalisation and weakened legal institutions and through these channels it affected economic development.

Furthermore, Simensen (2009) argues that Africa´s integration into the world market following 1500 – during what he terms the "protoglobalisation era" – took on a perverted form when slaves became the dominant merchandise from around 1650. He further states that the cruelties of this trade have left deep scars in both the African and the European psyche. "The export of an estimated 12 million people across the Atlantic, and possibly a similar number to the Arab world in the course of a full millennium may have been a factor in Africa´s lower population growth compared with that of other continents. In economic terms, the slave trade tended to overshadow trade in other goods, and although it enabled certain strong kingdoms to increase their power, it was devastating for the groups affected by the kidnappings and conflicts that the trade entailed. In political terms, the rulers who controlled the trade on the African side were caught up in a particular form of dependence that had profound effects on African political culture" (Simensen 2009).

e)The Colonial Extraction System

Colonialism in Africa took different form compared to Asia. Unlike in Asia, hostile tropical environment prevented colonizers from settling in Africa as a result of which they erected extractive institutions in these colonies. These colonial institutions have persisted over time and they continue to influence the economic performance of the colonies even long after independence.

Nunn (2007), using a stylised model for Africa, shows that colonial extraction when severe enough can cause a society to move from a high to low production level equilibrium. Due to the stability of low level equilibrium, a society can remain trapped in this equilibrium even after the period of colonial extraction is over.

However, many African as well nonAfrican scholars do not agree on the link between colonial extraction and the current underdevelopment in Africa. Ethiopia was never colonized but it is one of the least development countries in the continent while many Asian countries which have achieved development miracle since 1960s have been former European colonies.

However, there is one crucial link between colonialism and underdevelopment in Africa. This is the creation of a political map that is economically irrational and dysfunctional. According to Simensen (2009) Basil Davidson sums up this state of affairs in the title of one of his books: The Black Man´s Burden: Africa and the Curse of the Nation State.

Colonialism created artificial and non viable nation states that lacked legitimacy. This is the root cause of continued ethnic conflicts and civil wars that ravage the continent since the day of decolonization. Thus unless Africa does away with the current artificial colonial boundaries either through realignment of the current state boundaries wherever there are contestations or through more regional integration similar to the European model but not through hasty "United States of Africa" rhetoric, the continent will never achieve sustainable development.

f) Political Instability and Predatory States

The post colonial Africa has been characterized by lack of political stability. This has deep historic roots. Africa´s participation in slave trade promoted strife and broke down political and social cohesion in the continent. There has been historic resentment by Africans whose tribes were victims of slave raids by stronger tribes during the centuries of slave trade. The ethnic diversity of the continent is extraordinary; linguists have identified around 900 separate language groups while today there are about 2000 known ethnic groups in the continent.

Colonial political boundaries lumped many of these ethnic and linguistic groups into few pseudo nation states. When these "nations" became independent nation-building proved practically difficult. National endeavours have been hampered by internal conflicts and civil wars, and at worst a form of anarchy, as seen in Democratic Republic of Congo. The forces behind these conflicts are often complex. But once the parties have resorted to violence, we see in Africa, just as in the Balkans and the Caucasus, that ethnicity overrides all other forms of loyalty with a ferocity that defies belief, but is easier to understand if we bear in mind the role that nationalism has played in European history (Simensen, 2009).

Not every ethnic tension in Africa is the making of colonial conspiracy, however. Post independence African politics was dominated by authoritarian regimes and kleptocracies. These rent seeking dictators often intentionally sow seeds of ethnic conflicts by deliberate political exclusion and marginalization of various ethnic groups that reside within the country.

Even after two decades of democratic reforms in the continent, today about 50% of authoritarian states in the world are found in Africa. About 24 out of 54 states in Africa are authoritarian regimes. Only Mauritius qualifies as a full democracy in the continent out of about 30 full democracies in the world while 6 more countries in the continent are flawed democracies.

Opportunities for Africa´s Revival

The wave of democratic reforms since the 1990s and the commodity price boom since 2001 lead many to believe that Africa could claim the 21st century. In fact, following the commodity boom African economy grew by over 5% on average for more than 6 years which was unprecedented in the history of the continent. Many argued that Africa needed about 7% annual average growth rate to achieve the Millennium Development Goals; but 5% was just as good.

However, this hope was dashed when the global economic downturn abruptly ended the commodity price boom in mid 2008. As a result, African economic growth plummeted to less than 3% in 2009. The recent revival in oil and other commodity prices and signs of global economic resilience are causes for optimism. However, reduced capital inflows coupled with widening budget deficits in many African countries are sure to delay any hope for faster recovery. Apart from this, the current revival in commodity prices may be short lived. Commodity prices may settle at much lower equilibrium levels even after the global economic recovery dashing further any hope for faster economic growth recovery in Africa.

In face of such reality, the only hope for Africa is to radically adjust its businesses in three key areas. First, Africa needs to institute transparent and accountable governance faster than ever. The prevalence of authoritarian regimes in the continent is seriously harming its image. This will scare the flow of FDI crucially needed to spur growth and development. The 24 authoritarian regimes in the continent should transform as a matter of urgency or perish.

Second, rapid investment in infrastructure. FDI will not come if there is no adequate road network, electricity or efficient telecommunication systems even if a country is near perfect democracy. One might ask where will the money come under current economic difficulties? That is a crucial question. However, there is no alternative. There must be adequate infrastructure if the continent is to revive from the current economic quagmire.

Finally, pursue export led growth strategy. Enough is enough with continued dependency on export of primary commodities. The current commodity price doom has proved to Africa that no matter how much wealth of natural resources the continent is endowed with, it will not be able to rely on export of primary commodity to achieve sustained economic revival. Manufactured export led growth strategy is the only way out of the current low level poverty trap in the continent.

References

Bhattacharyya, S. 2009. Root Causes of African Underdevelopment, Journal of African Economies.

Simensen J. Africa: the causes of under-development and the challenges of globalization. http://www.regjeringen.no/. Retrieved on August 9, 2009.

Nunn, N. (2007). Historical Legacies: A Model Linking Africa's Past to its Current

Underdevelopment, Journal of Development Economics, 83(1), 157-175.

Nunn, N. (2008). The Long-Term Effects of Africa´s Slave Trades, Quarterly Journal of

Economics, 123(1), 139-176.
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Dr. Wolassa L. Kumo

Development practitioner and researcher. Research interests include risk and uncertainty, productivity and efficiency, finance and investment, currency substitution and development problems of Africa.