The Struggle for Global Economic and Military Superiority: Implications for Africa's 'Rich-Poor' Countries.

The contest for global economic superiority has just started. As Western economies sink into economic recession, Africa, which had been alienated from global trade for ages, seems to be their savior. The exodus of Western and Eastern investors to Africa is surging. Are these foreign investments in Africa beneficial to Africans? Will these investments situate Africa at the centre of global economic enterprise or relegate it to the periphery?

The credit crunch that hit North America in 2008 and the recurring Eurozone crisis has left a spin in global economic, military and political power play. When the financial crisis hit the world’s biggest economies, the developing economies, especially in Africa, thought that they were far away from the collapsing economic debris. As it turned out, this fervor was false. Most developing economies have been smacked by the ever increasing global oil prices and the imbalances in global trade.

In Uganda, for example, the economy was hit by runaway inflation that swung to alarming double digits in just a space of five months, owing in part, to domestic mismanagement of the economy and high global food and oil prices.

As developed and developing economies are entangled in this economic quagmire, the struggles for global economic, political and military superiority will not but intensify. Apparently, the crown for global superiority is slowly but steadily sliding through the hands of the US and Europe, the two global players that have for long dominated the global economic enterprise. “European Union’s current members accounted for 31% of the world economy in 1980 (measured by each country’s GDP, adjusted for purchasing power). By 2011, the EU share slid to 20%, and the Fund projects that it will decline further, to 17%, by 2017.” (Jeffrey D. Sachs, A World Adrift, The Independent of May 5, 2012).

This startling economic squeeze has stretched beyond Europe. “The US share of global GDP, around 25% in 1980, declined to 19% in 2011, and is expected to slip to 18% in 2017, by which point the IMF expects that China will have overtaken the US economy in absolute size (adjusted for purchasing power).” (Jeffrey D. Sachs, A World Adrift, The Independent May 5, 2012). Consequently, “The US, characteristically these days, insists that it will not join any new IMF bailout fund. The US Congress has increasingly embraced isolationist economic policies, especially regarding financial help for others. This, too, reflects the long-term wane of US power.”, Sachs notes. Even with austerity measures in Europe and government bailout plans in the US, there are no prospects of economic recovery on the horizon.

As the US and Eurozone slide into economic chasm, other powers are emerging to challenge this global dominance and claim their share of the global economic enterprise. China, for example has made economic inroads in Africa. Dambisa Moyo has observed that, “In 2009, China became Africa’s single largest trading partner, surpassing the United States. And China’s foreign direct investment in Africa has skyrocketed from under $100 million in 2003 to more than $12 billion in 2011.” The Zambian born economist has further noted, “Since China began seriously investing in Africa in 2005, it has been routinely cast as a stealthy imperialist with a voracious appetite for commodities and no qualms about exploiting Africans to get them. It is no wonder that the American government is lashing out at its new competitor — while China has made huge investments in Africa, the United States has stood on the sidelines and watched its influence on the continent fade.” 

The new African Union Headquarters in Addis Ababa that was constructed with $200 million donation from the Chinese government.

The biggest threat to the US and Eurozone may seem to be China on the surface, but underneath, the rise of the entire BRICS (Brazil, Russia, India, China and South Africa) economies is destined to alter the global economic, political and military dynamic. The positive economic strides made by economies in the Middle East in sectors such as: oil and gas, tourism, manufacturing, sports, and entertainment in the last two decades cannot be overlooked. As Sachs has noted, “The shift to such a multipolar world has the advantage that no single country or small bloc can dominate the others. Each region can end up with room for maneuver and some space to find its own path. Yet a multipolar world also carries great risks, notably that major global challenges will go unmet, because no single country or region is able or willing to coordinate a global response, or even to participate in one.” The global economic ignominy is threatening to send more hard punches. What is yet to be seen is whether global economies will stand this force.

Africa's 'rich-poor' countries within the context of global economic and military contest.

In his book The African Predicament and the American Experience: A Tale of two Edens, Ali A. Mazrui posits thus “Africa in the twenty-first century is likely to be one of the final battlegrounds of new forces of globalization – for better or for worse.” The story of Africa and her mineral resources is a tale of plunder, manipulation, and exploitation. A continent endowed with natural mineral resources harbours the world’s most poor, illiterate, disadvantaged and vulnerable. One may even think that African mineral resources are still lying idle beneath the feet of continental Africans. Alas, the minerals are exploited day and night, and money and whatever it is exchanged for, is swindled.

The increasing global resource constraints have led to massive exodus of genuine and sham foreign investors (some people refer to these klepto-capitalists as harvesters) from the West and East to the African continent. In June 2011, Secretary of State Hillary Rodham Clinton gave a speech in Zambia warning of a “new colonialism” threatening the African continent. Referring to China’s increased influence in Africa, Clinton noted, “We saw that during colonial times, it is easy to come in, take out natural resources, pay off leaders and leave.” Whether China’s presence on the African continent is going to transmute into the second scramble and partition of Africa is a tale that posterity will tell.   What is certainly clear is that there is greater than ever clamor for Africa’s mineral resources from players from the West and East.

The claim that the West is guilty for the economic and political plight of African states is as valid as the assertion that the continental African political elite are responsible for the continent’s economic and political misery. Over the years, African governments through a handful of African political class and elites have signed clandestine deals with Western and Eastern multinational companies, to allow these companies full and unabated access to Africa’s mineral wealth.

 African leaders at the inauguration ceremony of the new African Union headquarters in Addis Ababa, Ethiopia

Clandestine oil agreements, land give away, tax exemptions, and other government subsidies between African political elites and multimillion corporations from the west and the East is rampant. In some cases, foreign governments and corporations have been given total admittance to extract resources for mere exchange of military arms by African political charlatans under the guise of universal economic and social multilateralism. This is compounded by the fact that legislation in African countries is too weak to protect people from any form of economic exploitation and manipulation.

Money that is generated through these transactions does not filter down to the rightful recipients. In Africa, the trickle-down theory has failed to work especially when political elites are at the top of the trickle-down chain. As such, majority of African natives have capsized in trenches of poverty, famine, and limited or no access to public good and services. African governments have become agents of self- human destruction and sabotage.

The rift between the rich (minority) and the poor (majority) has done all but widened, while money from these economic deals, which is routinely swindled through corruption by the political elites, is lying in foreign banks in Europe and America. Sadly, with access to these furtive proceeds, African political elites have succeeded in entrenching authoritarian rule and dictatorship that is devoid of rule of laws, respect for human rights, empowerment of people, and economic development.

Africa is rich in mineral resources but her people will remain poor until, maybe, the mineral resources are exhausted; Africa will have fertile soils but her people will remain impoverished and malnourished; Africa’s mineral resources will have market in the West and East but her people will remain less educated; African governments and political elites will always make a bite out of dealings with foreign governments and multimillion companies but they will not provide public goods and services; in some cases, natural resources will continue to be exchange for arms and the sons and daughters of mother Africa will continues to swim in a murky and bloody ocean of armed conflicts.

A very good case in point is Democratic Republic of Congo (DRC). DRC is considered to be the world’s wealthiest country boasting with mineral resources worth 170 trillion dollars (this is bigger than the economy of the US and Europe combined). Contrastingly, majority of the 70 million people that live in Congo live in abject poverty. Yet Congo’s mineral resources have been exploited since the colonial period. 

The global economic barometer indicates that the current global economic constrictions are here to stay. The more these existentialities manifest themselves in economies in the West and the East, the more voracity for Africa’s resources will heighten, and the more people in Africa’s ‘rich poor’ countries will be wrapped in rugs of poverty and hopelessness.

I hope the winds of posterity will turn the African dice to a much better plane!