Africa: Wealth & Poverty, Live Side By Side

The debate about the “image of Africa” seems to be reaching a consensus. The starving African child represents a reality that is rare and local. We must clear our minds of that image as representative of Africa, all of it, always.

The growth figures show that Africa is apparently doing well economically and many of the conflicts, which were always local, often quite small but created terrible suffering, have come to an end. Medication for AIDS and other diseases has become more widely available. No one speaks of the hopeless continent any more.

Some people have tried to say that the image of the starving child was “wrong”. But it wasn’t invented. From Biafra, to Ethiopia and more recently Somalia and Niger, it is an occasional shocking reality which we will almost certainly see again.

On the other hand there is a new image which projects Africa as the new China, the driver of the world economy in a few years’ time. This image shows Africa as young, smart, dripping in bling and driving a flashy car. These are simplistic reversals of the old image, and as unrealistic as the hopeless continent.

Even Oxfam, which has raised millions with images of starving African children, has now admitted that Africa is not as simple as that. A survey that the aid agency recently conducted showed that the images of starving African children are actually counterproductive in terms of their own fundraising.

Three quarters of more than 2,000 people Oxfam surveyed said that although hunger was the biggest problem facing Africa, only 20percent felt they could do much about it. 

Most respondents said they had become desensitized by images showing hunger drought and disease. Barbara Stocking, the CEO of Oxfam, called for a more nuanced picture of Africa. She said “The relentless focus on on-going problems at the expense of a more nuanced portrait of the continent, is obscuring the progress that is being made towards a more secure and prosperous future.” 

The negative image of Africa “is not the truth”.

The implication of what Stocking is saying is that aid agencies have only agreed to tell the truth about Africa now because the images they have been using for fund-raising have actually eroded people’s willingness to give them money.

But I will bet that when the next humanitarian disaster hits, the aid agency which advertises with most graphic pictures of the victims will raise most money.

There is no doubt that many African countries are doing a lot better than they were in the last two decades of the 20th century when the figures for growth were, in terms of population growth, negative. 

Growth has been above 5 percent in many countries for almost a decade, Africa’s resources have been fetching high prices, the wars have diminished in number and extent, and governance has improved.

Many capitals that were economically stagnant a decade ago are now booming, their biggest problem: traffic jams. And the old problems, many of them country specific, have not gone away.

Somalia’s clan rivalry, Nigeria’s corruption, Kenya’s tribalism and South Africa’s inequality are all alive and well.

So the new picture is better but the message is don’t generalise about Africa. However, is this change permanent or just temporary? And how much do these growth rates affect the lives of ordinary people?

The first question is – will Africa use this successful period to generate a prosperous and self-sustaining future? At the moment much of the wealth has been within an urban bubble.

If you counted economic prosperity by the increase in the numbers of flashy 4X4s, Africa would be reckoned to be doing well. These 4X4s now travel from gated housing estates on the fringes of big cities to shiny new glass office blocks and back again. Do their owners ever breathe real African air?

Outside that bubble the poor are still poor, with little being done for them in terms of jobs or services. Most of the poor are young and un-or under-employed. Whatever their qualifications, for those who do not have connection inside the bubble the future is bleak. How long before their anger explodes?

Secondly this commodity boom has lasted more than a decade but is now diminishing. Have African governments used the revenue from oil, gas and minerals to create industries that add value to them?

How much refining, processing and manufacturing has been created in Africa in this last decade? A recent article in Foreign Affairs by Rick Rowden argued that the recent growth in Africa is not bringing development.

He writes: “development has generally been taken as a synonym for industrialization.

Rich countries figured out long ago, if economies are not moving out of dead-end activities that only provide diminishing returns over time (primary agriculture and extractive activities such as mining, logging, and fisheries), and into activities that provide increasing returns over time (manufacturing and services), then you can’t really say they are developing.”

Rowden points out that Africa’s share of global value added goods has actually fallen from 1.2 percent in 2000 to 1.1 percent in 2008. In the same period Asia’s share rose from 13 percent to 25 percent.

Even in labour intensive low technology manufacturing Africa’s share of exports fell from 23 percent in 2000 to 20 percent in 2008. Services, he says, will not absorb all the young job seekers in the next few years.

This all looks reasonable – if rather depressing. But then I think of those traffic jams that twice a day – sometimes all day – clog up Nairobi, Lagos, Johannesburg, Accra, Abidjan, Addis Ababa. Looking out of my taxi bubble window at the multitude of walkers – the people outside the bubble – I cannot but think they would be staying at home if their destination was not some profitable economic possibility.

Puzzling – until you discover that the World Bank has had to admit that the figures they have for Africa are all wrong.

In the most recent edition of the journal, African Affairs, Professor Morten Jerven of Simon Fraser University Vancouver, drew attention to the 2010 revision of Ghana’s GDP figures upwards by over 60 percent.

Overnight Ghana was $13 billion richer and became a middle income country – embarrassing for the aid donors.  The reason was that the baseline date from which Ghana’s economic growth was measured was 1993. Many of the economic drivers that have increased wealth in Ghana did not exist then.

And data collection at that time was not that accurate. Nigeria has followed suit with an announcement that it would be revising the estimates of its growth shortly. It is expected to announce a difference as great as Ghana’s.

Professor Jerven also pointed out that all but 19 African countries had baselines for measuring growth and wealth date back before the turn of the century. New data might change our view of Africa completely.

Africa – as I have always thought – is a lot richer than is generally assumed. However, at the bottom of the pyramid, people can become vulnerable quite quickly especially when there is war.

So expect to see those horrifying pictures of starving children from time to time as well as lots of cool young Africans in fashionable clothes driving flashy cars. Both are real. Both are Africa.

The Succession Trap in Africa!

Mozambique’s Samora Machel built a strong consensual party with a succession tradition. Uganda’s Yoweri Museveni has not.

2012 was a tough year for African leaders: one resigned, one was sacked, two were overthrown in coups, two were defeated in elections, and three died in office. Even in states like Angola where incumbents remained in power, the question of leadership succession was rarely far from the agenda. In 2013 we can expect the topic also to be hot in Madagascar, Kenya and Zimbabwe, all scheduled to hold Presidential elections later this year.

Succession is an inevitability of political life, and there are several ways to accomplish it, from dynastic inheritance to assassination to a competition for votes. Some states do it better than others, however, and it’s fair to say that Africa has had more than its share of disorderly successions. Even where succession does not lead directly to violence or state breakdown, uncertainty surrounding the process can damage economic growth, as happened in fast-growing states like Kenya, Côte d’Ivoire and Malawi in the 1970s and 1980s.

Economic growth and leadership succession

Since African economies are now growing strongly again, it seems pertinent to ask whether growth will once more be undermined by problems of political succession. In many cases the answer unfortunately appears to be ‘Yes’. Part of the problem is personal, or ‘big-man’ rule, sometimes called ‘neo-patrimonialism’. 

These forms of governance are not necessarily obstacles to economic growth; however, growth under the purer types of personal rule rarely lasts more than one or two decades. When pro-growth policies and property arrangements are closely associated with just one man (or woman), the demise of that individual is likely to induce damaging uncertainty in investors.

So how do states avoid the succession trap? In a new  Paper for the Developmental Regimes in Africa Project, I answer this question by comparing sub-Saharan Africa with Southeast Asia, a similar, but economically more successful region. I combine historical analysis with systematic comparison to tease out the factors uniting those countries that combined high growth with succession (Laos, Malaysia, Mozambique, Thailand and Vietnam), and distinguishing those that fell into a succession trap (Côte d’Ivoire, Indonesia, Kenya, Malawi).

I found that high growth was more likely to be sustained through succession if leaders handed over power before the age of 75, if the country had a fairly homogenous ethnic structure, if the state had its roots in an identifiable pre-colonial political formation, and if the external economic environment was favourable. However, there were exceptions across the board, making these contributing, not crucial, conditions.

In addition, I found a combination of three conditions present across all the regimes that combined succession with high growth, and absent from those that didn’t. First, leaders were motivated to search for growth to stave off perceived threats to their survival from external aggression, popular mobilization, and/or resource scarcity.

Second, all had broadly pro-market and pro-foreign investment policy packages, although all retained substantial state involvement in the economy. And third, all the successful regimes embedded policy-making in strong institutions of one or other of two types:a dominant party with a tradition of consensual decision-making and leadership succession, ora strong, organic bureaucracy, effectively insulated from changes in political leadership.

Examples

Mozambique provides an example of the first type. Between 1997 and 2010, the country experienced growth of 7.83 percent, despite a change of leadership in the ruling Liberation Front of Mozambique (FRELIMO). FRELIMO was formed in opposition to Portuguese rule in 1962 by an elite group of assimilated Africans. 

A tradition of orderly succession was established in 1969, when Eduardo Mondlane, FRELIMO’s founding president, was killed by a parcel bomb. Although party vice-president Uria T. Simango was appointed successor at a meeting of the Executive Committee, this decision was overturned by FRELIMO’s more powerful Central Committee, with Samora Machel becoming President. When Machel died in a plane crash in 1986, the Central Committee nominated Joaquim Chissano as President. In 2002, Chissano announced that he would not contest the next Presidential election, and the party congress nominated Armando Guebuza to succeed him.

Like all political parties, FRELIMO has its tensions, but these are muted by an impressive sense of mutual loyalty and internal cohesion. Forged during the liberation war, unity has been maintained even though FRELIMO has abandoned its historic commitment to socialism and taken measures to encourage private enterprise. A stream of investments has followed.

Thailand is (the only) example of the second type. Between 1961 and 1998 growth there averaged more than 7 percent, notwithstanding more than 15 leadership changes, as power oscillated between military factions and weak civilian parties. Predictability was provided by an organic bureaucracy with roots in the 19th century, in which specialized pro-growth agencies were created in the 1950s. Continuity in the mission and personnel of these agencies gave domestic and international investors confidence, despite a bewildering number of political successions.

Growth and succession in contemporary Africa

Currently there are three countries in Africa that have maintained high growth for more than a decade but have yet to experience a political succession: Angola, Rwanda and Uganda. All are ruled by dominant ‘liberation struggle’ parties. More research is needed, but it seems probable that the RPF in Rwanda has some of the same unity of purpose as FRELIMO, despite the towering presence of Paul Kagame, and the prospects for succession with growth appear good.

In Angola and Uganda, however, leaders are older, external threats are less severe, and despite their post-liberation history, power is more personalised. In states like this, the prospects for combining succession with growth are poor.

To avoid the succession trap, political and economic actors need to devise institutions that can supply credible commitments for investors in a context of transition. In 17th century England, this happened when the King acceded to a range of formal checks on his power, an experience echoed in currently fashionable development thinking like Prime Minister David Cameron’s ‘golden thread’ or Acemoglu and Robinson’s ‘inclusive institutions’. 

Successful Asian and African countries have done things differently, however. Making  strong but personalised ruling parties more collegial and consensual, or strengthening and insulating the bureaucracy where parties are weak, might be more realistic alternatives.

Note

[1] I excluded countries with a population of under five million (eg Botswana) and also countries where a portion of the growth phase could be accounted for by a peace dividend (eg Ethiopia, Myanmar). I defined high growth as growth of at least 7% per annum.

War in Syria Such an Obviously Bad Idea.

Why hasn't the Obama administration intervened militarily in Syria? If you read this site with any regularity, you’ll know the answer to that. The great irony is that the major factors that make military intervention in Syria’s civil war impractical, unworkable, and dangerous are so obvious that the political, military, and intelligence establishment within Washington is unable to deny what we oddball libertarians constantly harangue about.

Case in point: 

Aaron David Miller’s latest Op-Ed in The Washington Post. Miller has been a Middle East advisor to six Secretaries of State in both Republican and Democratic administrations and he is now vice president at one of DC’s most prominent think-tanks, the Woodrow Wilson International Centre for Scholars. If ever there was a perspective that broadly reflected Washington, DC’s establishment, it would come from someone like Miller.

Here’s his take on Syria:

The idea that Syria was anyone’s to win or lose, or that the United States could significantly shape the outcome there, is typical of the arrogant paternalism and flawed analysis that have gotten USA  into heaps of trouble in the Middle East over the years.

Miller’s position on Syria isn’t all good; he entertains the notion that “perhaps [taking] a more active role far earlier in helping to organize a political opposition, even covertly,” might have helped. But, he says, from the beginning “all of the military options for intervention have been heavily skewed toward risk rather than reward.”

To stop the regime’s assault, let alone to topple it, would have required direct military pressure, most likely a massive air and missile campaign and probably an intervention force. Those, quite rightly, were never under serious consideration. Half-measures such as arming the rebels and instituting a “no-fly” zone carried risks but no identifiable rewards.

It was never clear how a limited military response would shape events. U.S. planners could not be certain that a military response wouldn’t have pushed Russia and Iran to up the ante with more weapons. And with Washington seeking Moscow’s support to keep pressure on Iran’s nuclear program, a major escalation over Syria wouldn’t have helped.

Miller then rightly asks: “And who, exactly, would we have been arming?” Ah, the perennial question of the Syria conflict, which readers have seen scrawled over this site since the start of the Syria conflict. More explicitly, the point is that the only rebel groups with a chance against the Assad regime are mostly foreign fighters with ties to extremist groups and even al-Qaeda. Only psychotics advocate arming them.

“We don’t control history,” Miller writes. “And it’s time we attend to our own broken house instead of running around the world trying to repair everyone else’s.”

Blimey! That’s a blatantly non-interventionist sentiment coming straight from a quarter-century-long Washington establishment insider. Don’t be fooled, though. Washington truly wants to intervene in Syria to effect the outcome of the conflict and establish a nice client state there when the dust settles. The resistance to intervention is not for lack of want, but for lack of ability.

There is virtually no conceivable scenario where a US-led intervention in Syria’s mess benefits Syrians or Americans. That’s a reality not even typical Washington imperialists can deny.

Somalia,& its Al-Shabaab;The Quest For Sustainable Solutions

In Somalia, the radical Islamist militia, Al-Shabab, that has terrorized much of the country over the past five years, appears to be on the run. They have been forced out of the capital, Mogadishu, and all of the major towns that were once under their control (including Kismayo in the South). But those who believe the Shabaab are finished could find that they are sorely mistaken.

The eradication of Al-Shabaab, although essential to the peace and security of both Somalia and its neighbours, is unlikely to be achieved by military force alone. What is actually required is a coordinated and sustained regional effort to eliminate the underlying causes of the growth of Islamist radicalism among Somali youth including assistance to effectively address the persistent and structural humanitarian crisis affecting most of Somalia.

Key requirements include improved governance, and concerted efforts to rebuild and expand Somali livelihoods, and the country’s economy. Most of the current generation of Somalis have grown up in conditions of conflict, insecurity of livelihood and deprivation. This has tended to make many of them vulnerable to the arguments and promises of the Islamist militants.

The new Somali Government must avoid the corruption trap and tendencies towards dividing up the governmental ‘cake’ along clan lines, and focus its efforts on solving the livelihood problems faced by the majority of the country’s population.

The new government must also urgently address humanitarian issues and start the flow of food aid to the areas liberated from Al- Shabaab. The Shabaab alienated large groups of people in southern and central Somalia by allowing them to die of hunger, rather than permit aid organizations to give them food. If the arrival of food aid, and assistance for reconstruction follows quickly in the tracks of the Kenyan and AMISOM forces, that will strengthen the local constituency for the elimination of Al-Shabaab in the country.

Food aid is a necessary but temporary expedient.

 It helps to keep people alive, while plans to enable them to earn a livelihood are being made. This is an area in which there is a vital role for the international community to play in putting Somalia back on the road to development and self-reliance.

Along with conflict, drought and desertification are key causes of impoverishment and destitution in large areas of Somalia and adjacent regions of Ethiopia and Kenya. With an increasing population, there is more pressure on the land and its limited resources. Drought and desertification disasters are occurring at increasingly shorter intervals, with less opportunity for recovery. Hundreds of thousands of rural households in Somalia and neighbouring regions of Ethiopia and Kenya have lost most of the livestock on which they depend, dropping entire communities into chronic destitution.

Implications for the IGAD region

Regional economic integration could make an important contribution to addressing these shared problems, in the context of the Intergovernmental Authority for Development (IGAD) – the Regional Economic Commission for the Horn of Africa. It provides the institutional framework for regional economic integration, towards increasing prosperity and integration into the global economy.

The countries of the region are bound by history and geography in relationships of interdependence with considerable potential for cooperation for their common development, for example, through transport corridors to seaports, management of shared water resources, and improved energy security.

Much of rural Somalia is gripped in a livelihood crisis with increasingly serious implications for human security. It is a situation that demands substantial investment in the integrated development of the region’s land and water resources and creating sustainable alternative livelihoods. The key requirements for this include improved infrastructure to provide reliable access to transport, water and affordable energy.

In particular, the rehabilitation of the country’s internal roads and their interconnection with those of the neighbouring countries could open the way to increased trade, economic growth and poverty reduction.

Similarly, the ongoing oil price crisis makes affordable energy a key problem faced by countries that like Somalia where people largely depend on oil fired electricity generation.

But this could be addressed by interconnection with Ethiopia’s electricity grid to enable it to purchase much cheaper hydroelectricity, a solution already agreed by Djibouti, Kenya and Sudan, in the context of the planned East African Power Pool (EAPP).

The EAPP is already on the way to becoming part of a new regional reality, and a key example of regional economic integration. In September 2012 the African Development Bank (AfDB) approved USD348 million in funding for a USD 1.26 billion project for an electricity transmission line connecting Ethiopia and Kenya. 

This is a key step towards the establishment of the East African Power Pool, which may later be connected to a Southern Africa Power Pool. The project will promote power trade and regional integration. Djibouti is already interconnected with Ethiopia’s power grid and buying Ethiopian hydropower at a fraction of the cost of oil-based power generation. The same could be done for Somalia.

Addressing the basic issues of sustainable rural livelihoods will need to be undertaken through forms of regional economic integration that encourage the cooperative development of the shared water resources of this drought disaster-prone region comprising Somalia, the Ethiopian Somali region (the Ogaden) and northeastern Kenya. These areas are inextricably linked in terms of ethnic ties, economic exchange and inter-dependence, shared natural resources, and the constant cross-border movement of their pastoral populations.

The Way Forward

There is an important opportunity for joint development of the hydroelectric and irrigation potential of the Shabelle and Dawa-Gennale-Juba river basins in the context of infrastructure-led regional economic integration. The cooperative development of the shared water resources of this drought prone region of Somalia, Kenya and Ethiopia offers considerable potential to rehabilitate the livelihoods of their populations and put them on the path to sustainable development and peace.

Multi-purpose dams on the Shabelle and Dawa-Gennale-Juba rivers could contribute to the hydroelectric power needs of the three countries, enhance their irrigation potential, and prevent the recurrent floods that from time to time devastate large areas of the lower Shabelle and Gennale-Juba basins, leading to serious loss of life and property. It would need significant investment, but it would be far cheaper than the costs of chronic conflict and humanitarian disasters and the economic returns would repay the investment.

With a million hectares of irrigable land on the Ethiopian side and hundreds of thousands within Somalia, both countries would benefit from such development. This would enable irrigation-based agriculture, livestock raising, agro-processing, and employment, for those who choose to settle, as well as those who are already settled, but are often affected by recurrent drought, and food insecurity. It would also reduce the chronic poverty and resource competition that are among the major underlying causes of conflict.

The dams to be built in the two main river basins would control the massive periodic floods like those that occurred in the lower Juba valley a decade ago, resulting in the loss of hundreds of thousands of livestock and considerable loss of human life. The regular availability of water would prevent the loss of huge numbers of valuable livestock, and crops to frequent drought disasters. Along with disaster prevention, they would also provide opportunities for hydropower production. 

The availability of affordable hydropower could provide a key economic missing link, by opening the way to agro-processing, adding value to agricultural and livestock production, providing employment for the population, and reducing poverty. This could also make a major contribution to reduction of resource competition and conflict risk.

As in India and China, labour-intensive light manufacturing has significant potential to put the Horn of Africa on the road to development. Countries like Ethiopia and Somalia have the necessary cheap labour for this, but what they need to make the jump is abundant, affordable and reliable electricity, to enable them to add value to their production, for example, by exporting meat and leather products, rather than livestock on the hoof.

Somalia, once it settles its internal conflicts, will be well-positioned to benefit from regional economic integration. This, of course, will depend to a large degree on the success of the new government, with the assistance of the AU forces in defeating the Al-Shabaab militias, and establishing an acceptable level of governance. If successful, a peaceful Somalia could have the opportunity, based on the shared water resources of the Dawa-Gennale-Juba, and Shabelle river basins, to rebuild its long neglected agricultural and livestock economies.

In the context of IGAD and regional economic integration, a peaceful Somalia, would also be well-positioned to benefit from Ethiopian use of its port facilities, as Ethiopia begins to tap the agricultural and livestock development potential of its Ogaden region. The closest ports to the southeastern Ogaden are those of Mogadishu and Kismayo. This would open the way to a new and more constructive, cooperative and peaceful relationship between the two countries.

This is particularly important in view of the rapid increase in population numbers across much of the area, and the increasing pressure of fast-growing populations on diminishing resources. The more effective and cooperative use of the region’s water resources, could make important contributions to economic development, to the reduction of poverty, periodic food insecurity, hunger and conflict risk.

The potential for irrigated agriculture and livestock-raising could serve as a lifebelt for both farming and pastoral populations dependent on erratic rainfall, in the context of periodic drought and food shortages, and increasing poverty. It would open the way to sustainable rural livelihoods, and to increased opportunities for urban employment and trade, within Somalia, and between Somalia and its neighbours.

In the context of regional economic integration, this would reduce resource competition and accelerate development and livelihood opportunities. It would also reduce conflict risk by providing the populations on both sides of the border with resources and opportunities that they could not afford to jeopardize, or allow to be jeopardized, through conflict.

Love Africa but Invest in it with your Brain

When considering Africa, people do not generally think of sky scrapers, city dealers, affluent middle classes, bankers in suits, screens of numbers and the trading of stocks and shares. This is, however, increasingly an African image we will have to get used to.

I recently watched a webinar of  the London Stock Exchange where investors were buzzing with enthusiasm for the growth in African shares. 

I got an impression that it was a bit of a gold rush, but I am always wary of the ‘next big thing’.  The story is, however, quite compelling: double digit annual growth in a number of counties;  over 10 percent of the shares on the Alternative Investment Market in London (AIM) are either primarily or totally involved in Africa; 

The African Securities Exchanges Association (ASEA) is currently represented by 20 exchanges in 27 African countries and the market is expanding rapidly.  In short, it is a great time to invest in Africa.

The 3 year performance of the FTSE Pan Africa Index compares very favourably with comparable indexes.

Some questions immediately spring to mind:  

How do you measure the market?  Where do you start?  What are the big opportunities?  Which counties?  Which Companies?  The choice is bewildering for most, even before you worry about how to spread your risk or consider currency fluctuations.  But there is help…

We have all heard of the FTSE 100 Index or the Dow Jones Industrial Average. We now have a new initiative from FTSE Group: the FTSE ASEA Pan Africa Index Series (launched 3 weeks back). Those wishing to invest, track the market place, or compare funds, now have a suitable benchmark index.  

This will help investors have the confidence to invest in funds and see how much they outperform, or underperform the index.

The Index excludes South Africa – a massive and much more mature market that would dwarf the output of other countries in it – instead focusing on Botswana, Cameroon, Cape Verde, Egypt, Ghana, Ivory Coast, Kenya, Libya, Mauritius, Morocco, Mozambique, Nigeria, Rwanda, Kenya, Tanzania, Tunisia, Uganda, Zambia and Zimbabwe. 

The index contains no more than 30 constituents per country and will have a maximum country weight of 20 percent.

I am now waiting for someone to launch a FTSE ASEA Pan Africa Index tracker fund which will allow investors to place money across the continent without paying large fees to asset managers.  Jonathan Cooper, Managing Director, Middle East & Africa, FTSE Group, said: “Investors are increasingly focused on frontier and emerging markets as a source of return and portfolio diversification.”

The lesson here is to love Africa with your heart, but invest in it with your brain.  The FTSE ASEA Pan Africa index has an impressive Year to Date (YTD) performance of almost 19 percent, compared with a YTD performance of under 5 percent for the FTSE BRIC 50 Index.  A thought worth pondering.

Christmas And The Milked Africa ..

Christmas is very important in the world’s calendar. It is the month our savior and Lord Jesus Christ was born. We have every reason to be joyful, thankful and delighted. 

Because of Christ, we are saved and free. The celebration of the birth of Christ is a poignant reminder of why he came to this world and the example he has set for us all to follow.

His ministry was focused on helping the poor, needy, sick and downtrodden. As we celebrate Christmas, the world must remember the poor and afflicted and those that are incapable of helping themselves. This is a moment we should reach out and be generous with what God has blessed us with.

Africa is still suffering from abject poverty, malnutrition, famine and disease. It will be a crime against humanity if the west continues to witness the impoverishment of a continent that has done so much to contribute to its wealth and prosperity.

Africa’s resources have played a vital part in the development of the western world and the west is duty bound to give back. Africa has the potential to continue to help build the infrastructures of the world, but it needs help in harnessing its raw material in a way that will benefit its people.

The agenda should not be business as usual, where only the interest of the west is at the center of any investment engagement, but how the peoples of Africa can benefit long-term from its untapped mineral and natural wealth.

Milking Africa’s wealth to service the west’s industry without any consideration for the plight the people in this rich continent  face each day, is sinful and against the teachings of Christ. And the west should be mindful of the long-lasting consequence this might have on its own people.

Taking from a continent and not giving back sufficiently can only continue to foster serious migration issues across the borders of Europe and America. Africans will continue to come in numbers to seek the wealth that has been taken from them and their fore-fathers.

Helping to develop and enrich Africa’s vital economic institutions are the only way forward in empowering its people and achieving self-sufficiency. As African countries continue to discover oil on their shores and mineral wealth on their land, the future can only be bright, as suffering is what most of them have come to know as a way of life.

It seems finally, the Almighty God has smiled on a people after witnessing how their resources have been ravaged with savage intent by the world’s industry with little or no compassion for its inhabitants. 

Prudent and vibrant leadership is slowly taking control of Africa’s governance, and it seems it won’t be long before Africa starts redefining its own economic agenda as it carves for itself a more dominant and fulfilling role in world economic affairs.

By the way, I wanted to wish a Merry Christmas to all of you, and saying a big THANK YOU for your support and readership!

Compensating Africa for Colonialism.. Legal Perspective

The question of compensation to African countries for being victims of colonization which occurred between the 18th and 19th century was raised once again by some African leaders during the 64th Session of the United Nations General Assembly which was held in September 2009 in New York. 

This path was championed by former Libyan Leader, Muammar al-Qadafi (RIP) who in an address on that occasion called on the colonial powers to pay not less than 77 Trillion US Dollars to Africa in compensation for the ‘evil' effects of colonial system in Africa. This is not the first time such a question has been raised by the Libyan Leader at an international forum. 

It was first raised when the German government, about a decade ago, decided to pay compensation to Jewish families who were victims of Nazi activities during the Second World War. And it continues as a matter of concern to many independent African states seeking  support and international consensus.

The matter has raised several questions with different dimensions including, whether compensation to Africa is necessary and feasible vis-a-vis the benefits derived from that system? What is the basis of determination of the quantum and mode of distribution of the compensation among the independent African states?

Do the colonial powers have the political will and resources as individual entities to pay compensation to Africa even if it is legitimate? These are important questions demanding answers but these are not the focus of the present article. The author only discussed them briefly setting the stage for an in-depth research and analysis.

The purpose of this article is to contribute to the ongoing debate and discussions on the matter from a legal perspective but in a balanced and open-minded manner with the aim to enlighten readers on the matter. The focus is on whether we can qualify colonization as a "wrongful conduct" for which responsibility or liability is attributable to the colonizers? And on what legal ground is payment of compensation sustainable under modern international law (precisely, after 1945)?

Before I turn to the legal issues involved, a brief descriptive analysis of the colonial policy in Africa would be helpful here to understand the trend, reality and effectiveness of that system.

II Colonial Policy in Africa

In the latter half of the 19th Century Africa become the object of widespread colonial expansion. During the 1850s Great Britain began its military campaign to conquer the Gold Coast, and the states of Ashanti and Fanti were subdued. In 1874 the British colony of the Gold Coast was formed. Ostensibly seeking to halt the slave trade, British forces occupied Lagos, which in 1874 was placed under the control of the Governor-General of the Gold Coast.

When the Suez Canal opened in 1869 – now the shortest sea route to India and the Far East was through the Mediterranean – the British sought to gain control of the waterway. With its possessions of Gibraltar and Aden, Great Britain controlled the exits to the Mediterranean and Red Sea. The Suez Canal, however, was commercially operated by a French company. Adjacent to Egyptian territory, the Canal was controlled by the Egyptian Government and the Turkish Kheidive (the latter had only nominal control).

In its efforts to obtain its goal, the first thing Britain did was to establish economic control over the Canal. Taking advantage of the economic difficulties of Egypt, in 1875 the British Government bought Egypt's shares in the Suez Canal Company, thus becoming the largest single shareholder. In 1882, under the pretext of quelling an uprising in Alexandria, British forces occupied Egypt.

British colonizers systematically robbed the African colonies, transferring their entire economy to the service of British industry. They directed the colonial states to rely exclusively on the export of agricultural goods like cotton from Egypt, Cocoa from the Gold Coast and Ivoire Coast, thus providing the industry of Great Britain with cheap and high quality cotton fibre and cocoa products. 

In 1875 Egypt was an exporter of grain, but by 1908 it was forced to import it. High tariffs were set for imported industrial raw materials and machinery for local production, and this led to a decline in the African industries. Existing records of this trend of economic relationship bear adequate testimony to these facts.

British expansion in Africa was a government policy and was also conducted by private capitalists like Cecil Rhodes. The British South African Company, owned by Rhodes, was given rights and powers of government in the area later called Rhodesia. Earlier, in 1886, the same rights were acquired by the United Africa Company, which began to trade in the region of the Niger Delta. In South Africa, British capitalists were eager to establish po9litical control over the gold fields of Transvaal, which were already in their power economically.

The Boer Government was not doing everything it could to make the mines as profitable as possible. As a pretext for was, the British raised the question of the status of foreigners, primarily British, who arrived in Transvaal after the gold deposits were discovered, the Boer Government denied the foreigners complete political rights, fearing that the newcomers would eventually usurp the Boers. British propaganda tried to convince public opinion that the government was fighting for the political interests of the English in Transvaal, not the mercenary interests of Cecil Rhodes and the Rothschilds.

In the 1850s Frances began to seize African territory in Senegal. In 1857 the French took Dakar and began a war to conquer the state of Kaior. The first victim of French capitalism in North Africa was Tunisia, which was of considerable geographical importance with respect to the Mediterranean. Since the 1860s Tunis had been in financial bondage to the British and French capitalists.

Taking advantage of a skirmish with nomadic Arabian tribes on the Tunisia-Algeria border in 1880, a French expeditionary force was sent in to "help" and occupied the most important centres of Tunisia. The French forced the local ruler to allow their forces to remain in Tunisia and local determine foreign policy. Later Tunisia was formally declared a protectorate of France. Already by the 1870s French colonialists began to penetrate into Morocco, gradually bringing individual tribes under their influence and utilizing feudal institutions to acquire land and privileges.

Belgium also participated in the division of African territory. In 1876 the King of Belgium, Leopold II, created the so-called International Association for the Exploration and Civilization of Central Africa. The real goal of the Association; however, was to seize and exploit the Congo River Bain. By 1884 most of the Basin area had come under Belgian control. But the mouth of the Congo River, with the diplomatic help of the British, was ruled by the Portuguese.

In the 1880s Germany initiated its own colonial policy. In 1883 the country founded a settlement in thee Angra Pequena region in south-western Africa. Later the territory was made a German protectorate.

Taking advantage of the fighting between the leading European powers to gain control over the last free possessions, in 1884 Germany seized Cameroon. In this way German Southwest Africa was formed. In 1885 the country took vast territories in the East Africa and laid the foundations for another colony – German East Africa.

In the 1880s Italy, with British backing, began to colonize Eritrea and Somalia.

In order to prevent the French from access to the Nile Valley, in March 1891 Britain reached an agreement with the Italian government to delineate spheres of influence in East Africa. Britain recognized Ethiopia to be in Italy's sphere of influence and stipulated that the western boundary of the Italian sphere be drawn at a sufficient distance to the East from the headwaters of the Nile. 

To cut off access to the Nile Valley from the west, Britain concluded an agreement with Germany. In accordance with the Anglo-German Treaty of 1893, the territory of Cameroon up to Lake Chad in the north and the Shari River basin was declared to be in the sphere of German influence.

The final clash between the British and French in their quest to gain control of the Upper Nile occurred in 1898 when French expeditionary forces marched out of Central Africa to the Nile. In early September of that same year, the British crushed Arab forces and seized the capital of the Sudan – Khartoum. Under pressure from England, French forces retreated from the Upper Nile region. 

In March 1899 the two countries reached an agreement concerning mutual spheres of influence in Africa. The boundary between French and \British possessions in Africa was primarily drawn along the watershed between the Lake Chad and Congo River basins on one side, and the Nile River basin on the other. France acquired part of the Sudan, which made it possible for the country to unite its territory in North and West Africa with its possessions in the central regions of the continent.

By the late 19th – early 20th centuries, all of Africa had been divided among the imperialist powers, with Great Britain acquiring the lion's share (as many as 37 million people inhabited British territory in Africa). In West Africa Great Britain seized Nigeria, the Gold Coast, Zambia and Sierra-Leone; in East Africa, the country controlled Kenya, Uganda, Zanzibar and Somalia. Almost all of South Africa was a part of the British Empire. Though formally a part of the Ottoman Empire, Sudan and Egypt were in effect British colonies.

France had the second largest colonial empire in Africa: West Africa, Equatorial Africa, Madagascar and a part of Somalia. Up to 17 million people lived on these French possessions.

Germany took Cameroon, Togo, Southwest Africa, and East Africa (including the territory of Tanganyika), with an overall population of approximately 10 million people. Belgium, Spain, Italy and Portugal also owned colonies in Africa.

The only independent state in Africa was Ethiopia, which defended its independence in an armed struggle with Italy. In late 1895 Italian forces began their advance into Ethiopia from Eritrea. Within a few months the Italian expedition forces were defeated in a battle at Adua. In October 1896 Italy was forced to conclude a peace agreement under which Ethiopian independence was recognized.

An all-African organization emerged during the fierce struggle against opponents to the unification of the African peoples. The 1958 meeting of eight independent African states in Accra, the capital of Ghana, marked the beginning of the formation of this organization. 

At the first inter-African conference held in Addis Ababa in May 1963, the Organization of African Unity (OAU) was formed the largest regional organization among the developing countries, OAU states its firm resolution to liberate the entire African continent from foreign rule and to eliminate colonialism and neo-colonialism in all its forms and manifestations.

The second phase of the national liberation struggle, which began when the African countries started to acquire their independence, was more complicated and bloody: the young states underestimated the power of neo-colonialism.

Socio-economic problems proved to be entirely difficult to overcome, and, in addition to the colonial legacy, it was necessary to remove the obstacles hat had hindered the development of African society since the pre-colonial period. Ethnic strife and tribalism complicated the situation even more in some states.

III The Aftermath of the colonial past

After the African states won their independence, ruling circles in the former mother-countries were reluctant to give up their positions. Thus, efforts were made to transfer power to political forces considered to be reliable. The colonial powers tried to impose state and legal institutions typical of bourgeois political and economic principles in the newly free countries, to entangle them in unequal treaties and to draw them into military blocs. The imperialist countries endeavoured to preserve the economic backwardness and feudal and tribal order in the liberated countries.

After winning political independence, it was important for the new state to attain economic independence. The colonial legacy had a ruinous effect on the economic situation in the African countries. Single corps and a one-sided and antiquated agricultural system made the new states dependent on the world capitalist economy. Progressive forces in the young states fought for full national revival, for radical economic and social reforms, and for genuine political independence from the imperialist countries.

Typing groups of countries emerged in Asia and Africa in the 1950s and 1960s: states undergoing radical socio-economic changes and following a policy of socialist orientation; states developing along the path of capitalism; and states remaining the possessions of capitalist states. Each of these general groups possesses a broad spectrum of political and economic situations.

As the countries of Africa became more politically independent, they began to seek regional solidarity and to protest the imperialist countries' policy of neo-colonialism. The new states were faced with the urgent task of overcoming the backwardness inherited from the period of colonial rule. Their need to develop  mutually beneficial types of economic cooperation demanded that they unite. 

Economic alliances made it possible for the developing countries to construct modern industrial projects. Alone, the majority of these countries had neither the financial base nor the corresponding market for optimal-size enterprises. By taking advantage of the international division of labour on a regional basis to achieve economic cooperation and integration the developing states were able to accelerate their economic growth.

IV  Evaluation of colonization in Africa

From the foregoing descriptive analysis, it is evidently clear that colonization of Africa was an organized and effective system lasting for a whole century in the interest of trade and commerce which was promoted in England, the Netherlands, Germany, Belgium and France by ruthless profit-making companies. 

It may be argued that Colonization of  Africa by the Europeans opened  the continent to western civilization, formal education, western democracy and   may further support this realities with the fact that countries in Africa such as Ethiopia which were not effectively colonized are worst today than those colonized in terms of development, peace and security. However, such arguments must be weighed against the problems of eliminating the aftermath of the colonial past which is very costly for Africa. The disadvantages weigh higher than the advantages.

The independent African States are paying high prices in terms of civil conflict (resulting from the arbitrary nature of the boundaries by colonial powers in Africa), problems of governance (resulting from the transfer of political power from colonial masters to favourite elites though power was taken from traditional rulers through conquest or treaties), backwardness (resulting from under-development, exploitation of human and natural resources), distortion of the African cultural development (resulting from the influence of European culture and religion), lost of respect and identity (resulting from master-servant relationship and subjugation of Africans), to mention but a few. It appears justifiable on those grounds to say that colonization has done more harm than good to Africa.  

V  Some legal implications of colonization

The decolonization process was basically completed by the 1960s after the landmark of the adoption by the UN General Assembly in 1960 of the "Declaration on the Granting of Independence to Colonial Countries and Peoples", (GA Res. 1514 XV of 14). The resolution declares among other things that: 

"The subjection of people to alien subjugation, domination and exploitation constitutes a denial of fundamental human rights,  is contrary to the Charter of the United Nations and is an impediment to the promotion of world peace and cooperation". From this day, colonization, whether direct or indirect, has been qualified as a "wrongful act" and prohibited by international law just as was done with slavery which was originally coalesced in the Vienna Declaration on the Abolition of the Slave Trade in 1915, one of the flagrant abuses of human rights. Such an act would lead to state responsibility. But the question is whether the 1960 Declaration has a retrospective effect for the colonial powers?

The law of state responsibility is concerned with the determination of whether there is a wrongful act for which the wrongdoing state is to be held responsible or liable and what the legal consequences are (e.g. an obligation on the part of the wrongdoing state to restore the previous situation or pay compensation), and how such international responsibility may be implemented (e.g. through countermeasures adopted by the victim states such as reprisal or restoration.

In the Spanish Zones of Morocco Claim (1925) 2 RIAA 615, Umpire Huber expressed the concept of state responsibility in the following terms:

"Responsibility is the necessary corollary of a right. All rights of an international character involve international responsibility. If the obligation is not met, responsibility entails the duty to make reparations.'

We can refer to the work of the International Law Commission Draft Articles on State Responsibility (Yearbook of the ILC, 1979), which represents an authoritative statement of the principles regulating state responsibility, in particular in relation to the content, forms and degrees of state responsibility. This can be supplemented by a considerable amount of case law on the subject generated within the last century. Article 19(2) of the Draft Articles states that:

Article 19(2) of the Draft Articles defines an international crime as:

"An internationally wrongful act which results from the breach by a state of an international obligation so essential for the protection of fundamental interests of the international community that its breach is recognized as a crime by that community as a whole ..."

Four practices are expressly identified as international crimes, although these are merely illustrative and not exhaustive. These are:

i)       A serious breach of the international rules created for the preservation of international peace and security, such as the rules prohibiting aggression;

ii)      A serious infringement of the principles which safeguard the right of self-determination of peoples, such as the rule prohibiting the establishment or maintenance by force of colonial domination;

iii)     A serious breach on a widespread scale of an international obligation of essential importance for safeguarding human beings, such as those prohibiting slavery, genocide and apartheid; and

iv)     A serious breach of an international obligation of essential importance for the safeguarding and preservation of the human environment, such as those prohibiting mass pollution of the atmosphere or of the seas.

In application of the above article, the colonial powers were directly and effectively engaged in colonizing Africa for over hundred years and the ‘good' and ‘bad' of that system can be imputed to the colonial powers.

The actions of state organs, agencies and representatives must he attributed to the state for the purposes of determining international responsibility. Direct or indirect responsibility will devolve to the states for:

i)       Acts of the executive, legislative and judicial branches of the government. (as in Draft Article 6).

ii)      Any actions of the political sub-division of the state, such as individual federal states or provinces (as in Draft Article 5).

iii)     An action of any organ, state employee or other agent of the government

functioning within their official capacity (as in Draft Article 8).

Acts which are lawful under municipal law, but unlawful under international law attract international responsibility and it is no defense to an international delict that colonization was legitimate under municipal law of the colonial powers. As the Court pointed out in the Polish Upper Silesia Case (1926) PCI) Reports, Series A, NO.7:

‘…municipal laws are merely facts which express the will of and constitute the activities of states in the same manner as do legal decisions or administrative measures.'

Imputability for actions of agents and employees of those states engaged in colonization extends in particular to the police and the armed forces. In this respect, the following principles are important:

          A state is liable for the official actions of all agents no matter how minor in rank (Draft Article 6). See, Massey Case (1927) 4 RIAA 15.

However, it would be difficult to determine whether the wrongdoing by the colonial powers constitute a breach of an international obligation of those powers. This is because the resolution itself was adopted by 89 votes to 0, with nine abstentions. The abstaining states include Belgium, France, Portugal, Spain, the UK and US (virtually all the states engaged in colonialism abstained).

The colonial powers did not give consent to be bound by the resolution and it may apply only between parties to the agreement.  As a general principle, a treaty does not establish rights or duties for third states without their consent (Article 34 of the Vienna Convention on the Law of Treaties, 1969). This rule is expressed in the maxim pacta tertiis nec nocent nec prosunt, and is supported by a number of international decisions. See especially, the Free Zones of Upper Savoy and the District of Gex Case (1932) PCIJ Reports, Series A/B, No. 46.

 A number of exceptions to this rule have been established both under the Convention and also in customary law. Cumulatively, these include the following:

(i)                Multilateral treaties declaratory of customary law will apply to non-parties, although in fact they are not bound by the treaty itself, but rather the underlying customary principles. See the North Sea Continental Shelf Cases (1969) ICJ Reports, p.3.

(ii)             Multilateral treaties which are instrumental in the creation of new customary rules may ultimately bind third parties on a customary basis, for example, the Hague Convention on the Rules of Land Warfare 1907.

(iii)           Emergence of a jus cogens: Article 64 of the Convention stipulate that, where a new peremptory norm of general international law has emerged, any existing conflicting conventional obligations are terminated.

Conclusion

Based on the expose' and critical analysis, it may be argued that imputability of the wrongful act of colonization to colonial powers will pass the test for responsibility whether they give consent or not to international agreements that criminalize and prohibit colonization. But the question that remains difficult to answer is whether those wrongful acts (colonization) can also pass the test of time (have retrospective effect)? This seems impossible in the present case.

It is important to note that the request for compensation for colonizing Africa, even if on any justifiable ground as shown in this paper, will require not just international law but most importantly the political will of the colonizers, united effort of the independent African States and support from the entire international community. 

This dream is not easily achievable (not in the shortest time) as envisaged by some African leaders because of the complexity of the issues. Africa was not the only victim of colonization and in the history of mankind people have been colonized by one another formally and non-formally. More so, where African States have also benefited in one way or the other through the relationship.

Alternatively, the African states must be able to strategically attract the colonizers to become more committed in their assistance to them for a speedy development on the continent. 

During the visit of the US President Barack Obama to Ghana in 2009 he made it clear that the destiny of Africa lies in the hands of Africans themselves. African states need to develop mutually beneficial types of economic cooperation which also demand that they unite.

Economic alliances within and outside Africa would possible lead African countries to construct modern industrial projects instead of wasting their energy in fighting for compensation for colonization.