African Seminar
Economic Sustainable Development
With an average GDP per capita of $671, Africa remains the poorest continent on Earth. Since Africa's mass decolonization in the 1950s and 1960s, tremendous amounts of aid have been given to the continent, totaling 3.2% of Africa's GDP, yet economic progress so far has been unsatisfactory. GDP per capita is growing at around 5% annually, a rate of economic growth that is mostly propped up by mining, oil drilling, subsistence farming, and a small amount of manufacturing and banking. African governments are plagued by coups d'états and instability, which deter potential businesses and incites wars over mineral resources. Much of Africa's revenue comes from nonrenewable resources such as diamonds and petroleum, and Africa remains the least industrialized continent in terms of manufacturing and industry, with only 15% employed in this sector, compared to 60% employed by farming.
Africa's economy is held back by disease, lack of infrastructure, corruption and red tape, and crushing poverty. Only 60% of Africa's population can read and write, and African countries spend little on education; the UN Educational, Scientific, and Cultural Organization, UNESCO, estimates that an additional $2.5 billion dollars must be spent in aid yearly to achieve a 50% improvement in literacy by the year 2015.
Africa's economic failure stands in contrast to the recent economic success of Asia, which had had similar levels of poverty in the 1960s but has recently outpaced Africa tremendously. Asia's economy is now driven mainly by the manufacturing sector, and Asia has several important centers of finance, such as those in Hong Kong, Tokyo, and Singapore.
Opinions are divided as to how to bring about economic success in Africa. Many believe that large amounts of aid and investment are necessary to bring about success in Africa; they argue that, since investors are unlikely to invest in African industries in their current financial state, Africa must be developed through the use of aid for immunization, education, clean water, and other programs. Ideally, aid programs help to prevent disease, provide food after crippling famines, and help educate African workers. However, this aid is often misappropriated, and some argue African countries become dependant on foreign aid to survive economically. Another possible solution is debt relief, in which debts to African countries are cancelled in order to free African economies from paying large interest payments to Western governments. However, many argue that debt relief helps only African governments, not African people, and that it encourages African governments to overspend with the expectation that their debts will be relieved in the future. The predominant modern strategy has been economic liberalization, which involves the removal of government regulations and taxation on businesses; however, this strategy has had only limited success, and was criticized for implementing economic reforms while still retaining undemocratic dictatorships.
The United Nations has poured billions of dollars into projects for Africa, but these projects have had only limited success. Clearly, new strategies are needed to bring economic success to Africa.