2 - Can Africa Compete in a Global Economy?

Summary

Introduction

Since their independence, the countries of sub-Saharan Africa (SSA) continue to face severe social, political, and economic developmental problems, notwithstanding the abundance of natural resources in the region. While some SSA countries are making significant progress toward socioeconomic development, the antecedents of underdevelopment are widespread even in the successful ones. It is not a stretch to characterize any of these nations as a microcosm of regionwide experiences, opportunities, and challenges. Accordingly, postindependence sub-Saharan Africa can best be described as a region overburdened with multifaceted, causally related precursors of underdevelopment. These factors include but are not limited to the following:

• 1. ethnic, civic, and social discontent, as manifested in political instability, conflicts, and wars;

• 2. susceptibility and vulnerability to preventable diseases, lack of basic medical care, low quality of life, and short life expectancy;

• 3. widespread civil service corruption, lack of accountability, ineffective governance, poor management skills, and inept leadership;

• 4. lack of physical capital stock, low-quality human capital stock, widespread brain drain, and high dependence on expatriates;

• 5. unstable macroeconomic and legal environments, weak private sector, weak property rights, balance-of-payments problems, high foreign investment risks, and low levels of foreign direct investment;

• 6. economic inefficiency, low levels of productivity and economic growth, high unemployment rates, lack of technological innovation, widespread poverty, low standards of living; and

• 7. environmental degradation and rapid depletion of highly valued and endangered flora and fauna.

As a result of the prevalence and pervasiveness of these manifold problem areas, SSA has proved incapable of fostering sustainable socioeconomic development through the ingenuity of its own peoples. In other words, there is a shortage of effective or visionary socioeconomic development initiatives, whether conceptualized, implemented, or driven by local leaders and governments. The situation has worsened in the past few decades, a period marked by the major structural transformation of the global business environment, what we call globalization. The concept of globalization can best be viewed as the emergence of a complex and dynamic set of forces that are fast changing, interdependent, and yet confounded with risks and uncertainties. Those forces have culminated in a new global business environment that is information driven and knowledge based. This new environment is changing the way institutional actors and stakeholders think and operate.

As Martin Spechler has argued in chapter 1, globalization has had multifaceted impacts on Africa.