Trade Liberalisation Kicked Away African Development Ladder

By Jomo Kwame Sundaram in IPS 8 May 2024

Africans have long been promised trade liberalisation would accelerate growth and structural transformation. Instead, it has cut its modest production capacities, industry and food security.

Berg helped sink Africa
The 1981 Berg Report was long the World Bank blueprint for African economic reform. Despite lacking support in theory and experience, Africa’s comparative advantage was supposedly in export agriculture.

Once obstructionist government interventions were gone, farmers’ previously repressed productive potential would spontaneously achieve export-led growth. But there has been no sustained African agricultural export boom since.

Instead, Africa has been transformed from a net food exporter in the 1970s into a net importer. Over the next two decades, its share of world non-oil exports fell by more than half from the early 1980s.

Sub-Saharan Africa (SSA) export growth from the late 20th century has mainly been due to foreign direct investment (FDI) from Asia, especially China and India. Nevertheless, Africa’s share of world exports has declined.

High growth in Asian economies contributed most to raising primary commodity prices, especially for minerals, until they collapsed from 2014.

Underdeveloped agriculture
African agriculture has been undermined by decades of low investment, stagnation and neglect. Public spending cuts under structural adjustment programmes (SAPs) have also depleted infrastructure (roads, water supply, etc.), undermining output.



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