July 5, 2005


Africa Leaps Forward: Forget Tony Blair and Live 8. The really amazing story is that Africa is starting to recover on its own. (Tom Masland, 7/11/05, Newsweek)

Behind the headline chaos, however, there is a more promising reality. Democratic elections have swept Africa. Thirty years ago the continent had only three elected heads of state; now there are 30. The International Monetary Fund says a core group of 25 nations representing three quarters of the continent's population has been steadily moving ahead economically, and asks, "Is Africa turning the corner?" The IMF predicts overall growth this year of 5.4 percent (chart), driven by often painful economic reforms that began more than a decade ago in South Africa and have since spread widely among its neighbors. "We've got a critical mass of countries, and we need to concentrate on that," says Trevor Manuel, South Africa's Finance minister.

In short, Africa is not sitting still, waiting for the West to help. Last Saturday, billions worldwide watched 10 simultaneous Live 8 concerts; this Wednesday, Blair will place Africa at the top of the international agenda at the G8 summit in Scotland. But the only practical result of the summit is likely to be the ratification of a plan to write off the debt of 18 poor nations, 14 of them in Africa. While this helps, the forgiven debt wasn't being paid anyway, and amounts to just $14 billion of the continent's $300 billion total debt burden. Beyond that, Blair's international Commission for Africa has proposed doubling annual foreign aid to Africa to $25 billion by 2010, and to $50 billion by 2015. But France, Italy, Germany and Japan are raising objections, and U.S. President George W. Bush has his own aid plan. So far, Africa has received more pledges than aid. And last week a new IMF study threw cold water on the whole premise of the summit, saying there's no good evidence aid works to promote growth in poor countries.

That only raises the pressure on Africa to pursue its homegrown recovery, which has its roots in the end of the cold war. Until the mid-1980s, the superpower rivalry made communism attractive to Africans, and set off a U.S.-Soviet duel to aid their proxies on the continent. Both sides were prone to wink at waste and theft committed by strongman allies. But South Africa's emergence from apartheid in the early 1990s set an important example to the rest of the continent. Although Nelson Mandela spoke of nationalizing white-owned industry on his emergence from prison, he quickly tacked right and accepted protecting property rights as part of the new constitutional order. His economic policy and that of his successor, Thabo Mbeki, alienated members of their coalition, notably the South African Communist Party and the Congress of South African Trade Unions. Yet fiscal discipline paid off with steady growth and investment, turning South Africa into an engine of growth for the continent.

As South African companies began spreading investment across the region, the idea of reform spread, too. There was no other game in town. Angola reunified and thrived on investment in oil. Kenya threw off a president-for-life and began to modernize, aided by South African money. Uganda, a one-party state, continued its 20-year march back from the tyranny of Idi Amin. The capital, Kampala, grew a skyline. Mozambique emerged from a devastating war to register the world's fastest growth rate in 2000, and is still going strong. In the past five years, sub-Saharan Africa has reversed a long-term decline in per capita GDP, and has started to grow again.

No question, the current boom is in part the product of record-high oil prices. Oil exporters grew much faster than importers last year, by 6.2 percent compared —with 4.7 percent, and the IMF expects that gap to widen this year. Angola's economic growth rate is nearing 14 percent, the fastest in Africa. But the emergence of relatively strong growth in non-oil states, too, led by South Africa, is testimony to the spread of macroeconomic reforms that are stabilizing inflation rates, raising currency values and encouraging private-sector investment.

The most striking success story may be Tanzania, which also has no oil.

It's not as if Africa and the Middle East could avoid the End of History.

Posted by Orrin Judd at July 5, 2005 7:33 PM

That would be closing the circle, no?

Posted by: ghostcat at July 5, 2005 8:39 PM

Hmm. Don't see any mention of Botswana, another success story, in there.

Posted by: John Thacker at July 5, 2005 9:29 PM

--The most striking success story may be Tanzania, which also has no oil. --

And radical Islam is on the rise.

Posted by: Sandy P at July 5, 2005 11:03 PM

I have read that South Africa is stagnating pretty badly - true or not? I think it is one of the reasons he has closed ranks with Mugabe.

Things in Kenya are worse now than 10 or 15 years ago, also. I know many missionaries and teachers and medical folks who will not travel there anymore.

Uganda and Mozambique seem to be much improved. How about Angola? Things have to be better there than 15 years ago.

Posted by: jim hamlen at July 6, 2005 10:50 AM

Kenya's actually been doing rather well recently, including electing a second party to power, always a key test.

Posted by: oj at July 6, 2005 11:33 AM