African Capitalism: Economic growth without Human Development

Although I am not happy saying this as an African, but I think very deeply inside of me and very convincingly that 80% of all the African countries have failed woefully; economically, politically and socially since their various independence dates. I think that most African countries and leaders are not serious. I am bitter about this fact. Many African countries got their Independence around the 1960s, more than 5 decades ago; and till now, many of them have barely anything to show that they have been able to govern themselves better and make life better for their citizens. They have not been able to achieve enormous feats nor take their countries to greater heights since their independence. The past and present leaders of many of these African nations have not even been able to build a nation-state; e.g. there are so many states in Africa but there are not so many nation-states. Most of these countries have so many ethnic groups and many African leaders have not been able to harmonize these different ethnic groups in their respective countries to build a nation-state. During elections, there are so many ethnic tensions, and leaders are chosen in most African countries based on ethnic sentiments. And after elections in many African countries, there are always ethnic-influenced protests and killings here and there.

So, most African leaders past and present have not been able to harmonize their countries into having common values; feeling of belongingness or oneness; collective goals; pursuit for greater good of country and not ethnic group; and pursuit for the glory of whole country. Most African countries got their independence alongside countries like South Korea, Malaysia, and Singapore which were third world countries. Comparing these countries, economically and socially; with most African countries, their contemporaries around the 60s, is like comparing 1 Zimbabwean dollar with $1. Agriculture for example has been grossly neglected in most African countries, maybe until lately. Around the 60s, Africa was leading the world Agriculture wise, and has most of her Gross Domestic Products (GDPs) built on solely Agriculture, but not same today. Africa has a lot of arable lands, but African countries are today the greatest importers of food in the world. Agriculture contributes like 3% of United States of America’s GDP, and many African countries import most food products from the United States of America currently. Most African economies are not diversified in any sense. The countries that have petroleum products like Nigeria are solely dependent on just Oil economy wise. Major manufacturing is low or not happening in most African countries at all and most African countries are still battling with common developmental essentials like steady electricity, water, efficient public transportation, efficient health care; and the citizenries of most of these countries still live below less than a dollar a day. Currently, most African countries have the highest number of patients that troop to the United States of America, India, Germany and so many other countries for most severe ailments. Then the Human Development Indexes (HDIs) of most African Countries are the lowest in the whole world.

Politically also, most African countries have failed in terms of leadership. Corruption has been a serious menace and most African leaders have helped to institutionalize it. Most African countries have had leaders that were not prepared for leadership, and came in thinking about enriching themselves alone. Regardless of the military coups that brought in so many military leaders in most African countries, in the past, most especially, I think that African countries have been most unfortunate with very terrible and dumb leaders. I mean, where are the African examples of “Lee Kuan Yew” that “single-handedly” transformed and changed the story of Singapore?

Africa is one of the wealthiest continents in the world in terms of natural resources, but the poorest in terms of every other thing, a case in point is the Democratic Republic of Congo which is the richest country in the world but the second worst in terms of HDI. Singapore, South Korea, Malaysia etc. have nothing in terms of natural resources to be compared with that of most African countries. By the 2014 HDI estimates of 187 countries; Democratic Republic of Congo with all her natural resources for an example has the HDI of 0.338 (186th); Nigeria, the largest economy in Africa has the HDI of 0.504 (152nd); Ghana, 0.573 (138th); Côte d’Ivoire, 0.452 (171st); Ethiopia, 0.435 (173rd); Kenya, 0.535 (147th); Uganda, 0.484 (164th); Namibia, 0.626 (127th); Zambia, 0.561 (141st); Mozambique, 0.393 (178th); Central African Republic, 0.381 (185th) etc. The few countries that managed to be within High Human Development are: Libya, 0.784 (55th); Mauritius, 0.771 (63rd); Seychelles, 0.756 (71st); Tunisia, 0.721 (90th); and Algeria, 0.717 (93rd).

Starting like this, because of the corruption of many African leaders, and their unseriousness, the delivery of public services and Welfarism have also been seriously left out over time. Inequality rates in most African countries are thick. Now there is a great wave of international capitalism that started from the West sweeping across the world. And Africa is following suit and prouding herself of not being left out. Most African countries have Free Market based Economies; governments are not supposed to interfere with the prices of goods and services. The prices of goods and services are being determined by market forces. This is good in terms of encouraging entrepreneurship; failure of public institutions to run factors of production, after years of neglect and abuse; and having the private sector to run factors of production efficiently, and provide employment and economic growth. A terrible fact however is that many African economies have been growing rapidly based on their GDP’s (nominal), but the HDIs are not coming up as well. For an example, the GDP of Nigeria is $522 billion but the HDI is 0.504 (152nd); Morocco’s GDP ($105 billion), HDi (0.617, 129th); Kenya’s GDP ($55 billion), HDI (0.535, 147th); Tanzania’s GDP ($34 billion), HDI (0.488, 159th); Cameroon’s GDP ($27 billion), HDI (0.504, 152nd) etc. This is an acute contrast to countries I used previously in my comparisons, like South Korea (GDP, $1.449 trillion; HDI, 0.891 (15th)); Malaysia (GDP, $367.712 billion; HDI, 0.773 (63rd)); and Singapore (GDP $295.744 billion; HDI, 0.901 (9th)); where HDIs are growing with GDPs. Most economists and the elite in Kenya have been so happy that Kenya’s economy has been termed a “middle income” economy. But the question remains, what this means to a corn-roaster at Ngara, a neighborhood in Nairobi, or a poor farmer, very far away. Or what it would mean in their lives, even in 20 years time?

That means there are serious economic growths in some African countries but there are no human development. Standard of living is so low in so many countries; and many African countries are claiming middle income economies. The inequality gap is thickening. This is because the political and economic sectors are run by the elite, the same people. In most instances, the politicians, when they have left power would now become the proper business men.

Currently, public services and Welfarism are being neglected by most governments currently, and most governments are removing subsidies of commodities like petroleum etc. based on the advice from IMF, World Bank etc. I can never deny the fact that a thriving of the private sector is the best way for most African countries to get out of their prolonged mess but there are still very clear roles of the public sector; there are certain things the governments should provide, and governments should not neglect their roles in providing these things. Public institutions are dying in many countries. Public schools and hospitals are dying in most countries because of the mentality that these things should be left for the private sector alone.

In Nigeria for an example, you would be seen as a joker if you send your ward to a public primary or secondary school. Because, most of these public schools are dead. And the unimaginable amount of money that parents spend per term for their wards at the privately run schools is something else. I went to public primary and secondary schools. My primary school education was free, and I got quality education through passionate and good teachers, in a very conducive environment. My life today is built on that education. But this is not the case today; parents pay more than $500 per term at various privately run primary schools in Nigeria especially in Abuja and Lagos. You can imagine this. Then most of the public secondary schools are very much dead because of the government’s neglect and the sudden and rapid increase of privately run secondary schools helped to bring about mass cheatings in West African Senior Secondary Certificate, National Examination Council, and Joint Admission and Matriculation Examinations. The examination papers for these exams leak every morning across the federation during these exams, and most secondary school students do not read again during these very important exams. Then the elite that can afford it, send their wards to big privately run secondary schools for quality education and where they pay more than $1,000 per term, in most instances. Then most public universities are dying also. Our father’s generations went to these public universities and always tell us stories about how good these universities were then, how emphasis were on quality education and conducive environment. The failure to sustain this however has given rise to privately run universities, run by mostly pastors and big politicians where students pay unimaginable sums of money to attend because the public universities have been neglected in every sense: poor infrastructures; and always marred by strikes by Academic Staff Union of Universities and Non-Academic Staff Union of Universities. Currently, there is this whole wave of Nigerians going for university education abroad because the public universities are dying pretty fast. Dr. Nnamdi Azikiwe went to a university in the United States of America because Nigeria had no university then and for quality education, decades later, Nigerians troop abroad for quality education. The best university in Nigeria is the University of Ilorin, a public university, and this university is the 20th in Africa based on the 2014 Webomectrics ranking of African Universities; for you to understand what I am saying. Nigeria, with all her oil money, cannot boast of the best public university in Africa for example.

Then you would be seen as a joke if you go to a public hospital in Nigeria for medical treatment, because most of them have been long neglected, with doctors that run their own private hospitals down town, and use the time they should have spent in these public hospitals where they were employed by the government, to run their private ones. I have cases of thousands of people that died not attended to, in these public hospitals during emergencies. Then the medical bills from these privately run hospitals are something else. If the public hospitals are working, at least the have-nots could afford going there for cheaper bills. These are common and essential things the government should provide. So to get the best services, education and health wise, one would have to go to the privately run institutions, and especially only the “haves” can afford this. Millions of Nigerians cannot afford visiting these privately run institutions. Many Nigerians have died from lack of money to travel abroad for major ailments like cancer and kidney cases. The elite in Nigeria (politicians, public office holders, wealthy business men) all go abroad for medical treatments, all of them. Including the president, his wife, former presidents, governors and key government officials all go abroad for medical treatment shamelessly. Many Nigerian politicians, all died abroad while seeking for medical treatment over severe ailments because Nigeria cannot boast of public hospitals that could take care of some major ailments. It is saddening that Nigeria with all her oil money cannot boast of one of the best hospitals in the world. The only crime in Nigeria is to be within the “have-nots.” And this is largely the case in most African countries.
In ideal capitalist environments like in the United States of America, the public hospitals and schools are the best; equipped to the teeth; affordable, cheap, with subsidies and scholarships for the “have-nots”. These public institutions create a balance; and make competition between them and the privately run ones active. That is what it should in an ideal Capitalist environment. I do not know from where most African leaders got the idea that public institutions should die because of Capitalism.

Moreover, another ugly fact is that most of the leaders in Africa that should make these Markets entirely free in the actual sense of Capitalism are the business people or have allies in the business sector. In most cases, during elections, the allies give them moneys to rig and bribe themselves through and when they get into power; they would have to reciprocate by given these business allies contracts and allowing them to have the monopoly of producing or importing very essential commodities. So you have the Markets not being truly free again. There is serious monopoly in the importation and production of very essential commodities in most Africa countries. In Nigeria, a former Vice President has one of the costliest private universities in the country. Politicians own private schools, estates and hospitals.

Then corruption sets in, because the Internally Generated Revenues that governments should generate from taxing these privately run institutions are not been used in most instances to deliver public goods, the way it should be in Capitalist economies. Corruption takes away these taxes. In Europe, when you pay tax, you see the results the next day, but in most African countries, civil servants that have been paying taxes for years, for example, cannot point to anything and say that their taxes brought this. And based on poor legislative and judicial institutions, governments are not been held accountable for things like this.

So in African Capitalism, the poor keeps getting poorer and the rich richer. The poor ones, in millions, cannot get good health care or go to good schools in most cases, because the public institutions that should be thriving, cheaper, are not there to create a major balance. The elite are just the ones controlling everything while the masses are so impoverished. Welfarism is totally neglected. Public Institutions are dying. Unlike in so many countries in the Scandinavia and Europe that have the best HDI’s in the world, and have their HDIs growing with their GDPs, like: Norway’s HDI is 0.955 (1st); Sweden, 0.898 (12th); Denmark, 0.900 (10th); Finland, 0.879, (24th); Germany, 0.911 (6th); Netherlands, 0.915 (4th) etc., there is a provision of public services: schools, hospitals, housing, transportation etc. Education, health care are free in most of these places and prices of essential commodities are very low. Some of these countries have economies that were built on Welfarism, why can’t African countries borrow from their model? They have been able to humanize their capitalism, even in almost all the countries in the West like the HDI of Australia is 0.933 (2nd); Switzerland, 0.917 (3rd); United States of America, 0.914 (5th); Ireland, 0.899 (11th); New Zealand, 0.910 (7th) ; Canada, 0.902 (8th) ; Belgium, 0.881 (21st); Austria, 0.811 (21st) etc. They tell African countries to remove all the subsidies here, for their economies to thrive, while they have a lot of it over there like the Structural Adjustment Programs experiences that caused inflation in so many African countries; caused intense poverty; caused great fall in the standard of living of so many people; made a lot of people lose their jobs; and messed up the social sectors through currency devaluation, higher taxes, lower government spending, rise in food prices, and cutting of wages. An average European has a good shelter, electricity, good food, efficient transportation etc., though they have gone far in economic growth and development for decades, their governments’ efforts, consciousness in making these provisions available, for almost everyone can never be neglected. They have capitalist economies but public services and Welfarism were never neglected. And people are living fairly well.

I do not have any issues with Capitalist economies, but African leaderships should not be carried away by this. There should be a bit of public deliveries and Welfarism. Economic growth without human development can never work. It is not by going to Davos and speaking good grammar, or showing everyone economic statistics or having smart finance Ministers that borrow all the Western economic principles and come and heap them in Africa; but by clear facts about the living conditions of the people. Yes, I know about the trickle-down effect, but that might never work in Africa. Because Africans are so selfish, and it takes great time, and would take more time in the African context. People are grossly underpaid in most private institutions, there is abuse of labour; and I can feel the philanthropic presence of Bill Gate in Africa than that of all the richest African men combined altogether. African elite would prefer to go for shopping in Europe than in his or her country.

Africa has made a lot of mistakes and is about starting a whole set of new ones again. Economic growth without human development can never help African countries. It is never by saying that the GDP is growing by this and that percentage and leaders prouding themselves in this regards but by, the translation of this, to the living conditions of the African people.

It is time this becomes a concern to African leaders, the very fact that GDPs and HDIs are not working hand in hand, in most countries in Africa. Welfarism and public goods deliveries must be highly considered and not left out based on the wave of international capitalism, and based on the way African leaders are following it blindly. It’s not only by economic statistics but should be mainly by the standards of living of the African people.



4 thoughts on “African Capitalism: Economic growth without Human Development” by Chambers Umezulike (@Umezulike)

  1. The problem with Africa consists chiefly in the fact that we appear to be ultra-modern externally but in our core, we are ultra if not even anti-modern. We need to embrace modernity and join the developed part of the globe in the journey of progress. By modernity here is not meant westernization but an acceptance of the fact of the centrality of reason, of the need for scientific breakthrough and technological innovations in Africa.

    @umezulike has said that Africa is one of the richest continent in the world, in terms of natural resources but it’s backward in terms of modern progress. It is in Africa that our universities toil and moil only to produce personnel…we don’t pursue knowledge for its own sake if not for the benefits of getting employed thereafter. We need to change; we need advancement; we need to be MODERN.

  2. YOU SAID IT ALL

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