Sub-Saharan Africa in Global Capitalism

Beginning of article

If we define sub-Saharan Africa as excluding not only north Africa but also bracket off, for the moment, the continent's southern cone, dominated by South Africa, the key fact about the rest - the greater part of the continent - is thrown sharply into relief: after 80 years of colonial rule and almost four decades of independence, in most of it there is some capital but not a lot of capitalism. The predominant social relations are still not capitalist, nor is the prevailing logic of production. Africa south of the Sahara exists in a capitalist world, which marks and constrains the lives of its inhabitants at every turn, but is not of it. This is the fundamental truth from which any honest analysis must begin. This is what explains why sub-Saharan Africa, with some 650 million people, over 10 percent of the world's population, has just 3 percent of its trade and only 1 percent of its Gross Domestic Product; and why income per head - averaging 460 dollars in 1994 - has steadily fallen, relative to the industrialized world, and is now less than a fiftieth of what it is in the Organization for Economic Cooperation and Development (OECD) countries.(1) It also explains why sub-Saharan Africa's economies have responded worse than others to the market-oriented development policies urged on it by the World Bank and other outside agencies since the 1980s. Now the aid flow is declining, while population growth is still racing towards a barely imaginable 1 to 1.2 billion in the year 2020.(2)

As we shall see, some forms of capital see plenty of profitable opportunities in sub-Saharan Africa, but the likelihood that the region is going to be developed by capitalism seems smaller than ever. On a continent of household-based agrarian economies with very limited long-distance trade, colonialism imposed cash-crop production for export, and mineral extraction, with manufacturing supposed to come later. Today, however, world demand is weakening for the export crops that African farmers produce - coffee, cocoa, tea, cotton, sugar, tobacco - and competition from much more productive capitalist agriculture in Asia and Latin America is intensifying; while industrial country dependence on Africa's minerals and metals is also declining (by about 2 percent a year).(3) And takeoff into manufacturing for internal consumption is blocked by an inability to compete with imports and by tiny domestic markets; meanwhile collapsing infrastructures, political risk, and poorly trained workforces tend to make manufacturing for export uncompetitive, even at very low wages.(4) As the Economic Commission for Africa says in most of Africa industrial expansion faces "impossible difficulties."(5) South Africa is, of course, the big exception, with a diversified and relatively sophisticated economy and a population growth rate well below that of the rest of sub-Saharan Africa: if we include all of southern Africa in our definition of sub-Saharan Africa (the more usual definition), South Africa alone accounts for about two-fifths of its total gross domestic product (GDP).

Africa in Global Capitalism: Two Perspectives

There are two ways of picturing Africa in the context of global capitalism. One is from the point of view of the people living and hoping to improve their lot in sub-Saharan Africa's forty-eight nation-states with a considerable variety of kinds of "insertion" into the global capitalist economy, and a corresponding range of experiences of development (or the lack of it).(6) The other is from the point of view of capital, for which Africa is not so much a system of states, still less a continent of people in need of a better life, as simply a geographic - or geological - terrain, offering this or that opportunity to make money.

On the first view, what stands out are two general features. First, besides South Africa, the one large industrialized country in the sub-continent, there are just six other countries with over twenty million inhabitants each - Congo/DRC, Ethiopia, Kenya, Sudan, Tanzania, and Uganda - and one super-large country, Nigeria. Between them, these eight countries account for 61 percent of all Africans south of the Sahara (and Nigeria, with an estimated 118 million inhabitants in 1997, contains almost one in five of them); the other forty are small, including twelve mini-states with populations of less than two million.

Second, however, is the fact that, in terms of income per head, size and wealth do not go together: Nigeria is one of the poorest African countries, in spite of its formidable oil production, with a per capita income of only 240 dollars in 1996. The so-called "middle-income" African countries are Senegal, Zimbabwe, Swaziland, Cote d'Ivoire, Congo PR, Cameroon, Botswana, Gabon, and South Africa. Yet with the exception of South Africa and its near neighbors, and the partial exception of Cote d'Ivoire, most of the citizens of these countries are often no better off than their apparently poorer neighbors: most of the "middle income" countries are mineral exporters, their per capita income figures boosted by the value of the oil and other minerals that the big transnational corporations extract and export from them.

In most of Africa, even in countries with major mineral exports, economic life still largely revolves around an agricultural cycle that remains acutely dependent on capricious weather conditions. Growing pressure of population means a constantly expanding landless labor force, partly working for subsistence wages on other people's land, partly unemployed or underemployed in the cities, sometimes migrating to neighboring countries (e.g., from Burkina Faso to Cote d'Ivoire), living on marginal incomes and with minimal state services, including education and health. This situation seems set to persist, or get worse; after a moment of optimism in the mid-1990s, no one now expects to see the 5 percent growth in GDP per annum that is agreed to be necessary for any significant reduction in poverty (given average population growth in the sub-continent of 2.7 percent per annum), let alone any hope of even beginning to close the gap with the industrialized (or post-industrial) world.(7) As the Economic Commission for Africa puts it, "according to current estimates, close to 50 percent of the population [of Africa] live in absolute poverty. This percentage is expected to increase at the beginning of the next millennium and to prevent that, African countries will need ... to create seventeen million new jobs each year [merely] to stabilize the unemployment rate at the current level." And this is not something the Commission seems to think likely.(8)

Even the 1998 Report of the much more market-oriented African Development Bank has, in spite of every effort to identify bright spots, a somber tone overall, and understandably so. In the foreseeable future, there are no good reasons to think that capitalist development is going to transform the situation.

Africa through Capital's Eyes

On the other hand, from a corporate viewpoint, in which the aim is not to develop countries but to exploit profitable opportunities, the prospects can still appear bright enough. Above all in the oil, natural gas, and minerals industries there is optimism, even excitement. Africa's resources are still substantially untapped, many existing discoveries are yet to be developed and many new ones still to be made. The "investment climate" has been made easier, thanks, as we will see, to a decade and a half of aid "conditionality," and the returns can be spectacular; the rates of return on U.S. direct investments in Africa are, for example, the highest of any region in the world (25.3 percent in 1997).(9) Under World Bank-International Monetary Fund (IMF) prompting, stock markets have been established in fourteen African countries with another six in prospect, with brokers in London …