Magnus Blomström and Mats Lundahl
Sub-Saharan Africa is in a deep economic crisis. For instance, the World Bank (1989:2) reports that Africa, a region of 450 million people in 1987, had a total GDP of around 135 billion US dollars, about the same as that of Belgium, which has only 10 million inhabitants. A similar indicator of Africa’s economic performance is the fact that Singapore, a small island of only 2.7 million inhabitants, exports some 50 per cent more manufacturing products than all of Sub-Saharan Africa together (Blomström 1990). These two observations indicate the seriousness of the problems dealt with in this book.
The situation in Africa has been bad for a long time, but during the 1980s it deteriorated much further. The continuing crisis has several dimensions. Stagnating or negative economic growth, serious balance of payments and fiscal problems and sluggish agricultural performance, coupled with rapid rates of population increases, are only some signs of the economic disaster. The social dimensions of the crisis include increasing unemployment, decreasing expenditure on social services and education, worsening nutrition and continuing high infant mortality. Environmental problems, such as desertification and deforestation, are accelerating. Moreover, the political systems are generally characterized by corruption, inefficiency and instability. And as if this was not enough, we are now hit by the news of another round of severe drought and famine in Africa.
Why this disaster? Unfortunately, there is no simple answer to that question. The background to the African crisis is complex and highly debated (see, for example, Milner and Rayner 1992; Rose 1985; Säve-Söderberg and Taxell 1988; World Bank 1989). The internal factors behind Africa’s economic decline that are most frequently mentioned include misdirected macroeconomic policies, corruption and administrative inefficiency, lack of industrial tradition and low technological capability, poor health care and education and high population growth. Among the important external factors, fluctuations in terms of trade take a leading position. Although the country studies presented in this book stress different sources for the crisis, they generally conclude that internal factors have played a more crucial role than external ones.