Omotayo Tajudeen

World News


After Years of Progress, Africa is Trending Backwards

It was just over 20 years ago I debated in print a rather gloomy position about the state of the world promoted by Mandla Maleka. I described his position as “Free trade and markets don’t work and the proof is that the state of the world’s poor is declining and global wealth inequality is growing.”

It was one thing to disagree with a position, but an opinion without evidence has little value. So, I looked at hard data from sources such as the United Nations Development Programme and the World Bank, along with numerous academic studies. What the data showed then were lower infant mortality rates, higher literacy, greater food security, less poverty, and greater economic equality.

Since then a populist type of politics on the Right has started trumpeting the same anti-market doom and gloom as the Left did some years ago. Even in the United States, there are people convinced that life is getting worse. A poll found only 24% of Republicans agreed that “life in America today is better” than it was 50 years ago. For Democrats it was 47%, and where 30% of Democrats thought it was worse, 59% of Republicans did.

Now the data is very convincing. By almost any measure, life in the U.S. is better than it used to be. Republican Nikki Haley lamented how life was better 50 years ago, but I found the violent crime rate, especially murder is down while life expectancy is higher, unemployment is down, teen birth rates are down, and median household income is up and poverty rates are much lower. The comparisons could go on and on.

It appears we need to take a fresh look at what the actual data says, not what people imagine is the case.

World trends, as I outlined in 2002 remain generally true but there were two recent developments having a negative impact on the wellbeing of people, especially the most vulnerable in developing nations. One was the pandemic, which according to the World Health Organisation resulted in some 7 million deaths around the globe. The reality is you can’t have that number of deaths without a substantive, negative impact on the economy. On top of the costs of lost lives, there were massive medical costs incurred and supply-chain disruptions as well. Remember: in free markets, it is people, not minerals, who are the ultimate resource.

Hanan Morsy of the UN’s Economic Commission for Africa said in 2022, “One of the most critical implications of COVID-19, has been the reversal of very hard-won gains that the continent has managed to achieve in terms of reducing poverty. So, we’ve lost two decades of hard-won gains of reducing poverty in Africa due to the pandemic.”

Sadly, many poorer nations compound problems with detrimental regulations, lax property rights, impediments to trade, and a plague of economic Albatrosses in the form of wealth-destroying state-owned enterprises. Ken Gichinga from Mentoria Economics said better policies can reverse a lot of the negativity. “We need strong fiscal policies and monetary policies, but most importantly, we need policies that encourage business, policies that encourage enterprise, which means things like VAT and taxation. Those things need to be reduced so that we have money in the pockets of people so that there is demand for goods and services.”

A second factor negatively impacting the world’s most vulnerable people is Russia’s war in Ukraine. Russia’s decision to continue with its seemingly pointless war is harming the world’s food and oil supply, which is increasing both food and energy costs. It is one thing when people in wealthier nations pay more for essentials but quite another when it impacts low-income groups.

Between Putin and the pandemic, Africa is being hit particularly hard with a decay in economic well-being.

The costs of the invasion imposed on the world’s poor says Bitsat Yohannes-Kassahun, “Comes as African economies are still trying to emerge from the impacts of the [pandemic], for which they did not have enough resources to cushion themselves.” In particular, the war drove up food and energy prices, with the International Monetary Fund saying, “Staple food prices in sub-Saharan Africa surged by an average 23.9 percent in 2020–22…”

South African President Cyril Ramaphosa recently joined a “peace mission” of a small number of African leaders to Russia and Ukraine.

At a press conference in Ukraine, Ramaphosa admitted, “This conflict is affecting Africa negatively” and said, “There is a need to bring this conflict to an end sooner rather than later.” But he seemed to treat both the aggressor and the victims as equal partners in this atrocity. He said, “The road to peace is very hard.”

The road to peace is only hard if the aggressor continues his aggression. The war in Ukraine ends when Russian aggression ends.

While all nations were hit by the double blow of the pandemic and Putin’s war, not all were hit equally, nor does it negate the truth that, “the last 30 years have seen dramatic reductions in global poverty,” according to the Brookings Institution.

A Brookings report found outside of Africa, poverty has declined dramatically, especially in India and China. Brookings projects, “India will, however, experience a short-term spike in poverty due to COVID-19, before resuming a strong downward path. By 2030, India is likely to essentially eliminate extreme poverty, with less than 5 million people living below the $1.90 line.”

Brookings argues that only three Asian nations will fail at eradicating extreme poverty: North Korea, Afghanistan, and Papua New Guinea. So globally the trends I outlined in 2002 remained true for most of the world. Africa, which was doing well, started losing ground again only recently.

The Brookings report should be a wake-up call for African politicians, but sadly many cling to their old policies, embrace the Russian war criminals, and turn a blind eye to the pandemic. Brookings warns: “These trends point to the emergence of a very different poverty landscape. Whereas in 1990, poverty was concentrated in low-income, Asian countries, today’s (and tomorrow’s) poverty is largely found in sub-Saharan Africa and fragile and conflict-affected states. By 2030, sub-Saharan African countries will account for 9 of the top 10 countries by poverty headcount. Sixty percent of the global poor will live in fragile and conflict-affected states. Many of the top poverty destinations in the next decade will fall into both of these categories: Nigeria, the Democratic Republic of the Congo, Mozambique, and Somalia.”

If Africa is to regain the lost ground in recent years its political leaders are going to have to wake up and abandon the failed policies and charlatans they have embraced.