Commission for Africa: More neo-liberal capitalism

Submitted by Anon on 22 March, 2005 - 12:55

By Paul Hampton

The demand to “make poverty history” is winning wide resonance this year and nowhere is it more relevant than in Africa, where the majority of people subsist on $1 a day. But the Commission for Africa report published last week shows how little the ruling class are prepared to do to help the majority of Africans.

The Commission for Africa was appointed last year by Tony Blair. When the G8 meets at Gleneagles in Scotland in July, Blair says he wants Africa on the agenda, with the report centre-stage.

The Commission’s 460-page report published on 11 March is full of catchy sound bites about Africa suffering “a tsunami every month”. Its main emphasis is on “good governance”, security and “inclusion”. Paul Vallely, the main author of the report, said the Commission’s main conclusion was that “one factor underlies all sub-Saharan Africa's difficulties over the past 40 years: the weakness of governance and the absence of an effective state”.

The report, perhaps not suprisingly, fails to identify capitalism as the principal cause of African underdevelopment and it is largely supportive of the neo-liberal model of capitalist development. Nowhere is capitalism mentioned to explain the poverty of Africa, nor indicted for the exploitation of African workers.

The nearest the report comes to criticism is where it states that relying on the private sector to provide infrastructure services in Africa such as water, transport and agricultural markets has been a “serious policy mistake, driven by the international community, that undermined growth prospects and generated a substantial backlog of investment”. And it adds that “forcing poor countries to liberalise through trade agreements is the wrong approach to achieving growth and poverty reduction in Africa, and elsewhere”.

The report is also noticeably meek on the role of the IMF and the World Bank, seeing these institutions as part of the solution to African poverty, rather than part of the problem. The report urges the World Bank and IMF to “reorient” their missions towards Africa and give the continent greater representation on their boards — but only to serve up the same bitter pill in more attractive packaging.

According to Peter Hardstaff from the World Development Movement (WDM): “Overall the report is a mixed bag. Much of it, while not negative, contains nothing particularly new, innovative or radical… Many of the demands are less far reaching than those proposed by the Brandt Commission over two decades ago.”

Its main recommendations, including the doubling of aid flows to Africa and 100 per cent cancellation of multilateral debts owed by poor countries — are largely restatements of existing UK government policy. Other demands, such as the immediate removal of subsidies on cotton and sugar beet might seem to go further, but in fact have already been decreed by World Trade Organisation rulings.

The extra aid, totalling $25bn (£13bn) a year, requires a mechanism to finance it. The report endorses Gordon Brown’s plan for bond issues repaid from future aid budgets, known as the International Finance Facility. However this has already been rejected by the US and Canada. Just to hedge its bets, the report also mentions French President Chirac’s proposal for a tax on air tickets and aviation fuel to fund development — but with little conviction or argument.

In any case the funds proposed are not enough. The World Health Organisation says to develop basic health services in Africa will cost $65 billion over the next ten years. According to the UN, industrialised countries’ farm subsidies cost developing countries between $125 billion to $310 billion annually in lost sales and lower prices, with Africa one of the main losers.

The report emphasises “boosting African competitiveness” by devoting $10bn of extra aid a year for infrastructure and establishing a $550m facility to improve the investment climate by cutting red tape. In other words the plan is to create a better business environment so that multinationals can reap profits from a more open and stable African economy.

At best the report promotes the needs of the African business class. The needs and interests of African workers are almost completely overlooked.

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