Wed, Jan 19, 2005 - Page 9 News List

Cash alone won't help Africa with its troubles

By Richard Dowden  /  THE OBSERVER , LONDON

UK Chancellor of the Exchequer Gordon Brown wants a Marshall Plan to save Africa, just as America "saved" Europe at the end of the World War II. His speech on Jan. 6 at the National Gallery in Edinburgh, Scotland, was full of missionary zeal to end poverty and disease.

It's good that he cares, but he has failed to ask why Africa is poor. He seems to think a lack of aid is the cause. The sad truth is that Africa has had a Marshall Plan several times in the past 50 years and has little to show for it. Until we understand why, Brown could be raising expectations for Africa yet again -- and making things worse by failing to deliver.

The analogy between Europe in 1945 and Africa today is false. At the end of the war, Europe had peace and a highly skilled population.

The job was rebuilding -- all that was missing was finance. The US provided US$13 billion over three-and-a-half years (about US$76 billion at today's prices) to buy American food and goods to rebuild Europe. If distributed equally, every European would have received US$49, or US$293 at today's prices.

Africa has had about a trillion dollars in aid in the past 50 years, roughly US$5,000 for every African living, if distributed at today's prices. If aid were the solution to Africa's problems, it would be a rich continent by now.

Africa has been made poor by unstable politics. The ruling class has failed to create viable states that provide health, education and economic opportunity. As a result, literacy rates are low and civil services are weak. Until the politics is right, huge amounts of aid would make things worse.

Brown wants to double aid to Africa, with an extra US$50 billion through his International Finance Facility. But which countries would he give it to? Lumping the whole continent together does Africa no service. Many countries are doing well -- South Africa and Botswana, for example; others, such as Congo, have fallen apart and have no capacity to handle aid; and some -- Mozambique, Ghana, Uganda -- are already receiving most of their budgets in aid with no sign that they will become self-reliant in the near future.

The chancellor wants to write off debt for African countries regardless of their governments' corruption record. But debt relief should be targeted at countries which have been committed to getting their economies going and spending more on medicines than Mercedes.

Where rulers still pocket aid or spend it on guns, debt relief simply rewards bad government. Would Brown really write off the debts of extravagant oil-rich countries such as Angola or Nigeria in the vague hope the cash would relieve poverty?

Countries need to earn their living in a fair system of international trade. Here, Brown is right -- agricultural subsidies in the rich world prevent Africa from competing and dumping subsidized food in Africa destroys local economies. Ending agricultural subsidies, tariffs and import regulations in the rest of the world are key to Africa's economic success, but can Brown persuade his G8 partners to do this in 2005?

Africa's poverty is a symptom of its malaise, not the cause. The cause is politics.

If we want to help Africa, we must try to understand it but Brown does not think you need to understand people in order to save them. His cuts in the UK's government machine in London have substantially reduced the number of political analysts in the British Foreign Office, so fewer know the difference between Mali and Malawi. Thanks to Brown, our ability to understand Africa, and therefore to help it, is diminishing.

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