World Poverty: Africa and the World Bank

 

Africa has a very distressing history and the future does not look much better. Therefore, the aspiration of the World Bank (WB) to significantly reduce poverty by 2030 would seem an impossible one.

thCA6SYPHQThere are too many agencies, too many do-gooders, each holding a fragment of a giant jigsaw puzzle and that fragmentation makes the overall task incredibly daunting. There is no joined-up thinking, no concerted effort to find a solution; each body, group or church may feel good about their actions but how many of these thoughtful people have thought to ask an African what is needed? Without a co-ordinated approach little will change.

Moreover, there is no organisation per se that could take charge; the World Bank, United Nations (UN), International Monetary Fund (IMF), G8 or G20, their approach and history is so rotted by politics that they can’t see the desert for the sand. I don’t have the answers but what I do believe is that a top-down approach will not work.

We must give the people the power and that entails spending big and over an extended period and the priority must be education. You must give the people the power to think for themselves and in doing so give them the power to rid themselves of the corrupt and useless.

Much of sub-Sahara Africa has become dependent on ‘aid’ and it may take several generations to overcome the dependency culture that has been allowed to embed itself. A further consequence of the ‘aid’ culture is the widespread corruption that permeates deep into all facets of government in various countries of the region.

Places like Chad are riddled with problems, e.g. 80% of the population is reliant on subsistence farming and agriculture accounts for 50% of the nation’s production. The main products are cotton, millet and peanuts. The country has a much larger bureaucracy than it requires and corruption is rife. Ongoing problems with instability through factional fighting and various armed groups jostling for power make it difficult to govern. Child trafficking for force labour and sexual exploitation is still common. The government does not have a law that bans such a despicable crime.

A very telling point is life expectancy at just 49 years. This figure clearly points to the thCAWDW0J8depth of poverty in the country. The other factor is the per capita household earnings, whereby the lowest 10% have 2.6% whereas the highest 10% have 31%, quite a disparity. (CIA) The pressure on the poor multiplies when we consider the high inflation rate, currently running at 5% annually.

You may think that Chad has enough problems to contend with; unfortunately the country has to cater for around 400,000 refugees as well. Most of the refugees have been forced out of the neighbouring region of Darfur in Sudan.

A promising development (or is it) is that Chad has oil. However, that has only highlighted the country’s desperate need for a better infrastructure network. It would be so easy to think, oh, Chad has oil, let’s build lots of roads and have thousands of trucks roaring around the country. Alternatively you may take the view that the situation allows for a huge ponder on what is economically and environmentally sustainable. A rail network might be a consideration.

Nigeria too has oil and it could be anticipated that the country would present an illuminating picture but that is not the case. While oil provides 95% of foreign revenue the country has been on the rack over many years due in part to internal squabbles, the struggles for power. The internal strife has prevented the development of beneficial infrastructure and necessary reforms in education and health. Thus 70% of the people live below the poverty line. Such poverty is unlikely to change any time soon due to the stark disparity in income between the top and bottom at 39% and 1.8% respectively. (CIA).

Perhaps because of its oil Nigeria has been bailed out a few times by the IMF. In 2000, the IMF gave Nigeria $1bn to help restructure its debt but they could not pay the loan back and where forced to leave the IMF in 2002. Nonetheless, in 2005 the IMF came back with a new substantial package of $18bn in debt relief and a further $12bn in repayment relief. (CIA)

Untargeted money does not always help. The poor in Nigeria have little hope of levering themselves out of poverty especially when inflation is running at a very high level: 10.9% 2011 but rising to 12.1% in 2012. Poverty entails a constant struggle to make ends meet but with inflation at such a high it must be extremely disheartening. To add to their misery a lack of human resources such as education and health provision makes raising their heads above the parapet a forlorn hope; or so it must seem. View the video. It’s really good!

http://www.globalissues.org/video/765/dumisani-nyoni-poverty-understood

 

Kenya, the largest economy in East Africa is not much better off. An estimated 75% are dependent on agriculture for their livelihood of which around 50% live below the poverty line. The country’s GDP growth has hovered around the 5% mark over the last 3 years. However, with inflation remaining at a high of 10% in 2012, prospects are not bright for the poor. As already stated, it is hard to survive when prices outpace a meagre income.

In 2010, $1 was equivalent to 79 Kenyan shillings by 2012 you needed 86 shillings to the dollar. Therefore the $1.25 a-day threshold of the World Bank becomes increasingly pernicious against such a background. The good news is that oil may have been discovered in 2012, well, we must hope it is good news though it has not brought much joy to the poor of Chad or Nigeria.

The bright beacons of Africa have faded. South Africa, where the freedom fighters overthrew apartheid, now stands accused of failing to look after the poor and of police brutality by their erstwhile supporters. The recent gunning down of striking miners is illustrative of where the new leadership place their priority. President Zuma, has only recently outlined the country’s next development plan, (24 June 2013). Their aspiration is to create 11 million new jobs by 2030. I wish them a lot of luck.

Zimbabwe, once a shining example of African potential now basks in a new glory; that of fast fading star. A clear indication of where unbridled corruption can lead. Where inflation is so high it is practically off the chart.

Several key issues flash there light consistently when looking at the problems that beset sub-Sahara Africa. As noted, poverty is on the increase and corruption is rife in several nations. Education is in need of vast investment over a protracted period as does the infrastructure in most of the countries of the continent. The problem is where to start? Should we operate with the heart or with the head? Can the two comfortably co-exist and how would that affect the distribution of funds into the continent?

Perhaps, we need to think of a today and tomorrow approach. Today, the short-term to consist of disaster relief and tomorrow as the long-term commitment to spend the overwhelming majority of funds on education and infrastructure as both of these can have a considerable effect on the former.Of course any projects would have to be done with indefatigable partners and that must include local people. The World Bank has praised the Chinese industrial development as a prerequisite for ending world poverty, however, there is little or no indication of such development in Africa.

Moreover, we must take cognizance of the points raised by Professor David Hulme, when talking about existing WB and other agency projects, “There is really no consideration given to how these goals and targets would fit into national processes.” Hulme goes on to add a damning summary of the effect of the previous Millennium Development Goal (MDG) that the WB is so proud of. He suggests that the MDG has not reached the elite or middle class of the rich world, but significantly has had no impact on the elite or middle class of the developing countries. If the latter is the case, the WB has a critical barrier to overcome in trying to achieve its latest target. In essence, what Hulme is accusing the WB of is that they are operating in a vacuum.

www.cpd.orgbd/PostMDG/Op

 

Without local leadership to implement and to maintain and continue to stimulate their individual economies, change cannot be fostered. Without change there can be no end to world poverty!

This is the third in a series that challenges the assumption of the WB to cut poverty to 3% or less by 2030!

 

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