Globalization and Africa's Unfinished Agenda - Notes

Globalization and Africa’s Unfinished Agenda

Thandika Mkandawire's essay addresses the conflict between Africa’s social projects and the demands of globalization. This conflict arises from internal problems within Africa, as well as the external pressures of integrating into the global community. Unlike other nations where globalization might be driven by market forces or national policies, in Africa, it is largely influenced by international financial institutions (IFIs).

While Africa's engagement with globalization is significantly shaped by external forces, African nations are not passive recipients. They actively signal these global forces, hoping to benefit from global competition for markets and investment through structural adjustment programs. However, globalization in Africa is also influenced by national actors who often adopt a submissive stance towards imposed policies.

The impact of globalization on Africa depends on the degree of social cohesion that African countries can muster, both individually and collectively. Social cohesion is crucial for developing internal strategies that make external strategies politically viable and legitimate. Failure to create adequate internal responses will expose African countries to "immiserizing" globalization, resulting from internal weaknesses combined with the way Africa is integrated into the global system.

Internal problems stem from inconsistencies, conflicts, and a sense of betrayal by leaders who failed to fulfill the promise of independence. These issues are compounded by the impact of foreign pressures on domestic politics, which can alter the preferences and ideologies of key actors, as well as the composition and strength of political coalitions.

Globalization often marginalizes localized concerns, histories, and social pacts, portraying them as provincial and outdated. This essay aims to assess globalization through the lens of African nationalism, recognizing its potential for constructing social cohesion that can enable Africa’s beneficial interaction with the world. Despite the contested meanings of nationalist ideologies in Africa, they remain dominant and influence responses to globalization.

Interpretations of Globalization

There is considerable confusion about the origins, distinctness, geographical extent, intensity, impact, driving force, direction and future of globalization. Anthony McGrew identifies three interpretations:

1. Hyper-globalists: They view globalization as a new epoch in human history with great promise or dire consequences, suggesting a zero-sum relationship between globalization and nation-states, leading to a hollowing of the state.

2. Skeptics: They doubt the novelty of contemporary economic interdependence, question the erosion of state sovereignty, and argue that globalization is mediated by nation-states.

3. Transformationalists: They reject both the hyper-globalists’ rhetoric and the skeptics’ insistence that nothing has changed.

Despite differing views, most participants in the globalization debate rely on materialism, where the economy and technology determine culture, politics, and global governance. However, globalization is a result of human agency, influenced by ingenuity, ideologies, and resource endowments. The impact varies among classes, societies, and nations due to differing resources. The absence of global governance structures makes the processes appear uncontrollable. Certain actors have established mechanisms to manage things that are important to them. The issue is the asymmetric extent of global governance, its authority, reach, accountability, and inclusiveness.

In discussions about globalization and Africa, nuances often disappear. The focus emphasizes hyper-globalist perspectives and the incomprehensible marginalization of the continent. Africa’s marginalization is often framed as an exception. Globalization is portrayed as an unstoppable train and Africans are cautioned that they must take appropriate measures (IMF/World Bank policies) or risk marginalization. Margaret Thatcher's sentiment is echoed: "There is no alternative" to adjustment.

The period from 1960–75 saw significant gains in social indicators, but the last two decades have been termed "the lost decades" for Africa with economic stagnation, bloody conflicts, and famines. Africa's share in global trade and investment has plummeted and its forced delinking is the opposite of self-reliance. Africa has become so inconsequential that its disappearance would supposedly go unnoticed. Regardless, Africa will not disappear due to its geographical immensity and various links.

Globalization involves the relocation of national governance functions to transnational arenas and the accommodation of global capital within national territories. While Africa's impact on global affairs may be slight, globalization has enormous implications for African societies beyond economics.

The Uncompleted Tasks: The Nationalist Commitments

African nationalism had five main objectives: complete decolonization, nation-building, economic and social development, democratization, and regional cooperation. These elements formed the "nation-state project" of African nationalism, which is used to view globalization and its potential for Africa's accomplishment of its "historical tasks." Only decolonization has been completed.

National Sovereignty and Nation-Building

Several factors have hindered Africa from completing nation-building, including mismanagement and the weakening of structures due to the demands of the global system. While some welcome the erosion of the nation-state, Africans have doubts. Internal factors undermining nation-building are the "original sin" of African nationalism.

African nationalism became a totalizing ideology to combat divisive forces, like the divide-and-rule tactics and "tribalism." Nationalists had two theoretical options when confronted with social pluralism. They could either produce political uniformity, or they could design structures that produced a political pluralism congruent with that of the social pluralism of their societies. Most chose political uniformity. This choice, combined with the centralization of power that it entailed, has meant that issues acquired menacing national significance because decision-making processes have been overtaxed. There are no local-level governmental institutions to absorb some of the blows inflicted by globalization. The authoritarian nature of state-building and neoliberal "statophobia" have combined to suggest that state-building should be abandoned or drastically curtailed. States remain crucial mediating institutions. Forced incapacitation of states leads to conflicts as violence and lawlessness take on ethnic dimensions. Ruling elites have failed to pursue nation-building seriously, partly due to the end of "elite consensus." Colonial experience has colored African leaders’ understanding of the nation-state. Demographic changes have made the rhetoric of nationalism less convincing. The economic crisis and mismanagement have eroded the legitimacy of the "national project." The authoritarian nature of nationalist politics and foreign interference have compromised the legitimacy of the ruling elite.

Globalization has further undermined nationalism. In the aftermath of colonialism, African countries faced neocolonialist opposition, with theories about dependence. In the 1970s, OPEC's rise suggested the possibility of extending political independence to the economic sphere through "self-reliance," "delinking," and a "New International Economic Order." Developed countries began appealing for nonconfrontational interdependence, but recession and indebtedness shifted the focus to competition. Nationalism had to defer to external powers. Nationalism regards the nation as its unit of analysis, prefers control over economic activities, and tends to engage in redistributive policies. Policies aimed at cementing the nation together. Some of these policies contributed to the fiscal crisis. The corruption and mismanagement of these policies relegated them to the realm of rent-seeking and patron clientelism, which presumably accounted for Africa’s decline. Globalization has become entangled in its own contradictions and is disruptive of social cohesion. Increased social differentiation along class or income lines, intensified by the rejection of redistributive policies, has led to ethnic conflict. The paradoxical consequence of such intra-ethnic differentiation is that a premium is placed on ethnic cohesion. The erosion of political stability has led to claims of sub nationalism. The current situation has also spawned new leaders with a jaundiced view of nationalism. Associating nationalism with the corrupt regimes they have replaced, these individuals tend to embrace globalization uncritically and have been much less concerned with legitimacy at home. Dependence has become normal. Denationalization applies not only to institutions but also to individuals and ideologies. Some flaunt their membership in external networks, acquiring political leverage. Leaders such as Yoweri Museveni, Paul Kagame, Isaias Afwerki, and Meles Zenawi have assumed power through military means, are unable to establish inclusive national coalitions, have had little time for democracy, and are partial to guns.

Economic Development

Eradicating poverty, ignorance, and disease was a salient feature of nationalist platforms, with economic development and industrialization as key elements. Africa remained an exporter of raw materials in the postwar period. The inconsequential inflow of capital into manufacturing pushed African states to engage in direct productive economic activities. Despite myths, "African socialism" involved little nationalization due to a lack of assets. African leaders considered development a national effort within an international context.

Development strategies relied on exports and historical examples of ruling classes pursuing nationalist policies amid internationalization. In the 1960s, Europe's nation-building was idealized, with developing countries expected to retrace its "stages of growth." European development, led by a "national bourgeoisie," contrasted with Africa's "dependent" bourgeoisies managing "overdeveloped" states. Pessimism about change led to calls for delinking or revolution, and social differentiation was met with calls for a new international order.

By the 1980s, the high-performance East Asian economies became the new standards, characterized by commitment to development, political capacity, and efficient bureaucracies. These contrasted with African states captured by interest groups, which were incapable of pursuing national development agendas. Developmentalism has faced criticism for sanctioning the destruction of cultures and human rights violations, being used by foreign powers for intervention, and serving as camouflage for corruption and environmental destruction. Orthodox criticism states that African developmentalism was statist and favored independence, leading to the current impasse. Globalization is meant to lead to increased trade. African policy-makers are accused of failing to heed the lessons of trade theory and exhibiting an anti-trade bias. Dani Rodrik states that Africa’s marginalization in world trade is primarily due to the conti- nent’s lagging performance in terms of output growth. Africa’s marginalization in world trade is primarily due to the conti- nent’s lagging performance in terms of output growth. It is not due to trade ratios (relative to GDP) that are low by cross-national standards. African countries trade on average as much as would be expected by international standards once their individual characteristics (such as income level and size) are taken into account.

Maladjusting Africa and Shifting Goals

Until 1973, many African countries experienced positive rates of growth. The oil crisis and decline in trade terms led countries to borrow, with the BWIs advising against caution. Borrowed funds were misused on unproductive projects. By the late 1970s, borrowing became unsustainable, leading to exclusion from private financial markets. African countries sought aid with conditionalities aimed at making state policies "market friendly." Resulting in policy tutelage and experimentation. Success stories were rare, and failures were buried. Letters of intent were kept confidential. Skepticism remained regarding the measures and knowledge of consultants. The driver’s seat in our affairs were often blind or blindfolded;

Getting Prices Right

African governments were advised to "get the prices right" through liberalization. With the assumption that a minimalist state was the best instrument for development. The problem of development had always been to find institutional arrangements and political incentives that would enable and induce states to competently and efficiently compensate for market failures. This advice ignored vast amounts of development research that pointed to the main structural constraints on the functioning of markets in the developing countries. The constraints included lack of capacity to adopt imported technologies, economies of scale, information asymmetries, and absence of markets for a whole range of goods and services.

Despite the fastest growing economies being characterized by strong interventionism and a "developmental state," Africa was advised to favor a "minimalist state". The World Bank interpreted the Asian experience as evidence of neoliberalism until the Japanese government insisted the World Bank revisit the Asian experience, it eventually produced the Asian Miracle study. This admission did not affect the World Bank’s advice to Africans. The institution continued to argue that the Asian economies could have performed even better without state intervention. It also claimed that African governments were congenitally unable to do any- thing useful about “market failures. Continued retrenchment of putatively “bloated bureaucracies” continued with downsizing due to removing sources of revenue in order to stimulate private investment. The “hollowing” of the state does not augur well for the consolidation of democracy in Africa. In the developing countries, this manifests itself in the replacement of “developmental” states by “regulatory” or “competitive” ones.15 In the quest for external legitimacy to attract foreign capital, these entities tend to ignore or even suppress domestic “social pacts” and allow external experts pre- sumed to be attractive to foreign interests to assume control of key pol- icy instruments.

Getting Governance Right

Capitalist accumulation demands a strong state. Where state structures have been enfeebled by downsizing they are unlikely to facilitate globalization. By the end of the 1980s, “good governance” was added to the policy agenda. Since the impetus for such “remoraliza- tion” is in the hands of external actors, it has failed to be anchored in popular participation. The central tenet of these policies is to replace “developmental states” with essentially regula- tory ones.

Getting Property Structures Right

In its 1995 report, the World Bank claimed that bureaucrats were still too evident in the economy. Greater emphasis was directed toward privatization. First, such privatization was supposed to improve the fis- cal basis of the state by both providing fiscal revenue and unburdening the state of subsidy-hungry industries. Second, it was supposed to increase efficiency on the dubious grounds that privately owned firms are more efficient than public ones. Third, it was supposed to signal to foreign investors policy changes in individual countries.

Getting Politics Right

Initially, good governance meant getting market-friendly institutions right. Now, this has been extended to mean “getting poli- tics right.” Curiously, several studies suddenly appeared to suggest that economic growth and democracy actually go hand in hand or, at least, involve no obvious trade-offs. Democracy was assumed to be a luxury. Before reaching that destination, nations would have to traverse the vale of tears in which strong governments would ride roughshod over the myopic demands of the masses for instant gratification.

Getting Culture Right

More recently, it has been suggested that what was wrong with Africa was not only states or markets but also societies themselves rendered impervious to any rational, collective pursuit of the national good. The World Bank now has programs to enhance, mobilize, or create such social capital.

Getting Policy Ownership Right

African elites have been portrayed to other international elites as incapable of being trusted with their countries’ affairs. Africa’s “historical tasks,” which I mentioned earlier, were viewed as not only passé but also as the actual source of Africa’s tribulations. It has also produced aid-conditionality regimes vitiated by princi- pal-agent problems. While such policies as devaluation can be implemented by a handful of technocrats in the Central Bank or Trea- sury, the changes demanded by structural adjustment programs (SAPs) require negotiating with many actors.
This charade is apparently the out- come of “policy dialogues,” which usually involve as much intellectual exchange as that between a ventriloquist and a dummy.

The Experience

Policy-making during the adjustment period has been emptied of developmental objectives because the focus has been on stabilization and financial-sector concerns, which neglect the “real” economy. Adjustment has failed. Even the chief economist of the World Bank, Joseph Stiglitz, recommended, in 1998, the tran- scendence of the Washington consensus in order to place development back on the agenda.

Continued poor per- formance is blamed on noncompliance with conditionalities. Improvements in terms of trade and favorable climates explain much more than SAPs. Growth rates have begun to falter and are likely to have fallen further with the Asian crisis. INVESTMENT remains very low. Policies explicitly designed to ensure that liberalization would promote greater integration and increased economic growth have failed. Structural adjustment in Africa has meant reversing some of the changes that African governments sought. Meanwhile, countries are driven back to the production patterns of the colonial era. African economies were the quintessential “late latecomers” to the process of industrialization. SAPs have called for policies that have prematurely exposed African industries to global competition and thus induced widespread deindustrialization.

Waiting for Foreign Capital

By swallowing their nostrums, countries are supposed to attract foreign capital. To the surprise of the purveyors of these policies, the response of private capital to Africa’s diligent adoption of SAPs has, according to the World Bank, “been disappointing.”
Contrary to the IMF’s claims that adhesion to its policies can signal credibility and attract for- eign investment, the African experience has been that the IMF’s seal of approval is not taken seriously by the business community — and this was before the Asian crisis. The minimal foreign investment trickling in has gone mostly into mining activities. African governments and regional institutions began declaring they could not pay their debts at a time when their debt-service ratios were much lower than those of the heavily indebted Asian and Latin American countries.

Aid, Debt, and Globalization

Africa is present in the “global village” as a recipient of aid that has increasingly taken humanitarian form and is chan- nelled through NGOs. African countries find themselves more heavily indebted than ever. Much has been said about debt relief but little has hap- pened. Debates on what to do with “debt overhang,” which has frustrated resumption of growth in Africa, are conducted at a scandalously leisurely pace, at least when com- pared with the sense of urgency that has produced rescue packages for other parts of the world.

Globalization and Democratization

One promise of the nationalist struggle was democratization. That democracy would favor “macro- economic populism,” which would lead to high levels of public con- sumption and to fiscal crises, it's cruel choice between rapid (self-sustained) expansion and democratic processes. One should note that more recent empirical tests have cast doubts on the “iron law” of the trade-off between democracy and development. struggles for democracy intensified, and a significant number of gains have been registered as Donors began to urge African countries to “get the politics right” if they were to receive any aid.

opening up of economies and societies, the political conditionalities transmitted through global insti- tutions, and the solidarity from movements encapsulated in the notion of “global civil society” are generally supportive of efforts at democra- tization in many countries. A silent compulsion of market forces forces the state from its local moorings. To signal foreign capital that they are in charge are tempted to assign maintenance functions to institutions immune to liberal democratic political control, such as central banks. There is a preoccupation with external appreciation than domestic support for state. A surprise in the lukewarm reception of emerging democracies from Western countries where Geopolitical and economic concerns of the major powers have counted more in the choice of African allies than adhesion to a putatively simi- lar ideology. Even when donors have seemed to favor democracy, they seem to prefer a “tropicalized” version shorn of all the key elements of true democracy.

Regional Cooperation

African nationalism always saw itself in both national and continental terms. Not much was achieved in terms of regional cooperation due to the small-mindedness of import substitution industrialization and petty dictators. Africa’s spe- cific form of participation in the globalization process has not facilitated matters; one feature of it is the extent to which it has encour- aged regionalism among contiguous states.

Conclusion

The current directions of globalization, Africa’s own internal conditions, and the manner in which Africa is being “adjusted” to the exigencies of globalization do not support the historical mission of African nationalism. Globalization has tended to exacerbate the internal paralysis of the reformist impulses of national- ist objectives by rendering them unviable in relation to the judgment and sanctions of international markets. It is my view that the reformist impulses of the nationalist agenda, revamped to reflect the changed times, consti- tute a useful point of departure in dealing with globalization. The fate of Africa lies in a collective rethinking of that continent’s unfulfilled humanistic tasks in light of what has transpired and the concrete situation today.
Then we can recast those tasks as cornerstones of social jus- tice, solidarity, and equality and, ultimately, reconnect the continent with the rest of the world in a mutually beneficial way.