Sunday, March 24, 2019

How The West Has Kept African Exports Under 3% For Many Years


Literal slavery might have ended in Africa but economic slavery continued and had never stopped but rather becomes intensified. This is because, the secret of the development of the western world is hinged on this and they will put up a great fight to resist any attempt to reverse the trend. It is important to note that the Sub-Saharan Africa is fundamental to the development and prosperity of the western world. They source the raw materials for manufacturing in their factories from Africa and so they will do everything to keep Africa where it is in order for them to keep their status as a developed nation.

The western world is doing everything possible to convince Africa that they need to continue to produce raw materials in order to build wealth. They provide all the necessary support to aid the production of raw materials. They provide equipment, training on good Agricultural practices, post harvest handling, all in the bid to ensure that Africa effectively deliver their raw materials. Africa must come to terms with the fact that its prosperity can never lie in the production of raw materials. It lies in the production of finished goods not as assisted by nature but production of complex products as assisted by the intellectual capacity.

The trade report of the World Trade Organisation (WTO) in 2015 showed that the total merchandise export in the world in 2014 was about $18.5 Trillion. Out of this volume, the total value of manufactured goods was about $12.5 Trillion while that of Agricultural commodity was about $1.76 Trillion. This data therefore showed that no matter the volume of agricultural commodities being exported out of Africa, the value of African export will remain low because the pricing of primary products are usually very low since the demands are limited to few companies in few countries that use them as raw materials.

More importantly is the fact that they create a monopoly by ensuring that there are few major buyers of these commodities in their continents. They then add different regulations and commodity specifications that will be difficult for many African farmers to achieve. These two prong approach makes it easy for them to therefore grossly underprice the agricultural commodities. As a matter of fact, Africa is always at their mercy as far as selling the commodity is concern. They pose as if they are doing Africans a favour by buying below the stated regulation and specifications.

Another tool in the hand of the west to keep Africa small is aids and one sided trade. They ensure that the underdevelopment in Africa persist by giving aids to keep regimes that will do their bidding in power. Such aids are never given for infrastructure development that will aid intra African trade, rather, they are only given to advance their own course. Even when they propose trade agreements it is not about you exporting to them it is about them exporting to you. The strength of Africa is its people and the huge markets that this has created. This is the target of the Western world. Our misery is what defined their relevance. Their factory are running on the strength of the poverty and underdevelopment of Africa. 

The international monetary funds (IMF) and world bank are also tools in the hand of the west. The majority of the seats available at the helms of affairs of these organisations are occupied by the West. They advice Africans to take loans because this is an indicator to foreign investors that their economies are viable and these further impoverished the African nations because the West know that the money will be embezzled but the nation will still have to pay for these loans and thus become poorer. So funds for development are used to service the loans while the people sink further down into poverty. They also advise African countries against subsidising their Farmers while they give subsidies to their own farmers.

One of the ways out of this economic slavery is for Africans to grow intra-African trade. This is very important because it is going make a lot of difference in terms of growth and development among Africans nations if it is taken very seriously. For example the European Union (EU) with just about 509 million people controls about 33% of world trade and about 66% of these trade are done among the EU members. If the EU could achieve this with a market size that is below 50% of the African market, the positive impact of the growth in intra African trade can only be left for one to image. If Africa can grow its current intra-African volume from below 20% to just about 40%, it would have succeeded in lifting hundreds of millions of its population out of poverty just the way China have lifted over 200 million of its citizens out of poverty in the last 7years. 

This is why the African Continental Free Trade Agreement (AfCFTA) is not just a necessity but rather the major solution to the current underdevelopment of the African continent.The African Continental Free Trade Agreement (AfCFTA) was launched exactly a year ago. Out of 55 countries on the continent, only Nigeria, Tanzania and Eritrea are yet to sign this agreement. Out of the 22 countries required to ratify for it to take effect, 21 have ratified and just one more country this agreement will take effect leaving Nigeria behind.

What still baffles me is what Nigeria is afraid of. Nigeria is the major beneficiary of such agreements in ECOWAS and now we have opportunity for larger market and we have refused to be part of it just because of politics, unfunded fear, ignorance, opacity and lack of foresight. I just hope that Nigeria will not be left behind in this largest free trade agreement in the world.

Finally, I will like to urge the African nations to reduce resist the external influence of Western world who are using the instruments of civil society organisation and the organised private sector to mount pressure on the African governments in order to prevent them from signing and ratifying the all important African Continental Free Trade Agreement.

Bamidele Ayemibo
bayemibo@3timpex.com.

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