China brings trade not aid to Africa and Africans like it more than the West's nothingburgers of 60 years
 In the beginning there was the Marshall Plan, when the US spent US$12 billion to put a ravished Europe back on its feet after World War II. It worked splendidly.
So if it worked in Europe, why not Africa? Of course, American economic engagement abroad was intended for recovery of well ordered societies rather than the development of primitive post-colonial cultures of hunter-gatherers and day labourers without electricity, running water or even birth certificates.
But all was optimism in 1954 when US President Dwight Eisenhower amended the Mutual Security Act, and created foreign aid that we have today. Sadly, there is universal agreement today, that after 60 years, the high hopes of yesteryear have failed to materialise - certainly nothing like the success the Marshall Plan had in Europe.
But not so with China and its efforts in Africa, which introduced another operational model - trade, not aid. While the "trade not aid" mantra has been voiced for decades by those dissatisfied with the current foreign aid system, trade was a free market concept, which the statists, who run the West's foreign aid programmes, deplore, thinking it self-serving and greedy, not at all like their principled social model.
Like so many good intentions, there unfortunate unintended consequences, which went without remedy in the hope of a few million dollars more of the same would make the best hopes of the West come true. This being largely the creation of the civil service, civil servants loathe to admit defeat as long as there was other people's money to fight the good fight.
In well-organised and carefully supervised Europe, the US$12 billion (nearly $100 billion in today's dollars), the fixed outlay of the Marshall Plan led to rapid recovery; but in disorganised and largely unsupervised Africa, it led to a continuing dependence, and an unbroken record of failure.
Europe's success blinded western social engineers to the pitfalls of Africa. Educated competent and grateful Europeans were replaced by ignorant, incompetent and resentful Africans. But even to consider such factors was at the very least "unprogressive" and probably racist too. So no thought was given to the unthinkable.
After making no headway in the 1950s, the UN designated the 1960s as the "Development Decade," with President John F Kennedy launching the programme in his inaugural address, signaling a new sense of purpose in international affairs.
With a little tweaking here and there, well meaning social engineers in the West, whose bosses were also fearful of communist aggression and the growing popularity of Marxist ideology in African liberation movements, felt they could transform a recovery programme designed for Europe into a development plan for Africa.
But recently, people like economist Dambisa Moyo, a Harvard- and Oxford-educated Zambian, wants to say goodbye to all that, denouncing almost all western aid schemes as doing more harm than good in her book "Dead Aid: Why Aid Is Not Working and How There Is a Better Way for Africa". Her title is a play on the "glamour aid" stars Bono and Bob Geldof, and what she considered their ill-conceived project "Live Aid".
Ms Moyo, who is also served as an Africa economist at Goldman Sachs investment bank, certainly has the facts behind here. The evidence assessing the impact of aid on economic growth is comprehensive and persuasive.
For example, a study by Manchester University economics professor Paul Mosley and two of his colleagues found no statistical correlation between aid and economic growth in the developing world.
The International Monetary Fund (IMF) conducted its own comprehensive assessment of the aid-growth relationship, and concluded that there is “little evidence of a robust positive impact of aid on growth”.
Agreeing Ms Moyo says aid is ineffective and inhibits growth, chiding the vast “development community” from liberal humanitarians to subsidy-craving farmers and from development economists to international celebrities trying to build their popularity through displays of conspicuous compassion.
On one of the many podcasts and speeches on available on YouTube, Ms Moyo says: "If it is said that there should be no taxation without representation. But the converse is also true. Without taxation there can be no representation."
That is because 72 per cent of what African government spend comes from aid. The rationale is that that the people are too poor to tax at the moment. What's more, incoming aid - unlike the fixed sum of the postwar Marshall Plan - keeps coming until objectives are reached. But they never are, and the aid keeps coming. It's a sure thing. To raise taxes would only serve to reduce that steady income flow and put the whole system at risk.
Taxation would also leave the government vulnerable to criticism - perhaps lethal criticism - if tax revenues were mismanaged. It would also disrupt the world for the western civil servants who owe their jobs to delivering aid. To lessen the need for aid would give all concerned pain without gain. So all concerned are best served by leaving well enough alone. As one cynic said: "There's a lot of money in poverty."
In the end, the only people in the money is most of Africa at those directly attached to the aid. The most powerful are those who can make the allocations, which Ms Moyo sees a continuing wasteful, counter-productive scandal in which the supposedly helping professions help themselves to the lion's share of other people's money.
The New York Times even dubbed Ms Moyo “The Anti-Bono” for her accusation that “the pop culture of aid has bolstered misconceptions” about development aid, making Africa “the focus of orchestrated world-wide pity”.
As Ms Moyo sees it, the model for building trade capacity in Africa has been best developed by China, which comes not to do good but do business. Ms Moya praises China’s investment style, noting the Chinese are in it for commodities such as oil and copper.
While China’s indifference to African human rights abuses and it non-judgmental attitude toward corrupt African leaders are reasons for western criticism, Ms Moyo notes most Africans surveyed have favourable views of the Chinese and have benefited from the infusion of foreign direct investment.
And African leaders have every right to prefer China’s “straightforward approach” to the “endless nit-picking of the IMF”. In her analysis of Western objections to the Chinese presence, she notes objections to China's turning a blind eye to killings in Darfur or being on cordial terms with Robert Mugabe in Zimbabwe. These concerns, she says, are rooted in the “western liberal consensus” whose members believe it is their responsibility to look after Africa.
By building a dichotomy between a mutually beneficial Chinese-African relationship and a paternalistic Western-African relationship, Ms Moyo feels that conventional foreign aid the west is driven by "pity and guilt" and is of no use to anyone except the aid managers among the recipients and donors alike.
Ms Moyo recommends that Western donors pick up the phone, call African leaders, and “tell them that in exactly five years the aid taps would be shut off - permanently”. After this, they must no longer expect their ineffective and dysfunctional governments to be bankrolled by copious flows of well-intentioned official development assistance.
This is the way forward, she says, and one could do little better than adopt the Chinese model if one seeks to improve the life of Africans. |
