Economics is a slippery subject indeed. Even the great Albert Einstein who is widely presumed as the most intelligent specie to have graced the earth, the same Einstein who is the originator of one quaint equation, , which had been driving the successive generation of physicists and mathematicians crazy ever since it was proposed in 1905, once had to give up Economics. According to him, he had difficulties in “reconciling the paradoxes which are so thickly embedded in economics.” They simply drove the Professor of professors up the walls. Because, in economics, often times, theory is not a true reflection of reality.
In two consecutive editions of the Business day Newspaper of Tuesday 26th and Wednesday 27th August, 2014, Dr. Olu Fasan, a London-based political economist took time to scholarly criticize Dr. Kinsley Moghalu, Nigeria’s Deputy Governor of Central Bank’s recently delivered lecture on Africa’s development. While Dr. Moghalu delivered his lecture entitled “Beyond Africa Rising” at the London School of Economics, Dr. Fasan took to the Guardian Newspaper for a rejoinder under the caption: “Africa’s development: Fallacy of self-sufficiency”.
While Dr. Moghalu was on a mission to challenge the current orthodoxy about Africa’s development, Dr Fasan brilliantly defended globalization, which according to him, is a reality which “Africa must embrace (irrespective of) the challenges and the opportunities it presents.” Considering the status of both dramatis personae, the positions taken by these two highly placed individuals are profound ideas that can have fundamental effects, and define or re-define the terrain of policy dialogue. While one is the deputy governor at CBN, the other is an erudite political economist and a Visiting Fellow at the London School of Economics. It is for these reasons that we need to critically examine the worldview that Dr. Fasan hypothesized to correct any inaccuracy, just as he had done to Dr. Moghalu’s dissertation.
The fulcrum of Dr. Fasan’s disagreement with Dr. Moghalu is that globalization is not as dangerous as portrayed by the latter. Globalization to him has huge opportunities because it has liberated economies and has also succeeded in launching Nigeria’s economy to become the Africa’s largest through its recent rebasing. To him therefore, “nothing will perpetuate the inequality and marginalization that Africa currently suffers…more than an inward-looking, self-reliant economic policy.” He also submitted that self-sufficiency failed many countries that had practiced it in the time past that they had to abandon it.
Dr. Fasan did not hide his support for the middle class who, according to him “is often the victims of a policy of self-sufficiency”. He rejected the policy of self-sufficiency because it will “force the middle class to exercise frugality or control their tastes and cupidity through restrictions on imports.” If we may ask, what are the percentages of Middle Class citizens out of the entire population of Africa? How many people can really afford the price of the luxury things that flow into the continent on a daily basis? Let’s just consider the primary items that appear to be the cheapest of these items. How many citizens can afford the usage of gas cooker, microwave and other electric cooking appliances in the sub-Saharan Africa where, according to the statistics released in 2013 by UN on Global Issue, over 80% of the population depends on traditional biomass such as fuel wood, charcoal, wood dust and animal dung to meet their energy needs for cooking? In another statistics released by the same UN, around 27-28 per cent of all children in the developing countries are estimated to be under weight or stunted. Again, sub-Saharan Africa region account for the bulk of the deficit. Africa’s economic malaise is highly obvious but unfortunately our economics scholars pretend not to see it. Except for few wealthy elite and the more prosperous peoples of South Africa and the Maghreb, Africans have very few consumers. The much-touted middle class are not just there in the first instance as even the best educated ones such as Dr. Fasan often chooses to leave the continent for the West or the Persian Gulf in search of a better life.
To Dr. Fasan, globalization has liberated Nigeria’s economy which its activities in the “telecommunication and entertainment” sectors have suddenly made it the largest economy in Africa. But has this so-called economic improvement reflected in the lives of a common man in the street of Lagos, Yola or Owerri? A similar IMF’s pronouncement in Ghana three years ago claimed to have increased its overall GDP by two-thirds and vaulted it into middle-income status. Between then and now, Ghana’s currency has lost more than 30% of its value against major trading currencies; cost of living and utility tariffs have risen to an embarrassing limit while inflation has hit a high of 14%. Today, hopes of oil riches have dried up as Ghana’s success story descends into disenchantment as its citizens struggle to afford daily bread. And, it is disheartening to note that Ghana is now on its knees begging IMF for the award of another loan of slavery. That is what happened when a country implemented a World Bank’s dictation, such as what Dr. Fasan is recommending, hook, line and sinker.
The antics of the agents of globalization such as World Bank, IMF and their funding countries, who have long cultivated the diplomatic habit of shunning out encouraging figures to deceive the African leaders is not a new phenomenon. They often mention the fictional productivity of Africa just when the issues touch the mainstream. The risk is that few citizens and some African scholars are bought into this false sense of hope; thereby assist these agents of domination in spreading the misleading impression that appropriate route is being taken.
Indeed, Dr. Fasan is right about the development of telecommunication across the African continent. But he forgets to, or deliberately decides not to, talk of many African countries where radios, televisions, and automobiles are rare luxuries till date. No one is canvassing for total break away from the global world as Dr. Fasan assumed. Even an unlettered man in the remote part of the continent knows that he needs his neighbour to survive the rigours of this age. What everyone is saying is that such relationship must be based on principles. After all, the ‘Asian Tiger’ countries did not withdraw from global economic institutions or flout their rules before they developed to the point where they are today.
Adewale Stephen
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