African Economic Problems

The fundamental weakness in African economies, the product of history and physical features, can be summed up in a single phrase - the low development of primary industry, i.e. agriculture in all forms, fishing and mining. Africa is not in a position to live by selling skills - i.e. importing raw materials, adding value, and re-exporting; primary production is therefore vital. This is not often so brutally stated, for reasons which will appear. Wherever it is forgotten, the danger of attempting to build an elaborate secondary and tertiary system with no primary base or motive power immediately arises.

Low primary production is associated with low purchasing power and low division of labour; therefore, a small, market, low opportunity for investment in secondary industry, and a low level of trade. Even in Zambia or the Congo, where primary mineral resources have been highly developed, the resulting trade in minerals lay to Europe, and the purchasing power generated was largely exported too - the white miners of Northern Rhodesia spent most of their earnings in southern Africa, the Congo Belgians in Europe. Certainly, African earnings - were remitted to a poverty-stricken subsistence economy in distant rural areas; but they were mainly dissipated in social expenditure there, and little found its way into agricultural improvement. It is where cash-crop agriculture has been strongly developed that the effects on African purchasing power have been felt in a growing local market and in further productive investment.

Low-yield subsistence agriculture - apart from its effects on health and energy - means low division of labour, and a tiny market even for food. There four families out of five are farming, the market for farm produce, outside the producing family, is 0.25 per cent of a family: it only rises to 1.5 per cent when the proportion of all families in farming has fallen to 40 per cent. It is very largely this low food production which marks the contrast with medieval Europe, where there was usually just enough food to allow division of labour and the development of a market economy.

Subsistence agriculture, a falling death-rate, and scanty employment opportunity outside farming implies huge underemployment in crowded rural areas. When widespread education is added to this explosive mixture, concealed underemployment is revealed as overt unemployment, because the differential in pay between the modern and the traditional sector is so high. The educated young, in a mobile society, will go where the rewards are greatest; they join the queue seeking wage-paid work in the urban sector.

An additional problem arises from the late entry of Africa into an already developed World economy, with its tendency to produce substitutes for tropical raw materials and with, allegedly, less elasticity of demand for raw materials than for manufactures - though this last point will need more argument. This situation in the outer world is the more serious because the inter-territorial market within Africa has been so hard to develop.