Economic digression in Africa

Economic development and growth in most of the developing countries especially in Africa has been very slow over the past few decades. Several factors have been attributed to this slow economic growth with much weight being placed on poor governance and corruption as a result of lack of independent judicial systems. While most of the economic stagnation in African and other developing countries can be attributed to internal factors, there are also external factors that have led to the aggravation of this situation. Both developing countries and developed countries have a stake at improving the economic condition of developing countries.

Africa is todays the poorest region in the world both in relative and absolute terms. The 21st century has recorded a reduction on growth in most of the countries in Africa and predictions that had been made earlier by the neoclassical theory of growth, asserting that there is a chance of poorer countries such as Africa to catch up with richer countries in terms of per capita income has become an over optimistic view that today seems almost impossible to achieve. Actually, most of the African countries have registered a decline in economic growth compared to the 1980s and 1990s. In the year 1995, most African countries had an average per capita income of less than  1045 (apart from South Africa), articulated in real terms purchasing power (International Monetary Fund, 1995 Spatafora, 2005 World Economic Outlook, 1995). Between the years 1965 and 1990, the real gross domestic product registered very slow growth as compared to the pacific and East Asia. There are several economic issues or factors that have contributed to the slack economic growth in most of the developing countries, most of which are located in the African continent. Among them include poor governance, corruption, and poor infrastructure (Salim, n. d Snider, 1996).

Economic problems facing developing countries
As mentioned above, developing countries have in the last one decade registered a decline or slow economic growth a factor that has continued to widen the gap between the rich or developed countries and the developing countries. Africa is one of the continents that have most of its countries experiencing economic hardships today. There are several factors or challenges that developing countries are facing and that affect their economic growth and development (BBC MMX, n. d VOA, 2003).

Poor governance
Governance of a place dictates the economic policies and practices that are practiced in an area of a country. Governance has a direct impact on the economic development experienced or achieved in an area. Most developing countries are characterized by poor governance characterized by increased corruption. Corruption refers to the abuse or misuse of public power or office with an aim of meeting personal needs. According to the World Banks findings, corruption is the greatest obstacle to effective social and economic development (World Economic Outlook, 1995). Corruption weakens development by interfering or distorting the law thus weakening or destabilizing the institutional foundation upon which economic development is rooted. Most of the major causes of corruption are economic based and thus has a direct impact on economic development in a country (Corrigan, 2009 SAKO, 2006 Kilgour, 2009). Corruption in most developing countries is very rampant and this is an economic challenge to these countries. Economic development can only be achieved where good governance is achieved and corruption rooted out. In most developing countries, governance is based on the desire to fulfill personal desires rather than the achievement of the overall good of the country. This has been a major cause of increasing corruption in developing countries. Businessmen and government officials collude in order to increase their wealth at the expense of the citizens (Baffoe-Bonnie  Khayum, 2003). Most of the economic policies formulated in developing countries are usually self serving and protect only the interests of a few persons. This has resulted to creation of few bourgeoisies on one hand and very poor individuals on the other hand. Most developing countries especially in African are characterized by a wide gap between the poor and the rich. Innovation and creativity among the poor group (which is the largest) is thus discouraged. Corruption as a result of poor governance in developing countries has led to creation of cartels and monopolies thus affecting free and fair competition which is essential for economic development (Dinavo, 1995). The poor end up paying more towards the running of the government while they receive nothing in return for their contribution. Wealth is distributed among the powerful politicians and prominent people in most developing African countries while the qualified, innovative and entrepreneur poor people are discouraged and condemned to poverty (Thirsk, 1997). With rampant corruption in developing countries, it is difficult to achieve economic growth and development. Poor governance is a major economic challenge among the developing countries and a hindrance to economic development (Obasanjo, Orville  Africa Leadership Forum, 1990 Spector, 2005).

Poverty
One of the major economic challenges that the developing countries are faced with is poverty. Africa is one of the poorest continents around the world today. Most developing countries are very poor making it impossible for them to exploit their natural resources that may be essential in bringing about economic development. In the 21st century, the world has recorded an increase in globalization and adoption of technological modes to improve production and trade (Gries  Naud, n. d). Participating in the global markets is an expensive endeavor although very rewarding in the long run. It requires use of modern technology in production to ensure that goods produced meet the many quality standards set by the global market and also to increase the competitive strength of a company or an industry. Developing countries lack financial resources to enable them participate in the global markets hence their dwindling economic conditions. Poverty is a major challenge and contributor to the slow economic growth being registered by most African countries. Poverty or lack of financial resources has also made it difficult for industries in developing countries to adopt the new technological means necessary in improving the production and quality of goods. Goods from developing countries end up lacking the necessary quality to enable them trade successfully in global markets. Poverty is an economic challenge to developing countries that has hindered economic development in these countries (Nnadozie, 2003 Adsn, Graham  Olukoshi, 2006).

Poor infrastructure
One of the major contributors to economic development is infrastructure network within a country. Infrastructures such as roads, airports among ensure that goods are transported to areas of high concentration to areas of low concentration thus enabling trade and bringing about economic development. Good infrastructure also creates avenues for mass production hence international trade. Without good infrastructure, it is impossible to engage in any meaningful trade. Most developing countries especially in Africa are characterized by poor infrastructures that are unable to support national and international trade. These countries have poor road networks, substandard airports and inefficient railway infrastructures. This has made it difficult for the transportation of goods from the areas of production to major national and international destinations (Adhikari, Kirkpatrick  Weiss, 1992). Due to poor infrastructures in developing countries, goods and services tends to be exchanged within a locality or a small area at very low prices since almost all individuals within such an area produce similar goods. This has led to an increase in poverty and lack of development. Trade is a great avenue of achieving economic growth and development but it can only be effective if there are good network of infrastructures. Without infrastructures, it is difficult to achieve national or international trade. Another form of infrastructure that is poorly developed in the developing countries is the communication networks (Frischtak, 1994). Today, in most western and developed countries, face to face communication, telephones linescommunication and letters have ceased to be communication means and have been replaced by online communication enabled by internet services. It is estimated that over 70 of American citizens have full access to internet services at any given time. With increasing use of information technology, it is also possible to purchase goods using the internet thus reducing transaction costs, increasing efficiency and speed of transaction. This has led to a tremendous increase in trade and commerce hence economic development. However, this is not the case with developing countries. Less than 20 of most citizens in Africa have no access to internet and online purchasing is still a new concept being developed today (Kilgour, 2009). Poor communication infrastructure is a major hindrance to economic development in developing countries and a major challenge to the governments in developing countries.

Lack of manpower and high illiteracy level
Most of African developing countries are rich in precious minerals and stones while others have very fertile agricultural lands. Minerals and agricultural products have created avenues for economic development in different already developed countries. However, this is not the case in developing countries. Most developing countries have very low literacy levels with good quality education being accessible only to the rich and influential persons. Low illiteracy levels have made it impossible to have the relevant manpower and experts to aid in extraction of minerals and effective utilization of lands for economic growth (Bloom  Rosovsky, 2003).

Foreign direct investment
An increase in globalization and technological advancement has made it vital for countries to open up their borders to foreign investors with an aim of improving their economic growth and development. Like all other countries, developing countries have in the recent past opened up their national borders and invited foreign investors to their countries to carry out business in the countries. To make foreign investment in developing countries more attractive, governments of these countries have reduced most of the restrictions including environmental rules and regulations. Foreign direct investment is today one of the biggest challenge that developing countries are faced with. Most of the industries in developing countries especially in African are owned by foreign investors. Such companies engage in various business including exploration and extraction of minerals in these countries using many methods that are not environmental friendly. Most of the companies also exploit the workers in developing countries owing to the high level of poverty and unemployment rate. At the end, developing countries and their citizens do not benefit from such direct foreign investments as all finished goods are exported back to the home country of the investors. These investors have also led to the killing of local industries and demoralization of local entrepreneurs (Ekeledo  Bewayo, 2009 Adams  Behrman, 1982). Environmental degradation and depletion of raw materials are some of the effects of foreign direct investment in developing countries. Today, most governments are channeling taxpayers funds to environmental conservation rather than economic development further affecting the economic stand of these countries (Gullberg, n. d Batterbury  Forsyth, 1997).

Loans and debts
Another major hindrance to economic development in African countries can be attributed to repayment of international loans and debts. The international community in the name of helping developing countries gives out loans for construction of infrastructure and social amenities among others. Most of such funding has no revenue return and they carry high interest rates (Sachs  Collins, 1989). Developing countries are today burdened with loans and debts which they are required to service for further loans to be given. As such, a lot of money that should be dedicated to economic development is used to repay loans and depts. Also, the loans come with a lot of restrictions. For example, for a government or a developing country to be granted a loan, it may be required to retrench some of its public workers. This leads to loss of revenue in terms of taxes and an increase in poverty level. Stringent and costly terms of international funding as well as increased burden of loan repayment also forms part of economic challenges being faced by developing countries in their endeavor to improve their economies.

Possible measures to eliminate such setback
Government and judicial restructuring
Most of the above economic challenges are founded or can be attributed to poor governance and ineffective legal avenues or structures in the developing countries. As mentioned above, corruption is one of the killers of economic development in African countries and it needs to be restructured. Currently, most legal systems including the judiciary and the police are not independent thus making it difficult for prosecution or perpetrators of corruption. Outcomes of judicial rulings are highly influenced by government and other influential persons within the developing countries (Cline  Weintraub, 1981 Ross, 1991). For economic progress to be achieved in these countries, legal restructuring is one of the ways to use. The judiciary, the executive and the legislative should become independent. The judiciary in particular should be restructured in such a manner that enables it to fully exercise its mandate without any outside or political influence. This way, cartels, monopolies and wealth accumulation by few persons via illegal can be reduced (Cheema, 2005 Sahn, 1996). Transparency and accountability should be made mandatory for all government and public servants so as to root out corruption. Civic education should also be given to citizens in developing countries (Colman  Nixson, 1986 Demirg-Kunt, 2006). Most of the citizens in developing countries do not know their rights or even government operations and procedures. Elections in democratic countries are largely carried out not on merit but on the power to influence. This needs to change and can only be achieved via rigorous civic education which would in turn ensure good governance is put in place for economic reform to be achieved.

Infrastructure upgrading
Infrastructure is the backbone in which national and international trade is founded. One of the developing countries major setbacks to participation in international markets is lack of good infrastructure networks. To improve economic growth and development in developing countries, it is vital for the governments of these countries to commit a large portion of their budget to upgrading of infrastructures (Sarris, 1987 Isham, Kelly  Ramaswamy, 2002). Developing countries should also seek for donor aid from already developed countries. Instead of taking loans, developing countries should request for grants and donations from developed countries as well as international organizations such as international monetary fund (White  Leavy, 2000 Fanelli  Squire, 2008).

Role of developed countries
Developed countries since they have a stake in economic degradation in Africa and developing countries should also have a stake in helping these countries revive their economy. Debts and loans repayment burdens are some of the economic challenges facing developing countries. Developed countries should consider writing off such long term debts as well as their interests so as to help developing countries concentrate on improving the economy. Any loan granted should also not have terms and conditions that contradict the well being of the developing countries especially in their endeavors to rebuild their economy (Cooper, 1992 Killick et al, 1982). Developing countries should be decisive enough to refuse any grants or loans as well as investment that may hinder economic development and growth.

Conclusion
Developing countries have been struggling with the issue of economic development for a long time. After the 1990s, the economic development gap between developing countries and developed countries widened and this trend has persisted to date. Most of the economic challenges that developing countries face are internal and related to governance and infrastructure. However, there are also some external factors contributing to low economic development in such countries. Developed countries should aid developing countries improve their economies by given them the necessary resource, guidance and advice without interfering in the running of a country or micro-managing the developing countries.

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