Ferguson examines Africa’s economic future

Harvard historian Niall Ferguson devotes his latest Newsweek column to an examination of the positive and negative factors influencing African economic development.

Ten years ago little more than 1 percent of Zambians had a cellphone subscription. Today the proportion is approaching a third. Never before have Africans been able to communicate across distance more easily. More importantly, cellphones are giving poor Africans access to basic financial services for the first time.

So there is hope. Take a look at the pace of economic growth in much of Africa, and the picture is brighter than at almost any time since the end of colonial rule. It may not matter if population outstrips agricultural production in individual countries, so long as enough Africans are producing hard commodities that fetch high prices on world markets. Trade will do the rest.

The real obstacles to prosperity in Africa are not, after all, Malthusian. If Western governments had the will to override their small-but-powerful agricultural lobbies, free trade in farm produce would be a boon for African farmers.

Yet a bigger problem even than our protectionism is the dismally low quality of African governance. Zambia’s recent peaceful and democratic change of government remains a rarity. Neighboring Zimbabwe continues to languish under the senile dictatorship of Robert Mugabe. Somalia is the world’s most lawless country. Mali has just suffered a coup. And so the woeful list goes on.

The naive view is that such instability is due to the “resource curse”: the idea that valuable commodities can be more a bane than a boon. But as Oxford economist Paul Collier argued in The Plundered Planet, the real trouble is not the resources, but the defective political institutions that sit on top of them.

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