Monday, August 13, 2012

Why is Africa so poor despite its gold and diamond resources?

Answer: This is a very complex and misunderstood topic. Before answering, it is important to note that "Africa" is not a political or economic entity, and therefore addressing this issue must be done on a nation-by-nation basis. In fact, some African countries such as South Africa, Kenya, and to some extent Morocco and Egypt have relatively high standards of living. The question is also posed poorly, as Africa as a whole does not contain an even spread of gold and diamond resources, and often nations have additional resources or less (such as oil in Nigeria but desert in Chad). Effects on most African nations' wealth include, among other things, (1) residual effects of colonialism, (2) current exploitation of poor nations by wealthy nations, (3) a pervading lack of strong political institutions to manage the economy, and (4) Western ignorance in their interventionist strategies such as the International Monetary Fund (IMF) and World Bank. Colonialism forced African peoples into regimented and incredibly foreign manners of government. Warring tribes were often "placed" in the same nation while other tribes were split by these artificial boundaries. Also, colonizers placed certain tribes in positions of power which has caused uprisings in areas such as Rwanda. Pertaining to the question about natural resources, these are often extracted by wealthy nations, who take the wealth from those resources back to their already wealthy countries. This has been the case in oil-rich Nigeria and diamond-rich South Africa. Wealthy nations also often trade extraction rights for vast amounts of extorted "dirty money". Historically, the world has not seen a well-developed economy without a corresponding strong government. In contrast to a Western-style political institution of checks and balances, traditionally African tribes were not organized in such a way. Many argue that in addition to easy access to education, healthcare, and natural resources, a strong government that can balance its own power by virtue of the bureaucratic structure of itself is essential. Lastly, the IMF, World Bank, and other international aid organizations have created massive problems by failing to understand the social and political contexts of the African countries within which they work. They lend money to nations, henceforth focusing on repayment of the loan, rather than the efficacious use of that loan. They require structural changes in the government that detrimentally weaken the local and federal governments. Furthermore, aid organizations normally focus on distributing birth control and food, which benevolently helps the people, but it ameliorates the symptoms without tackling the sickness, such as establishing and funding schools or citizen advocate groups. Read more: http://wiki.answers.com/Q/Why_is_Africa_so_poor_despite_its_gold_and_diamond_resources#ixzzG3oMEK7u9

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