By Patrick Bond
May 19, 2016 -- Links International Journal of Socialist Renewal -- From May 11-13, the World Economic Forum (WEF) Africa summit in Kigali, Rwanda reinforced extractive-industry and high-tech myths. The gathering unveiled the 1%’s elite’s exuberant imagination and its lack of exposure to the continent’s harsh economic realities. As an antidote, grassroots protesters all over Africa are questioning the logic of export-led ‘growth’ and renewed fiscal austerity, instead demanding that policies meet their basic needs.
Surreal self-congratulatory rhetoric is on the lips of many WEF luminaries, epitomised by ethically-challenged Tony Blair celebrating the dictatorship of host Paul Kagame.
• “Africa will probably remain natural resources-driven for the next two decades at least,” pronounced software executive and WEF leader Brett Parker. “Investment in infrastructure, transportation and logistics has been responsible for more than half of Africa’s improved economic performance and is a cornerstone of socio-economic development.” In reality, commodity prices have since 2011 crashed to record lows, along with the main measure of shipping and logistics (the now rock-bottom Baltic Dry Index), leaving resource-dependent societies like Nigeria in profound crisis.
• In spite of the oil price falling below $30/barrel earlier this year and hovering around $48 today (from a 2008 peak of $140), Standard Chartered Bank’s Razia Khan (whom Cambridge University considers “the leading analyst on African economies”) argues that Uganda should keep pumping scarce investment funds into petroleum exploration, notwithstanding production costs there of $70/barrel.
• Similar pro-corporate advice comes from Greg Mills – who directs the (Johannesburg mining tycoon) Oppenheimer family’s Brenthurst Foundation – in search of state “policies which aim to encourage long-term, generational investment” in Africa’s utterly collapsed mining sector. The Oppenheimer’s Anglo American Corporation – Africa’s largest firm over most of the last century – lost 94% of its value on the London Stock Exchange from 2008 peak to 2015 trough.
• Ignoring such data, intoned African Leadership University’s Fred Swaneker, “The Africa Rising narrative presents the most compelling argument for the continent’s prosperity.”
New elements of Africa Rising hucksterism emerged at this year’s WEF, including a child-like fascination with “Fourth Industrial Revolution cyber-physical systems” – artificial intelligence, robotics, nanotechnology, biotech and the like – that will supposedly allow Africa to leapfrog the world, indeed to “lead the way”, because the continent is “the world’s fastest growing digital consumer market.” Reality check: fewer than one in three Africans have home electricity, and just one in five have used the internet.
Still, vain hopes for vibrant consumption markets continue. When Cape Town hosted the WEF in 2011, African Development Bank economist Mthuli Ncube made fanciful claims about the new middle class: “Hey you know what, the world please wake up, this is a phenomenon in Africa that we’ve not spent a lot of time thinking about.”
Even The Wall Street Journal, one of the world’s great business periodicals, was fooled by Ncube: “Last year, the continent's 313 million-person middle class – those who spend between $2 and $20 a day – comprised about 34% of the population. Its number rivals that of the middle classes in China and India, according to the study, which was reviewed by The Wall Street Journal.”
That review was rather incomplete. Massively indebted and unable to buy even basic foodstuffs for $2/day in most African cities, the supposed mass middle class has fizzled. A more accurate rendition of ‘middle class’ lifestyles would start at $20/day. This group of Africans actually fell as a share of the continent’s population from 6.5% in 2000 to just 4.8% even at the peak of the commodity boom in 2010, even Ncube’s data show.
More recently, admits a Reuters journalist, “Whether it's selling pensions, pasta or toothpicks, investors in Africa have been targeting the booming middle class. But a year of diving commodity prices has exposed how much the continent, and its consumers, still rely on exporting resources. This, in turn, is raising doubts about whether the growth of the African middle class has been overplayed: has the wealth created by the decade of growth been widely distributed, or have only relatively small pools of urban consumers merely benefited from a transient commodity boom?”
As reality dawns, even the continent’s oldest retail bank, Barclays, has just announced it will sell its African operations.
The most gloomy reason to fear Africa’s for future, climate change, was distorted beyond recognition at the Kigali WEF. Referring to the December 2015 UN climate summit in Paris, the director of the Africa Progress Panel (founded by Blair in his prime a decade ago), Caroline Kende-Robb, pronounced that the “COP 21 in Paris was an unambiguous success [because] African nations seized the chance to shift the climate narrative from one of dependence to one of opportunity and transformation.”
In reality, African activists criticised Paris because
• emissions-cut commitments are non-binding and inadequate (even if promised cuts are realised, the temperature will rocket up 3 degrees, killing hundreds of millions of Africans),
• US negotiators reintroduced the failed strategy of carbon trading (the ‘privatisation of the air’) and
• the deal officially prohibits ‘climate debt’ lawsuits against Northern over-emitters who bear liability for climate damage.
The African elites who signed in Paris condemned their citizenries to a hellish future of climate apartheid. For the WEF, that might well represent “an unambiguous success.” But leading climate scientist James Hansen called the Paris deal a “fraud… bullshit.”
The WEF fibbery and desperate corporate huckstering seem more frenetic than in past years, perhaps because lurking behind the elite backslapping, there is widespread African social resistance to neoliberal power and ideology. Across Africa, the establishment’s public policies still fail to deliver and much of the continent’s wealth has been looted.
Even the supremely arrogant Robert Mugabe admitted recently that $15 billion worth of his country’s diamonds are unaccounted for, thanks to the alliance of Beijing/Shanghai/HongKong, TelAviv, Dubai and Harare (Zimbabwean-army) diamond dealers with fingerprints on the missing goods. The main looter, Sam Pa, was jailed in China last year for reasons unknown, but that fact won’t return the wealth, at a time Zimbabwe has literally run out of money and cannot print its own.
Afro-optimistic, from below
Yet just as the International Monetary Fund (IMF) recognises that unrepayable debt has again mounted, requiring ‘fiscal consolidation’ (spending cuts), African protesters have gathered five years of momentum to resist. Indeed, if we consider various measures of civil society activism against perceived injustices, Afro-optimism should be back in style, seen from the grassroots perspective.
Since 2011, the continent has witnessed a dramatic spike in social protests, as recorded by the African Development Bank (AfDB) based on Agence France Press and Reuters reporting. According to the AfDB’s 2015 African Economic Outlook, from 2011-14 protests occurred at a rate at least five times greater than in 2000.
And rather than falling back after the dramatic ‘Arab Spring’ – the 2011 North African uprising that was especially intense in Tunisia, Egypt, Libya and Morocco – the continent’s protesters subsequently picked up the pace in Algeria, Angola, Chad, Gabon, Kenya, South Africa, Uganda and many other countries.
The AFP/Reuters press reports confirm that the vast majority of protests since 2011 were over inadequate wages and working conditions, the low quality of public service delivery, social divides, state repression and lack of political reform. A half-dozen examples illustrate impressive results of recent protests.
• In Mozambique, water and food price hikes in September 2010 catalysed consumers’ text messages proposing a mass ‘strike’, paralysing Maputo for a weekend and resulting in not only police violence but a price freeze and new state service subsidies.
• The immolation of Mohamed Bouazizi in Tunisia that sparked the North African uprising in early 2011 was in part the result of frustration after police upended his fruit cart, but the larger context was the Ben Ali dictatorship’s implementation of IMF advice to raise local Value Added Tax (VAT) on informal merchants while lowering corporate tax rates.
• In Senegal, sustained demonstrations in 2011-12 prevented a third term by the authoritarian neoliberal president Abdoulawaye Wade.
• In Nigeria, the December 2011 doubling of local petrol prices – ordered by IMF managing director Christine Lagarde – caused an uprising that in the subsequent fortnight nearly overthrew the government before the increase was reversed.
• In 2014, the most spectacular protest was in Burkina Faso, where in the spirit of 1980s revolutionary Thomas Sankara, mass demonstrations overthrew president Blaise Compaoré. The Burkinabés’ revolt began in 2011 with vigorous food riots that were put down by lethal police force, leaving more than a dozen fatalities. In 2015, Compaoré’s attempt at a comeback was similarly foiled by the masses and he even briefly faced charges in absentia for Sankara’s murder.
• The October 2015 victories of South African students and low-paid university workers – a 0% fee increase and the ‘insourcing’ of casualised employment – offered a more recent successful socio-economic protest that threatened to become a much more serious challenge to political power.
Some social turmoil is localised, taking place in the vicinity of mines and oil wealth, as correlated in recent Links International Journal of Socialist Renewalmappings by the London-based Centre for Economic Policy Research based on data gathered by University of Sussex researchers, and in more than 200 studies in the Environmental Justice Organisations, Liabilities and Trade research project’s ‘EJ Atlas’. South Africa is witnessing many more mining struggles, such as the battles against titanium, iron ore and coal within a couple of hours drive of Durban.
Labour is also regularly revolting in Africa. In 140 countries each year, the WEF’s Global Competitiveness Report authors ask businesses how to “characterise labour-employer relations” in terms of cooperation versus confrontation. Of the 1/3 most militant countries in the world, African countries typically account for 40%, far higher than any other region.
Since 2012 (the year of the Marikana Massacre), the South African working class has been ranked angriest, earning the gold medal in the global class struggle. The 2015 WEF rankings for the other most ‘confrontational’ workers include those from, in order of militancy, Algeria, Tunisia, Mozambique, Guinea, Chad, Liberia Mauritania, Lesotho, Morocco, Cape Verde, Zimbabwe, Tanzania, Sierra Leone, Seychelles, Ethiopia, Kenya, Cameroon and Gabon.
Pressures causing many African societies to revolt include the continent’s worsening fiscal shortages, which in turn reflect not only the commodity price crash since 2011, but a worsening outflow of funds by multinational corporations via tax dodges and other illicit routes. Former South Africa president Thabo Mbeki’s African Union panel on Illicit Financial Flows (IFFs) last month raised the estimate of IFFs to $80 billion annually.
There is also the matter of licit financial outflows. In South Africa, these legal flows of profit, dividends and interest have driven the last fifteen years of current account deficits, in turn requiring South Africa to borrow abroad to make up the difference: the country’s foreign debt has soared from $32 billion in 2000 to $140 billion today. Combined with South African corporations’ record as the most corrupt elite on earth, according to 2014-16 PricewaterhouseCoopers Global Economic Crime surveys, no wonder the workers are so angry and the Gini income coefficient is at a world-leading 0.77 (on a scale of 1 when one person receives everything and 0 when income is equally shared).
The Sub-Saharan African debt has doubled to over $400 billion in the last decade, and when debt default nears, as will soon be common, the neoliberal IMF returns to the scene with disastrous effect, just as in the 1980s-90s. The African ‘voice’ at the IMF is getting quieter, especially after the December 2015 board restructuring due to new shareholder weights favouring China (up 37%), Brazil (+23%), India (+11%) and India (+8%). But contrary to rhetoric about BRICS solidarity, Nigeria lost 41% of its voting power followed by Libya at -39%, Morocco -27%, Gabon -26%, Algeria -26%, Namibia -26% and even South Africa -21%.
Last month, the IMF’s Regional Economic Outlook for Africa suggested that “a substantial policy reset is critical in many cases.” Yet offering no new economic policy advice to lower vulnerability to commodities and debt, the IMF predictably intoned, “Because the reduction in revenue from the extractive sector is expected to persist, many affected countries also critically need to contain fiscal deficits and build a sustainable tax base from the rest of the economy.” It is hard to translate this as anything other than the standard command to lower social spending and impose higher VAT charges on ordinary people.
Precisely this combination – a policy ‘reset’ that is actually more of the same neoliberalism – along with many mining firms reacting to the lower prices by raising output (in search of more rapid albeit much smaller profits) and shirking their labour, social and environmental obligations, are underlying material conditions behind what US academics Adam Branch and Zachariah Mampilly term Africa Uprising.
The enormous potential for the protests they document – e.g. Uganda’s 2011 Walk to Work movement – has not yet been realised (perhaps with the exception of Tunisia), because in so many sites of struggle, state repression rises and then the protests, they conclude, “fragment into particularised constituencies without a common vision for progressive political change in the country.”
Indeed as Frantz Fanon had warned in his book For the African Revolution nearly six decades ago, “For my part, the more I know political cultures and circles, the more the certainty is imposed on me that the greatest danger to threaten Africa is the lack of ideology.”
However in at least one vital protest zone, South Africa, a May Day gathering of more than 50 trade unions – led by the continent’s most militant (the 350,000-strong) National Union of Metalworkers of South Africa – announced that a new workers federation will soon emerge bearing a socialist ideology, and in turn will hopefully revive the loose United Front alliance of several hundred social movements and left organisations. A workers party is promised, perhaps to merge with the Marxist-Leninist-Fanonist Economic Freedom Fighters prior to the next national elections (in 2019).
But even if the protest upsurge is ignored (or repressed) in Kigali and within the WEF set, more awareness about popular risings against ‘Africa Rising’ rhetoric is long overdue, given the former’s potential and latter’s utter bankruptcy.
Patrick Bond is professor of political economy at the University of the Witwatersrand and honorary professor at the University of KwaZulu-Natal Centre for Civil Society. A version of this article originally appeared at The Conversation-Africa .