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Africa's Rise and Its Hurdles

The continent, which has 40% of the world’s gold and up to 90% of its chromium and platinum, has not benefited from these blessings as most of its minerals and agricultural products are bought cheaply and exported to the West unprocessed.
posted onOctober 14, 2022

By Jonah Ruhima

In the period between 1881 and 1914, there was an invasion, division, annexation, and colonialization of Africa by Western European countries.

In 1884, the German Chancellor, Otto von Bismark, called a meeting of 13 European leaders in Berlin to formalize and regulate colonialism and trade in Africa.

The last years of the 19th century saw a transition from informal imperialism (military influence and economic dominance) to direct rule.

After this "formal colonialization", the economies of partitioned African countries, which were now colonies of the European countries, were structured to produce raw materials for the European industrial revolution.

This has been a defining factor in why African economies have been in the doldrums up to now and why we rarely add value to our products.

Many in the world may say Africa now got independence, but to what extent? Very many researchers, writers, and scholars have extensively and repeatedly explained with evidence that imperialists have never left Africa but rather changed the tactics of colonialization and exploitation of Africa.

Africa has the natural resources and commercial power to become the world’s richest continent but western exploitation and what Kwame Nkrumah called Neo-colonialism is no doubt the number one hindrance to Africa’s economic development and absolute independence.

In his book Neo-colonialism: "The Last Stage of Imperialism", Kwame Nkrumah the great Pan-African leader states, "The essence of neo-colonialism is that the state which is the subject to it is, in theory, independent and has all the outward trappings of international sovereignty. In reality, its economic system and thus its political policy is directed from outside.”

After independence, Western powers built neo-colonial systems, policies, and lopsided trade laws that continue to rob Africa of key commodities.

This is deliberate to cripple African economies and make us entirely dependent on the West for food and aid supplies.

Africa is a richly-blessed continent with natural resources ranging from land, water, oil, natural gas, minerals, and forests. It is home to some 30% of the world’s mineral reserves.

The continent, which has 40% of the world’s gold and up to 90% of its chromium and platinum, has not benefited from these blessings as most of its minerals and agricultural products are bought cheaply and exported to the West unprocessed.

For every raw commodity like minerals and agricultural products that are imported from Africa, European companies make ten times more profits after processing these products into finished goods.

In 1997, the IMF and other five international organizations introduced Aid For Trade, an important mechanism aimed at helping poor countries to be able to build the capacity to add value to their primary products for export such that these products can fetch better prices in the international markets.

But this agenda and other campaigns like Trade Not Aid have just been lip service for over 40 years as we have not seen any benefits from them. This is one of the reasons why Africa today contributes less than 2% of global merchandise and adds value to less than 18% of its total products.

African producers fetch only 7 to 10% of the retail value of the crops they produce. This has created Africa’s underdevelopment and its great dependency on the west for food and other product imports and for aid, as we earn very little from our produce and spend a lot on imports.

It’s in the best interest of the western world for Africa to continue exporting its products unprocessed.

In their book "The Wheat Trap: Bread and Underdevelopment in Nigeria", Gunila Andrae and Bjorn Beckman assessed Nigeria’s dependency on imported food supplies, mostly wheat imported from capitalist countries, and how it had led to the underdevelopment of Nigeria’s agricultural sector.

The writers used the term "underdevelopment" in the sense of radical underdevelopment theory (A.G. Frank, Samir Amin) to mean a process where the development of production in third-world countries is obstructed by their mode of integration (in a subordinate position) in the world capitalist system.

In this sense, underdevelopment is not a natural state of backwardness that all societies have experienced, but rather something that emerges as a result of colonialism and imperialist dominance. As the second most traded commodity in the whole world, coffee is one of the products where imperialists aggressively continue to exploit Africans with very unfair lopsided laws.

Whereas coffee is mainly consumed by developed countries, more than 90% of coffee is produced by developing countries. It’s estimated that African coffee farmers are losing over $1.47 billion from exploitative prices.

Farmers have no power to influence market prices, and because of this injustice and exploitation, small-scale farmers are prone to remain in poverty. The coffee supply chain is dominated by a few multinationals (50% of the coffee market is dominated by only 5 companies).

The farmers have very limited bargaining power individually. A cup of coffee is an example of how much money the actors behind the coffee (producers, roasters, and sellers) receive at each stage of the value chain. If a cup of coffee sells for $3, the seller gets to keep 79% of the value ($2.37) and the roaster gets 13% ($0.40).

The middleman or carrier earns 5% ($0.14) while the farmer keeps 3% of the total value of the cup ($0.09). Clearly, what is happening to the African coffee farmers is akin to the bleeding of the leech to fatten the heifer. Globally, despite producing the best quality of coffee, African coffee farmers get the lowest prices compared to fellow farmers from other parts of the world like Brazil, Colombia, and India.

Organizations like the International Coffee Organisation, whose role was to increase transparency, and access to relevant information, and promote a sustainable coffee economy for the good of all stakeholders, particularly small-scale farmers in producing countries, have instead been exploitative and unfair to the group they are supposed to protect.

In Uganda, President Museveni has been deeply concerned about these exploitative trade deals and has hence kicked started efforts to add value to our coffee. This is part of a bigger agenda, the agro-industrialization agenda, where the government wants to add value to all agricultural products produced by our farmers in order to maximize the profits from agriculture, create jobs and also widen our revenue base.

The government of Uganda has been running deliberate programs to support farmers to multiply their production. This has been done through programs like NAADS, OWC, etc., which have distributed inputs to farmers, built irrigation schemes, offered machinery like tractors, millers, etc., and advisory services to help farmers learn better modern methods of farming and post-harvest management.

It’s through these support efforts by the government that Uganda is currently the food basket of the region and has bumper harvests every season. It’s also important to note that even during the COVID lockdown, Uganda managed to raise its coffee exports from 5.1 million bags to 6.1 million bags annually.

But as expected, this genuine agenda by the president aimed at giving our local farmers decent pay for their produce has been facing resistance from some local actors who have been benefiting from the exploitative coffee trade deals.

As a listening leader as we know him, President Museveni recently invited key players in the coffee industry and explained to them the need to add value to our coffee, but the war on imperialism and its exploitative and survival tactics is a war all of us as Pan Africanists and patriots must fight.

We all need to support the President and government on its agro-industrialization agenda and help our local farmers get fair prices for their products, generate employment opportunities for our young population and also raise our revenue, which will help the government finance the social services we all need.

The total and real independence of Africa and the survival of its people lies in its economic independence, which can be achieved through industrialization and value addition to our products.

The writer is a concerned Ugandan citizen

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