A worker checks readings on an energy management system, South Africa. Photo credit: National Cleaner Production Centre South Africa (Courtesy of un.org)
February 24, 2023
I am publishing below, “Industrialization is the Antithesis of Slavery” a new article by my colleague, Nancy Spannaus, creator of the blog, americansystemnow.com, because of the importance of this topic. Unfortunately, many Americans and non-Americans alike, foolishly repeat the silly and false notion that the success of the United States in becoming a great industrial power laid on the foundation of slavery. Nothing could be further from the truth. The U.S. achievement in becoming an economic power was despite, and in opposition to slavery. A progressing economy requires trained, skilled, and educated workers to operate the tasks required by productive manufacturing industries. Slave labor, exploiting the animal-muscle power of human beings only works in labor intensive occupations performed for example, in sugar, tobacco, and cotton plantations. Spannaus uses the writings of American System Economist, Henry Carey, a follower of Alexander Hamilton and advisor to President Lincoln, to elucidate the issue.
Slavery kept southern sections of the United States in backward economic conditions, that are still evident today. Slavery also contributed to a racist notion that “blacks” are inferior, affecting the U.S., such that we are still struggling with forms of racism centuries later.
To free all men and women, in Africa and in the U.S., we must exploit, if you will, the unique powers of the human creative mind. This can only be accomplished in a scientific-technologically advancing industrial economy, where every human being can be engaged in a productive profession and treated with dignity.
Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for over 30 years. He is a teacher, writer, public speaker, and consultant on Africa. He is also the creator of the blog: lawrencefreemanafricaandtheworld.com. Mr. Freeman’s stated personal mission is; to eliminate poverty and hunger in Africa by applying the scientific economic principles of Alexander Hamilton
President Abraham Lincoln delivering his Second Inaugural address on March 4, 1865, one month before his death.
April 17, 2022
President Abraham Lincoln, who was assassinated on April 15, 1865, was arguably the greatest U.S. President, but I would also suggest, perhaps the finest American. His tragic death changed the the, world not just the United States. My colleague, Nancy Spannaus, provides a fitting requiem for the fallen President. A Requiem for Abraham Lincoln
His temperament, his intellect, and his commitment to the U.S. Constitution, saved our precious Republic, which was less than eighty years old, and heading towards a Civil War, when he took office in 1861. President Lincoln’s unwavering resolve to defeat the opposing army of the Confederacy, demonstrated his superior military skills and strategic understanding that only the surrender by a defeated South, would the Union be preserved. His tragic death affected the world, not just the United States. If his reconstruction program had been fully implemented in his second term, the U.S. would be dramatically different today.
Much has been written and even taught that President Lincoln was not opposed to slavery, but only freed the slaves to win the Civil War. The remarks by the intellectual titan and fierce anti-slavery leader, Frederick Douglas, following the death of President Lincoln, quoted in Spannaus’ articles eloquently dispute this claim. Douglas was an ally of President Lincoln in the fight to eliminate slavery.
In his eulogy on June 1, 1865, at Cooper Union, NY, Douglas said:
“But what was A. Lincoln to the colored people or they to him? As compared with the long line of his predecessors, many of whom ere merely the facile and service instruments of the slave power, Abraham Lincoln, while unsurpassed in his devotion, to the welfare of the white race, was also in a sense hitherto without example, emphatically the black man’s President: the first to show any respect for their rights as men.”
The vast majority of Americans are also unaware that President Lincoln adhered to the economic policies of Alexander Hamilton’s American System. Abraham Lincoln in his basic campaign stump speech, advocated for protectionism, a national bank, and internal improvements. As President, he initiated the building of the Transcontinental Railroad across the U.S., connecting the Atlantic and Pacific oceans, which became a model of transportation infrastructure for the rest of the world. To fund the U.S. economy during the war he created a new currency-greenbacks, bonds backed by the federal government. Lincoln’s economic advisor was Henry Carey, a student of Hamilton’s economic method.
Abraham Lincoln’s frequently delivered speech on Discoveries and Inventions, reflects his philosophical understanding of human economy, revealed in its opening sentences:
“All creation is a mine, and every man, a miner.
The whole earth, and all within it, upon it, and round about it, including himself, in his physical, moral, and intellectual nature, and his susceptibilities, are the infinitely various “leads” from which, man, from the first, was to dig out his destiny.
In the beginning, the mine was unopened, and the miner stood naked, and knowledgeless, upon it.
Fishes, birds, beasts, and creeping things are not miners, but feeders and lodgers, merely. Beavers build houses; but they build them in nowise differently, or better now, than they did, five thousand years ago. Ants, and honey-bees, provide food for winter; but just in the same way they did, when Solomon referred the sluggard to them as patterns of prudence.
Man is not the only animal who labors; but he is the only one who improves his workmanship. This improvement, he effects by Discoveries, and Inventions.”(Emphasis added)
Let the U.S. again return to the policies of Abraham Lincoln by providing true leadership in the world.
As viewers of my website know, this is my second post in recent days discussing former outstanding U.S. Presidents and their policies. Why has American culture not produced such leaders in the last six decades following the death of John Kennedy? This will be the subject of a future article.
Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for over 30 years. He is the creator of the blog: lawrencefreemanafricaandtheworld.com. Mr. Freeman’s stated personal mission is; to eliminate poverty and hunger in Africa by applying the scientific economic principles of Alexander Hamilton.
Watch my hour long presentation from October 3. I discussed that the future of our planet in this century will be dependent on the African continent with its projected population of 2.4 billion and 1 billion youth by the year 2050. Either we set in motion NOW policies to develop African nations and realize the potential of 1 billion young creative minds, or we fail to do so, which will lead to more misery, and instability. The whole world will suffer from insecurity on the the African continent.
Past African giants like Cheikh Anta Diop and President Kwame Nkrumah understood what was required to develop the nations of Africa: infrastructure, energy, industry, and science. Africa suffers from an deliberate policy of imposed economic under-development, which must be overcome, not only for the sake of Africa, but for the very future of our planet.
The United States has adopted an anti-development, geo-political ideology that opposes development in Africa. For example, why hasn’t the Biden administration praised Ethiopia for the construction of the Grand Ethiopian Renaissance Dam (GERD) that will generate 6,200 megawatts of electricity for the Horn of Africa? I am sure that Presidents Franklin Roosevelt and John Kennedy would have supported Ethiopia’s drive for development, if they were alive today.
All this and more, including quotes from Diop and Nkrumah, is presented by myself in this video, which I believe will stimulate further discussion on the future of Africa.
Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for over 30 years. He is the creator of the blog: lawrencefreemanafricaandtheworld.com. Mr. Freeman’s stated personal mission is; to eliminate poverty and hunger in Africa by applying the scientific economic principles of Alexander Hamilton
There is no better way to celebrate Black History Month than to to absorb the ideas of Frederick Douglas. I recommend you read this latest article written my friend, American historian, Nancy Spannaus-see link below: Happy Birthday, Frederick Douglas. I also suggest you read his wonderful autobiography: Life and Times of Frederick Douglas.
Frederick Douglas believed in the U.S. Constitution and demanded that Americans and their leaders live up to its noble principles. That is something we should all aspire to. Douglas wrote: “Men talk of the Negro problem. There is no Negro problem. The problem is whether the American people have loyalty enough, honor enough, patriotism enough, to live up to their own Constitution.” Frederick Douglas did not advocate tearing down America, but rather, demanded that Americans live up to the principle embodied in the U.S. Constitution.
Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for over 30 years. He is the creator of the blog: lawrencefreemanafricaandtheworld.com
I was asked to participate on inauguration day in an event sponsored by African Women for Biden/Harris 2020. As an American, who is knowledgeable about Africa, I was pleased to present my ideas for an improved US-Africa policy. Below is the content of my remarks..
January 20, 2021
Hello, this is Lawrence Freeman. I am happy to join you this afternoon in celebrating the inauguration of President Biden and Vice President Harris.
I have been working in Africa for the last 30 years promoting development policies for the people of Africa; particularly transformative infrastructure projects. I teach classes in the Maryland area on African history. I am a consultant, researcher, writer, and lecturer. I created my own website: LawrenceFreemanAfricaandtheworld.com to help spread my ideas.
I have traveled to Africa many times and have visited several countries in sub-Saharan Africa. From my work in Africa over many years I have a good understanding of the dynamics of the continent. This administration will bring change to Washington. My hope is that this change will include initiating a new policy for Africa. One that is in the interest of United States, and one the serves the interest of Africa and raises the standard of living of all Africans.
Africa today has close to 1.5 billion people. It is expected that in 30 years by 2050, Africa will have close to 2.5 billion. It will have 1 billion young people and have the largest labor force in the world. If we do not address the needs of Africa today, then we could be looking at a dangerous situation in the years to come, and one that will make African nations less stable and less secure. It is in the interest of the United States and the world to help secure a stable future for Africa. We need new innovative policies that address those concerns.
After 500 years of slavery, colonialism, and neocolonialism, sub Saharan Africa especially, has been left without the basic infrastructure needed to develop its economies. African nations have very limited, if any infrastructure. The kilometers of railroads and roads in Africa is minimal, although it is beginning to change. The most troubling deficit in infrastructure is the reality of a mere 100,000 to 130,000 megawatts of electricity for all of sub-Saharan Africa! This is literally killing Africans. This lack of infrastructure has to be reversed. It is a matter of life and death.
In order for African nations to develop their full capacity, and realize their rich potential, African nations require a massive investment in infrastructure, especially railroads, electricity, and roads.
African nations also suffer from small manufacturing sectors. Africa has the smallest manufacturing capacity of any continent in the world. And this has to change as well.
African nations need to develop a manufacturing sector. I have been advocating for many years that we have to apply the same economic approach for Africa that we applied to build the United States from 13 agrarian based colonies into an industrial powerhouse. The U.S. accomplished this feat by implementing the American System of economics developed by Treasury Secretary Alexander Hamilton, under the direction of President George Washington.
Hamilton understood two principles that were essential for developing the United States that can be applied to Africa today. One, the government has the power to issue credit. African nations desperately need credit for development. Two, Hamilton understood that the U.S. would not be an economically sovereign nation if we had to buy all our manufacturing goods from abroad. He and his followers were strong advocates of building up a manufacturing based economy, which is exactly what Africa needs today.
Africa needs Investment in infrastructure across the continent including high speed railroads connecting major ports and cities, which is being proposed by the African Union. This will take massive amounts of credit. It cannot be done by the private sector alone. The United States should extend long-term low interest credit to African nations for development of infrastructure. The United States should also extend economic assistance to building up the manufacturing capacity in Africa which is quite minimal at this point.
It is in our interest to develop Africa not because we are competing with other nations, but because we want to assist in the development of the African continent. Robust African economies with growing populations will provide larger markets for American capital goods. This will also contribute to creating real security. Poverty is the underlying cause of most conflicts in Africa. The lack of food; lack of water; and lack of jobs generates conflict. Thus, by assisting Africa in developing its economies in these critical areas we will be creating the foundation for peace and security. Simply giving aid alone, which the United States is the leader, will not solve the problem. Providing counter terrorism training alone will not solve the problem. If people are desperate, if they are poor, if they are hungry, they can easily be manipulated into conflict against their brothers and sisters.
I believe Africa can have a very bright future–the more people means the more creative minds. Africa will have the youngest population of any continent in the world. The U.S. should help Africa develop the capabilities to nurture these creative minds because creativity is the source of all wealth.
Presently China is active on the continent. I do not think this has to be a competition between the U.S. and China. The needs of Africa are so large that there are more than enough opportunities for investment by the United States, China, and other nations. Remember the profound words of Pope Paul VI, who in his 1967 encyclical letter Populorum Progressio, said: the new name for peace is development.
It is my hope that with this new administration and in a time of change and optimism we will usher in a new policy of development for Africa. I have written, taught, and lectured on the Hamiltonian economic system and I know this is an approach that will work. It has worked over hundreds of years. It was implemented by President Franklin Roosevelt, who used public, government issued credit, and the Reconstruction Finance Corporation to fund his great infrastructure projects that brought us out of the depression. FDR intended to green the deserts of Africa after the war, unfortunately, he died.
Let us apply those same Hamiltonian economic principles for the development of Africa today. Now is the right time for the United States to extend its moral and economic leadership across the ocean, and act on behalf of the common good, which is in the shared interests of all nations and all people.
Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for over 30 years. He is the creator of the blog: lawrencefreemanafricaandtheworld.com
In 1791, America’s first Secretary of the Treasury, Alexander Hamilton, put forth his grand plan for industrializing the United States. In his “Report on the Subject of Manufacturers,” Hamilton rejected the then common assumption that America could prosper with an agricultural base, instead arguing that the new Republic should concentrate on developing industry. (courtesy of enterpriseai.news)
January 18, 2021
In memory of Dr. Martin Luther King (1929 to1968), a champion for the poor.
On Sunday, January 10, 2021, the Rising Tides Foundation (risingtidefoundation.net) hosted a class by me entitled: A Hamiltonian Solution for Africa. The first video below is my two hour presentation. The second video is an hour of questions and answers. For those of you who have the time and the desire to learn, I believe you will find these videos beneficial.
Alexander Hamilton, the first U.S. Treasury Secretary under President George Washington, prepared four economic reports establishing the American System of Political Economy in opposition to the Adam Smith-British free trade system. Hamilton understood that the U.S. would not become a sovereign economically independent nation without a robust manufacturing sector. This is true of African nations today, which have the lowest dollar amount of manufacture added value in the world. African nations are subjected to unfavorable terms of trade and weak currencies, because they are compelled to export their natural resources and import capital goods. Hamilton would not allow this to happen to the young U.S. following its independence from Great Britain.
My personal mission is to eliminate poverty and hunger in Africa by educating my African friends on the scientific economic principles of Alexander Hamilton.
“The intrinsic wealth of a nation is to be measured, not by the abundance of the precious metals, contained in it, but by the quantity of the production of its labor and industry.” Alexander Hamilton, Report on a National Bank, (December 13, 1790)
Lawrence Freeman is a Political-Economic Analyst for Africa, who has been involved in economic development policies for Africa for over 30 years. He is the creator of the blog: lawrencefreemanafricaandtheworld.com
Former African Union Ambassador, Arikana Chihombori-Quao, speaking to Lawrence Freeman’s class at Osher Lifelong Learning Institute in Montgomery County Maryland on the Berlin Conference. December 5, 2019
December 7, 2019
At the fifth week of my African history course (outlined below), 80 students heard Amb Chihombori-Quao discuss the effects of the Berlin Conference on the people of Africa today. This provocative presentation lead to many questions.
“Africa: The Sleeping Giant” 6 week-12 hour course syllabus by Lawrence Freeman
The instructor’s intention is to provide the class with broad overview of the development of the African continent over millennia and centuries, coupled with insights to understand the present. The instructor believes that it is impossible to know current events in Africa today, beyond the misleading media headlines, without a full knowledge of Africa’s unique and at times tragic history.
Week 1–“Introduction”: In this class we discuss the great diversity of the continent. This includes its size, climates, geographical characteristics, deserts, rivers, lakes, and historical facts regarding Africa’s many nations, its economic condition.
Week 2–“Man Is Not a Monkey”: This class traces mankind’s emergence to what we call modern man-homo sapien sapien-over millions of years by examining the effects of man’s powers of reason, that did not evolve from the apes, and mankind’s exodus from the African continent. We will then discuss a few of the early civilizations in East and West Africa, concluding with the great Bantu internal migration that transformed the continent.
Week 3–“Early African Civilizations-Slavery”: In this we class we continue examining early civilizations in Africa, iron making, and population growth. We will then leap ahead to the “discovery” of Africa by Europe and roots of slavery.
Week 4–“Slavery to Colonialism”: In this class we examine the seamless transition from slavery to colonialism, which in total encompasses 500 years, leading to destruction of the cultural and physical evolution of the African people.
Week 5–“European Empires Carve Up Africa”: This class focuses on the hideous Berlin Conference that divided up Africa in accord with Europe’s geopolitical Imperialist view of Africa and its people.
Week 6–“Africa’s Post Independence”: We leap ahead to the liberation of Africa from colonialism circa 1960. We discuss current and changing conditions in African nations, especially as the West abandons the continent and China supports Africa’s economic growth by building and funding infrastructure projects across Africa.
Below is an insightful article on the death of Robert Mugabe. One cannot honestly and competently analyze African nations today, unless one thoroughly studies the affects of colonialism, and before that slavery. When I look at the current state of affairs in Africa. I see the consequences of the long waves of hundreds of years of slavery, colonialism, and neo-colonialism. For example, can one truly understand Zimbabwe, Nigeria, Ghana, Kenya, and South Africa, without examining the evil role of British Imperialism and colonialism? Is Kenya not suffering today from the removal of the Kikuyu from the the Highlands, which were turned into the “Whitelands” by the British in the early 20th century? Similarly, it is impossible to truthfully discuss Zimbabwe, and its now deceased leader, Robert Mugabe without revealing the failure of the 1980 Lancaster agreement to rectify the stealing of 70% of the nation’s most fertile land from millions of “black” Zimbabweans that was given to 4,500 “white” farmers. Why are African nations, with abundant fertile soil, still using primitive methods of farming and have weak agricultural sectors? Why does Africa suffer from the greatest deficit of infrastructure in the world per land area, which is only beginning to be reversed by China with its Belt and Road Initiative? Why is Africa the least industrialized continent on the planet? Are we going to blind ourselves to the ugly history of what was done to Africans over hundreds of years, and naively and simplistic blame conditions today on a lack of good governance? This error, this lack of understanding Africa’s history, perverts the the thinking of Western institutions and Africa specialists, yielding flawed analysis.
The analysis in the article below published by WPR is useful. However, I can be more blunt: President Trump’s policy for Africa has nothing to do with helping Africa, but it only to counter China’s influence! President Obama did very little for Africa, but make speeches about so called good governance and promoted his fraudulent “power-less Africa” program. Sadly, President Trump is following in Obama’s footsteps, premising his strategy for Africa on the old British geo-political doctrine of winners and losers in a zero-sum game. Read my article: President Trump’s Fundamentally Flawed Africa Policy Stopping China is not a policy to help Africa, a continent still suffering today from enormous infrastructure deficits, a legacy of 500 years of slavery, colonialism, and neo-colonialism. Despite all the propaganda against China, China’s Belt and Road infrastructure initiative has done more to assist African nations in developing their economies in recent decades, that all the combined initiatives of Europe and the United States. President Trump’s “Prosper Africa” will not advance Africa’s interests. The best way to actually promote development in Africa, build robust manufacturing sectors, and industrialize the underdeveloped continent, would be for President Trump to join China in building infrastructure across the continent in the spirit of the Belt and Road Imitative.
During the Cold War, American policymakers frequently pushed nonaligned countries to take sides. The Central Intelligence Agency fomented coups against governments that flirted with communism and the Soviet Union, or that just drifted too far to the left for comfort. The State Department threatened to cut aid flows to countries that voted too often against U.S. priorities at the United Nations. Could sub-Saharan Africa find itself caught in the middle again if a cold war with China breaks out?
In a speech at the Heritage Foundation last December, President Donald Trump’s hawkish national security adviser, John Bolton, launched a new initiative called “Prosper Africa” that he said was aimed at promoting trade and commercial ties “to the benefit of both the United States and Africa.” But there are a number of reasons for African governments to be concerned about what the administration really has in mind.
First of all, Bolton cast the goal of increased economic engagement as something necessary for “safeguarding the economic independence of African states and protecting U.S. national security interests,” not as something helpful for African economic development. He pointed to the growing influence of “great power competitors,” China and Russia, which he suggested were investing in Africa mainly “to gain a competitive advantage over the United States.” While there are certainly valid concerns about some of China’s foreign aid and lending practices in Africa and other developing countries, African governments have generally welcomed Chinese aid and investment. It’s not at all clear they would agree that this is a competition where they must choose one side or the other.
A second reason to be skeptical of how seriously this administration takes the goal of helping Africa develop is the low level of U.S. engagement to date. President Donald Trump has not visited the continent; his wife and daughter have in trips heavy on photo ops but light on policy substance. Secretary of Commerce Wilbur Ross—hardly the most dynamic member of the Cabinet—was supposed to represent the administration last month at the U.S.-Africa Business Summit in Maputo, the capital of Mozambique, where details of the Prosper Africa initiative were announced. But he cancelled at the last minute because of a “scheduling conflict,” according to his office, sending Deputy Secretary of Commerce Karen Dunn Kelley instead.
By contrast, Chinese President Xi Jinping has visited Africa multiple times and has welcomed a stream of African officials to Beijing. Russian President Vladimir Putin will host 50 African leaders at a summit in Sochi later this year. Gyude Moore, a former minister of public works in Liberia (he’s now my colleague at the Center for Global Development), called the lack of Cabinet-level U.S. participation at the Maputo meeting insulting.
There are a number of reasons for African governments to be concerned about what the Trump administration really has in mind.
Finally, another reason to question the White House’s intentions with respect to trade with Africa is Trump’s view that trade policy is a zero-sum game: If another country wins, the United States must lose, and vice versa. Indeed, before getting to the mutual benefit part of his speech last December, Bolton asserted that the administration’s new Africa strategy would remain true to Trump’s “central campaign promise to put the interests of the American people first, both at home and abroad.”
So it should be no surprise that when he discussed trade, Bolton emphasized American jobs and exports to Africa. He said that the administration wants to pursue “modern, comprehensive trade agreements… that ensure fair and reciprocal exchange.” In recent congressional testimony, U.S. Trade Representative Robert Lighthizer also reiterated the administration’s goal of negotiating a bilateral trade agreement with an African country that could become a model for others. Negotiators for a little country, negotiating with a big country like the United States, might wonder just what reciprocity means in that context.
If more than two decades of history is any guide, negotiating a trade deal with the United States will mean more or less accepting whatever text American negotiators put in front of their counterparts, including onerous demands for strict intellectual property protections that could increase prices for drugs and agricultural inputs. Negotiating with one country at a time is also problematic because most African countries are party to one or more regional communities, which they are stitching together in a single, continent-wide free trade agreement that just formally entered into force. The continent—home to a large number of small economies, many of them landlocked—desperately needs more regional integration to increase its competitiveness by lowering transportation and other costs of trade and achieving economies of scale.
Beyond these problematic trade plans, what else is in the administration’s Prosper Africa initiative? Its second stated aim is to engage the private sector and double U.S. trade with and investment in Africa. According to Kelley’s remarks in Maputo, two of the three strands of the program are aimed at helping American companies find and close deals across Africa by streamlining and better coordinating U.S. government activities that provide information, financing and risk insurance to the private sector. She also suggested that these efforts on behalf of American businesses could include “U.S. government advocacy” to “expedite” transactions, which sounds like it might involve a little arm-twisting if African officials question the terms of a deal.
Helping African countries improve the investment climate, which is Prosper Africa’s third strand, and connecting American investors to opportunities on the continent, are worthy—and indeed longstanding—goals. Overall, however, the initiative appears to be a mix of existing programs in shiny new packaging, and with little new money. The $50 million proposed budget for Prosper Africa is a drop in the bucket compared to the administration’s proposed 9 percent cut in overall aid to Africa. And efforts to negotiate bilateral trade agreements country by country would undermine the regional integration that is needed for the continent’s development.
Trade and aid to support development in Africa can and should be to the mutual interest of all involved. But putting Prosper Africa in the context of the geopolitical rivalry with China, alongside Trump’s belligerent America First rhetoric, undermines that positive message.
Kimberly Ann Elliott is a visiting scholar at the George Washington University Institute for International Economic Policy, and a visiting fellow with the Center for Global Development. Her WPR column appears every Tuesday
Below is my article on China: Friend or Foe?-January 2019, that was published (abridged) in the African Union magazine: “Invest in Africa“-2019 vol 1. You can find it on page 65 (85 on the link to the magazine). There are many worth while articles to read in this volume of the AU magazine
By Lawrence Freeman
January 1, 2019
The short answer is a China is friend and contributor to Africa’s progress. Ignore all the propaganda, ignorance and outright lies claiming that China is the new colonizer of Africa. There is absolutely no truth in the contorted comparison between China’s involvement in Africa today, and 500 years of slavery and colonialism by Western nations.
Following the successful September 3-4, Forum on China Africa Cooperation (FOCAC) summit in Beijing, we have witnessed an escalated disinformation campaign alleging that China is attempting to snare African nations in a new “debt-trap.” New vicious rumors have emerged that China is taking over ownership of key infrastructure projects in Africa. Every African Head of State who has spoken out, has refuted these allegations and praised their cooperative relationship with China.
According to a report by the British based Jubilee Debt Campaign, “Africa’s growing debt crisis: Who is the debt owed to?” China is owed a minority of external debt. Their figures compiled from the World Bank and the China Africa Research Institute show that 20% of African government external debt is owed to China in contrast 32% to private lenders, and 35% to multilateral institutions such as the World Bank.
Of these 14 countries that have they examined: 11 owe less than 18% of their debt to China (Burundi, Cape Verde, Central African Republic, Chad, Gambia, Ghana, Mauritania, Mozambique, Sao Tome and Principe, South Sudan, Sudan and Zimbabwe); and three owe more than 24% -Djibouti (68%), Zambia (30%) and Cameroon (29%).
The proponents of the “debt-trap” accusation conspicuously, egregiously omit from their chronicle the history of the financial imprisonment of the then newly independent African nations by the IMF, World Bank, Paris Club, and their kith and kin in the City of London and Wall Street. Through manipulation of terms of trade, controlling prices, and forcing currency deviations, African nations found themselves shackled in several hundred billion dollars of new debt to the West shortly after African nations achieved liberation from imperialist colonial masters. Western debt replaced slavery and colonialism as the new method of looting Africa of its wealth, reinforced by the ill-fated Structural Adjustment Programs-SAPs, otherwise known as the “Washington Consensus.”
So, who is kidding whom about a “debt-trap?”
Debt for Infrastructure is Necessary
Railroads from the colonial period versus railroads of the future. The East-West and North-South railroads are long overdue
Credits issued for hard infrastructure; energy, railroads, ports, roads, bridges, and soft infrastructure in well equipped; schools, libraries, universities, and hospitals will always result in an increase in productivity i.e. the economic power of the society. By employing advanced technologies embedded in new capital equipment, including infrastructure, farmers and workers can produce more efficiently. Simply providing abundant energy, high-speed railroads, and water inputs to an African nation would lead to a jump in economic output.
All nations that have experienced real economic growth and raised the living standard of their citizens have created credit i.e. public-sector debt or borrowed debt at non-usurious interest rates for targeted physical economic growth.
China is the single largest nation contributing to financing and constructing of infrastructure projects in Africa according, to Deloitte’s 2017 edition of Africa Constructive Trends. The report examines 303 infrastructure projects begun in the first half of 2017 that costs over $50 million. Appropriately, energy& power, and transport comprise 167 of these projects-over 55% of the total. While African governments fund 27.1 % of the funding, China accounts for 15.5% of the funding and 28.1% of the construction for these projects. The US accounts for 3% and 3.3% respectively. Both Italy and France are larger than the US percentage in building infrastructure in Africa.
African Development Bank President, Akinwumi Adesina, speaking on November 28, 2016 accurately linked the deadly migrant crisis to deficiencies in Africa’s economic development and infrastructure.
“I believe that Africa development deserves significant support, even in the midst of these challenges. We must not forget that the reason several thousands of Africans have been (illegally) migrating to Europe, is because of the lack of jobs and shrinking economic opportunities at home. Our result must not be to reduce support, but to increase support to help build greater resilience, boost its economies, address its structural challenge, such as closing its huge infrastructure gap, strengthening intra-related trade, and creating jobs for its teeming youths.”
A study done by the AidData Research Lab at William and Mary College in Virginia that analyzed China’s investments in the developing sector between 2000 and 2014, concluded:
“We find that Chinese development projects in general, and Chinese transportation projects in particular, reduce economic inequality within and between sub-national localities,” and “produce positive economic spillover that leads to a more equal distribution of economic activity.”
China has come to know, what the US has forgotten, that infrastructure is the sine qua non to drive economic growth.
Africa’s huge infrastructure deficit is the causal factor for widespread poverty, and insecurity across the continent, precisely that which China has begun to address over the last decade. The Western financial system that dominated Africa from 1960-2000 contributed almost nothing to help African nations industrialize and failed to help create vibrant agro-manufacturing sectors. China with its Belt and Road Initiative has presented the world with a new paradigm to guide political-economic relations among nations; Africa is the beneficiary.
Lawrence Freeman is a Political-Economic Analyst for Africa, and Vice Chairman of the International Scientific Advisory Committee to the Lake Chad Basin Commission
