A CASE STUDY OF SUB-SAHARAN AFRICA

A CASE STUDY OF SUB-SAHARAN AFRICA

[SECURING LIBERTY, JUSTICE AND SOCIAL EQUALITY FOR ALL IN SOCIETY IN AN ERA OF RISING POVERTY AND INCOME INEQUALITY:

A CASE STUDY OF SUB-SAHARAN AFRICA

LEARNING OUTCOMES

Demonstrate their critical and comprehensive understanding of key issues associated with the production of ethical and technically competent research projects.

Demonstrate their capacity to appropriately design, develop and complete a desk based or empirical research project, which explores research, policy and/or practice associated with their substantive area of interest.

Produce a logical, coherent dissertation that clearly demonstrates their capacity for independent thought and the application of high level analytic and organisational skills.

Critically consider the extent to which participants contributed to research, policy and/or practice associated with their substantive area of interest.

Solution

[SECURING LIBERTY, JUSTICE AND SOCIAL EQUALITY FOR ALL IN SOCIETY IN AN ERA OF RISING POVERTY AND INCOME INEQUALITY:

A CASE STUDY OF SUB-SAHARAN AFRICA

Introduction

Africa is the third largest continent in the world. The continent is characterized by unique conditions in terms of both climate and terrain, with the continent being split into approximately two halves by the equator. The continent experiences some of the highest levels of rainfall in the Congo basin, while still yet, the continent is the second driest, harboring the world’s largest dry desert, the Sahara. These are not the only notable features about Africa. Africa, and in particular, the sub-Saharan region, is the poorest continent in the world. Nearly half of the population in this region lives in absolute poverty, meaning that they live on less than a dollar a day. The abject poverty has a plethora of effects on healthcare, education and mortality rates. This poverty persists despite the fact that the continent is richly endowed with natural resources. this paradoxical stature makes it difficult to determine what the exact cause of poverty is, though it may be attributed to corruption and poor governance. This dissertation explores the role of policy in addressing poverty in sub-Saharan Africa.

Literature Review

Social inequality in sub-Saharan Africa has been a weighty issue amongst sociologists, economists and other actors in different locations globally. Numerous researchers have attempted to deconstruct the issue, in an attempt to derive a more elaborate understanding of the issue, and how best the problem can be resolved. In this regard, numerous research papers, working papers, books and policy documents have been authored. This section provides a concise review of the literature on this topic. It is impossible to review all documents and consequently, the favored approach is to review the latest writings as well as some of the most pertinent ones regarding the matter. This section provides a discussion of the literature on this area. The literature review is organized into several subheadings under key themes identified in the literature. Some of the themes discussed include poverty in Africa, social inequality in Africa and the role of policy in eradicating the two matters above.

Africa’s Economy and the State of Poverty in Africa

In order to better understand poverty in Africa, it is imperative that one must first understand poverty. There is no single, universally accepted definition of poverty and indeed, the term varies in its usage and interpretations depending on the location and context of its application. For starters, it is important to highlight the issue of relative versus absolute poverty. Relative poverty regards individuals who have less money than those living around them (Our Africa, n.d). Relative poverty has more to do with inequality due to factors such as an income gap. Conversely, absolute poverty deals with the lack of or deprivation in regard to a particular identified threshold of poverty. Such a threshold, as will be seen, could be income or spending power. With absolute poverty, individuals are unable to access even the most basic of needs such as food, clothing, safe drinking water and healthcare (Mubvami, 1999). Absolute poverty may further manifest itself as either primary or secondary poverty. Primary poverty is essentially absolute poverty, a condition of deprivation. Secondary poverty, on the other hand, is a situation whereby individuals experience deprivation, despite the fact that they have an income that is sufficient to cater for their basic needs. This causes them to suffer the same conditions of absolute poverty and is as a result of individuals spending their income on items that make no direct contribution to better living or better health (Mubvami, 1999). It is absolute poverty that is the focus of this project.

The World Bank approaches poverty from a dimension of well-being, indicating that poverty is one of the aspects of well-being alongside inequality and vulnerability (The World Bank, n.d). this dimension provides an excellent framework through which poverty in Africa can be analyzed, as it ropes in the issues of inequality and vulnerability. Adding clout to the notion that poverty is a rather unequivocal term, the UNDP highlights that poverty has at least five clusters of meaning (Ehrenpreis, 2006). The publication presents a number of contributions on the issue of poverty, written by several different individuals.

In the first article, Robert Chambers, from the Institute of Development Studies, Sussex, UK, indicates that there are at least five clusters of the meaning of poverty. The first cluster is income poverty, the connotation that is most commonly espoused by economists (Chambers, 2006). This meaning pertains to the income levels of individuals the second cluster, according to Chambers, is a material lack or want, whereby poverty regards the lack of material wealth and access to services. A third cluster goes beyond material wants to identify poverty as a deprivation of human capabilities such as. The fourth cluster takes on an even broader dimension, harboring a multi-dimensional view of deprivation, with material deprivation being only one facet of deficiency. Chambers goes on to contend that these meanings of poverty have been developed by non-poor people, and reflect what their views are on what development should be. While noting that these definitions are deficient in as far as they are exclusive of the perceptions of poor people, Chambers introduces the fifth cluster which essentially pertains to the multiplicity of the meanings of the prior clusters. In further analyzing this outlook, Chambers highlights that in the view of those who are commonly the objects of poverty as envisaged in the first four clusters, poverty extends beyond the deprivation and to them, is about the bad experiences that they encounter in their daily lives. Poverty to them is a complex web of factors that leads to a bad life. Chambers, therefore, argues that it is imperative that poverty is viewed in its wider scope with a principal outlook on wellbeing versus illbeing.

It has been highlighted that one of the characteristics of poverty is that it varies based on the context and circumstances within which it is applied. Townsend aptly captures the essence of this notion whereby he highlights that present laws, conditions obligations and customs differ from those in the past and as such, definitions of poverty used in the past cannot suffice today (2006). In the same manner, a definition of poverty applied in one geographical locale might not suffice for the purposes of defining poverty in another locale. The context of poverty is fast changing due to globalization which connects both people and their standards of living (Townsend, 2006). Despite the lingering ambiguities in the meaning of poverty, it remains certain that central to the topic is the concept of deprivation. Nonetheless, many of the paradigms of poverty already highlighted are operational in Africa.

As noted, one of the most commonly accepted definitions of poverty has to do with income levels. In this regard, a threshold known as the poverty line has been defined. The poverty line essentially refers to the minimum amount that is required by individuals to satisfy their basic food needs and essential non-food requirements (Mubvami, 1999). This actually represents an upper poverty line. A lower poverty line defines the minimum amount required to sustain food requirements.

Poverty in Africa

For the longest time now, the sub-Saharan region of Africa has often been used as the poster child of poverty in Africa. Africa is the third biggest continent, comprising of 53 countries. It is the poorest continent in the world. Approximately 42% of all its inhabitants live below the poverty line (Tonnemacher, 2008). The Borgen project puts this figure at 48.5%, as of the year 2010 (2014). All ten countries with the highest proportion of residents living in extreme poverty are to be found in sub-Saharan Africa. The threshold currently used to define extreme poverty is living on less than $1.25 a day.  

Africa as a continent is greatly endowed with many natural resources. it hosts a third of the world’s mineral reserves, and two-thirds of the world’s diamond (The Economist, 2015). The continent is also a major producer of gold, having produced 22% of the world’s total gold production in 2008 (National Geographic, 2006). Moreover, the continent is also home to 10% of the world’s oil reserves. Other important minerals include cobalt, platinum, uranium, and chromium, all of which Africa has the largest reserves (AfDBG, 2016). In total, Africa plays host to 30% of the world’s known mineral reserves. Agriculture is another important sector in Africa, with export crops contributing significantly to the economy. The importance of Natural resources is underscored by the fact that in 2012, 77% of total exports were natural resources, with a 42% contribution to government revenue (AfDBG, 2016). Africa is also gifted with many renewable natural resources. For example, Africa is home to the world’s second largest tropical forest. 70% of the sub-Saharan population depends on woodland and forest resources for their livelihood.

Despite its vast endowment, Africa is plagued by poverty and civil strife, a factor which has led to the coining of the term ‘resource curse’, to characterize Africa’s paradoxical stature. Countries that are rich in resources have done more poorly and experienced more inequalities than anywhere else (BBC, 2012). The reasons for this status vary, but it can generally be attributed to poor use or misuse of wealth. More often than not, wealth is misappropriated or lost through corruption, embezzlement, and other similar vices. An overarching factor is poor/inadequate governance, which contributes to the poor use of wealth (Lawson-Remer & Greenstein, 2012). Indeed, poverty in Africa is a complex phenomenon, brought about by a range of multifaceted causes including economic, social and political factors (White, et al., 2001). Some of these causes are discussed.

Many countries in sub-Saharan Africa suffer from endemic corruption. The corruption is often spearheaded by crooked politicians, who work in cahoots with mining companies to siphon the proceeds from mining into their own pockets, rather than depositing this money into government coffers and using it to develop infrastructure (Lawson-Remer & Greenstein, 2012). Another problem that sub-Saharan nations face is a phenomenon referred to as “Dutch disease”. This is a phenomenon experienced by resource-rich nations. The essence of the Dutch disease is that as resource rich countries export resources, they earn foreign currency. The inflow of foreign currency raises the inflation rate, and this causes local production and manufacturing processes to be ineffective (Lawson-Remer & Greenstein, 2012). Many sub-Saharan nations are susceptible to this illness, by virtue of their resource-rich status. While the phenomenon is not the preserve of poorly-governed countries, well-governed countries are better equipped to cope with it.

Poverty in Africa has a plethora of effects on the population, such as poor health, high mortality rates, lack of access to vital resources and civil strife. Lawson-Remer & Greenstein, (2012) highlight that those countries with an abundance of resources yet weak governance are prone to armed violence. The top oil producing countries in sub-Saharan Africa in 2011 were Nigeria, Angola, Sudan, the Republic of Congo and Equatorial Guinea, each of which was plagued by violent conflict or repressive regimes (Lawson-Remer & Greenstein, 2012). Moreover, these countries also score very poorly on corruption.

The topic of poverty in Africa begs the question of what can be done to alleviate the condition. Firstly, it is important to highlight that while Africa indeed appears to suffer from the resource curse, there are other countries around the globe which have just as high or higher levels of natural resources, but which do not suffer from the plagues of corruption and armed violence. For instance, Canada has among the lowest levels of government corruption globally, yet it remains amongst the top ten oil producers in the world (Lawson-Remer & Greenstein, 2012). Additionally, Norway, which is a top ten exporter of crude oil globally, remains the world leader in the United Nations Human Development Index.

Seemingly, the most effective solution to Africa’s poverty problem lies in improved governance. These are some of the characteristics of more developed nations around the globe. Lawson-Remer & Greenstein (2012) recommend that African countries should focus on transparency in their dealings with mining companies, enact more stringent disclosure and anticorruption rules, and develop economic policies that are oriented towards economic diversification. This position is corroborated by Reyes & Due (2009), who indicate that prudent public investment is central to poverty reduction and addressing inequalities.

The importance of prudent policy making cannot be understated. Cashin, Sahay, & Pattillo (2001) highlight that there is an indirect link between good macroeconomic policies and poverty reduction, via the growth route. Good macroeconomic policies lead to higher growth, whereby higher growth, in turn, leads to a reduction in poverty. The link between macroeconomic policy and poverty is further highlighted by Christiaensen, Demery, & Paternostro, (2002). They provide change data for a number of African countries, finding that where there has been an improvement in macroeconomic policy, there has been a subsequent reduction in poverty. Conversely, in those cases with a significant deterioration in macroeconomic policy, there has also been a sharp increase in poverty (Christiaensen, et al., 2002). Evidently, there is some sort of link between macroeconomic policies and poverty levels. African countries need to develop their own mix of policies that reflect their own priorities and local realities (Reyes & Due, 2009). Despite this need for a local perspective, it is perplexing that majority of policy programs have been initiated or spearheaded by international donor groups and the World Bank.

The IMF points out several important objectives of economic policy. Firstly, economic policy should endeavor to maintain macroeconomic stability (IMF Staff, 2000). Moreover, governments should target more efficient tax systems. The need for efficient tax administration and enforcement cannot be emphasized enough, as this is essential in broadening the tax base. Thirdly, governments should also focus on improving infrastructure, since infrastructure is essential in supporting economic growth. Fourthly, governments should further focus on the privatization of state-owned enterprises, to improve efficiency and reduce political interference, while providing incentives for innovation and dynamism. Another objective is to increase investment in human capital, through increased spending in the areas of primary education and healthcare. Other important objectives include the establishment of robust financial systems, realistic exchange rates and openness to international trade as well as regional integration (IMF Staff, 2000). By focusing on these objectives, African nations would be in a position to reduce risk and thereby promote private investment. Indeed, uncertainty in the macroeconomic environment coupled with policy reversals were two of the reasons why investment risk in Africa was very high (Artadi & Sala-i-Martin, 2003). Keeping investment risks low is key to promoting investment and creating an opportunity for growth.

When it comes to policy making, public participation is essential. Reyes & Due (2009) point out that one of the approaches that have been applied towards this end is the community-based monitoring systems. These systems allow the poor to validate the information collected. This enhances the efficiency of poverty reduction programs. Pieterse, Parnell, & Wooldridge (1999), further emphasize the role of democratization and public participation in policy-making.

List of References

AfDBG, 2016. African Natural Resources Center (ANRC). [Online]
Available at: http://www.afdb.org/en/topics-and-sectors/initiatives-partnerships/african-natural-resources-center-anrc/

Artadi, E. V. & Sala-i-Martin, X., 2003. The Economic Tragedy of the XXth Century: Growth In Africa. Cambridge: NATIONAL BUREAU OF ECONOMIC RESEARCH.

BBC, 2012. Africa Debate: Will Africa ever benefit from its natural resources?. [Online]
Available at: http://www.bbc.com/news/world-africa-19926886

Cashin, P., Sahay, R. & Pattillo, C. A., 2001. Macroeconomic Policies and Poverty Reduction: Stylized Facts and an Overview of Research, Issues 2001-2135. s.l.:International Monetary Fund.

Chambers, R., 2006. What is Poverty? Who asks? Who answers?. Poverty in Focus, December, pp. 3-4.

Christiaensen, L. J., Demery, L. & Paternostro, S., 2002. Growth, Distribution and Poverty in Africa: Messages from the 1990s, Volume 614. s.l.:World Bank Publications.

Ehrenpreis, D., ed., 2006. What is poverty? Concepts and measures. Brasilia: UNDP International Poverty Centre (IPC).

IMF Staff, 2000. Policies for Faster Growth and Poverty Reduction in Sub-Saharan Africa and the Role of the IMF. [Online]
Available at: https://www.imf.org/external/np/exr/ib/2000/120100.htm#III

Lawson-Remer, T. & Greenstein, J., 2012. Beating the Resource Curse in Africa: A Global Effort. [Online]
Available at: http://www.cfr.org/africa-sub-saharan/beating-resource-curse-africa-global-effort/p28780

Mubvami, T., 1999. Urban Poverty in Zimbabwe, The Case of Harare. In: Urban poverty in Africa: Selected countries experiences. . Nairobi, Kenya: United Nations Centre for Human Settlements (Habitat).

National Geographic, 2006. Africa: Resources. [Online]
Available at: http://nationalgeographic.org/encyclopedia/africa-resources/

Our Africa, n.d. Poverty. [Online]
Available at: http://www.our-africa.org/poverty

Pieterse, E., Parnell, S. & Wooldridge, D., 1999. Emerging Architecture of Developmental Local Government in South Africa & Prospects for Poverty Reduction. In: Urban Poverty in Africa: Selected Countries Experience. s.l.:UN-Habitat, pp. 1-15.

Reyes, C. & Due, E., 2009. Fighting Poverty with Facts: Community-based Monitoring Systems. s.l.:IDRC.

The Borgen Project, 2014. Top 10 Poverty in Africa Facts. [Online]
Available at: http://borgenproject.org/10-quick-facts-about-poverty-in-africa/

The Economist, 2015. The twilight of the resource curse?. [Online]
Available at: http://www.economist.com/news/middle-east-and-africa/21638141-africas-growth-being-powered-things-other-commodities-twilight

The World Bank, n.d. Measuring Poverty. [Online]
Available at: http://go.worldbank.org/0C60K5UK40

Tonnemacher, S., 2008. Poverty in africa – cultural studies. S.l.: Grin Verlag Ohg.

Townsend, P., 2006. What is Poverty? An historical perspective. Poverty In Focus, December, pp. 5-6.

White, H., Killick, T. & Kayizzi-Mugerwa, S., 2001. African Poverty at the Millennium: Causes, Complexities, and Challenges. s.l.:World Bank Publications.