Hamish McRae: The continent is poor and getting poorer â¿“ but there are signs for hope

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The Independent Online

Start with two profoundly disturbing facts. The first is that according to the IMF, the average income per head in sub-Saharan Africa has fallen by 1 per cent a year, every year for the past quarter century. The second is that in the new United Nations Development Programme Human Development Report, published later today, African countries occupy the bottom 28 positions among the 162-countries list.

So Africa is not only poor but it is getting poorer. It is also at the bottom of the list on the wider measure of human development, one that includes health and education. Think of it like this. In our comfortable Western democracies, most of us can expect to have a higher standard of living than our parents. In most of Africa the reverse is true. So what can be done? Is there any reason to be more hopeful about the next 25 years than the past?

Everyone could draw up their own balance sheet and any check list has to be a gross oversimplification when applied to a diverse continent. But my personal list would have four reasons for hope, and sadly one reason for the most profound concern.

To start with the positive, there has certainly been an improvement in the quality of governance in Africa over the past ten years. The continent had the misfortune to achieve independence at the time when Marxist ideas of economic management were fashionable. It was natural to reject the market ideas of the colonial powers and pick the obvious alternative of heavy state intervention. We now know that doesn't work.

Second, state involvement in the economy encouraged heavy borrowing, loans that the West was unwise enough to make. The folly of that policy is now recognised by both sides. Whatever view one takes of the progress that has been made in relieving Africa's debt burden, at least the problem is at the front of the agenda. And debts will not be allowed to build up again.

Third, the West is beginning to be more sensitive to the ways it has shut Africa out of that great engine of economic growth, international trade. Africa's share of world trade halved over the past 25 years.

African nations are also becoming more aware of the potential of regional trade, the central subject of the present OAU summit. There are a large number of trade restrictions within Africa: export taxes, bureaucratic marketing boards, high import tariffs and so on. Just as trade within North America has been boosted by NAFTA and within Europe by the EU, Africa can hope to boost regional trade by better co-operation.

And fourth, there is now widespread awareness within Africa that without peace and order it cannot hope to restore prosperity. As Europe learnt twice in the 20th century war destroys wealth. Kofi Annan reminded the summit of this responsibility of its leaders at this Lusaka summit.

Against this must be set the catastrophe of Aids, which strikes Africa proportionately more severely than any other continent. It is very difficult to put quantitative measures on the economic impact in terms of wealth destruction over the next 25 years. We know it is a catastrophe but we don't know the scale.

Will the next quarter- century be as bad as the past one? My guess is no. Looking at sub-Saharan Africa as a whole, I suspect there will be economic progress, diminished byAids. Will income per head in Africa be higher in 25 years time? I am afraid not much. But it need not be poorer and, given the record since 1976, that is something.