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HOW long and deep can the current character of Foreign Direct Investment (FDI) penetrate the social legacy of colonialism and neo-colonialism in Africa?

Proclamations of economic growth throughout the continent are being received with much scepticism and consequently prompting the desire among many to address the persistent poverty, inefficiency and growing class divisions.

In a recent report issued by the United Nations Conference on Trade and Development (UNCTAD) entitled “Catalysing Investments for Transformative Growth in Africa,” it reveals that the rate of FDI in Africa is significantly lower than what exists in other so-called developing regions. These figures indicate that the reliance on western capital to fuel growth and development absent of a program for national reconstruction, will not work.

According to Ghana Web, “Africa’s investment rate is low compared to the average for developing countries and relative to what is considered necessary to achieve development goals, the 2014 Economic Development in Africa report has established.”

Therefore, based on an annual average, “the investment rate for Africa was about 18 per cent over the period 1990-1999 as compared to an average of 24 per cent for developing economies as a whole. The report said similarly, in the period 2000-2011, the average investment rate for Africa was about 19 per cent as compared to 26 per cent for developing economies generally.” These statistics could represent a lag in overcoming the development challenges which have been imposed by colonialism and neo-colonialism. Nonetheless, the consistently expanding oil and natural gas industry in various regions of Africa should translate into higher levels of investment as well as growth rates being discussed in the financial media.

Other factors may also include unresolved and burgeoning civil conflicts and inter-state border disputes. The Boko Haram insurgency in the northeast of Nigeria has led to the intervention of United States intelligence and military interests. Since late 2010, the North African nations of Tunisia and Egypt have not stabilised economically since the uprisings in those states. The Horn of Africa country of Somalia and the eastern regional state of Kenya are both embroiled and inter-connected in a counter-insurgency campaign with the high level interventions of the Central Intelligence Agency (CIA), the Pentagon and the European Union (EU).

All of these factors influence whether or not Africa will achieve genuine development or merely economic growth that does not fundamentally alter the international division of economic power and labour. If Africa cannot effectively stabilise its own internal situation then no one can honestly say that actual progress is being made which is sustainable.

Events in several African states clearly make the case for re-examining the notion of western investment-led growth.

From Southern Africa to the West African state of Ghana and the North African country of Egypt, socio-economic problems are escalating requiring a new approach to the organisation of society and its economic structures.

Africa must break with the world capitalist system to achieve real growth and sustainable development

The events in the three above-mentioned African states provide glaring examples of the ongoing economic crises taking place on the continent. With Africa firmly integrated into the international financial order of labour and mineral exploitation at the expense of the much-need improvements in the salaries and living conditions of the majority of people, there is almost no potential within the existing political arrangements for substantial aancements in the socio-economic status of the workers, farmers and youth. The rising expectations of working people related to the FDI-led policy orientations will undoubtedly prompt social unrest through strikes, mass demonstrations and other forms of resistance. If the notions of phenomenal growth within the neo-colonial African states cannot produce hope for the people then the much coveted political stability will remain unrealised.

Considering the tremendous reservoir of oil, natural gas and strategic minerals in Africa, there is no reason for the continent to remain trapped in the cycle of economic dependency on the imperialist states. Resources which belong to Africa must be effectively utilised for the betterment of the people. — Pan African Newswire.

Source : The Herald