Marian L. Tupy (Author at The Cato Institute)

Geldof Humanitarian Gig (Commentary)

Wed, 24 Jun 2009 00:00:00 EDT

Despite a global recession, most the Group of Eight major industrial countries appear to be on track to fulfill their 2005 Gleneagles Summit commitments to increase development aid to Africa. Africa, however, would surely be better off if rich countries followed the much-lambasted Italian example...

Is Aid Working? (Commentary)

Thu, 28 May 2009 00:00:00 EDT

Dambisa Moyo's book Dead Aid has reignited the simmering war of words about the effects of foreign aid on Africa. Her contribution is welcome, for scant evidence in favour of increasing aid notwithstanding, western governments seem determined to outdo one another in the extravagance of their promise...

Cannot Be Saved by World's Rich (Commentary)

Mon, 27 Apr 2009 00:00:00 EDT

Earlier this month, the London meeting of the Group of 20 richest countries reaffirmed the Group of Eight's commitments from 2005, when the world's eight leading industrial nations, meeting in Gleneagles, Scotland, agreed to increase aid, reduce debt and open their markets to African goods. The ...

What Will Help Africa? (Scholar Comments)

Fri, 24 Apr 2009 00:00:00 EDT

With over a trillion dollars in new resources pledged to them by the G-20 in London earlier this month, the World Bank and the IMF will likely spend this weekend reaffirming their commitments to more aid and greater debt relief for Africa.

What they are missing is the fact that aid has failed to stimulate growth in Africa.

Between 1975 and 2005, for example, per capita aid to Africa averaged almost $25 per year. By contrast, in China it averaged $1.50 and in India $2. Over the same time period, Chinese and Indian incomes rose by 888 percent and 174 percent respectively. In Africa, incomes fell by 5 percent.

Moreover, aid has encouraged waste and corruption. Inadvertently, it also financed, according to Paul Collier of Oxford University, "around 40 percent of Africa's military spending."

Similarly, the effects of debt relief remain ambiguous. Far from putting African countries on a firmer financial footing, debt relief has often led to yet more wasteful borrowing, necessitating more debt relief. Thus, the World Bank's and the IMF's Debt Relief Initiative for Heavily Indebted Poor Countries (HIPC) in 1996 was followed by the enhanced HIPC initiative in 1999 and then by the creation of the Multilateral Debt Relief Initiative in 2005.

Solution

Trade liberalization has the greatest potential to help Africa emerge from poverty. Unfortunately, the Doha round of negotiations on trade liberalization came to a halt and the threat of protectionism looms larger as the current global economic slowdown continues. More protectionist countries have more to gain from trade opening. Africa, much of which remains highly protectionist, should liberalize unilaterally. India and China have done so in the past and benefited.

Africa remains the poorest and least economically free region on earth. Rich nations should help Africa integrate with the rest of the world. They should end their farm subsidies and eliminate their remaining restrictions on African exports. But the main obstacles to economic growth in Africa rest with Africa's policies and institutions, such as onerous business regulations and weak protection of property rights.

Rich nations' emphases on foreign aid and debt relief take the spotlight away from Africa's internal problems and raise unrealistic expectations about the ability of rich countries to help reduce African poverty.

For more, read The False Promise of Gleneagles Misguided Priorities at the Heart of the New Push for African Development.

The False Promise of Gleneagles: Misguided Priorities at the Heart of the New Push for African Development (Development Policy Analysis)

Fri, 24 Apr 2009 00:00:00 EDT

In response to persisting poverty in Africa, representatives from the world's eight leading industrialized nations — Germany, Canada, the United States, France, Italy, Japan, the United Kingdom, and Russia — met in Gleneagles, Scotland, in 2005 and agreed on a three-pronged approach...

The False Promise of Gleneagles (Daily Podcast)

Thu, 23 Apr 2009 00:00:00 EDT

Zimbabwe Chooses an African Delusion (Commentary)

Wed, 11 Feb 2009 00:00:00 EST

At last, Morgan Tsvangirai, the leader of the Movement for Democratic Change, is getting his due when he becomes the prime minister of Zimbabwe today. For a decade, he suffered abuse, imprisonment and torture at the hands of the state. Now he holds the poisoned chalice of a collapsed economy and the...

Elections Offer Fresh Hope for South Africa (Commentary)

Wed, 04 Feb 2009 00:00:00 EST

The break-up of the African National Congress and the forthcoming general election provide a unique opportunity for a realignment of forces in South African politics. Creation of the Congress of the People, a new party, will erode the ANC's grip on power and reignite the public debate over pressing ...

Remembering Helen Suzman (Commentary)

Mon, 26 Jan 2009 00:00:00 EST

Growing up in Johannesburg in the mid-1990s, I had the great privilege of knowing Helen Suzman, the legendary white anti-apartheid activist and South African parliamentarian who died on New Year's Day. This outspoken and fearless promoter of racial equality and political liberty was an inspiration t...

Mugabe's Election Theft and Illegitimacy (Commentary)

Sun, 11 Jan 2009 00:00:00 EST

The cholera outbreak that has killed some 1,600 people and infected thousands of others has renewed the world's attention on Zimbabwe and its tyrannous ruler Robert Mugabe. Mr. Mugabe's economic policies and repression are responsible for widespread poverty, sickness and violence that have grippe...