Impacts of the Neoliberal Globalisation

- "Sub-Saharan Africa:

10% of world's population

- 1 % of world's GDP

- 50 % of population in

absolute poverty

2.1 Short-run: Neoliberalism

BUT...negative effects:

• poss. influence on world growth
• too much corruption / warlordism can destabilize business climate
• high inequality between countries causes migration

• inadequate measures of the governments ("reactive", "poor targets",...)

• influence of "traditional interest groups"

• external factors (e.g. natural desasters)

• lobbying of trade unions

• lack of ability to

negotiate with donors

• too much democracy: "Democracy may be desirable, but it is clearly not necessary, and sometimes even an obstacle, to mobilising enough political support for sustained reform." (Kayizzi-Mugerwa,26)

Bond, Patrick: Neoliberalism in Sub-Saharan Africa: From Structural Adjustment to NEPAD, in: Jonston, D., Saad-Filho, A.: Neoliberalism, A Critical Reader, Pluto press, London 2005.

Hunter Wade, Robert: Is Globalisation Reducing Poverty and Inequality, London School of Economics and Political Science, London 2004.

Kayizzi-Mugerwa, Steve: Globalisation, Growth and Income Inequality: The African Experience, Working Paper #186, OECD Development Center, 2001.

Lindert, Peter H./Williamson, Jeffrey G.: Does Globalization Make the World More Unequal?, University of Chicago Press, Chicago 2001.

Neoliberalism and Politics, and the Politics of Neoliberalism, in: Jonston, D., Saad-Filho, A.: Neoliberalism, A Critical Reader, Pluto press, London 2005.

Ravallion, Martin: The Debate on Globalization, Poverty and Inequality: Why Measurement Matters, ?

Saul, John J. / Leys, Colin: Sub-Saharan Africa in Global Capitalism, in: Monthly Review 51 (3), New York City 1999.

Tsikata, Yvonne M. : Globalisation, Poverty and Inequality in Sub-Saharan Africa – A political Economy Appraisal, Working Paper #183, OECD Development Center, 2001.

http://www.twnafrica.org/index.php?option=com_content&view=article&id=197:12-atn-statement-qafrica-and-the-global-crisis-time-to-throw-away-neo-liberalismq&catid=47:atn&Itemid=72

Pictures:

http://www.grida.no/geo/geo3/english/images/fig308.gif

http://oneworldyouthproject.org/wp-content/uploads/2011/07/globalization.jpg

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http://1565today.com/wp-content/uploads/2012/10/InternationalTrade.jpg

http://commons.wikimedia.org/wiki/File:James_Wolfensohn.jpg

http://commons.wikimedia.org/wiki/File:Dollar_symbol.jpg

http://www.educationviews.org/popular-lollipop-man-threatened-suspension-high-fiving-children-crossed-road-quits-job-protest/

http://commons.wikimedia.org/wiki/File:A_South_Sudanese_girl_at_independence_festivities_%285926735716%29.jpg?uselang=de

http://www.untogo.org/var/ezflow_site/storage/images/news/africa/un-convenes-meeting-of-aid-groups-to-discuss-how-to-tackle-hunger-in-sahel/13286-1-eng-GB/UN-convenes-meeting-of-aid-groups-to-discuss-how-to-tackle-hunger-in-Sahel_NGArticleFull.jpg

http://themoneyupdate.com/wp-content/uploads/2012/08/squeezed-debt.jpg

http://commons.wikimedia.org/wiki/File:Meles_Zenawi_-_World_Economic_Forum_Annual_Meeting_2012.jpg

Impacts of the Neoliberal Globalisation

Using the Example of "Sub-Saharan Africa"

Why "Africa"?

effect of globalisation on the Global South?

3. Reality in "Sub-Saharan Africa"

Timeline: Independence until today:

preliminary note: Keep in mind, please...

- 48 countries

- similar history, but very diverse political and economic images

1990s

1980s

1973 - 1980s

1960/1970s

• external shocks (e.g. Sahel drought: declining agricultural output)

• beginning economic reforms: "belt-tight policies", like devaluation, abolishing food & transport subsidies
• political limits of reforms (food riots etc.)

• poor initial conditions, but:
• rapid growth
• moderate inflation
• foreign capital inflows
• tight control of financial sectors

growing

foreign

debt

• deeper reforms
• some countries: multiparty democracies
• fiscal restraints (esp. public sector)

• deterioration in terms of trade
• reduction of import substitution and social sector
• large fiscal deficits, inflation

worsening inequality and poverty

growth rates falling

less public funding

=> less growth

capital flight: elites transfer money abroad

privatisation:

=> often accompanied

with corruption

=> crowding out of

local enterprises

debasing debt crisis:

1980: 60 Mrd.$

2000: 206 Mrd.$

3.2 other explanations

• the history

"Since the late 1980s, poverty in SSA, defined as those living on less than $1 per day, increased by 70 million to 290 million in 1998 – over 46 per cent of total population" (Steve Kayizzi-Mugerwa, OECD Development Centre)

• asymmetric trade: share of world trade diminished while export enhanced

• cooperation of foreign investors with corrupt regimes (Nigeria, DR Congo)

• unequal position in negotiations

"While we will not be at the high table of the IMF, we should be at least in the room where decisions are made." (Meles Zenawi †, president of Ethiopia)

1. Introduction

Inequality benefits efficiency...

lower oil prices

2.2 Merits of neoliberal globalisation concerning Sub-Saharan Africa

useful scope of influence in case of conflicts

4. African resistance

4.1 Positions

5. Sources:

integration in world economy

• no influence of IMF and World Bank
• no servicing of illegitimate debts
• abolishing of Bretton-Woods-Institutions
• World Bank Bonds Boykott
• resistance against regional trade acts

"Over the past 20 years the number of people living on less than $1 a day has fallen by 200 million, after rising steadily for 200 years" (James Wolfensohn, president

of the World Bank, World Bank, 2002)

easy WTO agreements (e.g. property rights,...)

illegal business opportunities

4.2 actions

sustained growth

• international initiatives
• formulation of continental terms of reference for modifying global imperatives
• local level:
• activist groups addressing the issues of conserving jobs, community health, power of women, functioning of local markets, availability of social services
• resistance against governments (seek political alternative to politicians they hold responsible), direct actions of urban actors (lawyers, students, organizations of rural women, urban workers, ...etc.)

poverty reduction

3.1 neoliberal explanations...

2. Neoliberalism and it's positive outcomes

Free market

export-focused policies

flexible labour

privatization

capital mobility