How Africa Still Remains An Economic Colony Of Europe
Unsurprisingly, nowadays Africa* still depends significantly on the European economic system. Furthermore, its behavior is that of a colony, and the European Union is doing nothing to change this.
First of all, on the monetary level, no less than 15 countries in Central and Western Africa have their currencies pegged to the euro (in what are called: UEMOA and CEMAC areas, plus the Republic of Cape Verde). Most of these states have implemented the system for some time now, their currencies depending previously on the French Franc or Portuguese Escudos (this is the case of Cape Verde) plus, all of them are former French or Portuguese colonies 1. It’s interesting that this is an unilateral decision, and the ECB does not have any obligations to maintain the exchange rate. We can interpret this measure as an act of recognizing one’s inability to pursue a solid and reliable monetary policy, thus transferring these prerogatives to another country. However, this measure also gives an advantage to the African countries (and to their European commercial partners, as well) by reducing the financial risk posed by a fluctuating exchange rate; taking into account that their external trade is mostly denominated in euros.
Further on, the second area where the European dominance is clear is external trade. Given the low levels of production and productivity on the African continent, it is somewhat clear that the level of dependence on imports is very high. In this area, Europe also leads the way, being the top commercial partner for the African nations. Its primal exports are machinery and vehicles, goods that are impossible to be produced in sufficient quantities and with competitive efficiency in today’s Africa. In exchange, the top-imported goods are petroleum and diamonds 2. Thus, the structure of trade today resembles very well the former trade between the metropolis and the colonies. However, besides industrial goods, there is a series of agricultural products that flood the African countries, products that are imported from Europe as well. Although more than 50% of the Africans* work in agriculture (a sector with low productivity and being mostly autarchic), the large imports from Europe connect the food prices to those valid internationally. And, how European agriculture relies on fuel prices (being an industrialized one), a soaring oil price will lead, unsurprisingly, to expensive food and thus to humanitarian problems in the concerned nations. And Europe supports this state of fact trough it’s Common Agricultural Policy 3.
Here is a sample of how the EU feels about it:
Finally, the humanitarian issue is one of great importance from two perspectives:
- Aid has represents a significant percentage in the income of the African states;
- The mechanism of aid can set political linkage between countries.
Being the world’s biggest aid donor (in relative, as well as in absolute terms), Europe spills a significant portion of its share of global aid (which is more than 50%) in Africa. This may be intended to represent compensation for maintaining the current trade agreements that are clearly against African economic interests, but can also promote EU’s image as a do-gooder.
Overall, almost 50 years on from the end of the European colonial empires, Africa remains, de facto, an European economic colony.
*I am referring mostly to the Sub-Saharan part of the continent.