Friday, May 27, 2016

Africa must crawl to the IMF: reality of rejecting liberty

The commodity slump has affected the commodity dependent continent Africa badly. Antoinette Sayeh head of IMF Africa had this to say about the situation in Africa, “we project growth to be even slower this year, at about three percent, about half of what has been customary over the last decade, and barely above population growth. Indeed, both last year and this year, GDP per capita growth will be below one percent -- something that has not happened since the late 1990s.” The late 1990’s was the beginning of the last commodity bull market.

The Africa Economic Development Institute based has this to say about the current dilemma facing Africa, “If economic conditions continue towards its downward path, IMF projects that 48 developing nations would need an additional $138 billion in financing.” Paul Wallace and David Malingha Doya jointly wrote an article for Bloomberg aptly entitled “Africa Turns to IMF as Commodity Slump Exposes Poor Policy.”

This should be no surprise to anybody who understands economics, in an article written back in 2009 entitled “Think for Tomorrow”, it was written “One must not forget that capital is created by human beings, the basis of creating capital is knowledge. Capital is good for up cycles, but a society that follows the basic laws of knowledge will be fine when the commodity boom is finally over, if ever that happens, some are talking of a fifty-year boom.” If people are allowed to use their knowledge they will use it, liberty, the best system for any society.

Instead of freeing up the market in good times, African despots stole the money, from Angolan president gave his family lucrative monopolies, undermining the future of Angola, this corruption was occurring everywhere in Africa. Believing the good times would last forever this was common occurrence in Africa, they plundered the diamond fields in Eastern Zimbabwe. It was at that time when commodity prices where high that it was time to introduce more free markets, more justice, more liberty.

It is incredible that a continent that never forgets imperialism and colonialism, always talks about the people yet fails to acknowledge that the market is the people. What else can the market be? When you control the market you are controlling people. People are controlled so that they can be robbed blind, there is no other reason to control people. As we understand more about our existence we appreciate the concept of liberty even more. Liberty allows us to be what we desire, to use our talents as best as possible to contribute that little to our existence and our futures. There are ruins in Southern Africa that are 200 000 years old, making the pyramids a modern phenomenon, lack of liberty makes it impossible to honor those genes that built cities 200 000 years ago.

Liberty is about contributing to the full in ones chosen way, that is the only way to honor one’s genes, one’s complete history. That is the idea of being alive, to use the full information package of our genes without harming other people who need to also utilize the maximum information available to them thanks to their genes. We after all going to die, nobody’s time on earth should be robbed. Any meaningful reforms lead towards liberty and freeing people, in freeing the markets, it’s people who purchase goods from apples to 3D printers, as it is people, people must be given the choice in deciding what goods and services are available and who produces them, that is what a free market is, an impossibility under current fascist doctrines espoused by World Bank and IMF, and current global order in general, where the elite have access to vast rewards from corruption.

In the boom times Africa of course thought times would never end, the IMF and World Bank where viewed with the correct suspicion and Africa turned to China, but never pressed its advantage with China. The real reason why African leaders moved away from IMF is because they correctly rejected IMF reasoning, but instead of freeing up the market, they wanted to hold on to their access to corruption. Dealing with China offered that opportunity, China would pour in money to get access to raw materials, and African leaders remained with their corruption loopholes, a win for China and Chinese industry, a win for African leaders, a complete loss for the African people as time has proven. There is no need for I told you so, peoples lives are being wasted.

With high commodity prices, large Chinese investments, Africa should have demanded more for its agricultural sector, the little Africa has to spare in terms of agriculture should have tariff free access to the Chinese market, that is now including the African people. However, liberty in individual African countries is far more important.

If back in 2007 reality had sank in the minds of the African elite, Africa with this current slump would well be on its way towards using its own enormous resources for the benefit of Africans instead of giving its wealth for the West or China to utilize in their industry but unwilling to accept meat from Africa implying the black man is dirty, his food is dirty, clearly not friends. Yet the same people would love to “buy” land in Africa and create agriculture but will not buy same agricultural produce from a black man.

Experience has taught us that race is the major language, but there was wishful that race was usurped by humanity but that is far from the reality. Africa needs liberty for the African to survive, humans need liberty to avoid great misery. The old order of kleptocrats and gangsters has to be wiped out and Africa takes the road of liberty. Guaranteed if Africa takes the road of liberty the IMF would be borrowing money from Africa. 

Bhekuzulu Khumalo

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Bhekuzulu Khumalo

I write about knowledge economics, information, liberty, and freedom