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73 CHAPTER SIX NEOLIBERAL ECONOMIC “PARADISE LOST”: AFRICA’S RECORD Around the world, especially Africa, neo-liberal policies in the form of austerity measures are imposed by powerful multilateral financial institutions like the International Monetary Fund (IMF), the World Bank, and WTO. Aided by these supra-national agencies, global capitalism is steered on the path prescribed by the neo-liberal economic policy (market orientation, privatization and deregulation) for the ultimate goal of creating smooth global conditions for accumulation. In the 1980s and 1990s, global capital mobility and trade increased, but the plight of the workers, growth and employment opportunities showed no major improvement. On the contrary what appeared to be more noticeable was the burden of national debt and declining collective bargaining power on a global scale (Cohen and Centeno, 2005). Indeed the application of Keynesianism both nationally and globally was aided by the Bretton Woods’ new International Monetary System and its two powerful supranational institutions of the IMF (through its austerity measures) and the World Bank (ostensibly under United Nations' auspices) and as instruments of centralization of capital against the global working class struggle (Phillips, 1980:126). Africa’s Economic “Paradise Lost” In Africa, the weight of the foreign debt, combined with the corruption of the ruling classes which have pillaged their countries, are leading to an absolute pauperization of the workers, peasants and popular layers. After more than 30 years of one-party regimes and/or military dictatorships in most countries, mass mobilizations have been forcing the neo-colonial bourgeoisies in power to accept multi-partyism, freedom of expression and association, the principle of free elections. These mobilizations are the result of internal factors (insupportable effects of the so-called adjustment policies of the IMF, the growing discredit of repressive and corrupt ruling circles) and external ones (echoes of the fall of the Stalinist dictatorships, as well as imperialist maneuvers to avoid the risk of sudden falls of its local allies). Indeed, today, the prikhvatizatisiya (grabitization) that has been bequeathed to the masses by a kleptocratic capitalism that has recently dragged itself out of the carrion house of economic shock therapy has led to ‘blitzkrieg liquidations’, the destruction of industry, the disappearance of health benefits and housing, the slashing of salaries, and the transfer of 74 wealth to a dozen or so private owners who now commandeer one public property. The glittering prospects held out by capitalist ideologists for the neocolonial world on the basis of untrammeled capitalism, the implementation of deregulation and neo-liberalism, has turned into ashes. ‘Free trade’ and the implementation of the World Trade Organization’s programs, and those of the World Bank and the IMF, have had disastrous effects. Most neo-colonial countries are still primary producers and commodity prices have been in a chronically declining spiral for at least two to three years. Coffee prices, for instance, fell by a half in two years and cotton by two thirds since 1995, damaging sub-Saharan countries in particular as well as Latin America. The post-11 September economic slowdown compounded this situation. Lower oil prices have undoubtedly benefited the industrialized countries allowing them to cut interest rates, but the vulnerable and poor oil exporters such as Nigeria, have, to say the least, benefited less. ‘External financing’, particularly in the infrastructure of ‘developing’ countries, has collapsed. Infrastructure projects have dropped in value from a total of $4.5 billion in the mid-1990s to $2.5 billion five years later. The World Bank’s vice-president declared: “Frankly, what we are seeing is a crisis whereby the public sector has withdrawn from financing infrastructure, thinking the private sector could carry the burden”. A director of the World Development Movement stated: “The deeply ironic thing is if you privatize services, investment actually falls. What western investors want is quick returns for what it perceives to be big risks”. In other words, “letting the market rip”, the substitution of previous minimal state sponsored aid to the neo-colonial world by ‘private investment’, has been an abysmal failure. At the same time, long-term resources from the West to the neo-colonial world have declined dramatically from the peak of $341 billion in 1997, to an estimated $197 billion in 2001. Even foreign direct investment (FDI) has fallen by just under nine per cent from its peak in 1999. Therefore, the access to capital markets by the ‘emerging markets’ has declined, which has increased the impact of the global slowdown of the last 12 months. Trade or...

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