Free trade, globalisation and development

SkepticOne

Originally posted by bonkey
"The farmer in a poor country" is typically also classifiable as "a poor farmer" - they go hand in hand. These people may choose to sell for a better price, to a distributor who will take their food (as you said) to an unknown destination....or (as I am asserting), they may choose to continue to sell locally.

Put yourself in their position. On one hand, you can get more money. On the other hand, doing so will remove much-needed food from the locale, resulting in ppl having to pay more for alternatives....possibly money they don't have.

I'm really looking at this from the point of view of the government of a small country. Prior to globalisation, the presence of buyers for global markets satisfying global demands for a product would have been minimal. Now, with the developments in communications and transport, such international demands make themselves known everywhere. Although many farmers will be consious of local demands, many will be swayed by higher prices being offered.

Your argument is blaming (?) globalisation for offering the farmer the choice.....but ultimately the farmer is the one making the decision as to whether or not to let his neighbours starve to death in order to make more money. There is - as I said - no compulsion on him to sell at the higher price. He has free choice, and he uses it.

Yes. That is the situation I am discussing. One where higher prices are available to farmers. I'm saying that this will have effects on local prices too. Of course, if all or most farmers choose not to sell at these prices, then such effects are minimised.

Ultimately, you can say that globalisation / free markets are permitting greater abuses...and I would agree...but I don't believe they are necessarily responsible for them. The system still allows that farmer to sell locally at the old price he used to.

I wasn't making a point about the individual farmers.

If, on the other hand, the farmer was instructed by the government as to what he could and couldnt do....that he had to sell at the higher price and allow his neighbours to starve to death....that would be a different story.

No, simply the situation where farmers are allowed to take advantages of higher international prices was what I was talking about.

Bear in mind, that the options you gave Sand were effectively what should the government do because the farmer is greedy enough to allow his neighbours to die for more cash. I'm not sure the government should be the responsible body there at all.

This would also be the view of lending bodies like the World Bank. However, I'm suggesting that it may be reasonable for them to impose restrictions on the profits of farmers, taking some of the choices of globalism away from them in the interests of feeding the local population.

Now this is slightly different to what is percieved to be the current problem, namely, that international prices are kept artificially low through richer countries subsidising their own agriculture. However, it is a potential challenge of globalisation and should be discussed.

In the 70's one of the issues of of concern was the move by farmers in poor countries away from supplying local demand for staples towards cash crops for richer countries. This situation could be regarded as an aspect of what I'm talking about.

BTW, I'm not against globalisation, but simply discussing some of the challenges it represents.

shotamoose

(Meh)
But isn't that the exact opposite of what you're complaining about in Jamaica in your first post?

No. I don't think tariffs on agricultural imports were the problem in India. The problem was that huge amounts of food were being exported because people elsewhere could pay more for it, while millions died because they couldn't.

(Sand)
1) Government intervention leads to several laughable failures
2) Government intervetion is not directed at creating economically viable companies but rather expanding industrial base regardless of cost due to security concerns.
3) Government intervention isnt strong enough to force companies to merge to gain economies of scale...Companies still seem to have a high degree of independance.
4) Government intervention cant protect or even minimise effect of market forces on production --- the 1972 oil crisis and the gains in the 1980s.
5) Advances in technology/production come from foreign investment by private firms, not the government.
6) Now if my auntie had balls shed be my Uncle but theres grounds to argue that SK would have developed with or without state intervention - and the government would have a bit more money to play around with to carry out its actual tasks rather than gambling it in failed schemes.

Well that's one very specific example which hardly negates the example of South Korea as a country with a highly succesful developmental history due to a large extent to effective government intervention, in defiance of neoclassical or neoliberal economic theories. Of course governments make mistakes sometimes - the point is that markets 'make mistakes' from the point of view of governments and the people who elect them, so governments have been and should continue to be allowed to intervene to correct these to ensure (although it's obviously never a sure thing) desirable outcomes.

It's not that I don't think markets can be effective. I'm just not religious about it - I don't believe in market infallibility. Market imperfections are everywhere, and governments can do something about it. We elect governments to act in our interests, and we are justifiably angry when they choose to sit idly by.

Agreed, hence you allow for the government to correct market failures...like the enviroment, as private companies do no take the cost of damage to the enviroment into account when determining their economic activity. It is up to the government to ensure they take those costs into account, through pigovian taxation or tradeable permits etc etc.

Well, that's the stock example of externalities given by textbooks, but what I'm saying is that market imperfection is pervasive.

And Im saying that they thought the same way you did about international trade, that it was a threat not a boon.

Well, both the Americans and British were quite keen to increase their exports as much as possible and to selectively protect their own markets. As I say, it mostly seems to have worked for them in developmental terms. Of course you say that they would have developed faster through free trade but there's no actual evidence for that, is there?

Hmmmmm - you realise your arguing a bit of a silly logical position.

I don't believe so. Transport costs is one reason why free trade hasn't existed yet. The Indian example is a case not of free trade per se but of market principles being put above humanitarian needs. Those people in India didn't have the cash to get food and there's no reason why they would in a situation of true free trade either.

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So how come nobody did?

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Because the British Empire believed as you do....that free trade ( true free trade ) would undermine British industry and lead to the ruin of its people.

I don't think you're answering the question. THe reason as I see it is that the people in India didn't have the money to pay the going rate for food, and starved because they lived in a market-driven society.

It seems fairly obvious to me that food should not be treated as a normal commodity and subjected to the usual market rules. If the price goes up our demand for it doesn't decline. If our normal supply is cut off we can't wait around for a new one. Food security should be a priority for everyone, yet if food trade was fully globalised most countries would be reliant on food imports, and vulnerable to sudden changes in the market. Fine if you're rich, not so good if you're poor and barely getting by as it is.

It's just one example of how people generally lag behind changes in the market. They lose their jobs in an old industry and maybe they'll take some time to pick up another one, maybe they won't be able to pick up another at all. The market's telling them to move to the city, meanwhile they're stuck in the sticks trying to get the cash together. People don't adjust as fast as prices do, so people tend to seek protection from market forces. That protection can go too far, obviously - it's a question of judgement.

Sand

Well that's one very specific example which hardly negates the example of South Korea as a country with a highly succesful developmental history due to a large extent to effective government intervention, in defiance of neoclassical or neoliberal economic theories.

Well its me taking a slightly closer look at a showcase industry...0 exports to 2 million remember. And seeing how much truth is behind the hype.

Of course governments make mistakes sometimes - the point is that markets 'make mistakes' from the point of view of governments and the people who elect them, so governments have been and should continue to be allowed to intervene to correct these to ensure (although it's obviously never a sure thing) desirable outcomes.

Agreed, the government should intervene to correct market failures - intervening to replace the market is foolish. And remeber whilst you talk of the government representing the people this is/was not true of South Korea.

Well, that's the stock example of externalities given by textbooks, but what I'm saying is that market imperfection is pervasive.

Markets are certainly distorted by goverment inteference which is often well meaning. Take rent control for example.

Well, both the Americans and British were quite keen to increase their exports as much as possible and to selectively protect their own markets. As I say, it mostly seems to have worked for them in developmental terms. Of course you say that they would have developed faster through free trade but there's no actual evidence for that, is there?

No, theoretically they would have grown faster - though not neccessarily in the same way as they have - with free trade. Theres no evidence they wouldnt have grown faster either:)

I don't believe so. Transport costs is one reason why free trade hasn't existed yet. The Indian example is a case not of free trade per se but of market principles being put above humanitarian needs. Those people in India didn't have the cash to get food and there's no reason why they would in a situation of true free trade either.

The world is just recovering to the level of global trade that existed at the turn of the century. Global trade on this scale isnt new. WW1, the depression and the nationalistic economic polices which followed dealt a huge blow to the worlds economies.

And the people in India certainly had cash to buy food. There was a crop failure, which led to a shortage of food which led to higher prices as the market supply was strictly controlled by the British. If free trade existed the food supply would be such that the Indian price of food would not be drastically effected as surplues from other markets absorped the shortfall in India.

I don't think you're answering the question. THe reason as I see it is that the people in India didn't have the money to pay the going rate for food, and starved because they lived in a market-driven society.

They lived in an imperial society where they were a province of a closed empire. The British werent so different to many today, they liked the idea of free trade internally but the idea of free trade with Johnny Foreigner?!??!?!?!?

It seems fairly obvious to me that food should not be treated as a normal commodity and subjected to the usual market rules. If the price goes up our demand for it doesn't decline. If our normal supply is cut off we can't wait around for a new one. Food security should be a priority for everyone, yet if food trade was fully globalised most countries would be reliant on food imports, and vulnerable to sudden changes in the market. Fine if you're rich, not so good if you're poor and barely getting by as it is.

Well the EU is following such a theory in which it pays farmers to produce food no one eats. So the amount of agricultural activity in the eU is higher than is efficient or necessary, and the price of food is kept artificially high for all us plebs. And thanks to the "Free Trade with Carlos Kickaball!??!?!?!?" mentality farmers who can produce the food we need far more cheaply and efficiently are denied a market and the chance to turn a nice profit. Its all for their own good of course. And dont we send them some pitiful aid packages now and again? They should be grateful:|

It's just one example of how people generally lag behind changes in the market. They lose their jobs in an old industry and maybe they'll take some time to pick up another one, maybe they won't be able to pick up another at all. The market's telling them to move to the city, meanwhile they're stuck in the sticks trying to get the cash together. People don't adjust as fast as prices do, so people tend to seek protection from market forces. That protection can go too far, obviously - it's a question of judgement.

Agreed its a question of judgement. Is it enough that someone should be content to work a 9-5, collect their wages and go home or should society be expecting them to *constantly* be educating themselves, seeking new qualifications so that if they do lose their job that they can find a new one quicker? Maybe some tax break to encourage this self - reliant attitude?

Or should we continue with the nanny state mentality and wreak far more havoc and spend far more in attempting to acheive the same end goal - less down time between jobs?

smiles

Can I throw in an interesting report from a study done by Dan Ben-David of Tel Aviv University and L. Alan Winters of Sussex University on "Trade, Income Disparity and Poverty" for the WTO.

• Extreme poverty is a huge problem. 1.2 billion people survive on less than a dollar a day. A further 1.6 billion, more than a quarter of the world's population, make do with one to two dollars a day.
• To alleviate poverty, developing economies need to grow faster, and the poor need to benefit from this growth. Trade can play an important part in reducing poverty, because it boosts economic growth and the poor tend to benefit from that faster growth.
• The study finds that, in general, living standards in developing countries are not catching up with those in developed countries. But some developing countries are catching up. What distinguishes them is their openness to trade. The countries that are catching up with rich ones are those that are open to trade; and the more open they are, the faster they are converging.
• The study also finds that poor people within a country generally gain from trade liberalization. It concludes that "trade liberalization is generally a strongly positive contributor to poverty alleviation—it allows people to exploit their productive potential, assists economic growth, curtails arbitrary policy interventions and helps to insulate against shocks". This concurs with a new World Bank study (2) which, using data from 80 countries over four decades, confirms that openness boosts economic growth and that the incomes of the poor rise one-for-one with overall growth.
• The WTO study acknowledges that some people do lose in the short run from trade liberalization. Some are well-off, others not. The report argues that the plight of the losers should not be ignored, but that the right way to alleviate their hardship is through social safety nets and job retraining rather than by abandoning reforms that benefit most people.

<< Fio >>

smiles

Also, "Growth is Good for the Poor" by David Dollar and Aart Kraay for the WorldBank produced some of the following results:

Our analysis indicates that income of the poor rises one-for-one with overall growth. Although there is a fair amount of variation, this general relation between income of the bottom fifth of the population and per capita GDP holds in a sample of 80 countries covering four decades.

A number of popular views about the poverty-growth relation are not true. First, a well-known idea in the development literature is the Kuznets hypothesis that inequality tends to increase during the early stages of development and decrease later on. We find no tendency for growth to be biased against poor households during the early stages of development: the effect of growth on income of the poor is no different in poor countries (or countries in the early stage of development) than in rich ones (or countries in later stages of development).

Second, we find no evidence that income of the poor falls more than proportionately during economic crises. Of course, the same proportional decline in income has a greater impact on the poor if social safety nets are weak, suggesting that crises may well be harder for the poor to bear. The greater hardship crises impose on poor people does not occur because their income falls more than that of other segments of society, however.

Third, we find no evidence that growth has become less pro-poor than it was in the past. The poverty-growth relation has not changed in recent years.

We find that openness to international trade raises income of the poor by raising overall income, with insignificant effects on the distribution of income. The same is true for improved rule of law and reduced government size, which raise overall per capita GDP but do not significantly influence the distribution of income. Stabilizing inflation is a super–pro-poor policy: not only does it raise overall income, it appears to have an additional positive effect on the distribution of income.

http://www.worldbank.org/transitionnewsletter/marapr00/pgs15-16.htm

I'm not arguing pro-globalisation, I'm just showing some of the articles which tend to get ignored.

<< Fio >>

shotamoose

Originally posted by smiles
Can I throw in an interesting report from a study done by Dan Ben-David of Tel Aviv University and L. Alan Winters of Sussex University on "Trade, Income Disparity and Poverty" for the WTO.

There was a discussion of that paper in a previous post here

Here's part of what I said:

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The first paper you quote, by Ben-David, Winters and Nordstrom, is a WTO research paper, and there's a rather interesting analysis of it by the Third World Network here .

As you can see, the paper contains several important qualifications not really reflected in the passage you quote. Probably the most important is that the research is based on data from 25 high and middle income countries. Ben-David writes that


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data limitations precluded the analysis of poor countries here—and it is far from obvious (at least to this author) that the impact of trade liberalization found on incomes in the middle and high-income countries could also be found in the poorest countries in the world.

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Which I would have thought rather limits the usefulness of the conclusions drawn, since this conversation (and the passage you quote) have been focussing on poverty reduction.

Ben-David goes also says that


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the results of this paper in no way imply that trade policy is the most important policy from a long-run growth perspective.

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And:


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In the case of the poorest coun-tries, a range of constraints to economic growth and development must be addressed if openness to trade is to have an impact on income levels and growth.

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Winters later writes in the same document that


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Openness probably needs several concomitant policies or conditions before it will generate growth

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All of which leads me to the conclusion that Rodrik laid out in the article I linked to: trade liberalisation tends to come after development, not the other way around. Poor countries would be better served by strengthening their national economies and institutions.

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So overall I don't think that paper is really relevant to poor countries. Thanks for linking to the other paper, I'll have a look at it soon.

shotamoose

Originally posted by smiles
Also, "Growth is Good for the Poor" by David Dollar and Aart Kraay for the WorldBank produced some of the following results:

I think their aim with this paper is to show that governments shouldn't pursue deliberately pro-poor policies, and their argument is actually rather weak.

They find that growth is in general correlated with poverty reduction, but it would be weird if it wasn't (and their data contains cases where it isn't), and as Dani Rodrik has pointed out, "a strong correlation between economic growth and poverty reduction is compatible with both of the following arguments: (1) only policies that target growth can reduce poverty; and (2) only policies that reduce poverty can boost overall economic growth".

So let's say growth is generally good for the poor, with wide variations between cases based on various factors. But the policies pushed for the last twenty-something years by the World Bank and IMF (and advocated by Dollar and Kraay) have not been good for growth. In Latin America and Africa, growth rates plumetted during the 1980-2000 period of liberalisation and structural adjustment in comparison with previous decades, while the two developing countries which have experienced the strongest and longest growth in the latter two decades (India and China) have done so without being subject to any IMF/WB programmes and by following their own, decidedly non-neoliberal paths.

Another implication of the D&K paper is that no particular attention needs to be paid to poverty as long as growth is achieved. However, their global averages hide a number of cases where growth was achieved without proportional decreases in poverty, suggesting to me that it's better to be on the safe side and have pro-poor rather than purely growth-only policies. That's if you only want the incomes of the poor to increase at a similar rate to those of the rich. If you want the poor to catch up, which seems a reasonable policy to me, you'll need to pay more attention to redistribution.

It's also strange that they are not concerned about finding that the incomes of the poor proportionately drop no slower than those of the rich during a recession. Since the poor are generally at a higher risk of severe deprivation as it is, and are far more likely to have to go without basic necessities such as food and clothing, you would expect that in a decent society their incomes would drop less fast.

Maybe the most serious problem with the paper is that, as an analysis of the D&K paper by the CEPRshows , "Aside from the correlation between economic growth and the income of the poor, almost all of the other tests in the paper are statistically insignificant". In particular, their regression results show no relationship between openness and the income of the poor. They simply assume that openness increases growth, and growth is good for the poor, so it follows that openness is good for the poor.

Piliger

Originally posted by bonkey

How can it have been "the driving force behind the success of the US internal economy and the internal EU economy"

because it is free trade across the Staes that enabled the US economy to prosper. Ditto for the EU. Your point of view isn't very strong if you don't know this basic stuff.

On the other hand...if it has been achieved, then perhaps you'd explain where and when....and why you said it hasn't been.

If you follow the thread and read what people write with more attention, then my statement about it not being achived was clearly a reference to global free trade and the rediculous assertion of the target of my comment.

Yes - unfortunately, the countries most opposed to working towards it are the developed economies - the very ones who are apparently trying to sell the notion as a good one.

On the contrary. The truth is that the developed countries have been against it but have been pressured in to supporting it by people who care about the undeveloped poor countries of the world and by international businesses who can see the long term gains. It is the developed countries that feel they have a lot to lose. The reality is of course that that is only short term. Every one will win in the long term.

They want the poorer nations to open up so the richer nations can sell to them....

Not a very sensibel suggestion considering these poor countries have nothing to spend on these comodities you suggest be exported to them.

but institute protectionist measures at the drop of a hat whenever foreign industry threatens their own.

Protectionism has been the reaction of all peoples who feel threatened. Third world countries have acted exactly the same.

This is not the way to prosperity for the poorer nations.

No. Free trade and globalisation is the fastest and shurest path out of poverty.

Well, several valid arguments have been put forward, its just that you have dismissed them out of hand - apparently because you fail to (or choose not to)recognise that people are criticising what is in place, and being termed "Free Trade", rather than the ideals of Free Trade itself.

You appear to be confused. There is no free trade in place. Except within a few international entities such as the US and the EU.

I dont think anyone seriously doubts that Free Trade would not be to the benefit of the developing nations. What they are saying is that the pseudo-Free Trade we see in practice is not the best way forward for these developing nations.

So you ARE confused or just jumping in to a confused situation and taking advantage of it.
These are the facts. THERE IS NO FREE TRADE TODAY EXCEPT IN A FEW INTERNATIONAL ENTITIES SUCH AS THE US AND EU.
Globalisation and the freeing of trade is a process that cannot be achieved overnight. The trouble is that there is a lot of commercial pain for all kinds of parties along the way. The process is well begun and is getting good support from many including international business, but is being blocked all along the way by those with vested interests such as the far right wing and far left wing agitators.
What is needed is a huge push toward free trade accompanied by a program of compensation to be managed by the UN so that the losers along the way can be balanced by the winners.
But however large the problems there si no doubt that a world where poor countries can export to rich countries without the huge tarrifs now in place is the quickest and fastest route to salvation for those countries. There has been no persuasive argument as to why whis is not the case.

shotamoose

Originally posted by Piliger

If you follow the thread and read what people write with more attention, then my statement about it not being achived was clearly a reference to global free trade and the rediculous assertion of the target of my comment.

I'm assuming that you're another version of Chill, and that the ridiculous target of your comment was little old me.

That being the case, I find it interesting that in this post you modify your previously stated position and actually end up agreeing with much of what I've been saying.

partial example:

It is the developed countries that feel they have a lot to lose. The reality is of course that that is only short term. Every one will win in the long term.

So you agree that there are costs associated with liberalisation. Think how much more difficult it is for developing countries to cope than it is for developed ones. I've read a lot of experts from the World Bank and associated bodies talk about these 'adjustment costs' as if they were a mere hiccup on the glorious path to the paradise of free trade. Funny, then, that they never seem willing to say how long the 'adjustment' period will last. And they never seem to acknowledge that economic shocks are far more dangerous for poor people than for the well-off, because poor people lack the resources and capacities and access to services to absorb shocks and respond flexibly. I'll put it in English: during these 'adjustment' periods, there tends to be sudden massive unemployment, and poor people get it in the neck. Malnutrition goes up, health and education go down. People have a nasty habit of dying faster while 'adjusting'.

That there will be adjustment costs is accepted. That these will be most traumatic for the poor should be obvious. That 'everyone will win in the long term' is a matter of conjecture.

Globalisation and the freeing of trade is a process that cannot be achieved overnight. The trouble is that there is a lot of commercial pain for all kinds of parties along the way.

Commercial pain is a euphemism, but could I suppose be applied to the situation in developed countries. In developing countries what we see is humanitarian pain, as I outlined above.

What is needed is a huge push toward free trade accompanied by a program of compensation to be managed by the UN so that the losers along the way can be balanced by the winners.

What, like some form of subsidies to certain sectors? I'm glad you recognise the costs associated with liberalisation, and I would prefer if liberalisation happens that there are safety nets put in place to protect the vulnerable, but I can't help thinking that it's a lot more sensible to maintain a managed trade system in which developing countries selectively protect and selectively liberalise, rather than this headlong rush towards liberalisation, with a few bribes thrown in.

there si no doubt that a world where poor countries can export to rich countries without the huge tarrifs now in place is the quickest and fastest route to salvation for those countries. There has been no persuasive argument as to why whis is not the case.

While tariff reductions in rich countries would probably help developing countries overall, there is considerable doubt that this "is the quickest and fastest route to salvation for those countries". I think it's at least arguable that cancelling the hundreds of billions of dollars of illegitimate, odious and unpayable debts they owe would make a far more significant, direct and immediate difference, and one targeted mostly at those who need it most, ie the Least Developed Countries. Trade reform, on the other hand, will mostly benefit the big developing country exporters such as Brazil, Argentina and Thailand.

Funny thing is, neoliberals and most other 'conservatives' never mention debt, probably because it can't be twisted into supporting a global free trade agenda.

buttons malone

Free trade and globalisation is the fastest and shurest path out of poverty.

I disagree.
First, you have not considered the vital issue of, replacing the leaders of all the different african states who are dictatorial and corrupt with new leaders who are truly committed to democracy, the rule of law, human rights and good governance. Free trade and globalisation can happen in the short run but what about the long run? So Africa jumps on the band wagon and participates in globalisation; their GDPand economic wealth rises etc, yet the question must be asked- is the commitment of African leaders to the African people apparent and moving away from a psychosis of corruption and embezzlement to one of truth and justice for the little black man? If not, then Africa is right back where it started

there is a lot of commercial pain for all kinds of parties along the way. The process is being blocked all along the way by those with vested interests such as the far right wing and far left wing agitators.

Since the New Programe for African development was set up in 2002 to promote African economic development, the downturn has been reduced and Africa will continue to maintain its 2.5% economic growth. It is incorrect to say "the process is being blocked all along the way".

there si no doubt that a world where poor countries can export to rich countries without the huge tarrifs now in place is the quickest and fastest route to salvation for those countries. There has been no persuasive argument as to why whis is not the case.

I disagree. Of course some of the huge tariffs should be reduced but not all of it. If all of Africas tariffs are abolished, then other countries will want their tarriffs taken away and it will spark international discontent. In a way it is almost like giving aid.

shotamoose

Originally posted by Sand
And the people in India certainly had cash to buy food. There was a crop failure, which led to a shortage of food which led to higher prices as the market supply was strictly controlled by the British. If free trade existed the food supply would be such that the Indian price of food would not be drastically effected as surplues from other markets absorped the shortfall in India.

And you know this how? How do you know that the Indian people had enough money to entice food suppliers from abroad to sell them food? Import tariffs were not the issue, either.

I don't think your argument makes sense. There's a famine, so food supply drops. The British have been exporting food from India for years according to market rules, and keep doing so, since the food can still command higher prices abroad than in India, because the locals can't match the prices offered elsewhere.

You're simply assuming that there must have been some supplier elsewhere (where?) who wanted to sell the starving Indian peasants food at a price they could afford, but who was blocked by the British for reasons best known to themselves. The only reason to assume this is out of blind faith in markets.

Well the EU is following such a theory in which it pays farmers to produce food no one eats. So the amount of agricultural activity in the eU is higher than is efficient or necessary, and the price of food is kept artificially high for all us plebs. And thanks to the "Free Trade with Carlos Kickaball!??!?!?!?" mentality farmers who can produce the food we need far more cheaply and efficiently are denied a market and the chance to turn a nice profit. Its all for their own good of course. And dont we send them some pitiful aid packages now and again? They should be grateful:|

You're dodging the argument again. I'm saying that food security should be a major issue in developing countries, one that over-rides market principles. The EU's Common Agricultural Policy is a massively over-inflated and distorting version of a programme that once upon a time did provide food security for Europe, but that time is long past and now it does more harm than good. We're rich now, we can afford to import food almost regardless of what happens in the market. Poor countries do not have the same luxury and should be wary of compromsing their food security.

shotamoose

Originally posted by buttons malone
Since the New Programe for African development was set up in 2002 to promote African economic development, the downturn has been reduced and Africa will continue to maintain its 2.5% economic growth. It is incorrect to say "the process is being blocked all along the way".

That 2.5% is actually down on 2001's growth of 4.3%. According to this, "In 2002, of the 53 countries in Africa, only 5 achieved the 7% growth rate required to meet the Millennium Development Goals. Of the others, 43 registered growth rates
below 7%, and 5 registered negative growth". An average growth rate of 2.5% - considering that some of the countries with the highest growth are recovering from wars and only getting back to pre-conflict levels, and even if it's equitable, pro-poor growth - is simply not good enough.