As far as Africa’s current debt situation remains, the country cannot manage any meaningful development. What are the reasons behind these debts?
Every citizen of a country in the African continent walks around with a huge debt tag hanging from his/her neck. If a country is indebted, then its citizens are not free. What this means, in essence, is that Africans are yet to gain their freedom and this is disheartening considering the struggle and sacrifices of African heroes – both dead and alive.
To say that Africa is currently experiencing an economic crisis is a great understatement. The continent lacks basic infrastructure, economies in the various countries are stagnant, education and healthcare are expensive, and there is a high level of food and water scarcity.
Yet, the continent’s debt status continues to increase in a geometric progression – capable of drowning a whale in the belly of the deep.
The continent is deeply indebted to the West, and much of the debts are generated as a result of intervention and counterpart funding acquired to fight the economic hardships. Sadly, the funds have obviously failed to offer any improvement to the situation.
What are the true reasons behind the current debt situation in Africa?
There are many schools of thoughts who argue that the debt situation in Africa can be traced to political instability, others place it at the underdevelopment of human resources.
To some, it is as a result of the oil crisis of the 1973-1974, increased government spending after the colonial era, inheritance of poor colonial economic systems and trade practices, dependence on primary industries, and many more.
While it is true that all of these contribute to Africa’s debt situations in one way or the other, we have an even bigger problem.
My major concern is not the reason why we took loans; rather it is why we have been unable to repay these loans and why the continent continues to remain stagnant despite the large amounts received.
In my opinion, the African debt problem is as a result of the fact that African governments spend huge parts of their annual revenue servicing loans, money that could go a long way in developing their economies.
Compared to other developing countries Africa actually holds a small chunk of the total world debt. However, the problem lies in its inability to service this debt.
African countries are unable to service the huge debts and at the same time build their economies. Apart from North Africa, the rest of the African countries combined owe more than they make. This is why the debt burden in sub-Saharan Africa is growing faster than the economies can handle.
Mind you, this is not a mere coincidence. African countries were structured by the colonial masters to transfer their wealth to them even after independence all in the name of servicing bad debt. This way, they are able to put us under check.
Statistics show that Africa has been transferring its resources to the developed countries since 1985, from as low as 1.7 billion in 1985 to nearly 7 billion in 1997.
Taking this into consideration, it is evident that Africa’s wealth is being repatriated back to the richer countries in the West, just like in the colonial era. The only difference is that this time, it has been hidden under the tag of “debt servicing”.
We are indeed in the era of neo-colonialism and economic colonialism.
What are your thoughts?
Header Image Credit: The African Exponent
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