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Friday, July 08, 2005

 
The (Economically) Dark Continent

This column has been getting some recent attention; I received a link from a Banafsheh Zand-Bonazzi email. Kenyan economist James Shikwati pleads for an end to economic aid to Africa, arguing that it actually contributes to Africa's economic woes. Brief summary: it funds bureaucracies and discourages the entrepreneurial spirit. Read the whole thing.

Then read this January 2004 post on the relationship between economic freedom and per-capita gross domestic product. Pay close attention to this chart:

Index of Economic Freedom scores, per capita GDP photo Index2004Chart.gif

The data haven't changed much in a year. If you go to the Index of Economic Freedom search page and do regional searches on North Africa/Middle East and Sub-Saharan Africa, you'll find that NO African nations score in the "free" range (1.00-1.99), and only seven are "mostly free" (2.00-2.99): Botswana (2.44), Madagascar (2.68), South Africa (2.78), Cape Verde (2.84), Mauritius (2.90), Mauritania (2.93), Senegal (2.99).

The CIA Factbook's current ranking of per-capita GDP shows three nations with per-capita GDP higher than the world average of $8,800, all with "mostly free" Index scores: Mauritius ($12,800), South Africa ($11,100), Botswana ($9,200).

Economic reform must begin with political reform. Free those markets, and maybe one day there'll be some African nations as rich as Greece (per-capita GDP of $21,300).

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