Incomes in Sub-Saharan Africa Seen as Backsliding

Racked by war, disease and corruption, sub-Saharan Africa today suffers from income levels that actually are lower than in the late 1960s, when the region was embarking on a hopeful new chapter of independence from colonial rule.

The finding on average income levels, currently less than $1 a day per person in much of the region--was among an array of dire facts about Africa’s economies in a report released Wednesday by the World Bank and other agencies. At the same time, the authors insisted that there were reasons for at least some hope, including examples of reduced corruption and improved governments.

Since the early 1990s, 42 of 48 sub-Saharan nations have held multi-party presidential or parliamentary elections, according to the study. The report was compiled by the World Bank and African-oriented organizations such as the African Economic Research Consortium, the African Development Bank, the Global Coalition for Africa and the United Nations Economic Commission for Africa.

“Although the challenges facing Africa may seem insurmountable, the continent has enormous untapped potential and hidden growth reserves,” said Alan Gelb, chief economist for the World Bank’s Africa region. Successes in some areas, he added, “are opening up opportunities in others.”

The report comes at a time of extraordinary problems for the vast region that is home to about 600 million people. AIDS and malaria are slashing Africa’s young work force, eroding productivity and economic growth. Conflicts such as the war between Eritrea and Ethiopia have been spreading chaos. Political corruption continues to drain resources.

The study also painted a striking picture of Africa’s exclusion from the global economy. Africa’s share of global trade has been shrinking, and the region receives a minuscule share of foreign investment.

“Africa accounts for barely 1% of global [economic output] and only 2% of world trade,” the report said. “Its share of global manufactured exports is almost zero.”

“The overall trend is terrible,” said Stephen Morrison, an Africa expert at the Center for Strategic and International Studies in Washington, who had not seen the report. “Globalization has largely passed this continent by.”

The report singled out Africa’s failure to diversify its economies beyond exports of basic commodities, its reliance on foreign aid and its debt burden as problems that have held back advancement.

While scholars once spoke confidently of an emerging African “renaissance,” such talk has faded in recent years, Morrison said.

According to the report, Africa is burdened by an exceptionally large gap between rich and poor, with wide inequality in income, wealth and access to basic services. Fewer than one in five Africans enjoys access to electricity, and less than half have access to safe drinking water.

“The region’s total income is not much more than Belgium’s, and is divided among 48 countries with a median gross domestic product of just over $2 billion--about the output of a town of 60,000 in a rich country,” researchers said.

As recently as the mid-1970s, per capita incomes in Africa exceeded those in much of the developing world, including Asia. But that situation has gradually reversed, with Africa now “the poorest region in the world,” according to the study.

More than 40% of the sub-Saharan population now lives in poverty. But the number will inevitably increase unless Africa can sustain growth rates of 5%--double the rate of recent years, the report said.

Nonetheless, the researchers pointed to signs of progress. Nigeria has made rapid strides toward modernizing its economy and government after years of corrupt rule. A major new transportation corridor between Mozambique and South Africa illustrates the possibilities of infrastructure efforts, and the decision to allow competition in the airspace of West Africa is an encouraging sign of deregulation, they said.

In countries that have adopted economic and political reforms, such as Mozambique and Ghana, incomes have increased and poverty has declined, the researchers concluded.