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HOW THE ECONOMIC MACHINE WORKS August 3, 2014

Posted by OromianEconomist in Economics, Economics: Development Theory and Policy applications, International Economics, International Trade.
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How the economic Machine works

Watch and read more @

http://www.economicprinciples.org/

http://bwater.com/Uploads/FileManager/research/how-the-economic-machine-works/ray_dalio__how_the_economic_machine_works__leveragings_and_deleveragings.pdf#page=2

 

 

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Africa’s youth and the self-seeking repressive elites March 15, 2014

Posted by OromianEconomist in Africa, Africa Rising, African Beat, African Poor, Agriculture, Aid to Africa, Ancient African Direct Democracy, Colonizing Structure, Comparative Advantage, Corruption, Development, Dictatorship, Economics: Development Theory and Policy applications, Environment, Ethnic Cleansing, Facebook and Africa, Finfinnee, Food Production, Human Rights, International Economics, International Trade, Janjaweed Style Liyu Police of Ethiopia, Land and Water Grabs in Oromia, Nubia, Ogaden, OMN, Omo, Omo Valley, Opportunity Cost, Oromia, Oromia Support Group, Oromiyaa, Oromo, Oromo Culture, Oromo Identity, Oromo Media Network, Oromo Nation, Oromo Social System, Oromummaa, Poverty, Saudi Arabia, Self determination, Slavery, South Sudan, Specialization, State of Oromia, The Tyranny of Ethiopia, Tweets and Africa, Tyranny, Uncategorized, Youth Unemployment.
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Oijoolleeoromo

Africa’s youth will protest to remove self-seeking and repressive elites

 

“Some examples: authoritarian regimes, as in Ethiopia and Rwanda, are consolidating their positions. In Zambia, Angola and Mozambique, the press, civil society organisations and the opposition are under threat for demanding that the proceeds from raw material exports and billion dollar multinational corporate investments should benefit everyone. ….Short-term greed is, once again, depriving the African populations of the right to share in the continent’s immense riches. No-one can predict the future, but what can be said with certainty is that the possibility of a sustainable long-term and fair development that is currently at hand in Africa is being put at risk. The frustration that is fuelled among populations that are hungry and feel ignored by their rulers will bring about increasingly strident and potentially violent protest. In the near future, this will change the political climate, not least in urban areas. Utilising the internet and their mobile phones, Africa’s youth and forgotten people will mobilise and act together to remove self-seeking and repressive elites. But the situation is not hopeless, on the contrary. Civil society is growing stronger in many places in Africa. The internet makes it possible for people to access and disseminate information in an unprecedented way. However, I get really disappointed when I hear all the ingenuous talk about the possibilities to invest and make quick profits in the ‘New Africa’. What is in reality new in the ‘New Africa’? Today, a worker in a Chinese-owned factory in Ethiopia earns one-tenth of the wage of an employee in China. Unless African governments and investors act more responsibly and ensure long-term sustainable construction for people and the environment ‒ which is currently not the case ‒ we must all ask ourselves if we should not use the consumer power we all possess to exert pressure. There are no excuses for letting African populations and their environment once again pay for the global demand for its raw materials and cheap consumer goods.”  – Marika Griehsel, journalist, film-maker and lecturer

“Thousands of people are demonstrating on the streets to protest against low salaries, the highcost of living and an insufficient state safety net. A reaction to austerity measures in Greece? Or a follow-up to the Arab Spring? No, these are protests for greater equality in Sub-Saharan Africa, most recently in Burkina Faso. The widening gap between rich and poor is as troubling in Africa as in the rest of the world. In fact, many Africans believe that inequalities are becoming more marked: A tiny minority is getting richer while the lines of poor people grow out the door. The contrast is all the more striking in Africa since the poverty level has been at a consistently high level for decades, despite the continent’s significant average GDP growth. Some take a plane to get treated for hay fever, while others are pushing up daisies because they can’t afford basic malaria treatment.”

– Global Voices: http://globalvoicesonline.org/2014/03/11/reducing-the-gap-between-africas-rich-and-poor/

 

 

It is now evident that the African ‘lion economies’ have hardly even begun the economic and democratic transformation that is absolutely necessary for the future of the continent.

The largest movement ever in Africa of people from rural to urban areas is now taking place. Lagos, Nigeria, and Nairobi, Kenya, are among the world’s fastest growing cities.

The frustration that is fuelled among populations that are hungry and feel ignored by their rulers will bring about increasingly strident and potentially violent protest.

Soon, this will change the political climate, not least in urban areas. Utilising the internet and their phones, Africa’s youth and forgotten people will mobilise to remove self-seeking and repressive elites.

This piece was written in Namibia, where I was leading a tour around one of Africa’s more stable nations. There are several signs confirming the World Bank’s reclassification of Namibia as a middle-income country, which in turn means that many aid donors, including Sweden, have ended their bilateral cooperation.

I see newly constructed, subsidised single-family homes accessible for low-income families. I drive on good roads and meet many tourists, although this is off-season. I hear about a growing mining sector, new discoveries of natural gas and oil deposits. I read about irregularities committed by people in power, in a reasonably free press whose editors are not thrown into jail. There is free primary level schooling and almost free health care.

Most people I talk to are optimistic. A better future for a majority of Namibians is being envisaged. This is in all probability the result of the country having a small population ‒ just above 2 million ‒ and a functioning infrastructure despite its large area.

In Namibia, economic growth can hopefully be matched by implementing policies for long-term, sustainable social and economic development that will benefit more than the élite.

But Namibia is an exception. Because it is now evident that the African ‘lion economies’ have hardly even begun the economic and democratic transformation that is absolutely necessary for the future of the continent.

Some examples: authoritarian regimes, as in Ethiopia and Rwanda, are consolidating their positions. In Zambia, Angola and Mozambique, the press, civil society organisations and the opposition are under threat for demanding that the proceeds from raw material exports and billion dollar multinational corporate investments should benefit everyone.

The International Monetary Fund, IMF, predicts continued high growth rates across Africa with an average of over 6 per cent in 2014. That is of course good news for the continent. Perhaps the best, from a macroeconomic viewpoint, since the 1960s, when many of the former colonies became independent. This growth is mainly driven by the raw material needs of China, India and Brazil.

Meanwhile, the largest movement ever in Africa of people from rural to urban areas is now taking place. Lagos, Nigeria, and Nairobi, Kenya, are among the world’s fastest growing cities. But, in contrast with China, where the migrants from the rural areas get employment in the manufacturing industry, the urban migrants in Africa end up in the growing slums of the big cities.

In a few places, notably in Ethiopia, manufacturing is beginning to take off. But the wages in the Chinese-owned factories are even lower than in China, while the corporations pay minimal taxes to the Ethiopian state.

Short-term greed is, once again, depriving the African populations of the right to share in the continent’s immense riches. No-one can predict the future, but what can be said with certainty is that the possibility of a sustainable long-term and fair development that is currently at hand in Africa is being put at risk.

The frustration that is fuelled among populations that are hungry and feel ignored by their rulers will bring about increasingly strident and potentially violent protest. In the near future, this will change the political climate, not least in urban areas. Utilising the internet and their mobile phones, Africa’s youth and forgotten people will mobilise and act together to remove self-seeking and repressive elites.

But the situation is not hopeless, on the contrary. Civil society is growing stronger in many places in Africa. The internet makes it possible for people to access and disseminate information in an unprecedented way. However, I get really disappointed when I hear all the ingenuous talk about the possibilities to invest and make quick profits in the ‘New Africa’.

What is in reality new in the ‘New Africa’?

Today, a worker in a Chinese-owned factory in Ethiopia earns one-tenth of the wage of an employee in China. Unless African governments and investors act more responsibly and ensure long-term sustainable construction for people and the environment ‒ which is currently not the case ‒ we must all ask ourselves if we should not use the consumer power we all possess to exert pressure.

There are no excuses for letting African populations and their environment once again pay for the global demand for its raw materials and cheap consumer goods.
Some examples: authoritarian regimes, as in Ethiopia and Rwanda, are consolidating their positions. In Zambia, Angola and Mozambique, the press, civil society organisations and the opposition are under threat for demanding that the proceeds from raw material exports and billion dollar multinational corporate investments should benefit everyone.

http://naiforum.org/2014/03/africas-youth-will-protest/

The World Bank paints an optimistic picture of African potential, but warns against persistently high inequalities:

Economic growth in Sub-Saharan Africa (SSA) remains strong with growth forecasted to be 4.9% in 2013. Almost a third of countries in the region are growing at 6% and more, and African countries are now routinely among the fastest-growing countries in the world […] [however the report] notes that poverty and inequality remain “unacceptably high and the pace of reduction unacceptably slow.” Almost one out of every two Africans lives in extreme poverty today.

Revenue inequality in African towns via French documentation - Public domainhttp://globalvoicesonline.org/2014/03/11/reducing-the-gap-between-africas-rich-and-poor/

The ‘Africa Rising’ Narrative: A Single Optimist Narrative Masks Growing Inequality in the Continent February 24, 2014

Posted by OromianEconomist in Africa, Africa Rising, Colonizing Structure, Corruption, Development, Dictatorship, Economics, Ethnic Cleansing, Food Production, Human Rights, International Economics, Land and Water Grabs in Oromia, Land Grabs in Africa, Ogaden, Omo, Omo Valley, Oromia, Oromiyaa, Oromo Identity, Oromo the Largest Nation of Africa. Human Rights violations and Genocide against the Oromo people in Ethiopia, Poverty, South Sudan, The Colonizing Structure & The Development Problems of Oromia, Tyranny, Uncategorized, Youth Unemployment.
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“Compare that with the mean wealth of a South African at $11,310, Libyan ($11,040) and Namibian ($10,500). While the average Ethiopian has his asset base standing at a mere $260 despite years of economic growth and foreign investment – wealth has not filtered through to the people. With this kind of glaring inequality between and within countries, the “Africa Rising” narrative risks masking the realities of millions of Africans struggling to get by in continent said to be on the move.” http://www.africareview.com//Blogs/Africa-is-rising-but-not-everywhere/-/979192/2219854/-/12at0a8/-/index.html?relative=true

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“Africa Rising” is now a very popular story – a near-universal belief that the continent is the next investment frontier after more than a decade of sustained high growth rates and increased foreign direct investment.

We even now have memes for this new narrative.

But some people have their doubts about this whole “Afro-optimism” talk – they say Africa isn’t really rising.

They argue that Africa’s low levels of manufacturing and industrialisation discredit the continent’s “growth miracle”. Its share of world trade is remains very small compared to Asia.

Well, Africa cannot be reduced to a single narrative. We have been victims of this before – for hundreds of years the continent has always been seen in a kind of Hobbesian way – where life is poor, nasty, brutish and short.

Now, there is a minority global elite working round the clock trying to turn this long-held view of a continent.

While I do not begrudge them for their PR efforts – we cannot mask the glaring inequality in Africa by developing a new optimist narrative about the continent.

There are many stories about Africa. Not just one.

Genocide

While the sun shines bright in Namibia, not the same can be said of Malawi where the government is bankrupt or the Central African Republic (CAR) where sectarian violence is increasingly becoming genocidal.

Pretty much everyone else in the world seems accustomed to the living hell that is Somalia.

But we have also come to a consensus that Botswana and Ghana are the model countries in Africa.

South Africa is a member of the BRICS. While the petro-dollars are changing the fortunes of Angola – it has grown its wealth per capita by 527 per cent since the end of the civil war in 2002.

Not much can be said of South Sudan. Oil has not done anything despite pronouncements by the liberation leaders that independence holds much promise for the young nation’s prosperity.

The country imploded barely three years into into its independence.

This is the problem of a single narrative – it is indifferent to the growing and glaring inequality in Africa and its various political contexts.

Many Africans still have no access to the basic necessities of life. Millions go to bed without food and die from preventable diseases.

Others live in war-ravaged countries in constant fear for their lives. You can bet the last thing on their mind is not a blanket “rising” narrative about Africa and the promise it holds. That is not their Africa, its someone else’s.

Yes. “Africa Rising” may be real. But only to a small minority.

Wealth distribution

A report by New World Wealth highlights the variations in wealth distribution across the continent’s 19 wealthiest countries.

Africa’s total wealth stood at $2.7 trillion last year down from $3 trillion in 2007 after taking a hit from the global financial crisis.

These 19 countries control 76 per cent while the remaining 35 scrape over $648 billion. And most of this wealth is concentrated in northern and southern Africa.

The western, central and eastern regions have some of the poorest individuals on the continent with the highest per capita wealth from this group – with the exception of Angola – coming from Nigeria at $1,350.

Compare that with the mean wealth of a South African at $11,310, Libyan ($11,040) and Namibian ($10,500).

While the average Ethiopian has his asset base standing at a mere $260 despite years of economic growth and foreign investment – wealth has not filtered through to the people.

With this kind of glaring inequality between and within countries, the “Africa Rising” narrative risks masking the realities of millions of Africans struggling to get by in continent said to be on the move.

The sun may be shining bright in Africa – but only in favoured parts of it.

Read further @:

http://www.africareview.com//Blogs/Africa-is-rising-but-not-everywhere/-/979192/2219854/-/12at0a8/-/index.html?relative=true

Economics: The Comparative Advantage & Opportunity Cost February 22, 2014

Posted by OromianEconomist in Comparative Advantage, David Ricardo, Economics, Economics: Development Theory and Policy applications, Food Production, International Economics, International Trade, Opportunity Cost, Oromia, Specialization, The Colonizing Structure & The Development Problems of Oromia, Uncategorized.
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