Free Market System Would Free Africa by Lanre Olagunju

Despite the surplus that dwells plenteously on its fertile land, regarding the abundance of human capital, Africa, being the second largest of Earth’s seven continents, covering 23 percent of the world’s total land area and containing 13 percent of the world’s population still, Africa pursues traditional subsistence activities, which continues to provide sustenance for the majority of Africans. Till date, in spite of increasing levels of industrialization in many countries, Africa’s raw materials are exclusively being produced primarily for export. It’s crystal clear that being blessed is not enough. Countries like Niger and Nigeria among others boast of a whole lot of unexploited natural resources yet to be utilized.

Africa is rich in nature but richer in corruption, richer in customized and modern serfdom, richer in deceitfulness in government. Therefore, the benefits of freedom and equality that free market economy provides cant but remain alien to Africa.

Through deliberate reform or violent fight back, most of African nations won independence in the 1950s and 1960s. The colonial era is gone and long forgotten but many African nations have spent their post colonial era trying various forms of failed government with Marxism and military rule reigning longest? Of all the several effects of slavery, which Africa had more than enough to muster; the slavery of the mind is the greatest. Slaves don’t have the rights to think on their own or experiment new ideas, slaves don’t own anything, slaves don’t invest or buy because they have been bought. This is the only effective method slave masters use in retaining lordship over their subjects. Consequently, tyranny in government in the post colonial era is a carryover from the colonial era which is long over but with seemingly everlasting effect.



Over dependence on foreign aid and ‘kleptocratic’ governmental mismanagement is destroying Africa faster than the after effects of war. Or how else does one explain that funds gotten from foreign aids are been siphoned by government officials or at best, spent on things the funds have no business with.

A number of projects don’t see the light of the day while many die an unusual death even before maturity. Why? Over 80% of the funds goes into buying cars, office furniture, meetings, entertainment and the rest of the belly turning expenses that has got no business with the funds in the first place. This is a usual occurrence in Africa and the main reason poverty has become a second nature.

It’s worth noting that despite increasing population, food production has increased by 90% all over the world and this has got a ripple effect on real food price so as to decline by 75% in the last five decades. Unfortunately, many African nations are alien to greater agricultural productivity, internal economic freedom, international trade, a market system without over burdening government intervention, free financial market; which are all factors that brought about such a phenomenal transformation in world food production.

The most successful set of ground rules for coordinating economic activities is the system of protected private property rights which also include the protection of life and limbs and more importantly a private autonomy to compete under the rule of law. This also is out rightly absent and void in many African nations. Public policy normally do not co-ordinate human conduct as good as free market. Albert Einstein couldn’t have said it better when he said “everything that is really great and inspiring is created by the individual who can labour in freedom” many traditional collective pursuits such as the provision of water or electricity are nowadays satisfied more effectively by competing private providers.

A critical study of India’s economy reveals that over population, colonial exploitation, pervasive corruption, chaotic democracy, high illiteracy, anti-materialism and fatalistic culture is not solely responsible for India’s poverty rather absence of economic freedom.

A country with a per capita income of US$500 and about US$3100 in purchasing power parity is no doubt a poor one. But India is rich in potential, powered and driven by ordinary uneducated people who have mastered and outlived the excessive involvement of government and byzantine policy which pedals every aspect of the India economy since 1950.

In the 1930s, India emerged one of the developing countries in the world to manufacture automobiles, but interestingly these inventions are made by poor illiterates. Rather than support and encourage such brilliant innovation, the law requires an unaffordable cost to test run such invention. None of these vehicles currently qualify for registration and they aren’t permitted to move on public road under the law. What a law! Consequently, India has one of the lowest densities of vehicles in the world but being a pluralistic democracy, it’s pretty easier to bend this tortuous and anti-developmental regulation. Besides automobile industry, the IT revolution birthed by the vibrant informal sectors is also facing stifling growth due to excess taxation and detrimental government policies, same goes for other economic sector in India.

The relentless and dogged people of India have made it known that consumers are willing to pay for reliable services like electricity, education, automobiles, pay television and the rest. Also, given the opportunity and conducive environment, entrepreneurs can expose the myths of natural monopoly even in sectors as conventional as electricity.

The wrong notion that markets will only thrive amongst developed infrastructure has been proved mistaken by the informal economy sector of India. The reality is that wealth is accumulated through markets and not necessarily a prerequisite for markets to exist.

The revolution and transformation Africa longs for and desire might never materialize until the resurrection and proper use of her dead capital. An estimated $9.3trillion of dead capital exists in developing and former communist countries and these are assets that got the potential to initiate surplus production and increase productivity if adequately maximized. Wealth has to be created in Africa and the most appropriate way is to create incentive for individuals to do so. Free market is the path out of poverty.