Africa: Taking the Gap in Modern Economic Theory

The paper argues that while neoliberal policies drove growth in resource-rich African nations, they failed to reduce poverty. It advocates for a balanced approach where African governments nurture domestic industries and legislate private sector social responsibility to ensure economic benefits reach the wider society.

• Neoliberal economic theory and open markets facilitated a commodity boom and increased growth rates in resource-rich African nations due to competition between private investors, the US, and China. However, this investment has not sufficiently penetrated the real economy, leaving poverty to coexist with booming industries in countries like Angola and Nigeria.
• The author proposes that the private sector should take on greater social responsibility through legislation to provide public goods, including healthcare, basic education, pensions, and physical infrastructure improvements, which would in turn strengthen the public sector.
• Rapid privatization and the premature opening of domestic markets have been described as disastrous for many African economies, as they allow government elites to abuse the process and force unequal competition.
• African governments are often forced to comply with investor demands to minimize business costs due to a heavy reliance on FDI, but the author suggests they should seek more autonomy to nurture their economies and protect domestic businesses before exposing them to global markets.

APA

South African Institute of International Affairs (2009). Africa: Taking the Gap in Modern Economic Theory. https://saiia.org.za/research/africa-taking-the-gap-in-modern-economic-theory/

Chicago

South African Institute of International Affairs. Africa: Taking the Gap in Modern Economic Theory. 2009. https://saiia.org.za/research/africa-taking-the-gap-in-modern-economic-theory/.

Wikipedia

{{cite report |author=South African Institute of International Affairs |title=Africa: Taking the Gap in Modern Economic Theory |date=24 July 2009 |url=https://saiia.org.za/research/africa-taking-the-gap-in-modern-economic-theory/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{southafricaninstituteofinternationalaffairs2009africa, author = {{South African Institute of International Affairs}}, title = {{Africa: Taking the Gap in Modern Economic Theory}}, institution = {South African Institute of International Affairs}, year = {2009}, month = jul, url = {https://saiia.org.za/research/africa-taking-the-gap-in-modern-economic-theory/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }