Africa: Taking the Gap in Modern Economic Theory

The author contends that while neoliberal policies and foreign direct investment (FDI) fueled growth during the commodity boom, they failed to reduce poverty in resource-rich nations like Angola and Nigeria. The paper suggests that African governments should be granted more autonomy to nurture domestic businesses and mandate social responsibility from investors, arguing that a 'middle road' between privatization and state protection is necessary for a sustainable African economic renaissance.

• Neoliberal economic policies and open markets facilitated a commodity boom and increased growth rates in resource-rich African nations, but the benefits have not reached the broader society, as evidenced by persistent poverty alongside booming oil industries in Nigeria and Angola.
• African nations are often forced to comply with investor demands to minimize business costs because of a heavy reliance on foreign direct investment (FDI), which limits the ability of governments to provide essential public goods.
• The author proposes a 'middle road' approach where the private sector continues to drive the economy but is governed by legislation requiring social responsibility, such as providing healthcare, basic education, and infrastructure improvements.
• Rapid privatization and the premature opening of domestic markets have been disastrous for some African economies, allowing government elites to abuse the process and leaving domestic businesses unable to compete globally.

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} }