Tuesday, May 26, 2009

Some sad sentences about Africa

From Paul Collier in the Guardian:

"The global commodity boom that ended abruptly in September was the second since African independence. Africa has yet to diversify from dependence on primary commodity exports, so these booms were huge opportunities, pumping far more money into some governments than aid will ever do. Last year, Angola alone received from oil and diamonds more than double the entire aid inflows to Africa."


Why is this sad? Well (1) it is a very sorry state of affairs when aid flows are the benchmark of size for an entire continent. And (2) Collier thinks these booms were a wasted opportunity for development because they pumped so much money into some African governments (which is apparently a necessary precondition for development?)!

In my opinion, one of the biggest problems with traditional aid flows is that they are government to government (or multilateral bureaucracy to government).

Collier lists Botswana as a country whose government used commodity boom money to "lift the society out of poverty", but if you look at the graph in the post directly below this one you can plainly see that Botswana is one of the few countries whose Human Devlopment Index score is way worse than what its GDP per capita would predict.

YIKES!!!!!!

The rest of the article doesn't get any better, but is well worth reading.

4 comments:

ardyan said...

OTOH, Cuba's not so bad, right? For its GDP, it should be on par with...I'm not sure... can't read it, but it is doing better than one would expect. But then again, as Caplan put it, "HDI is basically a measure of how Scandinavian your country is," so I'm not sure how to see it. maybe Cuba's like a Latin Norway or something.

Angus said...

well, Cuba has not been a recipient of a commodity boom, nor of a lot of western aid, so I'm not sure how it's relevant to this post. Also, if Caplan said that, he is wrong. as the previous post to this one (with all credit going to Andrew Gelman and Justin Wolfers) shows, HDI is pretty much exactly a measure of how rich your country is.

ardyan said...

I just kinda took your post as saying that governments suck at making sure its citizens aren't dying, and I just wanted to point out that Cuba's not doing so bad for how poor it is.

But then again Cuba's just one country, it's HDI isn't very high anyway, and it's not that much of an outlier either.

And, true, I was off topic. My bad.

Angus said...

It is definitely true that Cuba appears to be the biggest outlier on the positive side of the graph where HDI is better than income predicts.

Sorry for jumping on you in my previous comment, thanks for reading!