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Debates and Viewpoints
Globalisation: The new face of imperialism
Nahas A. Angula

The common buzzword today is "globalization". Opinion makers, policy analysts, journalists and even leaders of impoverished Sub-Saharan Africa are predicting, and anxiously awaiting the arrival of a new dawn, the birth of a "global village".
However, from the vantage point of a citizen of Sub-Saharan Africa, globa- lization is nothing new. The so-called voyages of discovery of the 14th and 15th centuries opened up the world to Europe. Slave trade and colonization of the African people ensued. Imperialism crowned the global domination by Europe. The much vaunted globalization of today is in fact imperialism at its best, a wolf in sheep’s cloth.

The hegemony of merchant capital

The so-called voyages of discovery led to the development of merchant capital, which was dominant in Atlantic centres. Eventually, it created peripheral zones in the Americas and elsewhere.

It was the logic of accumulation of merchant capital which led to the trade in human cargo. The slave trade enabled the merchant capital to be expanded by the increase in the Atlantic trade. African citizens laboured in the mines and plantations of the Americas, and trade flourished. During this period, the Americas exported raw materials to Europe, and the latter supplied manufactured goods. This trade further enhanced the industrialisation of Europe and the Americas.

The industrialisation of Europe further incited the industrial class to seek more raw materials and secure their instant supply from wherever it could be found. This led to the establishment of colonial empires, which further strengthened European capital accumulation at the expense of colonial subjects, and often stifling indigenous values of initiatives and innovations. This led to wars of independence to which the United States made a pioneering contribution. However, as soon as the United States of America gained its independence, the whirlpool of capital accumulation drew the Americas into the Atlantic system and trade into a "new Alliance" between the USA and Europe. Eventually America, with its vast resources and human ingenuity, assumed the leadership in capital accumulation. The American position was particularly enhanced after World War II.

The Bretton Woods Institutions

The multilateral financial institutions, established in 1944 to regulate the workings of international markets were in response to the collapse of the global economic system which was caused by the unilateral actions of governments.

The International Monetary Fund (IMF) was originally established to maintain global monetary stability through the mechanism of fixed but adjustable exchange rates. However, in 1971, the United States decided to abandon pegged and adjustable exchange rates and opted for a floating rate for the dollar. The dollar and other major currencies were subsequently allowed to float freely. That action effectively changed the mandate of the IMF.

The World Bank was tasked to spearhead the reconstruction of the war-torn economies of Europe and Japan. The Bank was also tasked to stimulate the economic growth of the less developed regions of the Third World through the recycling of access capital. In this way the Bank was to intermediate between global capital markets and the developing countries. The Bank introduced, therefore, the International Development Agency (IDA) as a window for lending money to poor countries. However, in the 1990s, much of the global surplus was recycled to the developing countries through private capital markets. The role of the Bank in recycling market funds therefore diminished.

The General Agreement on Tariffs and Trade (GATT), which was managed by the International Trade Organization (ITO), was supposed to stabilise international commodity prices and to manage a liberal-trading regime. However, whereas Third World countries were forced to open up their markets, the developed North imposed restrictions on their markets and adopted greater trade protection. The recently concluded trade agreement between South Africa and the European Union is a good illustration of the asymmetry of power between the North and the South. It must also be noted that GATT excluded primary commodities from the list of commodities to be stabilised. Most of the excluded commodities are the ones on which the South depends for its economic survival. The policies of GATT, therefore, disadvantaged the Third World.

The Bretton Woods Institutions are today a shadow of their original mandate. Presently the IMF and the World Bank are no longer institutions of global governance. They are now functioning as institutions for policing the economies of developing countries. As far as the industrial countries are concerned, they set their own rules. Indeed, the international financial institutions have become instruments of economic policy of the Group of seven highly industrialised countries. The current dominant ideology of neo-liberalism is being marketed by these institutions.


The ideology of neo-liberalism was institutionalised by Thatcher and Reagan. It is a form of social Darwinism, where, by deliberate action, non-action, or through benign neglect the weak is allowed to perish and the strong to flourish. This environment and conditions are to be achieved through unbridled competition, and often reinforced by other means including privatisation and hasty structural adjustments.

The central tenets of this ideology are the free circulation of capital, freedom of investment and free trade in goods and services. On their face value they sound good economic principles. However, the question is, who owns capital? The underlying principle of neo-liberalism is that the market mechanisms should be allowed to direct the fate of human beings. Capital should call the shots!

According to Joan E. Spers, a former US under secretary of state for economic, business and agricultural affairs, one role of governments in shaping the new global economy "is to get out of the way to remove barriers to the free flow of goods, services and capital".
Hegemonic dictatorship of the market demands the total liberalisation of trade and capital markets. It further demands the privatisation of public assets, reduction of the role of government in the economy, a tax regime in favour of capital gain. Competition between nations, regions and individuals is said to be a virtue.

In this context, the industrialised countries are determined to construct the international economic architecture within the framework of this neo-liberal ideology, and the World Bank and the IMF are being restructured in order to form the pillars of the international economic architecture in respect to developing and transition countries.

For the rest of the world, the US is pushing for a new trans Atlantic marketplace. Those countries in between are often marginalized or are important only to the extent that they can provide a free source of raw materials, energy and cheap labour. The ultimate goal is to eliminate or reduce trade and investment barriers between Europe and North America.
The US is further pushing for a regulatory framework for communication through the Global Information Infrastructure (GII), revolving around five principles. These are private investment, market-driven competition, flexible regulatory systems, non-discriminatory access, and universal service.

This, coupled with the drive for privatisation, will ensure the domination of multinationals over tele- communications.

The world is, therefore, being shaped according to the economic interests of the US in particular, and the Northern industrialised countries in general. The rules of globalization are being drawn up by the rich and the powerful.

A world which is constructed on the principles of neo liberalism and dictated upon by multilateral financial institutions is a brave new world: one of winners and losers; the rich and the poor; the North and the South. It is a cruel, unfair and undemocratic world. Sub-Saharan Africa is a victim of this exclusion. The policies of structural adjustment imposed on the economies of many countries in the region attest to this fact. The region’s total debt now amounts to 110 per cent of its GDP, compared to 35 per cent for all developing countries.

And according to Walden Bello, in his book, Dark Victory, "cut off from significant capital flows except aid, battered by plunging commodity prices, wracked by famine and civil war, and squeezed by structural adjustment programmes, Africa’s per capita income declined by 2.2 per cent per annum in the 1980s".

He adds that some 200 million of the region’s 690 million people are now classified as poor. Even the least pessimistic projections of the World Bank see the number of poor people in Sub-Saharan Africa rising by 50 per cent to reach 300 million by the end of this year. If current trends continue, the United Nations Development Program estimates that the continent’s share of the world’s poor, now 30 per cent, will rise to 40 per cent by year end.

As long as the multilateral financial institutions continue with their current policies, buttressed by the neo-liberal orthodoxy, these bleak predictions will become true.

The struggle continues

The African people fought against colonialism and won political independence. Now the struggle is for Africa to gain a foothold in the global economy and a grip on global economic infrastructures. The New International Economic Order agenda of the Group of 77 must be resuscitated. For the Africans the project of African Unity must be brought to the forefront. It should not be confused with metaphysical myths. It must be taken on concrete level through political will. A united Africa will be able to devise its economic policies and trade regimes.

Moreover, the state in Africa must be made efficient and effective in providing conducive environment for economic growth and development. This means that African democracy should be based on total commitment to the welfare of people. Civil society in Africa should also be strengthened to play an effective role at community level. Above all, Africa should develop its human resource capacity and sharpen its ideology of Pan-Africanism as a counter to the imperialistic ideology of neo-liberal agenda.

Poor countries should not allow suicidal policies to be imposed on them by the rich. The unity demonstrated during the negotiations and subsequent rejection of the Multilateral Agreement on Investment clearly points to the fact that if the poor could unite the rich would listen.

The departure point lies in the restructuring of national economies, focusing on value addition to raw materials. This will strengthen African efforts towards manufacturing. Value addition will further help Africa to diversify its economic base. To achieve value addition on a competitive basis, capital, technology and knowledge should form a dynamic symbiosis for optimal synergy. In addition to enhancing human resource capacity building, the state in Africa should also provide funding for product development, and promote the development, acquisition and dissemination of technology. The private sector should now be in a position to adopt technologies and employ a competent labour force for the building of industries.

The subsistence sector should be transformed into cash exchange economy. Attention should be focused on the informal sector with the view of introducing appropriate technologies as well as capitalising the sector. Africa cannot continue to promote its economic development on dualistic basis. A national economy must be integrated in order to enhance internal synergy.

The restructuring process should also promote wider participation in economic activities by as many citizens as possible. This means that specific empowerment strategies should be adopted in order to allow wider participation by the citizenry.

In order to enhance Africa’s capacity for restructuring, the Africa Development Bank must become a truly institution for the development of Africa. Therefore, the Bank should be re-capitalized to take into account the continent’s growing needs.

(This article was taken from SAPEM magazine-Southern African Economist,, and also operating in the same group as and )

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