The Political Economy of Regional Integration and Development in

Africa: Rethinking theory and praxisBy

Samuel O Oloruntoba, PhDThabo Mbeki African Leadership Institute, University

of South Africa, Pretoria, South Africa.

Introduction

• Regional Integration has been on the agenda of post-colonial African leaders

• From the Lagos Plan of Action of 1980, Abuja Treaty of 1991 through to the NEPAD initiative, regional integration has been on the agenda of African leaders

• These efforts have not succeeded due to many pitfalls

Introduction

• Integration remains the most viable means of fostering social-economic development in Africa

• The global frenzy towards forming regional trade agreements among developed economies makes the case for integration in Africa more compelling and time-sensitive

• With a population of 1billion people and a rising middle class, Africa has a big market that the continent should tap into for its development

Historicizing African Political Economy

• African nationalities were partitioned at the Berlin Conference of 1884/1885

• This Curse of the Berlin (Adekeye, 2010) created artificial and arbitrary boundaries

• This imperial action also led to bondage of boundaries and the ‘Northern Problem’ (Ndlovu-Gatsheni and Brilliant Mhlanga (2013)

• Micro-states were created for the purpose of exploitation and dependence

Historicising African Political Economy

• Colonialism created a an economy that was externally oriented and structurally disarticulated

• Excessively integrated economies to the global capitalist system

• Evidenced in the fact that the ‘ratio of extra-regional trade to GDP in Africa is twice that of Latin America and nearly four times that of Europe’ (Schneider,2003:5)

• Exports dominated by mono-products and primary products

Pitfalls to Regional Integration

• The primacy of economics at the expense of politics-

• Top-down approach to integration

• Following the European model, African leaders have made market access the basis of forming integration on the continent

• While this may not be bad in itself, the structural economic problems of African countries affect its success

• Undue influence of formal colonial masters in the domestic affairs of African countries, especially France

Pitfalls to Regional Integration

• Vertical Integration at the expense of horizontal integration. African economies are unduly integrated to the advanced capitalist economies

• African countries trade more with the West than themselves

• Absence of infrastructures-roads, rails systems, ports, communication

• Barriers to movement of persons through multiple checkpoints

Dominant Theoretical Models

• Market Integration Approach-The market integration approach to regional integration was based on the liberalization of intraregional trade which was designed to abolish discrimination between contracting parties

• market integration involves the lowering and removal of trade barriers between states in a region in order to increase trade between them (van Rooyen, 1998)

• It includes a stage process-of free trade areas, customs union, common markets, economic union and total economic integration (Ballasa, 1962)

• It is anchored on neo-liberalism as an economic doctrine

Dominant theories con’td

• The Neoliberal Economic Theory

• This theory is in the main, a variant of the market integration approach to regionalism

• It favours North-South integration while at the same time focusing on the integration of peripheral economies into the global economy

• It prioritizes ‘open regionalism ….as a mechanism to enhance multilateral liberalization and promote integration in the world economy (Gibb, 2009)

Dominant Theories Con’td

• Dependency theory was a reaction to the modernisation theory.

• With particular regard to strategy for economic development, dependency theory emphasizes development cooperation using import –substitution industrialization strategy and protectionism

• This approach advocates regional cooperation among South-South countries.

• It’s main limitation is the focus on economic determinism• It overlooks other aspects of regional integration such as

political integration, culture, language and the involvement of the people in the efforts towards fostering regional integration in Africa

Dominant Theories Con’td

• New Economic Geography Theory of Regional Integration.

• The contribution of this theory to the issue of regional integration is premised on promotion of North-South Integration

• It posits that South-South Integration has a tendency of creating tension among contiguous states as one of them derive higher benefits than the other

• Political tensions among member states will undermine economies of scale

Limitations of the Dominant theories

• These market based theories are limited for various reasons

• First, the history of state formation in Africa is different from that of Europe

• Second, they did not address non-economic issues such as the need for political integration

• Third, they did not emphasise the need to incorporate development into regional integration-although the development cooperation school mentioned this

Limitations Con’td

• They fall into the neo-liberal frames which is pushing for higher integration of African economies into the global capitalist system-eg the EU-ACP Economic Partnership Agreement

• They place too much emphasis on state-actors, who are not really interested in pushing through the integration agenda because power and privileges

• They tend to encourage specialisation on production of raw materials based on the principle of comparative advantage-value added is discounted

• The market approach favour movement of capital and goods but not of people-despite MODE 4 in GATS.

Implications of the dominant theories on regional integration in Africa

• Low-intra-Africa trade-averaging 10-12% in the last decade (WTO, 2011)

• Commodity driven

• Africa lags behind other regions in the world in terms of intra-regional trade. For instance, in 2009, intra-European trade was 72 percent, intra Asian trade (52 percent), intra-North America trade (48 percent), intra-South and Central American trade (26 percent).

Towards a New Theoretical Model for Regional Integration in Africa

• Regional integration flows from regionalism and regionness

• The New Regionalism Approach is deemed to be a better theoretical approach for driving integration in Africa. This is so for several reasons

• This approach to the explanation of inter-state cooperation is not limited to economic activities. Rather, it incorporates social, political, security and environmental concerns

Toward a new theoretical model

• it is a process that is driven from below with the cooperation of non-state actors such as civil-society organizations and the private sector.

• It is a multi-dimensional approach which can provide an opportunity for the non-state actors to challenge the apathy of the state actors in concluding integration projects in Africa

• It goes beyond the prevailing focus on economic integration at the expense of other forms of integration in Africa

Towards a new theoretical model

• The new approach to regional integration in Africa incorporates recognition of socio-cultural and linguistic relations among Africans of various nationalities-not micro states

• The theory also fits squarely into the logic of de-colonialityand de-imperialism as it involves redefinition of boundaries, re-orientation of economic policies from outward to inward opportunities and reconnection of African people with what unite rather than what separate them.

• The New Regionalism approach will bring about transformational integration in Africa as it involved the people in their cultural, linguistic and spatial essence

Re-inventing Regional Integration for Development in Africa

• African leaders must shift the focus from market access based integration to development based integration

• Developmental integration involves focus on industrialization, cross-country infrastructural development in form of roads, rails, airports, sea ports and communication facilities

• Preservation of infant industries

Re-inventing Regional Integration

• Strengthening continental institutions such as the African Union Commission to fast-track political integration in Africa

• Political integration is necessary to solve the problems associated with sovereignty and related border problems

• Panafricanism should be renewed as an instrument of fostering political integration in Africa-through de-territorialisation of the continent

Re-inventing Regional Integration for Development in Africa

• Non-government stakeholders such as the private sector, civil society and the generality of the people must be involved

• Communication of the benefits of integration must be carried out in the language that the people can understand

• Specific languages spoken across different regions in Africa should be developed to facilitate communication among different peoples of the continent

Re-inventing Regional Integration

• Negotiations on the full integration agenda under the auspices of the African Union should be vigorously pursued

• However, the focus must be redirected to developmental integration

• South Africa and Nigeria are regional hegemons that should champion and support the idea of an African integration

• As the two largest economies they have a lot of benefits to derive from the large African market both in the short and in the long run

Building Competitiveness for regional integration

• Competitiveness issue remains a critical one in Africa

• The Global Competitiveness Index ranks most African countries weak-South Africa 56 and Burundi 144-the least

• Competitiveness involves issues of Governance Institutions, Infrastructures, Education, Financial, goods and labour markets

• Building competitiveness of products through development of new skills and capacity of firms and workers, technology acquisition, branding,

Competitiveness Issues

• To address these issues: Africa must address

• Improve education at all levels. Train thought leaders and emphasize science and technology education

• Diversify export base from raw materials to value added products

• Remove restrictions on movement of people

• The people should be drivers of the integration process

CONCLUSION

• Unfolding events in the global economic order makes integration a compelling agenda in Africa

• The artificial and arbitrary borders should be removed and replaced with the United States of Africa

• African integration agenda should not just be focused on the narrow agenda of market access but overall development of the continent in terms of improvement in the living conditions of the people

Conclusion

• The people, rather than the leaders should take the lead as they are the more affected by the fragmentation of the African societies

• The integration must be focused on building industrial, technological and human capacities across the continent

• Africa should leverage on its competitive advantages in terms of human and materials resources to maximise the benefits of a continental integration