The Africa Governance Report ANNEX 2: Development Periods and Their Principal Focus Global Development Characteristics Africa’s Development Characteristics Post WWII – Marshall Plan Period Development largely synonymous with industrialisation and post-war recovery in Europe. Enhance country’s capacity to manufacture finished goods through the transfer of public capital and technical expertise. Africa remained colonised and a reservoir for free natural resources to colonial powers. Populations were marginalised and served only as free, cheap or indentured labour in extractive sectors serving colonial powers. Liberation activities intensified – few gain their independence. 1961 – 1970: The First United Nations Development Decade Developing countries to set their own targets and achieve a minimum annual growth rate of five per cent of aggregate national income. Also, call for accelerated measures to eliminate illiteracy, hunger and disease. Limited progress made after ten years, with ultimate goals still very distant. This is exacerbated by the cold war being played out between the West led by the USA and the East led by the USSR Independent African States emerge: raise the dignity of Africans A time to eradicate colonialism, speed up economic growth and improve living standards of the people. Role of the state is central in building social and economic infrastructure and providing social services to citizens. A key feature was the import substitution strategy (ISI) that was intended to ensure protection of local industries and employment. This poses a threat to traditional economic discourse: extract natural resources from Africa and import most manufactured goods from the rest of the world. The OAU is formed. 1971 – 1980: The Second United Nations Development Decade Features included the call for a major part of financial resource transfers to developing countries to be provided in the form of official development assistance (ODA); developed countries to provide such assistance to a minimum level of 0.7 per cent of their gross domestic product (GDP) by the middle of the Decade, and the provision of special measures for the least developed among developing countries. Implementation severely compromised by the global economic crisis caused by the collapse of the Gold Standard to which several currencies were pegged. Lack of political will by developed countries to take urgent action on ODA and the development of a new world economic order. De-emphasis on social and human development policies and entry into the debt crisis In the late 1960s, the momentum of Africa’s development had slowed down considerably usually attributed to “over-investment” in the social sector and corruption; through the World Bank and the IMF; cash-strapped African Countries are enticed into massive borrowing for infrastructure. By 1970, many African states had been seriously weakened, a situation worsened by the oil price shock of 1973 that left African countries becoming crushed under huge foreign debt. The result was a sharp drop in overall investment in social services leading to sharp declines in living standards. Some African economies started recording negative economic growth rates and the incidence of poverty started rising again after some remarkable improvements in the 1960s. It was during this period that African countries, unable to manage on their own, were ‘handed-over’ to international financial institutions to manage, and donor dependency became the norm. Page 91 of 96