Africa Notes FMIB3
Hult International Business School
Popular in Global Economics
Popular in International Business
This 3 page Class Notes was uploaded by Mischa Rapt on Tuesday September 22, 2015. The Class Notes belongs to FMIB3 at Hult International Business School taught by David Green in Summer 2015. Since its upload, it has received 11 views. For similar materials see Global Economics in International Business at Hult International Business School.
Reviews for Africa Notes
Report this Material
What is Karma?
Karma is the currency of StudySoup.
You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!
Date Created: 09/22/15
Africa Tremendous potential and natural resource wealth severe poverty still widespread compex reasons Colonial history weak governance Social fragmentation Civil strife Tropical geography Impact of HIVAIDS adverse policies from OECD countries discourages inclusive growth SubSaharan Africa distinguished from North Africa different regions share much of the same economic development continent of natural resources Great diversity of development experience Lion economies some countires economies are consistently growing faster than any of those in the world but growth still dependant on natural resource extraction Huge Inequality lnequality by region despite slow growth high in Latin America and Sub Saharan Africa Mass severe poverty has become an African problem cultural differences Focus on Metastories 1 Africa is not China China escaped mass poverty through Lewis Two Sector Model african economies have large numbers of unproductively employed people with some exceptions Africa has not attracted investment in manufacturing incompete lewis adjustment people moving from unproductive rural area employment to unproductive urban area employmentinformal sector 2 Tropical Trap Tropical vs temperate climates affecting diseases and agricultural productivity South Africa with temperate climate better off than Tropical Africa Landlocked or not affects trade Africa is very tropical but soils are often very thin and not productive for temperate agriculture crops Tropical Health challenges malnutrition diarrhea no healthposts no medicines poorly trained staff requirements for illegal payments maaria particularly brutal malaria is controllabletakes ef cient govt and medical resources negected tropical diseases like EBOLAdestroyer of communities don39t affect OECD residents directly so little research is done nearly half of Liberia39s workforce no longer working since EBOLA crisis higher food prices as economies implode GDP growth down by 12 HlVAIDS particularly sub Saharan Africa Malawi Incidence of disease slowinglbetter policies more aid 0 Poverty trap farmers reusing land after too little rest resulting in signi cant deterioration of soil nutrients farmers work harder and harder just to stay in place 0 Africa needs a new Green Revolution developing new disease resistance varieties of wheat mechanized farming techniques 3 Resource curse Poor governance re ecting colonial history Resources like oil and gas a resource curseoil and gas reserves concentrated in North Africa and Nigeria assume country has large amounts of nonrenewable resources that generate huge economic pro ts which provides huge in ows higher in ation lowering exports skewing economy towards and funds could be productively invested in development or can result in corruption control of corruption public power exercised for private gain quotcapturequot of state elites and private interests Factory Africa would demand a set of policies to welcome intermediate production centers business friendly policy regimes transportation and communication structure appropriate labor skills pubic utility services entrepreneurial encouraging society supportive nancial sector ljlack of these re ect poor development management and poor governance ljlack of infrastructure can kill business ie Sub Saharan Africa is far less developed on average than in other low income countries around the world Variation in productivity agriculture land and labor productivity has been steadily improving since 1990 but developing countries still lag decades behind developed countries land intensive vs labor intensive Governance Corruption prevalent in almost all institutions that make Nigeria work well growing inequality due to small number of upper class taking all money What accounts for poor governance colonial history socia fragmentation OECD policies that discourage agricultureencourage extractive indsutries cold war civi strife Corruption in Africa Nigeria ranks near bottom of transparency Corruption can be fought Burundi worked to professionalize tax collection agency Tax revenues have nearly doubled in less than 4 yrs tactics include testing for all positions open of ce work space transparency in ruleslowered tax rates Is there a natural resource curse or hope for Africa Natural resources seem to be a blessing sell natural resources and invest in development of human capital and infrastructuresometimes it just doesn39t happen wasted natural resources in developing countries stolen through corrupt practices some places have made natural resources a boom rather than a curse BotswanaNorwaydubai vs Nigeria sudan Venezuela what are costs or resource cursewhat are key elements in explaining why there is a resource curse What policies shouls allow natural resources to support development Reason business investments are held back inability to say that I know what my business environment will be like I know how smoothly my govt will run
Are you sure you want to buy this material for
You're already Subscribed!
Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'