Two distinct periods stand out in Africa’s development strategy. The period spanning the 1960s and the 1970s was characterized by policies aimed at strengthening economic autonomy. It is during this period that diversification oriented policies were aggressively pursued in most countries. A major shift in economic policies in Africa was occasioned by the economic crises of the early 1980s. Most of the postindependence economic policies geared to long-term development were replaced by macroeconomic stabilization policies focusing on short-term goals. This reorientation of economic policies has failed to yield the expected results, and it is clear that a shift in policy orientation is needed to accelerate progress towards the MDGs.
In recent decades, sparks of economic growth have often vanished as quickly as they have been ignited. The current growth momentum also rests on a very fragile foundation.
The continent continues to rely on primary commodities whose prices have been major sources of trade shocks. While efforts towards diversification had some positive results in the 1970s and early 1980s, these gains were reversed in the mid11980s due to the economic crises of the period. Therefore, it is critical for African countries to embrace diversification as the central development paradigm.
Diversification experiences in Africa fall into five main categories: countries with little economic diversification such as Burkina Faso and Senegal; countries that made some early progress and then stagnated in the process such as Kenya; those that managed to deepen their diversification process as exemplified by Tunisia and Mauritius; backsliders in the diversification efforts consisting mainly of oil-rich countries such as Nigeria; and non-starters comprising largely of the conflict and post-conflict countries such as Liberia and the Democratic Republic of Congo. This diversity of experiences raises the questions of what factors drive diversification and what policies can foster diversification in the medium-term and in the long-term.
To learn more about this author, visit United Nations Economic Commission for Africa's Website.
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