An Objective inquiry by Dr.

Ignatius Gwanmesia into opinions that the most enduring legacy of European expansion has been to create a world economy structured to favour the global north?

Introduction The increasing media coverage and campaigns by Non Governmental Organisations (NGOs) and anti-globalisation campaigners against global economic structures that favour the north while victimising the south have ensured the universality of the latter’s plight. To achieve a focused analysis in this discourse, I will examine the OAU region of Africa South of the Sahara (ASS) and Europe as typologies of the Southern and Northern economic regions; represented by the Economic Community of West African States (ECOWAS) and the European Union (EU) respectively. I envisage using the structural frameworks and operational strategies of the EU in particular and northern policies in general to determine to what degree the case for northern economic favouritism is fact or fiction. I start with the consensus that “the world is essentially capitalist and exploitative in its operation” Went, (2000, p. Xii); Toussaint, (1998) and that any economic relationship between the north (owners of capital) and the South (labour providers) will be guided by “the owner of capital seeking to make profit” Soros, (1998. P. Xxii) irrespective of the micro welfare of the former. McChesney (1999, p. 104). This is because, “Capitalism rest upon a fundamental asymmetry of power between capitals and labour; if the power of labour gets too strong, the ‘rule of the game allow those who own and control capital to institute vicious counter attacks.”

Went, R. (2000, p. Xii).


Thus, could the enduring legacy of “exploitation-oriented policies that took off under colonialism and imperialism and being currently propagated under globalisation” Ohmae, (1995) by the north be “an acute sickness that the north rather manages than cure?” Bello et al., (2001). The analogy here is that, keeping the south; the indispensible source of raw material and dumping ground for European industries and products respectively on a life support machine is economically the preferred option rather than a death south. The European expansionist strategy is to ensure that the economic patient (the south) is not restored to full health so as to threaten the very economic existence of the north, but to remain so acutely incapacitated that the south’s economic survival depends on the north. Following this introduction will be a background overview of the evolution of the northsouth economic relations; colonialism, imperialism and globalisation. (See appendix One). The body of the essay will use headings like protectionism and trade liberalisation, dependency and debt servicing; globalisation and migration; subsidies and ecology to analyse northern economic policies towards the south. Under appraisal I will compare, contrast and correlate prevailing opinions on whether the legacy of European expansion has been to create a world economy structured to favour the global north? My conclusion will be a summary and projection on debates developed within the essay. Finally, the bibliography will use the Harvard model to alphabetically credit all citations made in the essay.


Background The paradox behind the widespread marginalisation in ASS is that “African nations are poor because they are rich? Martin Khor, (1995). Contentiously, the inter-play of power politics amongst the capitalist North to secure Africa’s wealth and resources are seen as the major determinants of Africa’s sustained economic stagnation. Adams, (1993). Analysts agree that colonialism and imperialism culminating in the partition of Africa was primarily underpinned by economic motives to exploit and extract Africa’s resources to sustain European industrial revolution. Nicholson, (1998, p. 71); Williamson, (1996); Soros, (1999). The accompanying slave trade that depleted Africa of her virile and active population also inflicted a debilitating blow to Africa’s political and economic aspirations. Needless to emphasise that Africa’s current powerlessness and economic vulnerability could be directly attributed to the ramifications of the slave trade. Nicholson, (1998, p. 69). Nevertheless, opinions are polarised on whether the legacy of the enduring northern-favoured economic policies are still underpinned by the same motives that informed colonialism and imperialism. With primary focus on globalisation; the pandemic phenomenon that is controlling societies the world over, I will examine the pros and cons of these opinions. As with most concepts, the initial premise is that, whatever opinions that is projected by any school of thoughts, is a factor of their vested interest and cultural background.


Protectionism and trade liberalisation Consenting to the symbiotic reality that in practice, “economic restructuring in a sense cannot be separated from politics” Crokatt, (1995); Nicholson, (1998, p. 120) and similarly that, “it is impossible to completely separate economic from social matters” Bennett, (1995, p. 288), it becomes obvious that limiting this discourse solely within the paradigm of economics is inherently problematic. Consequently the inadvertent drifts into related political or social spheres are unavoidable. For example, overtly, the EU’s, World Bank’s and International Monetary Fund’s (IMF) decisions to encourage the South to pursue market oriented strategies by opening their Third World economies to foreign investments carried overtones of either benevolent or humanitarian motives to enhance the south’s social viability that may eventually lead to the alleviation of marginalisation. However critical analysis shows a structured northern economic framework whose objective was “to promote export that would ensure that Africa’s debt repayments are met.” Baylis and Smith, (1997, p. 455). The reality in the liberation of Africa’s market is that, while it gave the Europeans a green card to access Africa’s vast resources, within a preferential global economic setup, the EU instituted protective barriers to deprive ASS of similar access to European markets. For example, the European Union’s enactment of; “a common market, with the EURO as common currency; the removal of international tariffs and trade restrictions; the free movement of goods persons, capital and services” have been cited by Pilkington, (2001, p. 13) as “tyrannical and exploitative capitalist policy frameworks to maximised regional economic gains while seeking to take advantage of one’s rivals.” These economic structuring served to ensure the EU’s economic domination of third world economies like those of ECOWAS’. This has been effectuated within the primary market sector by creating a common external tariff on imports from outside the Community. Considering that Africa’s export is primarily agricultural, it becomes increasingly clear that the EU’s Common Agricultural Policy (CAP) of: “protective heavy levies placed on all imported agricultural products; the purchase by the community of all commodity surplus;


the common guaranteed prices for most commodities”

Pilkington, (2001, p. 15) put African producers on the disadvantage. As a perpetuation of colonialism and imperialism, analysts perceive the north’s relationship with the south as primarily ‘exploitative.’; leading to disempowerment and abject dependency. Bennett, (1995); Went, (2000); Adams, (1993). Needless to infer that even in any north-south economic transactions where there seems to be overtones of competitiveness, the political and economic might of the north will ensure that deliberations and decisions are structured to favour the north. Again, the structure and operational strategies of the European Union is a typology of a northern economic colossus set up to exploit the economically vulnerable while using protectionist policies to advance European global economic interest. Comparatively, while hard working cocoa farmers in Ghana or tea producers in Cameroon are compelled through preferential European price-fixing to accept less than acceptable prices for their goods; their European counterparts are not only guaranteed top payments, but also the purchase of their surplus. Similarly, while fiscal polarisation is ripe within ECOWAS; in Europe “the vital role of the European Investment Banks (EIB) in developing the European Single Market and the establishment of Euro as the single currency” Alcock et al., (2000, p. 315) give Europeans multinationals and their agencies upper hands in any economic transactions. Ultimately, African producers are economically subjugated, exploited, alienated and rendered vulnerable. Although ASS nations and other southern states could subject the north and their agencies to the threat of nationalisation with or without compensation, Bennett, (1995, p. 282) cautions that “this threat carries with it complex economic and political ramifications.” For example, “When Iran decided to nationalise the Anglo-Iranian oil company, the CIA in collusion with Britain instigated the coup that overthrew the Premier Mossadegh to safeguard their vested interest.” This example of Iran shows that while sovereign independent ASS states may seek protection against undesirable economic practices the reality is that most of the African nations suffer from ‘learned helplessness’ and enforced dependency which deprive them of enforcing any sanctions comprehensively. Moreover, whatever the rational that maybe given, African countries that “try to protect their markets risk international sanctions themselves” Went, (2000, p. 3). In consensus,

Ohmae, (1995) states that “national states or trade unions can do very little or even nothing.” Consequently, maintaining the status quo or the legacy of vulnerability and dependency of ASS states is economically conducive for the advancement of northern global economic aspirations. Globalisation and migration

While some will argue that the North’s phenomenon of globalisation has improved the lives of Southerners from a communication, technological and consumer perspective, as will become evident in this discourse, there are ample reasons to provide a counter argument to show that, globalisation has enhanced and perfected the tools used by the north in the exploitation of the south as never before. Like its predecessors; imperialism and colonialism; globalisation has been posited as preferential structural frameworks to economically favour the capitalist north and their multinationals. Baylis and Smith, (1997, p. 127). In consensus, Martin Khor, (1995) defines globalisation as, “what we in the Third World have for several years called colonization which allows the more efficient exploitation of the less well-off nations using technologies that automatically benefit the richest world”. For example, attracted by cheap labour and favourable tax incentives “multinational corporations based in industrialised countries are relocating productions in those countries where core rights are not respected”. Brenton, (2000). Because of their dictatorial attitude to their work force, Went, (2000, p. 95); McChesney, (1999) has described northern multinationals corporations as “unaccountable private tyrannies”. As befits such image, northern employers habitually exploit their employees as well as deny them any wages negotiating rights and trade union rights. Thus this enduring structural framework, be it informal that is constructed to economically favours north, is the norm rather than the exception. Without union rights, workers can be sacked without notice or compensation. It is this fear of losing one’s jobs that compels the employees to be irrespectively compliant. This is more so where workers are unskilled. Where economic reforms would have ensured equity in transactions between the north and south, Went, (2000, p. Xi) explains clearly why these attempts are doomed to fail on their own terms: “they are attempts to rationalise a system with an irredeemable element of irrationality at its heart.” At a more professional echelon, the process of ensuring that the south remains marginalised and dependent is achieved by

depriving her of the very elites that would have been instrument in building the south’s economy. For example, Sjoberg, (1971, p. 6) points out that medical professionals from the south end up as employees in the north to subsidise the latter’s staff short fall.( brain drain). In globalisation, Went, (2000, p. 33) points out that trade liberalisation and the internalisation of production have led to altered relationships between industrialised and Third World. These and the tendency for European multinational corporations to repatriate capital to their rich north inevitably disempowers ASS nations at any economic negotiation table.

Consumerism In today’s globalised society, the comodifications of consumables are directly a factor of the exposure they received from advertisements. The proliferation of advance technologies especially the internet and the northern professionals’ know-how have favoured and enhanced their economic quest to socialise the south into nations of passive and preferential consumers of northern goods and ideologies. The global ‘cocacolisation’ and ‘MacDonalisation’ of these northern brands are circumstantial evidence that northern multinationals are increasing turning the south into areas of passive consumerism, while local products are shunted. Holistically, while northern economies are structured to benefit from their globally privileged economic position, in the south they prevalently “create demands inappropriate to national needs and divert resources from enterprises more basic to development.” Bennett, (1995, p. 284). Within the current global economic structures where profit-making seem to invade every orifice of the north’s transactions with the south, they tend to socialise the former into passive consumer is an enduring legacy that is there to stay. According to Bennett, (1995,p. 284) “local governments are no match for the bargaining power of the developed states whose means for rewards and punishment are formidable”.


Dependency and debts servicing

The dependency theory on international relations premises that, “if we have powerful economic actors, which can profit by using their monopoly or near-monopoly power to enrich themselves, then they will do so, even if it means keeping the poorer countries poor” Nicholson, (1998, p. 102). Applied to the north-south economic relationship, the south, especially Africa, far from developing under the impact of northern capital, will remain in a subordinate position purely in the service of the richer economies of the north, thanks to the way northern economic expansions can influence policies. Thus, so long as Europe ensures that ASS never attends the level of economic competence that would enable equity in competition, the former will always dictate economic tunes reciprocal to their economic vested interest. Nowhere is this more evident than in the management of third world debts; manufacturing industries and capital investments. Structuring northern economic to exploited the south on facilitated by the fact that the latter rely for “foreign exchange on primary export of single commodity that is either an agricultural product or an unrefined mineral” Bennett, (1995, p. 298). The repatriation of profit from extractive industries, plus the problem of servicing debts leaves little investment income within ASS for economic growth. In fact, “rescheduling of debts payments were accompanied by stringent conditions of austerity and reform measures imposed by the IMF and others.” Bennett, (1995, p. 292-293). In manufacturing, the north has consistently exploited the lack of professionalism in ASS. For example, in the Cameroon-Chad pipeline project, the technology and expertise that is cheaply exported from France in many cases have proved inappropriate for underdeveloped economies; they have to depend on expatriate know-how for their effective operations. As a structured occurrence to create and perpetuate economic dominance of the south, Bennett (1995, p. 300) points out that “without skills and knowledge amongst the general citizenry... economic development is marked by undue reliance upon nonindigenous personnel in managerial positions, especially in the economic structure”.

This trend is widespread today under globalisation where the South produces cheap primary products like cocoa beans which are exported to the North, where they are processed or converted into manufactured goods like chocolate then re-exported to the South with value added. The north sustains this legacy by limiting the capital needed to set up comprehensive manufacturing enterprises. ‘Compliant’ rather than ‘competition’ seem to be the economic motto; “those who want to attract capital or investors on the global market have to adapt to the demands and wishes of the supplier of capital, otherwise the party is off” Went, (2000, P. 26). In cases where the host countries threaten the multinationals, the preferential global economic structures mean that the latter can relocate their production or investment elsewhere. The increasing accumulation of capital and power has concentrated excessive and uncontrollable power in the hands of multinationals like the pharmaceutical companies “whose veto can be enough to hold up all sorts of political decisions.” As such, the health of the south which is a determinant of a successful economy is also a factor of profit-oriented policies; influenced by the vested interest of the pharmaceuticals. Thus the European sales of generic as opposed to designer drugs, or dumping drugs hitherto banded in the north to African countries are economic arrangements whose legacy serves the vested interest of the north. Consequently, nation states of ASS do not develop or are held in a semi state of developing because their position within the global economy is very convenient for many vested interest groups in the north. It is therefore plausible to infer that, by being forced to adapt their macroeconomics, fiscal and monetary policies to northern market demands as a consequence of the enforced dependency culture, this lopsided economic structure favours the Europeans.



Analysts have consensually cited European government’s habit of subsidising failing enterprises as disadvantageous to African companies who comparatively experience unfair treatment and competition. While in Africa failing companies die a slow and painful death, recently in Britain, the Government had to use the tax payer’s money to rescue Northern Rock. Rover earlier enjoyed a similarly treatment. In agreement, BIS, (1994) says the EU has structured her economy to enable international mergers, takeovers and direct foreign investment” so safeguard them against bankruptcy or insolvency. The EU’s Common Agricultural Policy to buy excess products at a competitive rate, while levying tariffs on products from the south have colluded with other factors to favour the north in economic transactions. In 1974, increasing concerns to the UN about the price of raw material and development compelled the “group of 77” “led to the demand for a New International Economic Order (NIEO) based on equity, sovereignty equality, interdependence, common interest and cooperation among all states” Bennett, (1995, p. 311). Dominated by the lessdeveloped nations who felt that economic transactions favoured the north, they pressed hard for a radical restructuring of the global economic system to address what they saw as inequalities and injustice. Within the context of northern vested interest, these demands threaten their economic welfare and as typical of the asymmetry in capitalism, they work to prevent any progress. Amongst other demands, a Charter of Economic Rights and Duties of States asserted the right of each nation to exercise exclusive sovereignty over its wealth and natural resources and to regulate foreign investments. Other demands called for the formation of producers’ associations and the establishment of “linkage between the prices of exports of developing countries; the price of imports from developed countries and the restructuring of the economic sector of the United Nation System” Bennett, (1995, p. 311). If this succeeded, the north and its multinational corporations would have lost their enduring legacy of exploiting the

south. Needless to say these provisions were not only vigorously opposed by representatives of the developed market economies, the south’s comprehensive lack of means to enforce their demands and the corresponding concerted inactions by the north meant that by the 1990s the dream for a NIEO had been vanquished. In colonialism, imperialism and globalisation, remunerative and stable prices for the south’s primary commodities which constitute their primary source of foreign exchange can spell the death of most northern economic ventures. As an economic safeguard, the operational structure of the north is preferentially constructed to prevent this happening.

Ecology Historically, Africans have depended on the forest through subsistence practice for their survival using crude and rudimentary technology. The onset of the industrial revolution in Europe and the arrival of the extractive and exploitative northerners in Africa have exerted irreparable negative repercussion on Africa’s biosphere. Despite persistent protests by the indigenes; their governments including NGOs like Green Peace, the vested interests of the north and their multinationals have always prevailed. Went, (2000, p. 39) points out that “under capitalism, rather than ecological concerns, the north’s only criterion is what is rational and profitable from the standpoint of their own narrow interest”. The political, fiscal and economic structure in the north enables her to overlook southern ecological and concerns as well as global warming resulting primarily from northern industrial activities. The economic and health ramification of the north’s ecological exploits in ASS colludes with other factors to diminish the latter’s ability to bargain on equal terms within the global economies. Northern economic policies are either directly or indirectly structured to maintain this legacy in view to profiting through the exploitation Africa’s resources.



Economic and political mainstreams presume that under the current economic structure of globalisation “everyone would gain in the end from free trade movement of capital and international markets and companies.” Went, (2000, p. 24). Assuming that everyone in this instance includes ASS, then her disadvantaged position in north-south economic transactions may be evidence that ‘that end is a long way away’. Moreover, the economic structuring under globalisation is said to be the result of powerful governments like Great Britain and United States; “Pushing trade deals and other accords down the throats of the world’s people to make it easier for corporations and the wealthy to dominate the economies around the world.”

McChesney, W. (1998, p. 13) Thus if the principal architects of northern economic structuring are the masters of corporation that “control much of international economy and have the means to dominate policy formation as well as the structure of thoughts and opinion” McChesney, (1998, p. 13) it is plausible to infer that, so long as capitalism in the guise of globalisation endures, ASS nations will always be economic victims e.g. being exploited through non-negotiable low wages and lack of Unionship in corporate relocation. A counter argument may point to the fact that in economic relocation, the home countries like the UK also suffers negative repercussion like unemployment and loss of income through loss taxes. Bull and Watson, (1984); Jackson, R. H. (1997) ultimately, this will put increasing pressure on the welfare system with far-reaching economic ramifications. Similarly in mitigation against European unfairness, Deacon et al., (1997) seeks to spread the blame by saying that we must also “be aware of the increasing importance of international and global actors such as the World Bank or IMF and their efforts to regulate world economics”. At a regional level, critics argue that part of the south’s

economically disadvantaged position is self-inflicted. Citing population control, Bennett, (1995, p. 319) points out that “population increases are cancelling out many of the potential economic gains of the poor countries” Nevertheless, this argument is rendered uncircumstantial since according to Eric Toussaint (1998), the way in which capital markets, multinational organisation such as the IMF, World Bank, WTO, OECD and G7 function restrict government’s policymaking abilities.” Indeed. McChesney, (1998, p. 13) says these corporations themselves are effectively totalitarian organisations, operating along nondemocratic lines.” Even where GATT would have been expected to ensure equity in economic transactions between African economies and Europe, Bennett, (1995, p. 290) stressed that “many policies of the European Community (EU) conflicts with GATT aims. These include the protection of farmers through a common Agricultural policy (CAP) and external trading preference system with developing nations.” Thus within this totalitarian economic framework, it is inconceivable to expect ASS to be accorded equity at any negotiation table. In any such transactions, neo-liberals argue that, “rather than the economic welfare of the people, the North’s policies are constructed to ensure that the vulnerable cows barely exist to provide milk for the master’s table. Khor, (1995). Within this context, it is plausible to infer that, the north’s economic policies are structured to sustain a horizontal rather than vertical progression so that ASS barely exists to service the north’s economic needs. In north-south economic relationships where actions and inactions can be judged as increasingly irrational, Joseph Schumpeter remarked that: “just as you can’t restore the health of someone who’s been run over by a truck by having the truck run him over in reverse, you can’t restore an economy to health by reversing poor economic policies” Marglin and Bhaduri, (1991, p. 184), it will take much more than turning back the economic clock or restructuring of the north’s economic decision-making mechanism to accord the south economic equity with their northern counterparts.



Preceding analysis suggest that, as typical of a “capitalist society where economic policies are primarily profit-oriented” McChesney, (1999); Soros, (1998), current northern economic structures under globalisation and hitherto under colonialism and imperialism are constituted to favour the northern owners of capital. Toussaint, (1998). Nevertheless, simply attributing the south’s economic vulnerability solely to economic factors is not only contentious and problematic, but erroneously subjective since “economic restructuring in a sense cannot be separated from politics and social matters.” Crokatt, (1995); Bennett, (1995, p. 288). While the ideology of ‘free trade’ or trade liberation under globalisation is contentiously perceived as beneficial to all, Went, (2000), MacChesney warns that; “freedom without opportunity is a devils gift, and the refusal to provide such opportunities is criminal.” However, the structures of the north’s actions or inactions within the global economy are irrespectively judged right and appropriate for the south by default. Moreover, the problem with economic unfairness is that
it can be manipulated, reshaped and moulded in the desired context to serve any purpose not just deprivation in the South”. Despite the technological, health and educational gain by the south, the fact remains that, so long as the globalised world remains under the yoke of capitalism with profit through exploitation as the north’s objective and process respectively, northern economic structures will always be constructed to favour their vested interest in the south.



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Imperialism. The political and economic domination of one country, or countries by another, which leads either to alien rule imposed by force, or economic domination and exploitation. Jary and Jary (1995,p. 309).

Colonialism: the political rule either directly or indirectly, of one society, country or nation over another. Jary and Jary (1995, 95)

Globalisation; the tendency for worldwide diffusion of cultural patterns. Jary and Jary (1995, p. 267)

Learned Helplessness: the inability of a person to act in situation where they have learned previously that they will have no control over the outcome. Pierson, ( 1999, p. 201) Thomas and


ASS: Africa South of the Sahara BIS: Bank of International Settlement CAP: Common Agricultural Policy. ECOWAS: Economic Community of West African States. EIB: European Investment Banks EU: European Union G7: Canada, France, Germany, Italy, Japan, the UK and United States. GATT: General Agreement on Tariffs and Trade. IMF: International Monetary Fund NGOs: Non-Governmental Organisations. NIEO: New International Economic Order. OECD: Organisation for Economic Cooperation and Development. WTO: World Trade Organisation