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Crude Private Neo-Imperialism: A New Pattern in Africa

Published online by Cambridge University Press:  11 November 2008

Sayre P. Schatz
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Extract

This article presents the hypothesis that there has developed in Africa in recent years a group of practices which constitutes a new pattern, to be called here ‘crude private neo-imperialism’. This term refers to unprincipled exploitation by some foreign firms of African governments that establish government-controlled, directly productive enterprises in an effort to accelerate economic development. The pattern referred to is ‘crude’ in that it involves outright dishonesty or hoodwinkery. It is ‘private’ in that the exploitative practices are carried on by private companies rather than by governments (although the latter have frequently given tacit and even explicit support). It is imperialism or ‘neo-imperialism’ in that the practices constitute not simply a series of similar incidents but a general phenomenon attributable to substantial contemporary causes.

Type
Articles
Information
The Journal of Modern African Studies , Volume 7 , Issue 4 , December 1969 , pp. 677 - 688
Copyright
Copyright © Cambridge University Press 1969

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References

Page 677 note 1 This article refers only to enterprises in which a controlling interest is owned by the African government. Ventures in which majority ownership and control rests with foreign private firms constitute a different economic species.

Page 678 note 1 Langley, Kathleen M., ‘Financing Development in Nigeria: an appraisal’ (Temple University, London, 1968, mimeo.), p. 6.Google Scholar

Page 679 note 1 This is admittedly an imprecise concept; it is perhaps impossible to establish clear-cut dividing lines between sharp bargaining and the adjacent phenomena (swindling on one side and hard, but acceptable bargaining on the other). The concept nevertheless appears useful; it is frequently employed and there is wide agreement that the practice does exist.

Page 679 note 2 Contracts secured by sharp bargaining can be thought of as a refined counterpart of the protectorate-creating or concession-granting treaties inveigled from uninformed nineteenthcentury leaders in many less developed regions. ‘These treaties were elaborate documents of whose contents the chieftain was wholly ignorant and on which he saw no objection to placing his mark in return for a few European baubles. He did not know, until the foreigners moved in and began to order him about, that he had signed a document which under the incomprehensible foreign law had made his country a “protectorate” of this or that European power.’ Norton, Henry K., ‘Backward Countries as a Field for Investment’, in Foreign Investments (Chicago, 1928), p. 202.Google Scholar

Page 680 note 1 Helleiner has recently commented upon this: ‘More thought is certainly required on the means for reducing the costs to African nations of foreign management contracts…The activities of foreign consulting firms also require careful scrutiny.’ Feasibility studies required for foreign loans are ‘inevitably prepared at exorbitant cost by foreign consulatants’ and some of the work ‘is little short of fraud’. Helleiner, Gerald K., ‘New Forms of Foreign Investment in Africa’, in The Journal of Modern African Studies (Cambridge), VI, I, 05 1968, pp. 21–2Google Scholar. Incidentally, an excessive price for a feasibility study may be costly to an African government even if paid for by the aid-providing government. The latter is likely to consider the expenditure part of its total aid package, and thus that outlay would substitute for other aid that otherwise would have been provided.

Page 680 note 2 Langley, op. cit. p. 7.

Page 682 note 1 Helleiner, op. cit. p. 26.

Page 683 note 1 See, for example, Mandle, Jay, ‘Neo-Imperialism: a comment’, in Social and Economic Studies (Kingston, Jamaica), 09 1967, pp. 320–1.Google Scholar

Page 683 note 2 The problem is more complex when a domestic source can produce the item for a higher price, but the African government attributes considerable value to the external benefits of stimulating domestic production.

Page 685 note 1 ‘Research upon the details of the present terms of management contracts is urgently required. It is often extremely difficult, however, to obtain information about them. Both parties to these contracts frequently guard their terms so carefully that this alone is ground for suspicion.’ Helleiner, op. cit. p. 21.

Page 685 note 2 See May, R. S., ‘Direct Overseas Investment in Nigeria, 1953–63’, in Scottish Journal of Political Economy (Glasgow), XII, 3Google Scholar, reprinted in Whetham, Edith H. and Currie, Jean I. (eds.), Readings in the Applied Economics of Africa, vol. 1, (Cambridge, 1967), p. 84.Google Scholar

Page 686 note 1 Where private financial support for political parties is inadequate, they perforce turn to irregular public sources.

Page 686 note 2 In Western Nigeria, the urge for government supervision was strong enough to lead to the actual ‘incorporation’ of the Ministry of Trade and Industry, as a device to facilitate control by the regular government apparatus over public productive enterprises.

Page 687 note 1 See, for example, West Africa (London), 26 10 1968, pp. 1245–6.Google Scholar