"African economies are growing at very different speeds"

http://www.economist.com/news/middle-east-and-africa/21709218-new-numbers-imf-tell-tale-two-africas-african-economies-are-growing

The Economist 
" African economies are growing at very different speeds" -Oct 29th, 2016 

In sub-Saharan African countries, economic growth varies as you look at different regions. In Nigeria is currently experiencing a recession, but the Ivory Coast is experiencing an 8% growth rate. One of the main dividing factors contributing to this difference in growth is resources. As the prices of different materials decrease, countries that export these materials and resources are getting less money for them. Angola (rich in oil and one of the fastest growing countries in Africa) will not grow at all this year, because oil prices are lower. Commodities that are exported to China from these African countries have halved in value in 2015. Countries that don’t rely on exporting resources to grow the economy will grow at 5.6% this year according to the IMF. The lesson is that countries shouldn’t rely on commodities as their only source for economic growth, it is important to diversify. The article uses the example of East African Countries, which have created mobile banking applications to help them sell oil and gas. But it is important that these countries don’t rely soil on these resources.  In the example of Angola, dropping of oil prices lowers the growth that the country sees from exporting this commodity.

These governments don’t have control to set commodity prices. To compensate for the drop in commodity prices, Nigeria tried to higher its exchange rate, which ended up hurting their economy. Countries such as Ethiopia and Malawi, which rely on agricultural exports for income, are experiencing a drought.  This relates back to our reading by Ferraro which suggests that countries such as Ethiopia and Malawa, who make most of their money on agricultural exports, should make sure they can feed the people in their own country before exporting this good. If they are going through drought, what little crop they do produce should go to feeding themselves. Many of these countries have high rates of malnutrition even though they export great amounts of food. Dependency theorists would say that they should use the food produced to feed themselves first and find other ways to integrate into the global economy.

According to the article, growth in South Africa has slowed to almost zero. But the problem with the projected economic growth in these countries is that it is hard for the IMF to make these calculations, and determine how people will be affected by economic growth or decline.  Ferraro also brings up the point that most citizens in a country may not benefit from the economic activity that is measured. Other aspects should be measured “such as life expectancy, literacy, infant mortality, education, and the like.” (Ferraro) The IMF and the World Bank often overlook social, political, and cultural factors. All of these factors contribute to the economic state of these countries, and they should all be considered when figuring out which ways will help improve their economic situations the best.

According to the dependency theory, states should try to be self-reliant. In contrast to recommendations from the IMF and the World Bank, dependency theorist think that states should try to be more self-reliant. Greater integration into the global economy doesn’t mean it will help the economy in these countries grow. This can be seen in African countries which aren’t seeing economic growth, trying to integrate them into the world economic system we have in place which revolved around Western and Capitalist systems does not seem like the best solution to do so. It is important that underdeveloped countries have a balance between self-reliance and economic interactions with the world economy. They should support interactions that help them to improve their social and economic wellbeing (which seems difficult to do in a existing system that revolves around developed countries).

Vincent Ferraro, "Dependency Theory: An Introduction," in The Development Economics Reader, ed. Giorgio Secondi (London: Routledge, 2008), pp. 58-64