[Marxism] Jeffrey Sachs: "China a model for Africa" (MH)

[Walter Lippmann]

(While not a socialist in any sense of the term, Sachs recently
seems to have learned something from the social dislocation that
has come about in light of the privatization of Eastern Europe
and the former Soviet Union. The extreme worship of all things
"private" is Bush's mantra. It's surprising to find anything 
positive being said about China in the U.S. media these days 
as China has begun to be targeted as the big bad wolf of the
present conjuncture, momentarily ahead of Russia, Venezuela's
Hugo Chavez and even Fidel Castro. Yes, Fidel has more seniority
in the "being hated" department", but China is targeted today.)
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MIAMI HERALD
Posted on Sat, May. 26, 2007
http://www.miamiherald.com/851/story/119427.html 

China a model for Africa
BY JEFFREY SACHS

The China Daily recently ran a front-page story recounting how Paul
Wolfowitz used threats and vulgarities to pressure senior World Bank
staff. At the same time, while the Wolfowitz scandal unfolded, China
was playing host to the Africa Development Bank (ADB), which held its
board meeting in Shanghai. This is a vivid metaphor for today's
world: While the World Bank is caught up in corruption and
controversy, China skillfully raises its geopolitical profile.

I had the chance to participate in high-level meetings between
Chinese and African officials at the ADB meetings. The advice that
the African leaders received from their Chinese counterparts was
sound, and much more practical than they typically get from the World
Bank.

Chinese officials stressed the crucial role of public investments,
especially in agriculture and infrastructure, to lay the basis for
private-sector-led growth. In a hungry and poor rural economy, as
China was in the 1970s and as most of Africa is today, a key starting
point is to raise farm productivity. Peasant farmers need the
benefits of fertilizer, irrigation and high-yield seeds, all of which
were a core part of China's economic takeoff.

Two other critical investments are also needed: roads and
electricity, without which there cannot be a modern economy. Farmers
might be able to increase their output, but it won't be able to reach
the cities, and the cities won't be able to provide the countryside
with inputs. The officials stressed how the government has taken
pains to ensure that the power grid and transportation network
reaches every village in China.

Aid offered

Of course, the African leaders were most appreciative of the next
message: China is prepared to help Africa in substantial ways in
agriculture, roads, power, health and education. And the African
leaders already know that this is not an empty boast. All over
Africa, China is financing and constructing basic infrastructure.
During the meeting, the Chinese leaders emphasized their readiness to
support agricultural research as well. They described new high-yield
rice varieties, which they are prepared to share with their African
counterparts.

All of this illustrates what is wrong with the World Bank, even aside
from Wolfowitz's failed leadership. The bank's failures began in the
early 1980s, when, under the ideological sway of President Ronald
Reagan and Prime Minister Margaret Thatcher, it tried to get Africa
and other poor regions to cut back or close down government
investments and services, leaving impoverished peasants to fend for
themselves. The result has been a disaster in Africa, with farm
productivity stagnant for decades. The bank also pushed for
privatization of national health systems, water utilities and road
and power networks and grossly underfinanced these critical sectors.

World Bank off track

This extreme free-market ideology, called ''structural adjustment,''
went against the practical lessons of development successes in China
and the rest of Asia, which demonstrate that public investments -- in
agriculture, health, education and infrastructure -- are necessary
complements to private investments. The World Bank has wrongly seen
such vital public investments as an enemy of private-sector
development.

The good news is that African governments are getting the message on
how to spur economic growth, and they are also getting crucial help
from China and other partners that are less wedded to extreme
free-market ideology than the World Bank. But the Wolfowitz debacle
should be a wake-up call to the World Bank: Only by returning its
focus to practical development strategies, can it do justice to the
bold vision of a world of shared prosperity that prompted its
creation after World War II.

Jeffrey Sachs is Professor of Economics and Director of the Earth
Institute at Columbia University.

C2007 Copyright: Project Syndicate