Government Failure in Africa, Part II
When writing about economic policy of African nations, I'm usually worried, sometimes mixed, and occasionally hopeful. Overall, however, the continent is a mess, as described in Part I of this series. To start Part II, here's a video discussion between John Stossel and Magatte Wade. The video has lots of grim news. Sadly, however, it…
August 16, 2026 byDan MitchellWhen writing about economic policy ofAfrican nations, I’m usuallyworried, sometimesmixed, and occasionallyhopeful. Overall, however, the continent is a mess, as described inPart Iof this series. To start Part II, here’s a video discussion between John Stossel and Magatte Wade. The video has lots of grim news. Sadly, however, it may be too optimistic. Here a chart from themost-recent editionofEconomic Freedom of the World. The most economically repressed region of the world is sub-Saharan Africa. Though at least there’s been some modest improvement in economic policy this century. Not all African nations are equally bad. Here’s a map showing which nations have mediocre policy (green), bad policy (orange), and terrible policy (red). Most problems in African nations are self-inflicted, but western nations add to the continent’s misery. Food aid (like free shoes discussed in the video) hurt local farmers. Foreign aidsubsidizes bad economic policyand isfuel for corruption. International bureaucraciesrelentlesslypushforhigher fiscal burdens. Trade barriers in other nationslimit opportunitiesfor African businesses. I’ll close by highlighting another problem for Africa, which is that French bureaucrats want to make a bad situation worse. Here are some excerpts froman articlepublished by France’s foreign aid bureaucracy. Across the continent, millions of workers toil under the taxman’s radar, and are deprived of the social protection that depends on tax revenues. Africa has the lowest social protection coverage in the world (17% of the total population, against a global average of 47%). Yet such coverage is crucial for tackling inequality on a continent with seven of the ten most unequal countries in the world. …When it comes to redistribution, Morocco, South Africa and Tunisia are among the countries that serve as a model. In 2020, social security contributions accounted for 10% of Tunisia’s GDP and 6. 6% of Morocco’s GDP, in contrast to the average of 1. 5% for 26 of the 30 African countries for which data are available. …“If all African countries taxed like Tunisia, the continent would bring in $500 billion of additional revenue per year, or 2. 5 times more than the $194 billion of additional annual funds the continent needs to achieve the Sustainable Development Goals,” says Sébastien Markley. The notion that South Africa is a model isabsurd. Almost as absurd astaking economic advice from France. Moreover, the last thing the continent needs is for corrupt governments to drain another $500 billion from an already-beleaguered private sector. Though the French bureaucratsaren’t alonein pushing theridiculous theorythat you get more growth by imposing higher taxes and increasing the burden of government spending. What Africa needs isMilei-ism, not statism. P. S. Africa is home to arather strange memberof theBureaucrat Hall of Fame. Posted inEconomics,Free Markets,Government Inefficiency,Government intervention,Regulation,Statism| TaggedAfrica,Economics,Free Markets,Government Inefficiency,Government intervention,Regulation,Statism| Leave a Comment