By Emmanuel Mwamba
Neo-liberal Polices Vs Development Economics
While it’s important to note that the effectiveness of economic policies can vary depending on specific circumstances, here are five arguments that proponents of developmental economics we make in favor of the approach over neoliberal policies especially pursued by the UPND:
1. Inclusive Growth: Developmental economics often prioritizes inclusive growth, aiming to reduce income inequality and improve living standards for a broader segment of the population. Neo-liberal policies, on the other hand, promote private and corporate driven economy. This usually leads to benefits of economic going to a few, making billions for owners of enterprise while leading to income disparities and high unequal society.
2. Industrialization and Diversification: Developmental economies often emphasize the importance of developing domestic industries and diversifying the economy. This can help reduce dependence on foreign markets and stabilize the economy against external shocks, which may be less of a focus in neoliberal policies that are foreign and private-centric.
3. Social Welfare and Safety Nets: Developmental policies tend to prioritize the establishment of social welfare programs and safety nets, providing a cushion for vulnerable populations during economic downturns. Neo-liberal policies may be more focused on reducing government intervention in these areas.
4. Long-Term Planning: Developmental economics often involves long-term planning and strategic investments in key sectors, infrastructure, and education. This can contribute to sustainable economic growth, while neoliberal policies may focus more on short-term benefits driven by market forces.
5. Regional Development: Developmental economics can promote regional development by directing resources to less developed areas, reducing regional disparities. Neo-liberal policies may not always address regional imbalances effectively.
It’s important to recognize that the effectiveness of economic policies depends on the specific context and implementation, and there is ongoing debate about which approach is best.
Different countries may adopt elements of both developmental and neoliberal policies to achieve their economic goals.
THE ASIAN DEVELOPMENT MODEL
The Asian developmental model may be considered advantageous for Africa compared to the Western model for several reasons:
Contextual Relevance: Asian countries, such as China, India, Malaysia, Singapore and South Korea, have experienced rapid economic growth and development in recent decades.
Their experiences may be more relevant and relatable to African nations, given similar historical and developmental challenges.
State-Led Development: Many Asian countries have successfully employed state-led development strategies, where governments play a central role in economic planning and investment.
This approach can be effective in addressing infrastructure gaps and fostering industrialization, which are critical for African nations.
Emphasis on Manufacturing: The Asian model often emphasizes building a strong manufacturing base, which can create jobs and increase export opportunities. This focus aligns with Africa’s potential to develop manufacturing industries and reduce dependence on raw material exports.
Infrastructure Investment: Asian countries have invested heavily in infrastructure projects, such as transportation networks and energy generation. These investments can improve connectivity within Africa and facilitate trade and economic growth.
South-to-South Cooperation: African countries may find it easier to collaborate with Asian nations due to shared development experiences and similar challenges. South-to-South cooperation can lead to technology transfer, investment, and knowledge sharing.
Long-Term Perspective: Asian countries have often pursued long-term development strategies with stability and continuity in government policies. This approach can provide a sense of stability and predictability for investors in African economies.
Learning from Mistakes: Asian countries have learnt from their past mistakes and adapted their developmental models accordingly. African nations can benefit from studying these experiences and avoiding common pitfalls.
It’s important to note that there is no one-size-fits-all approach, and the suitability of any developmental model depends on a country’s specific circumstances, resources, and governance.
We may consider elements of both Western and Asian models to design a development strategy that best suits us.