The heart of the system of perceived global integration called globalisation is fed by market flows which include the flow of labour. Professor Joseph Stiglitz of the Columbia University observes that globalisation is a multiple dimensional reality with several distinctive features to it. These include trade, foreign direct investment, knowledge, short-term capital flows and movements of labour.
This article focuses on the movement of labour. The talk on globalisation is usually focussed on its financial aspects that the issue of movements of labour hardly comes to the fore. Even in pressing for poor countries’ economic development the focus is more on increased capital investment, foreign direct investment (FDI) and foreign aid without a mention about the flow of labour. But given the larger differentials in returns to labour than in returns to capital it is clear then that loss of skilled labour can lead to serious economic retardation and regression. But as we shall see, there are also social, cultural and political ramifications.
But given the larger differentials in returns to labour than in returns to capital it is clear then that loss of skilled labour can lead to serious economic retardation and regression.
Over the last decade Africa has experienced a serious brain drain. Countless sons and daughters of Africa and other poor countries helped by the enhanced means of communication and transport have been crossing the seas once again in the same manner as millions of their forefathers and mothers were transported across the seas for four centuries, four hundred years ago, to go and work in Europe and in plantations in America.
We do not want to claim that the process of globalisation is solely responsible for the massive human capital flight.
It is estimated that the Trans Atlantic slave import alone accounts for a staggering 11,328,000 human beings. The Encyclopaedia Britannica puts it 15,000,000 but there are claims that numbers could be well over a hundred million.
This article sees a parallel between the movement of human labour in the 16th Century slave trade and the present massive flight of African human capital engendered by both pull and push factors of the process of globalization. We do not want to claim that the process of globalisation is solely responsible for the massive human capital flight. Of course there are issues of political governance in Africa and other economic and sociological factors, but all these are galvanised by the process of globalisation.
GLOBAL INTEGRATION
When the neo liberal agenda started to establish itself everyone in the West was talking about the coming integration of the world, the “New Economy”. It was expected that the world was becoming one global family and that the various barriers that separated nations, peoples and continents were disappearing. Indeed they have been disappearing as one culture and the powerful dominate the world but of course with serious consequences of new forms of barriers. Has the world really become an integrated whole?
From the outset we want to state that the integration of the world is far from being achieved in a world of serious and appalling intra and international disparities of north-south, rich-poor, powerful-weak, healthy-sick etc. Today there is a serious separation between the rich north and the poor south. The rich north is also referred to as the industrialized, advanced or developed world on the basis of the various criteria of development used including the huge body of intellectual and technological knowledge in form of human capital that it possesses. In the last decade the World Bank noted that what separated the developed from the developing world was not just the gap in resources but also a gap in knowledge or human capital. In the last decade it was hoped that globalisation or the “new economy” would reduce the divide between the rich north and the poor south. Alas the separation became more and more entrenched as poor Africa lost even the little it had to those who have more!
SHATTERED HOPES!
Since the 1970s, there has been increasing concern about the phenomenon of “brain drain” which is the mass movement of highly skilled labour with adverse economic consequences. The loss however goes beyond the economic realm affecting the social, cultural and political life of nations. Is there not a connection between the interconnected global economy and the increased flow or transfer of scarce human capital from poor to rich countries? There is empirical evidence that numbers of skilled Aricans emigrating to the West have been on the increase over the last few decades, the sharpest increase being recorded in the 1990s the decade of the spread of neo-liberal economic policy responsible of rapid globalisation.
What separated the developed from the developing world was not just the gap in resources but also a gap in knowledge or human capital.
As we have mentioned, there was excitement as the “new economy” emerged in the 1990s. There were all sorts of hopes raised by this excitement including the role that the integration of capital markets was to play in promoting economic growth. There was hope that increased flow of information and knowledge was going to close or reduce the knowledge gap between the developed and the developing world. There was a perceived hope for the growth of less developed nations as they benefited from their interaction with developed nations. It is clear however that globalisation has caused a serious and prolonged downturn for the global economy affecting even the powerful nations but much more the poor ones. Africa has suffered the worst setbacks let alone sub-Saharan Africa.
It is true at the same time though, that globalisation has had a positive impact in some regions or countries. Even in the hardest hit countries there are marginal pockets of benefits. The countries of south-east Asia for instance, have benefited from the free and faster flow of short-term capital and have recorded positive impacts from increased FDI. The GDP per capita in these countries has, more than quintupled over the last three decades with faster growth achieved during the last decade. This phenomenon has stunned the world of economics and is rightly referred to as the ‘Asian miracle.” In some poor countries in Africa including Zambia, Kenya, Tanzania, Uganda etc. there have been marked increases in traditional exports with increased opportunities for women.
But by and large, Africa has experienced serious economic setbacks which have resulted in high poverty levels. By the end of the last decade 340 million people or half the population of Africa, lived below the poverty threshold of US$1 a day. After a decade of strict adherence to neo-liberal policies of the IMF, the instruments of globalization, the per annum economic growth for Africa has averaged 3.9% the last four years, a level lower than the 5% percent annual level needed to prevent numbers of those living in poverty to rise. The child mortality rate in Africa is 140 per 1000 births and only 58 percent have access to safe water. The practice of austerity prescribed by the IMF and the World Bank has led to reduced spending on education and health a situation which has led to catastrophic human development conditions. It is estimated that only 50% of Africans have access to health care.
However, more characteristic of the era of globalization and of pertinence to our discussion are the lack of job opportunities as economies shrink; the massive job losses through retrenchments and the folding up of companies. Even those who remained in employment in the last decade saw their real wages plummet by over 20 percent or more while those who attempted to run business ventures saw their enterprises plunging into bankruptcy. Meanwhile, as conditions worsened in Africa doors were opening up in the developed world for the redundant and underemployed Africans. The internet, the various means of communication and of travel have all facilitated this process. There is evidence too of employment agents who go around the continent looking for trained Africans willing to work in Europe especially medical personnel like nurses and doctors.
The practice of austerity prescribed by the IMF and the World Bank has led to reduced spending on education and health
These factors have all ganged up to pull or “steal away” Africans from the other end and push them away from this end. The taxpayers sacrifice their meagre earnings for at least sixteen or seventeen years of education and training of the African child who would later be transported to where his or her presence is almost superfluous. Africa has been losing one of its scarcest and most needed resources-labour or human capital. According to economic research, this loss of skilled labour can be followed by adverse social and economic consequences. However, simply stated our hospitals have no doctors and nurses; schools, colleges and universities have no teachers and government departments do not have the needed technocrats; they have all gone grazing on the greener pastures of Europe, Australia, New Zealand, Canada and America. What about the middle class ready to take business risks of investments that bring growth as has happened in East Asia, are they there? What about the intellectual middle class needed to bring about an intellectual revolution that would turn Africa around, where are they? Let us recall that it was the intellectual movement of the Enlightenment led by intellectuals that pulled Europe out of the quagmire of the stagnation of the dark ages.
Our hospitals have no doctors and nurses; schools, colleges and universities have no teachers and government departments do not have the needed technocrats.
STARK REALITY-SOME FIGURES
Neo classical economical research has shown that loss of human capital would retard growth. Barro and Sala-I (1995) have shown that a one year increase in the education of a nation’s workforce increases the output per worker by five to fifteen percent. It follows then that a reduction in the number of educated workers would slow down economic growth. This is confirmed by recent research based on the “new growth” or endogenous growth theory. Edward Denison (1985) one of the foremost authorities on U.S. economic growth shows that growth in labour supply has contributed the most to U.S economic growth from 1929 to 1982 accounting for 32 percent contribution. He shows that two other aspects of human capital in form of education and training and technological advance have put in 14 and 28 percent respectively leaving only 26 percent as a contribution to U.S. economic growth by the growth of capital stock and others factors of production.
According to The Global Data Centre with data obtained from various primary sources like census, surveys and government and administrative data, 582,314 Africans have gone to live in the US between 1990 and 2003. Between 1991 and 2001 approximately 200,000 Africans have gone to live in the U.K. The average immigration rate to the U.K for the same period was 41,593 per year compared to less than 19,000 per year between 1980 and 1989; the years before the systems of neo-liberal policies were fully established. All these figures do not take into account Africans who have gone to work in the U.S and the U.K with valid permits but have no permanent resident status. They also do not take into account the illegal immigrants slaving away in restaurants and supermarkets as cleaners. Remember this is just two countries, there are other western countries hosting African skilled labour. Almost every urban family in Africa has a member or more living and working in Europe or America. I have at least nine well trained close relatives (brothers, cousins, aunty and their spouses) working and living in the U.K. and in Sweden.
Both the slave trade and the modern day globalization of labour involve a massive transfer of valuable human capital from Africa to Europe and America.
PARALLEL BETWEEN GLOBALIZATION AND THE 16TH CENTURY SLAVE TRADE
I am sure many would find it rather too crude and probably an exaggeration to compare the 16th Century transportation of labour and modern day globalization of labour. I put the two together because they are part of one system of western capitalistic domination and they have evolved as one process of the marginalization and “inferiorisation” of Africa. Pete Henriot traces the origins of globalization to the time of slavery. Though different in nature, the two processes are similar in some respects.
MASSIVE TRANSFER OF HUMAN CAPITAL
Both the slave trade and the modern day globalization of labour involve a massive transfer of valuable human capital from Africa to Europe and America. Slave trade grew with the emergence of the market economy that resulted in the need for transfer of labour and other factors to Europe. This is true in our age with unchecked growth of the market economy with more open labour markets engendering unfettered movements of labour to Europe and America.
WHO ARE THE MAIN ACTORS?
Let us identify the main actors. In both processes the main actors are capitalist western nations, the business barons of these nations and their African accomplices. Today with economic globalization outpacing political globalization, the Trans National Cooperations and their proprietors have more power than governments. They yield a lot of influence even on the economics of rich nations (including the U.S Treasury Department) which control the IMF and the World Bank, the latter two being the principal actors. I am sure the proponents of globalisation would say it is a matter of choice, there is no country or person being forced. But what about the conditions we have described above where are they coming from? And what about the pressure of the IMF and other rich nations on poor countries to toe the line or else no aid? The economic power of the rich nations with their influence on the lending institutions could well be equated to “gunboat diplomacy.”
There is also the question of complicity. During the era of the slave trade, chiefs and their counsellors benefited from the slave trade. They received gold, wines, perfumes, spices and other European goods in exchange for slaves. What about our African leaders, finance ministers and their governments who sign memoranda, letters of intent and other agreements- without the consent of their people? How many Africans today know the contents of the Letters of Intent and even what they look like? With the stroke of a pen ministers of finance have bound their citizens to agreements and huge burdens of debt with serious social and economic consequences. What about the benefits they get by travelling to Washington and lodging in five star hotels drinking fine wines and spirits?
Then there is the question of the recruiting agents who are making money out of the human capital transfer.
Then there is the question of the recruiting agents who are making money out of the human capital transfer. We see agents who come to African countries enticing nurses and other workers to go and work in Europe, Australia, New Zealand, Canada or the U.S. They do so even when they see children and mothers dying in labour in villages and hospitals without nurses. But how can they not do so after spending all their nights in some fine African hotels and lodges without seeing over sixty children squeezed in one classroom with an untrained teacher or members of a family in a squatter compound taking turns in taking the one meal of the day. What is their interest; can their selfish interest not be compared to that of the slave agents?
There is evidence of the mistreatment of Africans working in Europe as was the case centuries ago
THE EFFECTS
What about the effects? We have already alluded to the loss of human capital. What about the bad treatment of African migrants. There is evidence of the mistreatment of Africans working in Europe as was the case centuries ago and as reported to us by a BBC evening report of Focus on Africa of 23rd September 2005 as well as those Africans burnt to death in France. We can add too that the massive movement has the effect of separating loved ones. Families are scattered away and friendships have been separated in some cases almost for good. This is a huge loss for an African. It is sad when we visit different places where we lived and find that every person we ask about is either in the Europe, Australia, New Zealand, Canada or the U.S.
GLOBAL ETHICS AND GLOBAL ACTION
The adverse effects of the movement of skilled labour from developing to developed nations are blatantly recognisable even without looking at economic statistics and yet no one wants to put limits to the unfettered movements of labour from developing to developed nations. These effects by far outweigh the benefits Africans receive in remittances from relatives abroad. The last word we can put in for Africa is an appeal to pity and to morality. Are those with power both in the developed world and in Africa not aware of the misery that this continent is going through? Why should those who have more continue to get even the little that the have-nots have. The problems Africa is facing affect human beings and are therefore global. As such they need global and ethical responses based on social justice. The globalised world needs global action and more just global governance. For once let us allow morality to control the game rather than the market’s invisible hand that is indeed invisible and therefore not there!
Are those with power both in the developed world and in Africa not aware of the misery that this continent is going through?
Charles B. Chilufya, S.J.
Faculte de la Philosophie
Kinshasa
[This article made refences to: Joseph Stiglitz, Globalisation and growth in Emerging Markets and the New Economic in Journal of Policy Modelling Elsevier Inc., New Holland, 2003. The Global Data Centre at www.immigrationinformationsource.org. Barro, Robert and Xavier Sala-I-Martin, Economic Growth, New York: McGraw-Hill, 1985. E.F. Denison, Trends in American Economic Growth, 1929 to 1982 (Washington D.C.: Brookings Institution, 1985). Peter Henriot, S.J., Globalisation and Land Policy in Zimbabwe, a paper presentation at Arrupe Jesuit School of Philosophy, 2001.]
