The United States of Africa - Pipe Dream, or the future of the new African economy?

Business in Africa, June 2009
By Scherzando Karasu

In 1924, Marcus Garvey, the activist and poet, conjured a vision of a “United States of Africa” as the dawn of a new liberty for black people worldwide. His dream of a politically unified continent has echoed through decades of Pan-Africanist thought, inspiring movements both at home and in the diaspora.

Nearly a century later, the idea still resonates. Alpha Oumar Konaré, former head of the African Union, once declared that “the battle for the United States of Africa is the only one worth fighting for our generation.” Lofty rhetoric abounds. But how much progress has been made toward this federation of states, and what does it mean for Africa’s businesses and economies?

Old Dreams, New Realities

Talk of continental union is hardly new. The notion of integration dates back to colonial times, when Cecil Rhodes fantasised about a free-trade corridor “from Cape to Cairo.” More seriously, the creation of the Organisation of African Unity (OAU) in 1963 under Ghana’s Kwame Nkrumah gave institutional form to Pan-Africanist ideals. Yet the OAU, derided as the “Dictators’ Club,” achieved little beyond providing cover for autocrats.

The end of the Cold War, coupled with economic stagnation, prompted new efforts. The Lagos Plan of Action (1980) and the Abuja Treaty (1991) envisaged gradual integration through regional economic communities (RECs). These sub-regional blocs—ECOWAS in the west, SADC in the south, COMESA in the east and so on—were to serve as building blocks of a continental market.

Libya’s Colonel Muammar Qaddafi revived the cause in the late 1990s, pushing for an African Union with a common passport, currency and army. The AU was formally launched in 2002 with a mandate to deliver greater integration. The ambition: that an African could travel from Monrovia to Cape Town without a visa.

Progress and Pitfalls

Integration has advanced, if haltingly. In 2008, the tripartite summit of COMESA, SADC and the East African Community (EAC) announced plans for an African Free Trade Zone (AFTZ), covering 527m people and $625 billion in GDP—roughly half the continent’s industrial output. Uganda’s president, Yoweri Museveni, hailed it as a “strategic tool” for prosperity.

Yet reality bites. Africa’s intra-regional trade remains stubbornly low compared with other regions. Infrastructure is patchy, tariffs persist and borders are often shut as quickly as they are opened. Overlapping memberships of RECs add bureaucratic complexity. More damaging still, politics trumps economics: Nigeria guards its dominance of ECOWAS, just as South Africa resists diluting its sway in SADC. Few governments are willing to surrender sovereignty in the way European states did to build the EU.

Conflict also undermines progress. Somalia remains a failed state. Zimbabwe has descended into hyperinflation and repression. Sudan’s president faces indictment for war crimes. The Democratic Republic of Congo, despite vast mineral wealth, is a perennial powder keg. Even small border disputes, such as that between Djibouti and Eritrea, can derail integration efforts.

Global Lessons

Elsewhere, regional integration has reshaped the global economy. The European Union forged a monetary union in 1999. NAFTA deepened North American trade from 1993. ASEAN and Mercosur advanced in Asia and Latin America. Africa’s policymakers, eager to avoid marginalisation, hope to emulate these models. Larger markets could, in theory, attract investment, foster industrialisation and build negotiating clout on the world stage.

The economic logic is sound: trade liberalisation and economies of scale should spur growth. Integration could lock governments into more stable macroeconomic policies, foster cross-border infrastructure and encourage diversification. Yet the evidence so far is sobering. Most African RECs fall short even of functioning customs unions. Treaties are signed, but implementation is feeble.

The Long Road Ahead

Optimists argue that Africa’s small domestic markets leave it little choice but to integrate. The momentum behind the AFTZ suggests a recognition that regionalism is not a romantic slogan but an economic survival strategy. Still, progress will be slow, uneven and fragile.

The “United States of Africa” remains a distant aspiration. But the direction of travel—towards larger markets and deeper cooperation—seems irreversible. An Ethiopian proverb captures the challenge and the promise: “When spiders unite, they can tie up a lion.”

By Scherzando Karasu
March 2009

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