A vacuum of ideas - economic thinking in the early post-colonial era
When thinking about economic ideas and ideological biases in the early post-colonial era it is imperative to realize that there really were few or no trained economists (in the academic sense) who were part of the ruling parties or who were resident in Mozambique, apart from a very few foreigners.
Of the “33 university graduates in the whole country” at independence, none were PhD economists. Angola's ruling MPLA was similarly bereft of internal debate of economic ideas at this level. This means that economic thought as typically conceived in Western universities simply did not exist, at least not in written form.What did exist was a small cadre of revolutionary intellectuals who were schooled in Marxist economic ideology but who really did not participate in wider philosophical discussions of economic theory. Eduardo Mondlane, the father of Mozambican independence, was a sociology professor in the USA before joining the independence struggle in Africa and, before his assassination in 1969, could reasonably claim to be the most educated social scientist of the revolutionary era. Agostinho Neto, the father of Angolan independence was trained in medicine.
Insofar as these leaders and their successors followed standard Marxist economic doctrine from their Eastern Bloc supporters, they equated Portuguese colonialists with capitalists and oppressed African masses with the working class. Certainly, this was a reasonable interpretation of the facts on the ground but did not generate any question as to an appropriate course of action beyond defeating the Portuguese militarily. Sudden victory and independence in 1975 led to a situation where the victorious independence movements were thrust into de facto control of the economy and its consequent day to day emergencies, leaving theoretical debates over economics on the sidelines.
The economic vacuum created by the departure of the Portuguese settlers and the ensuing chaos left the newly minted states little option but to take over major production units such as plantations and factories.
Managing such enterprises proved more difficult given the near total collapse of economic value chains, the inexperience of new managers, and the disappearance of the old forced labor arrangements that supported the profit margins of many of these concerns. Externally funded insurrections — RENAMO in Mozambique, funded by the white Rhodesian secret police and South Africa/the USA; and UNITA in Angola, funded by South Africa and the USA as well as their own diamond mines — reduced the actual governable space to a mere fraction of the national territory in both cases with a consequent crash in economic activity (Kyle, 1990; Andersson, 1992).It could certainly be argued that the crash was a direct result not just of the civil conflict, though that would have been quite sufficient for the result, but also from the misguided attempt to exercise total economic control down to the micro level, as taken from traditional Marxist economic doctrine. Evidence for this could be seen in the virtual emptying of government- controlled marketing and distribution channels in favor of large informal markets which carried on outside of the regulatory regime. However, it was obvious in Mozambique by the early 1980s that not only was the government attempt at control failing to produce positive results, but external aid from the World Bank, the International Monetary Fund (IMF) and other agencies was conditional on a turn toward a market economy. In Angola the economic results of state control were no less obvious but impinged on the lives of the ruling elite far less due to their access to huge flows of oil revenue derived from newly exploited offshore oil fields.
The subsequent turn to the market in the 1980s∕90s in Mozambique and to a lesser extent in Angola post-2002, definitely did have an intellectual basis in economic theory but this was more imposed from the outside than arising as the result of an economic debate in the countries themselves. FRELIMO in Mozambique saw clearly that their economy was suffering and that their control apparatus was not up to the task of promoting development or growth.
The World Bank and the IMF had a clear alternative: they strongly promoted the “Washington Consensus” as laid out in John Williamson (1989). In many cases the turn to the market was simply an official recognition of ongoing commercial activity — simply allowing the “shadow economy” to be sanctioned by the government. But overall Mozambique clearly accepted the economic doctrines espoused by the donor community because there was little choice — if they wanted the aid, they needed to accept the policy changes and the ideology that underlay them. In short, they needed the money.This meant in effect a massive retreat from government control of the economy. Reduction of government barriers to international trade were very much in line with research such as that by Anne Krueger (Krueger, 1997) and others at the World Bank extolling the virtues of neo-liberal market solutions to development issues. Subsequent high rates of growth in the Mozambican economy served to justify and cement the “new thinking” in both the donor community and within Mozambique itself, at least for a time. Recently, some questions along the lines of those elaborated by Dani Rodrik (Rodrik, 2003) and others have arisen due to the very unequal distribution of growth across both space and class in Mozambique. In essence, some have benefited massively while others remain mired in poverty just as they were prior to the turn to the market in the 1990s. This remains as yet unresolved.
In Angola very similar (indeed indistinguishable) policy prescriptions were promoted with identical neo-liberal economics underpinnings. However, one major difference prevented their wholesale adoption in Angola — the government had massive flows of oil revenue and didn't need money nearly as much as their Mozambican counterparts. Certainly some degree of market opening did indeed take place at the micro level, but overall government policy has remained fundamentally unchanged — Angola is a resource-extraction-based regime and focuses its efforts on maintaining and increasing its mineral revenue.
Indeed, these oil fields contributed to Angolan elite cynicism about the motives of “development assistance,” since the lip-service given to market reforms and good governance was coupled with a willingness to countenance a bloody civil war on the continent so long as oil continued to flow. Not only that, but the ruling elite had little or no direct economic need to reform since their own lifestyle could be amply supported by oil revenues. This promoted a mindset which, unlike almost all other countries in the region, did not see the need to cater to donor wishes. In terms of outside observers, the various explanations of the Resource Curse and Dutch Disease that are associated with W.M. Corden (1984) and Richard Auty (2002), who anchored their writings very much on empirical problems and low growth encountered by oil exporting countries. Angola is often cited as a prime example of how oil money can result in “rent seeking” behavior by favored elites. This strand of the economic literature remains directly relevant in Angola and has gained a new prominence in Mozambique given the discoveries of large deposits of natural gas in the past few years.