Introduction to economic history (Unit 3)


African Economic History

Various scholars of history have given accounts of the economic activities that occurred on the African continent and how African states interacted amongst themselves and beyond the African borders. Some of the major economic activities that are worthy of note can be traced as far back as the trans-Saharan trade and the succeeding trans-Atlantic trade (popularly known as the slave trade) which occurred before the Industrial Revolution of the eighteenth century. With the Industrial Revolution, the economy of Africa took another turn as this development ushered in the age of legitimate commerce.

In this unit, the reader should be able to:

  • Give an assessment of the economic history of Africa
  • Highlight the dynamism in the economy of the continent
  • Highlight how the respective entities responded to the economic changes.

One of the key questions in African economic history concerns the effect of the slave trade on the continent’s social, political, and economic structures. It is quite obvious that the slave trade had a negative impact on demographic growth in many regions, particularly in the short and medium term, and that this may have been on the whole detrimental for polities that were already characterised by a shortage of labour. How this affected the total population and the evolution of domestic markets has been the subject of much debate. It is generally agreed that African participants, be it states or networks of merchants, were motivated to engage in the external slave trade because they were able to realize economic gains from these transactions. An assessment of some West African states such as Asante, Dahomey, and Oyo reveals that, during the slave trade, they grew from small kingdoms to extensive imperial systems, which was largely as a result of their participation in the slave trade.

Although, Britain pioneered the abolition of the slave trade in 1807, others followed suite till the middle of the century. Britain’s declaration was accompanied by an intensified trade in slaves from some parts of the Atlantic and eastern Africa up till the middle of the century, while domestic slavery persisted in many regions into the twentieth century. Whether the closing of the trans-Atlantic slave trade led to a ‘crisis of adaptation’ as the external trade shifted to ‘legitimate commerce’ in the middle of the nineteenth century is a highly contested question. The basic reasoning underlying this claim is that the end of profitable slave exports undermined the fiscal capabilities of centralized states, and that the income terms of trade (that is, the price of exports over that of imports) deteriorated as the slave trade ended. The general consensus is that this crisis has been overstated.

The transition to legitimate trade has been described as an evolutionary, rather than revolutionary, process, though there were important regional transformations which were evident in political, economic, and social structures. For instance, in the Sokoto Caliphate, slavery for domestic production increased after the abolition of the trans-Atlantic slave trade, and this contributed to reducing the struggle towards adaptation. Coastal kingdoms on the other hand, witnessed their financial base begin to deteriorate. An example of such was Dahomey.

Slavery was the major labor force in important zones of nineteenth-century legitimate commerce such as groundnut production in Senegambia and palm oil production in southeastern Nigeria, while the use of pawned labor was important in the early twentieth-century expansion of cocoa production in the Akan forest kingdoms of the Gold Coast and the Yoruba region of southwestern Nigeria.

In eastern Africa, until the end of the nineteenth century, slave trade continued to be important for commercial exchange. This was also the case in West Africa. In southern Africa, commercial farming was implemented by white settlers whose labour force was sometimes comprised of slaves, but more often of African workers who had had their own production displaced by the confiscation of their cattle and/or land.

Consequently, the slave trade was not sustainable and increased existing problems of labour scarcity, even though within a short while it helped some states to accumulate wealth and to expand. It also provided incentives for market growth, as slave trading caravans carried other commodities for exchange and allowed for imports of currencies that facilitated domestic economic exchange.

With the abolition of the slave trade and the gradual transition to ‘legitimacy’ there was a transition to cash crop exports based on family and wage labor that lasted even through the twentieth century. In the meantime, slave labor was increasingly used in domestic economies, serving as the foundation for the cash crop revolution at the end of the nineteenth century. In the twentieth century, this explosive growth in agricultural production of goods for exports was made possible by a free labor market. The lesson from the transition to cash crops is that growth was rapid and sustained over a long period. In the period of colonialism, it is argued that the increase in financial and other resources caused widespread development, also spurring positive institutional change such as the development of markets in land, labor, and credit. Recent research indicates that in both Kenya and Ghana, living standards were increasing during this period, and that in British Africa as a whole real wages also increased in the colonial period. The rate of production in the period enabled the colonial state and its postcolonial successor to expand its revenue base.

Many strategies were employed by the colonial state which led to the formation of marketing boards, which resulted in revenue generation and facilitated the emergence of the ‘developmental state’ in the late colonial period, which continued to expand in the postcolonial era until structural adjustment policies were undertaken in the 1980s. After some two decades of general stagnation, growth returned to most African economies since the end of the 1990s.

Notwithstanding the periods of growth recorded in its history, African economies unarguably make up the majority of the poorest economies in the world. However, it is important to trace these historical events to serve as blueprint for present-day development and institutions.

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