Imperatives for getting cheap export mining and agricultural inputs were the driving motive behind colonialism and more recently the Lome Convention. The threat of an unprecedented financial crisis due to excess Eurodollars in Western banks prompted Western powers to promote dramatic lending policies that are responsible in great part for Africa s debt burden. Skyrocketing international commodity prices created unequal terms of trade at the expense of Africa. The need for outside markets, cheap labor costs, and easy circulation of trade and investment across borders is responsible for intensified privatization measures. Indeed, both the World Trade Organization and the Africa Growth and Opportunity Act, with formal rules and enforcement mechanisms, aggressively promote these policies to support the hegemony of transnational corporations.
Privatization essentially supports mergers and acquisitions.
Privatization initiatives in Africa are mostly direct transfers from State monopoly back to the monopolies of former colonizers, boosting corruption in the process, usually through the enticement of government officials. For example, privatization of utilities services like water, electricity, education, health or transport are a disaster. The rationale behind privatization includes promoting efficient management. In fact, African consumers experience a worsening of service delivery, more distortions, shortages and price increases. In addition, workers are unhappy because jobs and social security are shattered while expatriates with huge salaries are being hired.