Financial crisis impoverishing women in Southern Africa- personal reflections
How does the current global financial crisis affect nations in the Global South especially Africa? Not many neo-liberal economists reflect on the effects of such crises on the vulnerable groups, especially women and children.
Alternatives to the neoliberal framework should be sought, including elevating the role of governments to ensure that the poor are protected from the blows of the crisis, through people-centered economic policies. Only then can the Global South can really talk about real economic emancipation of its people!!
According to Joseph Stiglitz in 2008, the crisis was caused by ‘inadequate competition, inadequate incentive structures, and lack of transparency within the financial systems’, which saw multinational companies such as General Motors, Ford and others which had overproduced and speculated their profits in the housing sector, go bankrupt overnight.
Scholars such as Dani Nabudere have noted that the financial crisis started earlier, in the 1970s, when the oil crisis hit many nations in the Global South, leading them to borrow money from World Bank and IMF at lower interest rates, but they had to pay back with high interest rates.
At that point in time, US President Ronald Reagan and British PM Margaret Thatcher believed that the market ruled the economy and government was not supposed to be involved in the day to day affairs of the economy. The impact of such neo-liberal policies - known as the Washington Consensus – was increased power in the hands of the World Bank and the International Monetary Fund (IMF).
This in turn led to increased poverty in the Global South nations where public spending in education, health and social services was cut off, workers were retrenched and the foreign currency exchange was no longer under government control. Results included poor service delivery in the health, education, social services sectors, as well as in the creation of a pool of unemployed citizens, especially in Sub Saharan Africa, as the governments spent more of their resources paying off their debts to the IMF and World Bank at the expense of building their nations.
Professor Patrick Bond, among other political economists, argues that due to such neo-liberal policies, even the US and EU economies were bound to crumble with the progression of time. The crash of the Asian stock markets in 1997 led many Asian states to request assistance from the global financial institutions. Such events were an indication of worse things to come, including the crash of stock exchanges in the USA and EU in September 2008.
Southern Africa was not spared, even though some of the heads of state in the region in 2008 - including former SA president, Thabo Mbeki - stated that ‘there was no financial crisis‘. The economic crisis in the region adversely affected vulnerable groups including women.
According to Action Aid’s Resource Kit on Gender Equality, failure by policymakers in taking into account the gender dimensions of poverty and inequality leads to programmes and policies that are ineffective, at best, and harmful, at worst , for women and entire communities as well.
Agriculture in the region is the backbone of most economies and women are involved in food production at all stages, but the financial crisis forced many countries (such as Malawi) to sell their agricultural goods such as tobacco and others at a lower price. Many women were retrenched from their employment.
Zambia, Lesotho, and South Africa are some of the countries that were also negatively affected by the mining sector’s collapsed. Most workers in the Zambian copper mines were retrenched, leaving ripple effects reaching women and their children.
It is imperative for the social movements working on gender equality in collaboration with other progressive movements such as trade unions, faith-based organizations, and youth organizations in the SADC region to engage their governments to create economic policies that improve women’s and men’s lives in the face of the economic crisis and climate change.
Recall that the heads of state in the Southern African region have committed themselves to improve gender equality when they signed the SADC Gender protocol in August 2008. Prof Dani Nabudere in his lecture at the UKZN-CCS on the 6th of November, 2009 stated that the communities should form credit unions or co-operatives in harnessing resources and increasing food security, as an alternative.
The onus on addressing the financial crisis lies in the hands of the people. They should put more pressure on their governments to ensure that people’s dignity is restored, and put emphasis on people’s lives, not aimed only at accruing profits.
Other alternatives could include taking advantage of global events taking place in Africa, including the 2010 Fifa World Cup in South Africa. Southern African citizens should come up with people-centred initiatives that will ensure the African people benefit from the global event and not end up having all the profits going to international corporations such as Coca Cola, MTN, Nike, among others.
In a sub region like ours, where young women between 15 and 24 are 2.5 times more likely to be infected with HIV than young men, creating opportunities for young people to be engaged in economic activities during the 2010 World Cup is another way of alleviating poverty, and only then the dignity of African people be restored!