Sustainable Livelihood Literature, inspired by the works of the Nobel laureate Amartya Sen clarified the economic approach of vulnerability as “the likelihood of loss of well being due to a combination of risks…”, following Mike Davis term of “semi-proletarianization”. The resultant effect of rapid economic integration of great subsistence peasantries of Africa into the world market was the creation of surplus population lacking existential means of survival. This had greatly increase inequality in the global economy, depicting a major failure of the process. Therefore this seemingly intractable and continuous gap between the rich countries and the countries of the “south” had generated a lot of scholarly debates.
For our purpose here, the article would attempt a way of empowering the local organization to engage in the process of globalization in order to minimize the socio-economic vulnerability of the “locals”. In other word, it would identify the means by which Sub Saharan African countries can benefit in the global economy. This would be access against the backdrops of the risk people of this region are prone to in the process and how local organization can be empower to reduce the vulnerability. Can the vulnerable in Sub Africa be made to benefit in the process rather than been at the receiving end? Are there organizational capacities to engage favorably in the globalization process? How should local firms and/or organization compete favorably in the continuously expanding global markets? Can the state of the region be pro-active rather been passive in the global arena? These are some of the major issues that this essay would attempt to critically examine.
The risks associated with the process emanates as social and economic space of countries continue to transcend their boarders. On this basics, the rich country of the “north” are able to cut-across their economic and social-cultural space. This makes poor/developing countries to be susceptible to the economic, social and cultural myth of the west. Competition became the order, and local organization cannot meet-up with efficiency and effectiveness of foreign firms due to capital and technology superiority. Therefore, widespread job-cuts became common; and ranks sizing and downsizing became a popular term among local organizations.
This follows that the process of globalization exposes developing countries to likely economic recessions. It in turn leads to increased social and economic inequalities in the distribution of wealth. Critics of the process had described it as leading to an explosive growth in inequality. Mike David made reference to the IMF/World Bank Structural Adjustment Programme (which is associated with globalization) as primarily responsible for “increase in urban poverty, increase exclusion and inequality and weakling urban elite… ” Jan Aart Scholte refers to it as the “the pain of global restructuring”. Importantly, the process is bringing in a new way of division of labour; the debt of work redefine and its consequential mass production with resultant effect of structural unemployment in Africa. What comes to mind here is if Sub Saharan countries have the substantial capacities to govern global economy in order to minimize the risks it posed. In actual fact, globalization process moves beyond the global economic integration and has taking world politics from the state-centric, sovereignty based model of governance to a more multilayered system. The implication of this to Sub Saharan African countries was that they are gradually loosing the control of territorial and economy space. In other word, they have been reduced to mere regulatory bodies for sustenance of the process.
In the light of the implication of the risk posed by globalization process, large numbers of people are insecure. Ulrich Beck argued that globalization could be seen as modernization of modernization that replaces industrial society with a risk society riven by insecurities. As stated earlier, the vulnerable are the insecure and in most cases are not benefiting from the process. The informal sector of the economy is always the most venerable. And considering the fact that large number of people still survive through the informal sector of the economy in this region implies that the process would have considerable effect both positive and negative on the people. In consequence, the process has tended to reduce their standard of living of large number of people from this region. In the case of corporate organization, local manufacturing firms are producing below capacity in the face of competition. The former World Bank director, Joseph Stiglitz had once stated that the unfair trade liberalization has forced many poor countries to compete with highly developed and industrialize American and European countries. From the foregoing therefore, this write-up would delve into analyzing some specific and cogent ways for countries in Sub-Saharan Africa to engage effectively in the process. Essentially, the analysis would be narrow down to policies adjustment by which Sub-Saharan countries and local organizations need to concentrate upon in order to benefit in the contemporary order.
Engaging the Locals:
This section of the essay would make an elaborate explanation on ways local organization can be effective and benefit in the face of the global competition. Attention would be place on human capacity development and utilization, nature and composition of the work place and work force, economies of scales and technology acquisition.
The rapidly changing work place had necessitated the need to move from the traditional state-centric approach of work to work base training in organization. African government and indeed locally based organization in South Africa need to concentrate more on training and development of labour. This would enable the workforce to meet-up with technological advancement and contemporary methods of task execution. It would facilitate high-skill labour and man-power in various sectors and the consequential attainment of product quality to international standard. Work based training, though might lead to hard employment practices as argued by Geoffrey Woods. However, one cannot underestimate the strength of active, efficient and highly skilled work force in the globalization process. The much celebrated Chinese economy growth within the confine of the contemporary world order could be traced to its strong work force. In fact, a company which fails to have a coherent training strategy put itself in a position of dependence on external labour market and hence have very limited chance in competing in the process.
Another point in mind is the need of Local organization to improve on the nature of work place to meet international standard. The nature of work place is continuously transforming in consonance with globalization. Locally situated organization in Africa should not be found wanting in this regard. The parameters of work should be well defined and fit to the evolving nature of work place using sophisticated and advance technology. In essence, the identification of individual workers to a particular occupational task should be replaced with a more flexible work base environment. This has a lot to do with workers training and identification of prior experience rather than placing emphasis on qualification. Flexibility in all ramifications is an important aspect of current globalization, since technology development is not static. Also, the role of labour union in this context should be well defined. They need to be aware of current trend in technological innovation, canvass for it acquisitions and emphasized on labour training and development.
Traditionally, labour union has been more pre-occupied with salary increases, promotions and benefits alike. In this era, labour struggles should forthwith include pressuring the management to acquire the necessary technology to be able to fit into the globalization process. We are in a post modern era; therefore all forms of conventional approaches to issues should be changed in Africa. This would make Sub-Saharan Africa and indeed South Africa to compete favorably.
Local manufacturing companies cannot compete favorably without enlarging their production capacity and market base. A radical approach to locating new market source is very important. This would enable them to benefit from the principles of economy of scale which include but not limited to bulk buying of materials, managerial specialization and accessing all avenue to advertise their product globally. This would improved their competitiveness and bring benefits to the firm on the long run. And importantly, local organization should endeavor to acquire modern technology for cost effectiveness and efficiency.
Role of the Government:
Classical economist such as Adam Smith has argued that a nation would be better off if she concentrate it efforts on the products she has comparative advantage. The point I am trying to drive at is that Sub-Saharan Africa countries should concentrate on labour intensive product such as textile and Agricultural produce; since there is abundance of cheap labour around, cost of production is going to be minimized and firms can compete in the global markets. The role of government therefore is to provide appropriate policy framework and level playing ground for all companies involve in the sector. Good policies framework would eventually creates several opportunities and capabilities for local firms to thrive within the global market. Jagdish Bagwati stated that protectionist policies would improve nation economy. He argues that European and American countries still maintain protectionist policies by subsidizing production in aerospace, electronics, steel and agriculture.
In essence Sub-African government should still maintain protectionist policies in some areas where it is most needed. The Sub continent should operates with multiple strategies of coping, in order to develop the informal sector to deal with the risks. Also, the sub continent must make use of the opportunity provided by the process, and making the best use of western scientific knowledge through acquisition and technology transfer. It is very important for the countries of the region to provide safety nets.
World Bank has identified the need for these more than five years ago. In its report of January 24, 2001; the global bodies canvass for the improvement of social safety net and in fact make it permanent in developing country. It is the responsibility of the government therefore, to put in place appropriate policies and implement it to the later. There should be such arrangement as mutual community support; market base arrangement like giving low interest loan to Small and Medium Scale Enterprises (SMEs) and of much great significant is social benefit to the vulnerable. Self employ and rural dwellers should also be coved by the government safety net.
Conclusion:
It is important to understand that all the aforementioned are only achievable under a good and responsive government. The benefit of globalization is open to all countries; it is now left for each to take up the opportunity provided by the process. South Africa, for now, is the only efficient sub Saharan country tapping into the opportunity. The need to have mutual goal in the negotiation of international trade regimes, that is WTO should be emphasized. Sub Saharan African countries needs to move beyond exportation of raw material to feed industries in Europe and America to major exporter in manufacturing produce. Africa Growth and Opportunity Act (AGOA) have not been exploited by the countries in the sub continent. The Act opens arrays of opportunity to eligible sub Saharan countries to tap into the United States Market in such area as textile product. It allows for zero import duty for product from the sub continent under the Generalize System of Preference (GSP). Majority of this country are presently in slumber, and they need to wake up in order to reap the benefit of the process. New partnership for African Development (NEPAD) is a good framework for the continent to reap the benefit of globalization. If the countries of the region implement NEPAD to the later; significant benefit of globalization would be reaped. Essentially, government should always make promising intervention to reduce vulnerabilities. A reduction in vulnerability is thus both an end and a means to development. Our faith is in our hands!
References:
Jagdish Bhagwati, (2002) Protectionism www.econlib.org
Jan Art Scholte (2000) Globalization: a critical Introduction, New York, Palgrave
Joseph Stiglitz (2004) Globalism Discontents in Frank Lechner and John Boli (ed.) the Globalization Reader, USA, Blackwell
Mike Davis, PLANET OF SLUMS: Urban Involution and Informal Proletariat, New Left
Review, March-April 2004
World Bank news release, January 24 2001 Improving Safety Nets Vital For Making Globalization Work For World's Poor
Geoffery Woods Globalization and Human Resource Management
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