Forget (almost) everything else. The trouble with African economies is simply and squarely the lack of property rights protection. It still beats me why the African political elite have failed at instituting even intra-elite property rights protection. The fact that the African political elite – who also happen to be the wealthiest people on the Continent – cannot invest in their own countries has resulted in massive capital flight. The quote below says it all.
Speaking at the New Partnership for African Development (NEPAD) meeting in Abuja, Nigeria, in December 2003, the former British secretary of state for international development, Lynda Chalker, noted that 40 percent of the wealth created in Africa is invested outside the continent.
And this is only what gets counted. Although obviously the upper bound, recent revelations of Mubarak’s wealth (between 20 -70 billion) may be an indication of the amount of personal wealth stashed overseas by long time autocrats like oil-rich Angola’s Edwardo do Santos, Equatorial Guinea’s Obiang’ and Sudan’s Bashir, among others.
The contrast is that:
In corrupt societies in Asia, such as Indonesia, Bangladesh and Pakistan the citizens still prosper because the corrupt elite keep their money at home. They invest in new mobile phone network, build private hospitals and tourist hotels (here).
In short, elite political instability and distrust in Africa is one of the key reasons why the region remains poorer than any other in the world.