Ghana's new government was far more gifted at destroying wealth. Successive leaders regarded cocoa producers not as successful businesses to be nurtured but as a bank to be robbed. The government forced the farmers to sell to the state at fixed rates -- at one point a mere 6 percent of the world price.
Officials then sold the cocoa on the world market and pocketed the difference. The farmers soon quit producing, and cocoa exports dropped from 19 percent of gross domestic product to 3 percent. Today, Ghana remains poor.
Undeveloped countries are plagued with leaders who pursue their narrow interests at the expense of those who live in the territory they control. Consider one current crisis, a famine in southern Africa produced by bad weather and terrible public policy. The Malawi government, whose citizens are currently starving, actually sold 167,000 tons of emergency grain last year but can't account for the money. The agricultural sector in Zimbabwe, which typically kicks off surplus food, was decimated when President Robert Mugabe, facing a difficult election, played the race card and redistributed white-owned farms to blacks. Food production dropped 40 percent.
None of this is to say that the African leaders whom Bono and O'Neill encountered don't have legitimate beefs with U.S. and European policy. The recently passed farm subsidy bill will depress world prices of grains, soybeans, and cotton. That hits Africa's agriculture-based economies particularly hard.
Meanwhile, Ghana's finance minister points out that his country's farmers can sell all the raw cocoa they want to Europe. But if they produce cocoa butter or chocolate, they are hit with high tariffs.
The World Bank estimates that the protectionist farm policies of the developed world cost African farmers $2.5 billion a year. The U.S. lowered trade barriers to African producers last year with the African Growth and Opportunity Act. But some domestic interests, such as textile producers, are still protected.
Yet contrary to Bono and many devotees of aid, it's not the developed West that's doing the most to frustrate trade in Africa. Most African countries maintain much higher tariffs against each other than the developed world does against them. If African leaders are serious about ending poverty, they ought to get their own policy houses in order by lowering barriers to trade -- and forming governments that protect wealth rather than confiscate it.
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