Aid, Debt, and Foreign Direct Investment

When African countries achieved political independence in the late 1950s and 1960s, their citizens had high expectations. They had been promised by the nationalists and the emerging political class that the departure of the “colonial masters” would herald a new era of economic prosperity, opportunities, and better future. Prime Minister Kwame Nkrumah of Ghana proclaimed in 1959 that “We shall achieve in a decade what it took others a century … and we shall not rest until we demolish these miserable colonial structures and erect in their place a veritable paradise” (Nkrumah, 1957, quoted in Ayittey, 1999, p.7). Chief Obafemi Awolowo, a leading Nigerian nationalist and frontline politician, said that if elected Nigerian president, he would build a Disney World in Nigeria. The new political leaders were very resolute about what they intended to accomplish: an industrial economy, educated population, and modern society. In their attempts to promote economic development, postindependence African leaders faced the onerous task of mobilizing development finance, without which their aspirations would be a mirage