Laissez-Faireism for Africa?

There are fads in development economics, 1 and the latest today, at least in the North, is what may be called laissez-faire ism. This states the belief that a retreat from government activism in economic affairs is the major means of improving the quality of a country's performance. It is seen as ‘central to the solution of a lot of the problems we see around the world’. 2 Such a strategy stresses the benefits of reliance on markets, on profit incentives, and on the growth of private sectors. Free-market pricing is crucial not only for products (in Africa, particularly agricultural products), but also in factor markets and in international transactions. Wages should be allowed to find their own level, as determined by supply and demand. Exchange rates should also be permitted to approach their natyral levels, for artificially over-valued exchange rates are especially damaging. Tariffs and other forms of protection should be cut back. Countries should turn away from inward-looking import-substitution towards outward-looking export-orientation. 3