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APPLES & ORANGES:
HOW GHANA‟S POLITICAL ECONOMY
TRULY COMPARES WITH SOUTH KOREA, AND BRAZIL
By
Daniels Dodzi Tornyenu, B.A.
New Jersey City University of New Jersey
A Thesis Submitted in Partial Fulfillment of
the Requirements for the Degree of Master of Arts in Political Science
to the office of Graduate and Extended Studies of
East Stroudsburg University of Pennsylvania
December 19, 2020
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ABSTRACT
A Thesis Submitted in Partial Fulfillment of the Requirements for the Degree of
Master of Arts in Political Science to the Office of Graduate and Extended Studies of
East Stroudsburg University of Pennsylvania.
Student‟s Name: Daniels Dodzi Tornyenu
Title: Apples & Oranges: How Ghana‟s Political Economy Truly Compares with South
Korea, and Brazil
Date of Graduation: December 19, 2020
Thesis Chair: Samuel Quainoo, Ph.D.
Thesis Member: Ko Mishima, Ph.D.
Thesis Member: Adam McGlynn, Ph.D.
Abstract
This paper calls for a reexamination of the standard literature why Korea successfully
used foreign aid while its peers continue to be aid dependent. My focus is on Ghana,
Brazil, and South Korea, - the most representative examples of countries which used
foreign assistance, had similar per capita gross domestic product (GDP) in the early
1960s, but which end up differently sixty years later. Salutary scholarship to South
Korea‟s leapfrog industrialization and democracy between 1962-1980 is mainstream.
Much of these unfairly presume my focus countries had identical aid flows to
industrialize. This qualitative paper reappraises the key building blocks of Korea‟s
successful development transition to clarify Ghana‟s growth collapse and Brazil‟s
delayed ascent. The paper considers the weighty broader implications of America‟s Cold
War policy objectives in addressing the replicability of the Korean “miracle” to other
countries.
DEDICATION
To my wife Ruby Bortey, my daughter Marie-Chantal Tornyenu, and my son JeremyAjanou Tornyenu. You bid the sun to delay its descent until I prevail. To Vincent Twum,
the constant nudger.
iv
TABLE OF CONTENTS
LIST OF TABLES ______________________________________________________vii
CHAPTER 1 ___________________________________________________________ 1
INTRODUCTION ______________________________________________________ 1
Methodology ................................................................................................................... 6
CHAPTER 2 ___________________________________________________________ 9
COLONIAL LEGACIES: GHANA, KOREA, AND BRAZIL GREAT BRITAIN AND
THE UNITED STATES __________________________________________________ 9
Ghana ............................................................................................................................ 11
Brazil ............................................................................................................................. 18
Korea ............................................................................................................................. 27
CHAPTER 3 __________________________________________________________ 34
FOREIGN ASSISTANCE _______________________________________________ 34
Ghana ............................................................................................................................ 35
CHAPTER 4 __________________________________________________________ 43
KOREA AND AMERICA _______________________________________________ 43
CHAPTER 5 __________________________________________________________ 48
BILATERAL VS. MULTILATERAL CHANNEL AID ________________________ 48
State Leadership ............................................................................................................ 52
Korea‟s Democracy ...................................................................................................... 53
Africa and the Cold War ............................................................................................... 55
Brazil ............................................................................................................................. 58
v
CHAPTER 6 __________________________________________________________ 62
ANALYSIS ___________________________________________________________ 62
Portability of the Korean Model ................................................................................... 64
CHAPTER 7 __________________________________________________________ 67
FINDINGS AND CONCLUSIONS ________________________________________ 67
Conclusion .................................................................................................................... 73
REFERENCES ________________________________________________________ 77
vi
LIST OF TABLES
Table 1:_______________________________________________________________51
vii
CHAPTER 1
INTRODUCTION
This paper focuses on Ghana and her peers, Brazil and South Korea. All three
countries are examined although it focuses on South Korea (hereafter, Korea) which, in a
single generation, experienced an exponentially high growth and democracy ahead its
1960s GDP peers, Ghana, and Brazil. These three countries, are the most representative
examples of countries that had similar GDP in the 1960s but whose divergent paths now
put them in different economic brackets. According to Jiyoung Kim, Korea‟s GDP was
comparable to some poorer countries of Asia and Africa in the 1960s.1 Korea‟s
ascendance as a „breakout nation‟ began with a growth spurt in the 80s and 90s that led to
an astonishing $1.410 trillion GDP in 2014, and lands it in the high-income bracket.2
Brazil is regarded upper middle-income country with $2.346 billion G.D.P while Ghana‟s
1
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348.
https://bit.ly/2F5Rr5b Google Scholar
2
Sharma, Ruchir. Breakout nations: In pursuit of the next economic miracles. WW Norton & Company,
2012. https://bit.ly/3j6inAA Google Scholar
G.D.P. is $38.62 million and is ranked lower middle income.3 Korea, which declared
independence on August 15, 1948, is the premier development success story of the last
half century. Korea went from aid recipient to donor. It hosted the G20 summit, the
„unofficial steering committee of the world economy‟ in November 2010. The broad facts
of the Korean case are now relatively well known, though the contextual facts mediating
its spectacular developmental transition, and how it truly compares with other poor
countries like Ghana, are still unfolding. Given the infrequency of successful
developmental economy on the African continent, understanding how a sure star like
Ghana plummeted is important.
This paper focuses on the 1960-1980 period because it the most often cited period
during which Korea experienced its transformational growth. Second, because it was the
period during which the sharp divergence of the economies of my focus countries began
to distinguish them. Third, the period coincides with the Cold War during which the
uneven nature of America‟s involvement in each country became particularly evident.
Foreign aid regime, America‟s overarching Cold War foreign policy objectives,
and state leadership have been dealt with individually in the comparative political
economies of my focus countries. However, their interplay brings new perspectives that
make a compelling case for a reexamination of how the countries truly compare. Korea‟s
3
Sharma, Ruchir. Breakout Nations: In Search of the Next Economic Miracles. WW Norton & Company,
2012
https://bit.ly/3j6inAA Google Scholar
2
successful developmental experience, dubbed a „miracle‟ by some writers, has become a
prescribed economic model to countries aspiring to industrialize. The portability of the
Korean experience to other countries and the difference it could make in changing
Ghana‟s fortunes or its influence on Brazil‟s development policy choices during the
period is consequential.
The competition among nations to be economically self-sustaining, is often a
fierce engagement that is tilted in the favor of nations which specialized in products or
services that is of advantage to the economies of scale.4 The power that trade
specialization and dominance confer makes it an inherently „contentious and prominent
international issue.‟5 Trade disputes and their occasional escalation into military conflicts
challenge the conventional wisdom that bilateral trade promotes peace, and leaders are
rational.6 Powerful nations use trade to exact concessions or acquiescence from weak
ones. Immanuel Wallerstein‟s three-tier hierarchy World Systems Theory, has at its core
the advanced capitalist economies which run roughshod over weaker nations at the
4
Hazlitt, Henry Foreign Investment vs. Foreign Aid
https://bit.ly/3d0U84z Google
5
Topik, Steven C. Trade and gunboats: the United States and Brazil in the age of empire. Stanford
University Press, 1996.
https://bit.ly/3iPZzW1 Google Scholar
6
Martin, Philippe, Thierry Mayer, and Mathias Thoenig. "Make trade not war?." The Review of Economic
Studies 75.3 (2008): 865-900.
https://bit.ly/30nfBzR Google Scholar
3
periphery.7 The story of my focus countries is their scramble to escape the poverty trap of
the periphery for the core. The success of their integration into the capitalist world system
depends on factors including the forces of history, statecraft, and chance.
Korea is the benchmark among its cohorts due to its preeminent economic
success. A key distinction among my cohorts is also how they are distinguished
geographically and also by their policy choices to get ahead. For instance, Brazil
preoccupied itself with inter-American commerce while Korea oriented outward to a
global market. This thesis uses comparative historical analysis to better understand the
reasons my focus countries started similarly but end up differently six decades on. It is
my hope that understanding the facts behind Korea‟s economic success would prevent
countries like Ghana from the pursuit of doomed policies at the expense of viable ones.
Korea‟s success story, Brazil‟s half-fledged take-off, and Ghana‟s diminished
capacity has become a common subject of research in development economics. Generally
credited with Korea‟s success is its superior economic policy, efficient utilization of
foreign aid, and the role of the state. Beyond macroeconomic mismanagement as well as
badly implemented development strategy, the facts of the Ghana, and Brazilian cases are
far less understood, yet carry enormous interest for development economists.8 By
7
Cohn, Theodore H. Global political economy. Routledge, 2015.
https://bit.ly/2Gr6aYS Google Scholar
8
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348.
https://bit.ly/2PzLbV2 Google Scholar
4
focusing on the development of Korea‟s political economy, I have sought to return to the
fundamentals of Ghana‟s failure to achieve development and modernization – but with
one very important difference: whereas political economy theorists focus on Korea‟s
success as a template for other countries trying to industrialize, I use it to better
understand what went wrong with Ghana. Most scholarship comparing Korea‟s rapid
economic development with its peers often generalizes foreign assistance, a key factor in
capital accumulation, or, foreign debt. New literature reveals a better understanding of
how my focus countries actually measure up, and whether their comparison with Korea is
even fair. The scholarly attention Korea‟s superior development receives perpetuates
flawed mainstream conclusions about Ghana‟s failure. For policy makers as well as
development strategists, it is informative to analyze not only what Korea did well, but
also the factors that potentially held back Ghana, and Brazil. The need for the
reexamination of the standard literature of Korea‟s fast integration into the world‟s
economy would help debunk the generally held belief that sub-Saharan Africa is doomed
and incapable of rising even when granted all the funding that fueled Korea‟s rise. Using
historical records, my thesis reveals that Ghana could have achieved a parallel
developmental transition to Korea‟s if it too were to benefit from the identical
circumstances that transformed Korea. Moreover, the true underlying factors of Korea‟s
rise are glossed over or obfuscated. The more obvious means by which Korea achieved
its “great leap forward” are often minimized in the literature devoted to its rise. As Korea
is the yardstick by which successful developmental transition is measured, my new
5
perspective would be to use the building blocks of its success to elucidate Ghana‟s
comparative mediocrity. It takes one to better understand the other.
METHODOLOGY
This paper is qualitative in character and resorts to quantitative charts for
illustrative purposes. I used existing literature to find out why Korea used aid to achieve
rapid economic development and democracy from 1962-1980 ahead of Ghana and Brazil.
I focus on the colonial legacies of the countries, as well as aid flows to them. If there is
any, analyzing existing literature in each decade during, and, following Korea‟s rise, will
expose a discernible pattern of the minimization of aid distinction among the focus
countries. A qualitative comparison is compatible with the more nuanced, deeply
penetrating examination of the economic trajectory of the countries for a better
understanding.
Great leaders transform nations. Some have motivation to follow clear visions to
economic greatness. At other times, great leaders are made because of the choices they
make during unusual historical events. Great national leadership identifies and harnesses
resources to get ahead. Once lumped together as “Third world” countries, Korea roared
out of the bracket following great, consistent strides it made towards industrialization
beginning from early 1960s. Similarly, Brazil is regarded by political economists as one
of the rising new economies, the so-called, NIEs. A plethora of comparative literature
exists about how Korea used foreign aid successfully while Ghana and Brazil did not.
The true picture is different.
6
Ghana, Brazil and Korea are illustrative examples of successes and failures of
policies geared towards developmental transformation. The three countries have come to
symbolize the story of nations who started similarly but follow different developmental
paths. Korea achieved economic transformation going from a desolate agricultural
economy in the 1960s, to an industrial powerhouse. Korea is the world‟s 12th largest
GDP. Sixty years later, Ghana remains at the lower rungs of middle-income countries.
Ghana, Brazil and Korea have used foreign assistance on state-owned enterprises,
however, the relationship of the state with their SOEs varied in each country. My focus
countries have different experiences with international capital flows, with different
impacts on their development.
As the first country in sub-Saharan Africa to wrestle independence from a
reluctant colonial power, a lot was riding on how Ghana‟s ambitious bid for self-rule
bodes for its people, and other countries agitating for same. Of course, decolonization has
its limits in solving the problems of African states. The continued muddling of the
contextual facts mediating Ghana‟s economic and technological retardation, stigmatizes
sub-Saharan African countries as unabashedly anti-reform, anti-progressive, anti-liberal,
hence the need for substantive clarity. To be sure, there are a number of missteps in
Ghana‟s march to modernity. A call for the reexamination of the premises of Ghana‟s
lack of progress is as an attempt to clear the fog shrouding Korea‟s historical fast-track
industrialization. It is time to reexamine the facts behind Korea‟s rise and reassess
Ghana‟s arrested development. The story of Korea using American foreign assistance to
7
industrialize adapting Japan‟s industrial influences is by now a familiar story. Francis
Fukuyama believes, “Korea‟s adaptation of transplanted Western capitalism with
elements of Japanese industry organization in such a way as to be scarcely recognizable”9
is an ode to the triumph of liberal democratic capitalism. A simplistic explanation of the
Korean „miracle‟ presuppose the inevitability of Korea‟s rise but not Ghana, due to the
latter‟s so-called „African address,‟ a patronizing term of sub-Saharan Africa‟s docility.
Theories are plentiful about how influences of history and culture shaped my
focus countries. Moreover, fresh perspectives emerging in the academic community are
helping to better clarify the subtle factors behind the economic success of some countries
in overcoming adversities, and the futility of others in trying.
9
Fukuyama, Francis. Have we reached the end of history?. RAND CORP SANTA MONICA CA, 1989.
https://bit.ly/3fUPm8w Google Scholar
8
CHAPTER 2
COLONIAL LEGACIES: GHANA, KOREA, AND BRAZIL GREAT BRITAIN
AND THE UNITED STATES
Few events reshaped the world like the 18th century industrial revolution which
Britain ignited, and the emergent United States of America‟s rearrangement of the global
power structure following World War II. The former enabled Britain‟s Victorian boast
that theirs is the „empire over which the sun never sets‟ and whose bounds nature has not
yet ascertained.10 It is established that, at its peak in the 1890s, imperial United Kingdom
was the most powerful country on earth. It controlled roughly a quarter of the population,
territories and resources on the globe, and the Royal Navy „dominated nearly all
oceans.‟11 With about one-fortieth the land size of the United States, historians are
astonished by Britain‟s global footprint. Sources of revenue for imperial Britain were vast
and varied. Its ships were involved in the Atlantic slave trade, and profits from slavery
netted it trillions of dollars. According to some, this endeavor stains Britain‟s luster as the
10
Newsinger, John. The blood never dried: a people's history of the British Empire. Bookmarks, 2013.
https://bit.ly/33DBc7S Google Scholar
11
Ferguson, Niall. Empire: How Britain Made the Modern World. Penguin UK, 2012.
https://bit.ly/2CdNpX4 Google Scholar
most significant contributor to the making of the modern world. The resources Britain
marshalled from colonization following the abolition of the slave trade, enriched it yet
more. At the end of WW II America successfully supplanted Britain as the preeminent
global superpower. For my focus countries, the seismic shifts produced by the two
countries impacted their destinies.
How the Cold War helped or hurt Korea, Brazil, or Ghana is a central theme in
my thesis. I examined the role geopolitical significance plays as a contributing factor in
Korea‟s economic rise, Brazil‟s aspiration, and Ghana‟s paralysis. Why did America find
it compelling to help create a prosperous liberal democracy on the Korean peninsula, but
not Ghana? To what extent does Brazil‟s size, population and geographic location
influence its industrializing aspirations? How has the unique historical relations between
each of these countries and the West enabled or hurt their economic progress? How has
the ideological leanings of leaders of developing countries aided or impeded their access
to Western technology, funding, or even sabotage? Could Brazil, and Ghana replicate
Korea‟s greatness absent the overwhelming support Korea enjoyed from the United
States.
Colonial experience leaves long-standing impacts on the people and the
institution-building capacity of a country. In what follows, I examine the colonial
legacies inherited by the three countries form their colonial histories. Like Ghana, both
Brazil and Korea have colonial pasts.
10
Ghana
Ghana experienced a century-long colonialism by the British, an experience that
had a tremendous impact on some governmental institutions in the country and the
cohesion of the polity. The legacy of colonialism on the people of Ghana has endured
long past the lowering of the Union Jack and the raising of the red, gold, and green flag
on the eve of Ghana‟s independence. For good or bad, Britain‟s affairs in Ghana laid the
foundations for the country‟s future political economy. Similarly, Korea and Brazil are
shaped by the tenor of their experiences of subjugation under their respective colonial
masters, Japan and Portugal.
Slaves were forcefully removed from West Africa as early as 1570s and brought
to Brazil. For centuries, endless wars raged for the capture and selling of Africans for
harrowing odysseys to North America, Europe, and the Caribbean. On a scale unmatched
in history, the African continent was besieged and its energetic and productive youth
hauled away to foreign lands. The slave trade disrupted the economies and productivity
on the continent. Colonialism came on the heels of the inhuman trade in slaves when
European powers scrambled to carve up and plunder Africa in the 19th century.
According to Matthew Lange, „colonization of foreign lands has been a cataclysmic
series of events that dramatically transformed the lifestyles of peoples throughout the
world.‟12 Whole native populations were annihilated while colonists went to live in far-
12
Lange, Matthew. "British colonial state legacies and development trajectories: a statistical analysis of
direct and indirect rule." States and Development. Palgrave Macmillan, New York, 2005. 117-139.
11
off places as cogs in a sprawling colonial machine. Chaotic transformations were
unleashed over which the natives had no control. Colonial authorities imposed colonial
rule on the continent and drew arbitrary boundaries that lumped disparate ethnicities
together, but separated people with common ancestry in a typical „divide and conquer‟
strategy. This vast disruption of peoples‟ lives and cobbling multi-ethnicities together
underscores the extreme power of the European imperialists in Africa and also the
revolutionary changes that colonization began.‟13 Global colonization by which Spain,
Portugal, France, and Britain expanded their territorial influence, brought them enormous
wealth and power, while the people it dominated, remained exploited and poor for
extended periods of time.14
Some post-colonial intellectuals such as Frantz Fanon drew attention to the
inherent destructive aspects of colonialism while others like Niall Ferguson and likeminded scholars, courted controversy by describing colonialism as a “period of
trusteeship” whereby the technologies Europeans brought to the colonies offset the
hardships wrought on the them.
https://bit.ly/3gE1got Google Scholar
13
Lange, Matthew. "British colonial state legacies and development trajectories: a statistical analysis of
direct and indirect rule." States and Development. Palgrave Macmillan, New York, 2005. 117-139.
https://bit.ly/3gE1got Google Scholar
14
Yülek, Murat A. "The Old World Order: Trade Before the Empires on which the Sun Never Set." How
Nations Succeed: Manufacturing, Trade, Industrial Policy, and Economic Development. Palgrave
Macmillan, Singapore, 2018. 5-12.
https://bit.ly/2G9nUsc Google Scholar
12
The Asante empire emerged in the 17th century, and consolidated in the 18th
century, with Kumasi as its capital. At its peak, Asante dominion over vassal states like
the Bono and Akwapim, ensured the flow of tribute, most importantly gold, over which
the Asante held supremacy. That was the closest Ghana came to having a centralized
state. The lure of gold prospered West African kingdoms of antiquity, and enriched states
along the established trans-Saharan trade routes that stretched to the Atlantic coast of
West Africa. Gold, also drew Portuguese merchants to establish the first European
settlement in the Gold Coast in 1491.15 Britain was a late entrant to the lucrative trade in
gold and other resources in the Gulf of Guinea although before 1850, slaves were shipped
in British vessels to destinations in the New World and elsewhere.16 Britain used treaties,
coercion and warfare to emerge the dominant European power in the Gold Coast by early
nineteenth century and ushered in Ghana‟s colonial period.17
During most of the nineteenth century, the Asante state engaged in territorial
expansion and a push of trade from the Akan interior to the coast. This ambition collided
with the states that surrounded it. The Asante‟s uncompromising quest for direct,
15
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348.
https://bit.ly/2F5Rr5b Google Scholar
16
Ferguson, Niall. Empire: How Britain made the modern world. Penguin UK, 2012.
https://bit.ly/2CdNpX4 Google Scholar
17
Jiyoung
Kim (2015) Aid
and
state
transition in
Ghana
Quarterly, 36:7, 1333-1348, DOI: 10.1080/01436597.2015.1038339
13
and
South
Korea, Third
World
unimpeded trade with European merchants in the Gold Coast led to several armed
confrontations with the southern states which benefited as middlemen from their levies
on Asante goods. When they arrived, the British formed pacts with some of these states
to protect them from the Asante. The Asante was intransigent to the pressures exerted on
it by colonial Britain. Moreover, the Asante resented the growing intrusion of the British
in the interior of Ghana which it regarded its territory. The Asante viewed any meddling
in their quest for direct trade disagreeable and fought to protect their right to trade. The
mutual animosity between the Asante and the British led to frequent clashes.18 In these
clashes, the Asante “bore the brunt of British colonial army”19 assault until their
indomitable spirit was broken. The Asante capital Kumasi was sacked during their defeat
in the Yaa Asantewaa war of 1900. By then, the Asante overextended itself in reining in
rebellious vassal states. Also, its „weak internal structure‟, and challenge from the British
colonial army hastened the collapse of the empire. The British had full reign to extend its
rule into the interior of the Gold Coast having brought pockets of resistance under
control.
Britain established the Gold Coast Colony in 1874, a colony associated with
European commerce for over four hundred years. Like the line of European nations
before it, Britain too was eager to get its hands on gold, the most important mineral long
18
19
Jiyoung Kim: https://www.tandfonline.com/doi/full/10.1080/01436597.2015.1038339
Quainoo, Samuel Ebow. Transitions and consolidation of democracy in Africa. Global Academic
Publishing, 2008.
https://bit.ly/346Hj50 Google Scholar
14
associated with ancient and contemporary Ghana.20 Curiously, until the 1890s, gold
extraction relied on crude traditional methods like panning. In 1890, the British Crown
used the dubious “Foreign Jurisdiction Act” to seize lands, upturn treaties, and allocate
grants to themselves in the Gold Coast. In 1897, Britain acquired the Ashanti Goldfields
Corporation an extensive holdings in excess of 160 square kilometers for the commercial
prospecting of gold. Although relatively small, the Gold Coast was a profitable colony
for the British. Earned receipts from cocoa, bauxite, diamonds, gold, and other products
make it so. Cacao pods brought to the country in 1878 became the „king‟ crop and
thereafter contributed to colonial Gold Coast economic boom. Railway lines sprang up
conservatively connecting mining and farming areas to the ports.
The goal of the British was the exploitation of mineral resources in the colonies
and expansion of markets for Western produced goods. Britain‟s adopted methods
towards Ghanaians during the colonial period were repressive and blatantly
discriminatory. The mining concession Britain operated relied on expatriate labor to the
exclusion of Ghanaians. This practice is perpetuated even in post-independent Ghana
where plum jobs remain the exclusive preserve of expatriates. The British attempt to
introduce Western education system in the Gold Coast was a feeble and a far cry from
their own type of good schools and representative government in Britain. Even the core
20
Berry, LaVerle Bennette, ed. Ghana: A country study. Vol. 550. No. 153. US Government Printing
Office, 1995.
https://bit.ly/2XGLH8d Google Scholar
15
curriculum of the educational system Britain introduced in the colonies was mainly “the
creation of a group of educated Africans … „rooted in their own culture‟21 in order to
support its own colonial exploitative interests. In both education policies and interactions
in British, and French colonial territories, Britain promoted “adjustive” policies with little
emphasis on the kind of diffusion that undergirds France‟s “assimilation” policy of
“creating a Black Frenchman.” This comparison by no means signify a picking of sides.
Britain and France and their two systems of absolute subjugation of Africans are two
faces of the same coin.
The British devised indirect rule in „grudging recognition of the sovereignty of the
traditional Chiefs‟ only after relentless assaults to “strangle this institution” and strip the
political powers of Chiefs failed.22 The so-called British „native‟ administration is a token
of traditional authority, and relied on Ghanaian chiefs for its execution. Indirect rule
therefore is the “colonial policy of using the African elite, specifically the elders and
chiefs” as the main agents of local colonial administration.23 The influence traditional
leaders had over their subjects made the practice a success although it denied the colony
21
Clignet, Remi P., and Philip J. Foster. "French and British colonial education in Africa." Comparative
Education Review8.2 (1964): 191-198. https://bit.ly/31SWa1R Google Scholar
22
Samuel Ebow Quainoo: Transitions and Consolidation of Democracy in Africa, State University of New
York Press, Albany, New York, 2008, p.74
23
Akurang-Parry, Kwabena O. "„Disrespect and Contempt for Our Natural Rulers‟: The African
Intelligentsia and the Effects of British Indirect Rule on Indigenous Rulers in the Gold Coast c. 1912–
1920." The International Journal of Regional and Local Studies 2.1 (2006): 43-65.
https://bit.ly/2DvcRIk Google Scholar
16
the homogeneity it needs to forge a cohesive nation out of its diverse peoples. British
tolerance of the coexistence of traditional chieftaincy alongside colonial bureaucratic
authority, proved fateful as it seeded conflicting loyalty Ghanaians developed towards the
new state. Consequently, harbored feuds and lingering resentments among tribes
predating the colonial period, crept into post-independent Ghanaian politics.
In events preceding WW II, the British colonial government seized upon seismic
tremors that rocked Accra on June 22 1939 to whip up war anxiety propaganda in
colonial Gold Coast. The quake left sixteen dead and “sizable damage to residential,
business and government properties.‟24 In the absence of immediate explanation for the
sudden devastation, local press echoed British colonial government propaganda that
German ambitions for war to reclaim lost territories in Africa was imminent. The Gold
Coast Regiment prepared for war believing the Gold Coast would be drawn into the‟
rumbling European war.‟ Up to 70,000 soldiers and support staff from the Gold Coast
served under the British in WW II.25
There is consensus among historians that African nationalism increased in the
aftermath of World War II.26 Returning Gold Coast soldiers joined the agitation for
24
Holbrook, Wendell P. "British Propaganda and the Mobilization of the Gold Coast War Effort, 1939-
1945." Journal of African History (1985): 347-361.
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25
Killingray, David. "Military and labour recruitment in the Gold Coast during the Second World
War." Journal of African History (1982): 83-95.
https://bit.ly/2HUPOst Google Scholar
26
Money, Jacob Louis. "The Impact of WW II on African Nationalism and Decolonization." (2018).
17
political independence when veterans were fired upon during a peaceful march to present
a petition to the colonial administration to honor its pledge. The murders immediately
raised the tenor of the fight for self-rule. It outraged the populace and mobilized them to
make “Full Self-government Now” the future rallying call of Kwame Nkrumah‟s CPP
movement. Ghanaians won the fight for self-rule after a century enduring beatings,
arrests, and imprisonments. Nkrumah and his party went from “irresponsible and unruly
veranda boys”27 to lead the successful struggle for the emancipation of the Gold Coast.
The transition to self-rule was peaceful considering it was birthed from violence.‟28 The
parliamentary democracy Nkrumah‟s CPP established at independence, was overthrown
in 1966, followed by alternating military and civilian governments. Ghana‟s post-colonial
trade balance, strong at independence in 1957, became negative since 1980s. Its transition
in the late 1960s-1980‟s was more from one military junta to the other; not
developmental.
Brazil
Europeans reached what would be modern day Brazil in April 1500, and stumbled
on a linguistically and culturally homogeneous Amerindians living on the coast and the
basin of the Parana and Paraguay Rivers. The Amerindians consist of the Tupi-Guarani
https://bit.ly/3mDlYsk Google Scholar
27
Nkrumah, Kwame. "Movement for colonial freedom." Phylon (1940-1956) 16.4 (1955): 397-409.
https://bit.ly/2FjhKVv
28
Apter, David Ernest. Ghana in transition. Princeton University Press, 2015.
https://bit.ly/2DOqi5K Google Scholar
18
and the Tapuia, the former, a variant of the Indians who spoke a different language. Tales
of cannibalistic rites were rampant among the Tupi who were famous for their ferocious
resistance against subjugation. The Portuguese‟s interest in the land led to a colony at Sao
Vicente in 1532. The sheer size of Brazil presented a challenge to the colonial authority
whose push into the hinterland necessitated expense and time. Like the rest of Latin
America, Brazil became an exporter of „highly important foodstuffs or minerals for
European commerce‟.29 In spite of this designation, not much was collected in revenue
from Brazil. In fact, tribute from the colony throughout the 16th century amounted to a
negligible 2.5 percent of the crown‟s income compared to 26 percent from trade with
India. Black slaves were imported mainly from West African beginning in the 1570s to
replace Indian slaves, due to cost and the intensity of the „compulsory labor‟ demands of
the European-run sugar economy. Indian slaves got by with little and deeply resented the
„notion of constant work.‟ Moreover, the Africans slaves had experience working with
iron implements and cattle raising.30
The state and the Catholic church were the two institutions responsible for
Brazil‟s colonization. Their roles overlap but the state fundamentally guaranteed
Portuguese sovereignty over the colony, while the state religion, Catholicism, took on the
manifest responsibility of molding people‟s behavior. Catholicism emphasized obedience
29
Boris, Fausto, and Sergio Fausto. "A concise history of Brazil." (1997).
https://bit.ly/2F2Kodo Google Scholar
30
Boris, Fausto, and Sergio Fausto. "A concise history of Brazil." (1997).
https://bit.ly/2F2Kodo Google Scholar
19
to the state, living a sinless life through this „vale of tears.‟ The church was a constant
presence throughout important events in people‟s lives. The church baptized and gave the
sacraments, blessed marriages, and in death, buried them. This „cradle-to-grave‟ presence
in parishioners‟ lives made the church a significant institution leading to its being courted
as a partner of the colonial crown in Portugal.
Moreover, even Brazilian Catholicism was based on the notion of „purity of
blood‟ which pitted Old Christians (more Catholic) against New Christians (less
Catholic). The so-called New Christians were discriminated against, routinely arrested,
and often victims of the Inquisition. Thankfully, the Inquisition was not as widespread in
Brazil as in the Spanish American colonies. So, although the Portuguese colonists
chanced upon a homogenous people, the splinter of the populace presented unique
challenges. Brazilian colonial society is divided into masters and slaves, with wealthy
rural landowners and merchants perched on the privileged apex of the social pyramid.
The society was further divided into broad categories of „nobility, clergy, and folk‟.
Manual labor is socially scorned and regarded as „something just for blacks‟, a prejudice
against blacks that persists to this day. Throughout its colonial history, Brazil‟s colonial
administration bureaucracy worked to dilute the royal power of the absolutist crown king
in Lisbon resulting in tension between the two institutions.31
31
Boris, Fausto, and Sergio Fausto. "A concise history of Brazil." (1997).
https://bit.ly/2F2Kodo Google Scholar
20
Brazil declared independence from Portugal on September 7, 1822 amid Don
Pedro‟s shouts of “Independence or death!”32 Most Brazilians were „unaware‟ of who
governed them at the time, its independence was without the „convulsive legacy of
revolution suffered‟ by Spanish colonies in the hemisphere. It ended the period of
Portuguese crown control over Brazil and ushered in a monarchy under the reign of Don
Pedro as emperor. Following Brazil‟s independence, Pedro I sent emissaries to America.
Two years later in 1824, Brazil was formally recognized by the United States, followed
by Portugal.
A new constitution centralized the government and divided the country into
provinces governed by „presidents‟. Traditional agricultural products like coffee and
timber fluctuate in growth and income with coffee dipping and soaring the most mainly
because global demand and supply often lacked balance. Brazil‟s transition to a republic
in 1889 had big implications for the country. The agricultural barons used their newly
found influence as key players in the national economy to negotiate policy space that
affect their sector.33 They became more vocal and used their visibility to wrestle
32
Worcester, Donald E. "Independence or Death! British Sailors and Brazilian Independence, 1822–1825:
Vale, Brian: London and New York: IB Tauris, 219 pp., Publication Date: 1996." History: Reviews of New
Books 25.3 (1997): 115-115.
https://bit.ly/2XFJrhx Google Scholar
33
Dinius, Oliver. "Francisco Vidal Luna and Herbert S. Klein, The Economic and Social History of Brazil
since 1889 (New York and Cambridge: Cambridge University Press, 2014), pp. xvi+ 439, $90.00, $32.99
pb;£ 55.00,£ 19.99 pb." Journal of Latin American Studies 48.1 (2016): 182-183.
https://bit.ly/3a3oLoI Google Scholar
21
favorable terms to shield their sector from undue attention. Slavery was outlawed in 1850
which greatly reduced the constant injection of fresh slave populations into Brazil,
exerting a stress on the country‟s existing labor force. European immigration intensified
following the emancipation of slaves and transition to free labor. Mass European
immigration helped introduce the modern state in Brazil with improvements in treated
water, garbage disposal, and in public education which improved literacy. Moreover,
democratic gains lagged as regional oligarchs denied voting to illiterates. This purposeful
isolation of the majority peasantry was done to further entrench the barons‟
predominance in political decision making.
Brazil has fought on the side of the United States in both world wars. During WW
II, it contributed troops – the Brazilian Expeditionary Force - in the fight against fascism
in Europe, a move that accords with the United States foreign policy objectives. For
Brazil, participation in World War II was out of Germany‟s relentless sinking of Brazil‟s
merchant ships.‟34 This practical act of protecting its merchant fleet led to security
alliance with the United States. Despite 200 years of shared history as trading partners,
relations between Brazil and the United States is characterized by ebb and flow of tension
but never war. Political engagement between the two countries is shallow as best as
political leaders often „seem to talk past, rather than to, each other.‟35 From 1591 to 1808,
34
Ellis; Evan: “The Strategic importance of Brazil,”
https://bit.ly/3gCudBi Google
35
Smith, Joseph. Brazil and the United States: Convergence and divergence. University of Georgia Press,
2010.
22
the paranoid crown in Portugal closed off colonial Brazil ports to foreign ships, which
could partially explain why Brazil and the United States have diplomatic archives of the
other but little by way of actual interaction. America regards Brazil as peripheral to its
foreign policy interests. Brazil resents being indiscriminately lumped together with many
of its smaller Latin American neighbors.36 As a regional power, Brazil frowns on
America‟s adventurism and hemispheric ambitions in its backyard.37 America‟s quest for
sphere of influence in Latin America clashed with Brazil, the region‟s predominant
power. In the ensuing uneasy relation, trade and friendship take a backseat to the rivalry
between them.
Brazil‟s history as a huge political entity engaged in a long struggle to occupy,
control, and develop vast interior spaces, is not different from the origins of the United
States. Its land borders measure in the thousands of kilometers and stretch across three
time zones, (four, if one includes Brazil‟s offshore islands). Brazil‟s extensive use of
slave labor have traditions of African and Asian influences much like America. Native
values and practices persist although European traditions dominate native cultures and
claims to land rights. Brazil dominated world production of coffee, however, its interior
https://bit.ly/2EZW2Wh Google Scholar
36
Smith, Joseph. Brazil and the United States: Convergence and divergence. University of Georgia Press,
2010.
https://bit.ly/2EZW2Wh Google Scholar
37
Ellis; Evan: “The Strategic importance of Brazil,” https://theglobalamericans.org/2017/10/strategic-
importance-brazil/
23
where the coffee is grown is traversed by mule trains. Only when Brazil started
manufacturing automobiles in the 1950s were its first major roads into the interior
developed.
According to Evan Ellis, in size of territory, population and economy, Brazil
accounts for approximately half of South America‟s total. Its military is larger than the
„rest of the Armed Forces on the continent combined,‟ and many of its neighbors are
furnished by Brazil‟s domestic arms industry. Furthermore, Brazil‟s claim to the same
„exceptionalism‟ with which America regards itself, accounts for nothing in America‟s
concept of „partners‟ in the hemisphere. America did not blink at the $46.8 billion
Chinese investment „across 87 projects‟ in Brazil. Neither did the extensive military
cooperation with China elicit a wink from America.38
Brazil‟s modernization was strengthened with strides in its industrialization, and
agriculture. Thanks to Brazil‟s strong anti-communist stance, and the successful space it
negotiated with the US by its geopolitical importance during the Cold War. Like Korea,
America supported the Brazilian government and helped modernize its university system
especially its agricultural research program through international credit agencies such as
the IRBD and IDB. Analysts say such cooperation give Brazilian products a competitive
edge over American agricultural exports.39
38
Ellis; Evan: “The Strategic importance of Brazil,” https://theglobalamericans.org/2017/10/strategic-
importance-brazil
39
Herbert S. Klein & Francisco Vidal Luna: “Brazilian Politics During the Cold War”
https://bit.ly/3gHcJUr Google
24
Brazil acknowledges America‟s status as the most powerful actor in the world
with an unchallenged military primacy in global affairs. Aware that voiced strong antiAmerican sentiments in foreign policy forums could draw Washington‟s ire, Brazil has
kept from inflammatory rhetoric in its relationship with the US. Although Brazil aligned
with the United States during the major world wars, it stayed away from the Korean War
in the 1950s, Vietnam War in the 1960s, the US Central American policy of the 1980s,
and the Persian Gulf War in the 1990s. This has upset successive US administrations.
Brazilians are frustrated why bonds of friendship between their two governments do not
translate into national favors from the richer America. This leads to faulty expectations in
their relations. From such unfulfilled expectations come lingering disappointments.
However, America recognized Brazil‟s blood sacrifices during the World War II which
went beyond force contribution in the campaign in Italy. It included naval base sharing
on Brazilian soil in the event of a massive attack on American homeland during the war.
Of immediate benefit of the war time cooperation with America was the building
of the heavily subsidized South America‟s first steel mill at Volta Redonda in the state of
Rio de Janeiro completed in 1946. America calculated the symbolism of the gesture
would keep Brazil out of the German camp during the war. The steel mill was an
exclusive privilege to Brazil as it was denied to its neighbor and rival, Argentina. This
gift of American technology is considered an essential element in the industrialization of
Brazil.
25
Brazil‟s 70,000 strong army veterans returning from WWII with bleak job
prospects, „very alarmed‟ the Vargas government which feared the army “would likely
overthrow the civilian government.”40 America shared Brazil‟s fears that safety of the
Panama Canal could be jeopardized when a pro-fascist government takes hold in Brazil
with Italians and Germans pouring veterans into the country at war‟s end. Uruguay and
Argentina also had large German and Italian populations that could endanger security of
the hemisphere.
Monica Hirst writes about a new phase of America and Brazil relationship at the
end of World War II. Hirst breaks down Brazil‟s litany of „unmet expectations‟ from
America by the decades. It begins with 1950‟s lack of special acknowledgement for
having fought against the Axis powers and was frustrated when not granted more support
for its economic development policies in the aftermaths of World War II; in the mid1960s, when it did not receive economic compensation for having contained „domestic
communist forces‟; and in the mid-1970s, for not being upgraded to „key country‟ status
in US foreign policy. In the mid-1980s Brazil, together with other Latin American
countries, regretted the lack of US help in dealing with the debt crisis and, in the mid1990s, the lack of American support in a period of global financial turmoil.41
40
McCann, Frank D. Brazil and the United States During World War II and Its Aftermath: Negotiating
Alliance and Balancing Giants. Springer, 2018.
https://bit.ly/2DzA1NN Google Scholar
41
Hirst, Mônica. The United States and Brazil: a long road of unmet expectations. Routledge, 2005.
https://bit.ly/2DzerZD Google Scholar
26
The way Brazil and the United States perceive constitutional rule account for
some of their differences. The United States acts to „defend and promote constitutional
government,‟ and values civilian supremacy over the military; the same cannot be said of
Brazil. America‟s impersonal bureaucracy functions in ways that Brazil‟s does not. Laws
are openly bent to favor civilian and military elite in Brazil. Brazil‟s strong domestic
economy has in the past generated few emigrants to the United States. However,
Brazilians are now building a steady presence sustained through networks of familyunification provisions of US legislation. Over the years, Brazilian presence in America
has fueled an increasing appetite in the production and consumption of their culture –
including music, book publishing, and television programing. At home, Brazil is not
immune from the pressure of American environmental groups on how the Brazilian
Amazon is managed and exploited. Environmental activists want to see the Amazon a
relatively serene island insulated from rapid deforestation for timber products and for the
development of living spaces and industries.
Korea
The disastrous civil war that accounted for the modern-day North-South split
aside, Korea‟s homogenous ethnicity has a long history dating back millennia (500,000
yrs.).42 Koreans migrated from China to occupy the Korean Peninsula and established the
42
“Country Profile: South Korea” May 2005
https://bit.ly/30DxhI4 Google
27
city of Pyongyang.43 Japan‟s geopolitical perch at the confluence of American, Russian,
and Chinese interests during the nineteenth century presented it with a quandary as
Western countries began flexing their imperial muscle. Stronger European states overrun
neighboring weaker ones, then pounced on non-Western nations in distant lands and
dominated them. As in the natural world of the strong dominating the weak, Social
Darwinism was the norm. Japan calculated correctly that it would have to act swiftly to
keep from being subjugated themselves aware they were surrounded by hostile states.
Japan realized there was no stopping European momentum on their colonization spree in
Asia. Rather than wait and fall like other “lesser breeds,” the Meiji leadership in Japan
embraced the European, „dog-eat-dog‟ adventurism and looked overseas for conquests of
its own.
In 1876, Japan went to Choson, (Korea) on a diplomatic mission signing an
Unequal Treaty with terms favorable to itself. The favorable wind it wanted to complete
its takeover of Korea came in the form of a peasant rebellion in 1894. Tokyo pounced. It
sent in its army and navy, goading the Chinese which sent in its Yellow Sea fleet. China
was roundly defeated in what became the Sino-Japanese War of 1894-95,44 and ushered
in a period of Japanese empire building. Moreover, it was Japan‟s victory over Russia in
the Russo-Japanese War (1904-1905), the first Asian country to defeat a European power
43
“Country Profile: South Korea” May 2005
https://bit.ly/30DxhI4 Google
44
Miller, John H. Modern East Asia: an introductory history. ME Sharpe Incorporated, 2008.
28
in modern times, that gave it „Great Power‟ status. That paved the way for total control
over Korea, which Japan declared a protectorate in 1905. Meiji celebrated Japan‟s
membership in the Western imperialist club believing that becoming imperialist
themselves helped escape the Asian stigma of cultural inferiority.
When Europeans arrived in the East, they replaced the Asian form of sociopolitical relationship based on paternalistic authority. They imposed „legalistic concept‟
of interstate relationship. The European concept of equality among a community of
sovereign states was alien to the Asian suzerainty with which Japanese were familiar. The
Asian pecking order rested on the warrior code of „overlordship of superiors over
inferiors.‟45 That concept explains why conflicts between equally-matched adversaries
perpetuated until the scale of power shifted in favor of one side. Japan‟s domination of
Korea at the turn of the twentieth century, reversed to the shared Asian concepts of
benevolence, paternalistic leadership and of dependency. Koreans identified with
Japanese suzerainty; the way Japanese lived in lofty imperial style and did not flinch
from the use of brute force in the imposition of their will on Koreans. However, Japanese
also resorted to trade and cultural exchange, secret diplomacy and alliances, of
compromise and even collaboration when opposition mounted against their domination.
In Korea, the Japanese colonial power oversaw a people with common ancestry.
The Japanese presence in Korea as statesmen, administrators, businessmen, ended almost
45
Miller, John H. Modern East Asia: an introductory history. ME Sharpe Incorporated, 2008.
29
three centuries of national isolation. Japanese are conflicted in their relation with their
colonies: they regard themselves superior with nothing in common with their fellow
Asians but curiously pushed assimilation in China and Korea in order to make them
become „Japanese of sorts.‟46
Japan‟s empire builders assumed the „civilizing mission‟ and „cultural
assimilation‟ rationale of some Europeans. They set aside all pretenses of kinship and
lived posh lifestyles in exclusive enclaves shielded from the „inferior‟ Koreans. The total
assimilation policies Japan pushed during its thirty-six years of Korean occupation had
the ambitious objective of “Naisen ittai” „(literally, Japan-Korea, one body).‟47 Japan
forbade use of Korean language, and encouraged Koreans to be „loyal imperial subjects,‟
who recognize the divinity of Japan‟s emperor. Furthermore, Japanese colonial
authorities proscribed Korean newspapers and made it illegal to form political groups.
The cornerstone of Korean growth is the perfusion of culture and technology that
resulted from Japanese occupation. Japan located some manufacturing plants and
corollary industries in Korea and granted access to Koreans who acquired critical
technical skills in the process. Although many Koreans were hired at entry level
positions, determined ones worked their way to comfortable perches at senior levels. This
participation in Japan‟s expansive bureaucracy and technical environment, offered
46
Yahuda, Michael: The International Politics of the Asia-Pacific, 3rd ed, p. 160
47
Caprio, Mark E. Japanese assimilation policies in colonial Korea, 1910-1945. University of Washington
Press, 2011.
https://bit.ly/31q61fa Google Scholar
30
Koreans the chance to taste and participate in modernity. Many authors agree Korea‟s
modern economic growth owes much to the era of Japanese imperialism,48 during which
GDP reportedly grew at a faster pace. President Park Chung-Hee‟s state-directed
development was a legacy of the Japanese colonial period. Japan‟s heavy investment in
education, infrastructure and health, contributed to Korea‟s „industrial take-off‟ barely
two decades later.49 The British were standoffish in their contact with the Gold Coast
expending most of their resource in mineral extraction, and the push of selling European
made goods. Their interest to modernize Ghana was feeble at best, whereas Japan was
immersed in Korea to the extent that the Korean capital of Seoul became a „little Tokyo
in Seoul.‟50 This integration of Koreans contrasts with the British whose discriminatory
policies, segregated the mines and largely kept out Ghanaians except for token low
positions.
Japan abdicated its hold on Korea at the end of World War II. The United States
emerged the most powerful and visible presence in post-war South Korea. Although
America‟s effort in the reconstruction of Korean economy was to ensure political
48
Nicolas Grinberg: “From Miracle to Crisis and Back: The Political Economy of South Korean Long-
Term Development” 25 March 2014
https://bit.ly/30EhyIM Google
49
Hassink, Robert. "South Korea's economic miracle and crisis: Explanations and regional
consequences." European Planning Studies 7.2 (1999): 127-143.
https://bit.ly/31oWogA Google Scholar
50
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348.
https://bit.ly/2F5Rr5b Google Scholar
31
stability, it had overarching geopolitical interests and the desire to promote American
values on the Korean Peninsula. However, skepticism about an „industrialized South
Korea‟ made American foreign policy advisors stress a traditional, agrarian economy for
Korea, and actually „impeded its industrialization‟ efforts.51 Nonetheless, Korean acumen
to industrialize prevailed, resulting in rapid technology-driven economic growth,
suggesting a nation can come back strong from a debilitating war.52 Korea became
America‟s anchor in a line of defense that stretches around the globe to where
Communist, and Western democratic forces face-off in Germany and Eastern Europe.
Korea‟s geostrategic importance to America got development grants flowing from
Washington. The grants, coupled with Korea‟s willingness to fight for development,
made their country a “telling front-line illustration of the superiority of the free way of
life.”53 America supported Korea‟s Syngma Rhee amid allegations of being considered
corrupt by some. America‟s armistice agreement in 1953 led to an appeasement with
„promises of aid and by a treaty-based guarantee of military security from the United
51
Lie, John. "Aid Dependence and The Structure Of Corruption: The Case of Post‐Korean War South
Korea." International journal of sociology and social policy (1997).
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52
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348.
https://bit.ly/2F5Rr5b Google Scholar
53
John Lie: Aid Dependence and the Structure of Corruption: The Case of Post-Korean War South Korea;
https://bit.ly/3gCZ3tJ Google Scholar
32
States‟.54 As with the Truman, and Eisenhower administrations before him, Kennedy
signaled America‟s renewed commitment to prevail against the hemisphere‟s growing
threat of Chinese-led communist guerilla insurgencies with his, „pay any price, bear any
burden …in the defense of liberty‟ inaugural speech.55 Unlike Korea, Ghana lacked the
geostrategic position that would have made it a country of value to America‟s foreign
policy goals. Although America committed to „help those resisting subjugation by
minorities,‟ Ghana‟s fight against British colonialism was largely ignored by America.
Korea‟s industrialization has been chalked to strong central government
leadership of the state in steering the economy in trade, technology and development. An
elite bureaucracy staffed by great managerial talent with oversight powers to discipline
large firms, was instrumental in the government‟s strong command over the efficient
allocation of resources to the private (chebols) and public sectors.
54
Yahuda, Michael. The International Politics of the Asia Pacific. Routledge, 2011.
https://bit.ly/34jwxbD Google Scholar
55
Yahuda, Michael: The International Politics of Asia-Pacific: 3rd ed, p. 99
33
CHAPTER 3
FOREIGN ASSISTANCE
Ghana, Korea and Brazil have all been recipients of foreign aid. Foreign aid has evolved
over time to become an essential conduit of foreign policy. The size, composition, and
purpose of foreign aid, make it the subject of legislative debate of donor countries. Its
flexibility as „both carrot and stick‟ has been the focus of economic analysts and
generated volumes of literature. According to Clair Apodaca, aid can be withheld to
wreak economic hardship on an adversarial regime, or conversely extended as incentive
for compliance.56 Policy experts agree that politics is at the center of the successful use of
foreign aid for development. Because most foreign aid essentially goes through
government channels, both ends of the foreign aid regime - donor and recipient - is often
tainted by contrasting aspirations.57 This makes the state‟s role in foreign aid the focus of
56
Apodaca, Clair. "Foreign aid as foreign policy tool." Oxford research encyclopedia of politics. 2017.
https://bit.ly/3d6thEp Google Scholar
57
Lawson, Marian L., and Emily M. Morgenstern. "Foreign aid: An introduction to US programs and
policy." Congressional Research Service (R40213) (2019).
https://bit.ly/3gCZ3tJ Google Scholar
development policy analysts. Foreign aid is evaluated on the success or failure of the
state effectiveness in aid utilization and is a crucial criterion of developmental policy. At
the center of this is the „effective state.‟ Comparative case studies of aid success in
Ghana, and Korea, and, Korea and Brazil, credit Korea‟s frugal fiscal policies „and often
the capacity and commitment of the state in devising and enforcing these policies‟ to help
the state achieve growth.58
Ghana
Ghana‟s relationship with foreign assistance is better understood through a brief
history of the country‟s post-independence political economy development. The agitation
for political self-determination among several African colonies intensified after World
War II when the colonial powers proved too weak to slow their momentum or chose to
grant them. Britain was a diminished power in the aftermath of WWII, but defiant in the
face of America‟s enthusiasm to quickly dismantle the old colonial system over which
regressive traditional powers like France, and Britain, presided. Churchill‟s declaration
that “Britain would not cede any of its territories without war”59 was a well understood
growl heard by an emergent America to curb its exuberance scuttling the moribund
colonial system. America feared the consequent hardship and possible collapse of the
economies of colonial powers and stayed its hand. America‟s ambivalence was a mixed
58
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348. https://bit.ly/2F5Rr5b Google Scholar
59
Yahuda, Michael. The International Politics of the Asia Pacific. Routledge, 2011.
https://bit.ly/3g5TWRr Google Scholar
35
message to Africans pushing for independence. Many historians believed that many
African countries exist because colonial powers voluntarily granted them independence.
At the vanguard of Ghana‟s drive for political autonomy were some former graduates of
the colonial school system, like Kwame Nkrumah. Furthermore, American sentiment
after WW II signaled the end of „old-world‟ colonialism.
In the Gold Coast, Kwame Nkrumah‟s Convention People‟s Party (CPP) won
over the UGCC making him Ghana‟s first prime minister when Britain granted
independence on March 6, 1957. Three years later in 1960, a new constitution declared
Ghana a republic and Nkrumah was elected president. In due time, he was proclaimed
president for life. He used constitutional and party powers to skillfully combine different
registers of power and legitimacy to detain his opponents often without trial. Opinion on
his rule differed remarkably between his ardent supporters who believe in his agenda and
policies, and those who regard his human rights abuses excessive.
The coherence of Nkrumah‟s plan lies in how he accelerated the groundwork for
Ghana‟s transformation as he embarked on public projects like the Akosombo Dam and
the Volta Aluminum Company. He expanded healthcare and school enrolment, built
roads, and brought development to the overlooked Northern Territories. He began the
basic step with specific sectors with intent of scaling upon this initial foundation, and
initiated import-substitution. He improved upon the atomic energy project in
Kwabenya,60 and brought a drydock and shipbuilding infrastructure to the industrial city
60
Ghana Atomic Energy Commission. "Ghana Atomic Energy Commission: at a glance. 3." (1998).
36
of Tema. He envisioned a Ghana with reliable fast trains and good roads, an advanced
healthcare system with nuclear components as basis for industrialization. Despite the
gains from investments in select industries, the returns on Nkrumah‟s import-substitution
industrialization were negligible as Ghana‟s strong currency made exports too
expensive.61 The bolts and nuts of Nkrumah‟s stated industrialization plan relied on his
capacity to exercise eminent domain, suppress labor cost, and roll out excellent
infrastructure. With these in place, secondary sector products labeled, “Made in Ghana,”
was a ripe, low-hanging fruit. However, things did not pan out. Rather than remain
focused on prioritizing Ghana‟s development transition and pulling the country ahead,
Nkrumah habitually strayed off course, hitching Ghana‟s developmental vision with the
total political emancipation of the rest of Africa. Under him, Ghana championed African
international relations during the decolonization period, a costly distraction. An
influential advocate of pan-Africanism and founding member of the Organization of
African Unity, Nkrumah‟s message to the Fifth Pan-Africanist movement conference he
attended in Manchester, UK in 1945 was the call for all Africa to unite against colonial
economic exploitation by the West. Of most appeal to him and the movement was a
federal United States of Africa that would supplant colonialism with African socialism.
He look to synthesize “traditional aspects with modern thinking” to be achieved by non-
https://bit.ly/3isRfec Google Scholar
61
“Ghana: A Country Study” 11/1994
https://bit.ly/2XGLH8d Google
37
violent means, if possible.62 The movement believed the Western exploitation of Africa
may morph but continue nonetheless. In Nkrumah‟s view, even the United States, with no
prior colonial ties to Africa, was poised in, „an advantageous position to exploit
independent Africa unless preventive efforts were taken.‟63 Nkrumah‟s investment in
Pan-Africanism competed with Ghana‟s limited resources for his envisioned publicsector projects. His emphasis on economic independence made him suspicious of the
conditionalities of international financial institutions (IFIs). This led to a stagnation of the
economy under him. Soon, facts on the ground had little in common with his stated
ambitions to industrialize and propel Ghana into modernity. Nkrumah‟s government
borrowed to finance important imports when foreign currency reserves dried up. Unlike
Korea which instituted strong oversights over state spending, Ghana‟s lack of oversight
of how foreign assistance was utilized for development, led to paternalism and
widespread corruption. By mid-1960s, continued borrowing for debt financing drowned
Ghana in further debt, and rising inflation eroded the standard of living for Ghanaians.
His opponents believed Nkrumah was wasting state resources on external programs. To
crack down on nationwide dissent, Nkrumah centralized power and declared Ghana a
one-party state. In these early days of Ghana‟s attempt to industrialize, order is what
mattered to Nkrumah, not fairness. His ambitions led to centralized power to the
62
Nkrumah, Kwame. "Kwame Nkrumah." Education 4 (1959): 1.
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63
“Ghana: A Country Study” 11/1994
https://bit.ly/2XGLH8d Google Scholar
38
exclusion of the opposition. Several opposition members disappeared, some only to reemerge either chastened or on trial in so-called kangaroo courts with pre-determined
judicial outcomes. Judging from Korea‟s experience, it is a fair price that must be paid to
cultivate the healthy environment for less distraction and concentration while the country
attempts an industrial lift-off. Deepening economic problems necessitated passing an
austerity budget in 1961. Ghanaians opposed the state‟s policies as they implicitly
assumed that government should behave as a benevolent social guardian. To further
concentrate power, the state formed alliances with the elites and patrons. However, this
did not prevent his overthrow in 1966.64
The intervening years after Nkrumah‟s overthrow were dire for Ghana. Jiyoung
Kim referred to the years 1966 to 1983 as, “the black years,”65 a period in which Ghana‟s
military churned out one military junta after another as if in musical chairs fashion,
registering six military coups since its independence.66 The country‟s chaotic political
instability in the 1970s frightened an already ethnically diverse citizenry into their
regional bubbles. The result is that, already an abstract construct, the nation-state had lost
64
“Ghana: A Country Study” 11/1994
https://bit.ly/2XGLH8d Google
65
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348.
https://bit.ly/2F5Rr5b Google Scholar
66
“Congress: Ghana: A Country Study” 11/1994
https://bit.ly/2XGLH8d Google
39
its prominence to local, ethnic, and regional interests. Benefits and opportunities became
politicized and apportioned along ethnic lines and meaningful political participation
ceased. Moreover, the government‟s attempt to bring Ghanaians together is often viewed
with suspicion especially if such feverish calls come in the runup to an election.
The National Liberation Council (NLC) which overthrew Nkrumah with
“assurances of more democracy, more freedom,”67 and more prosperity for the Ghanaian,
soon learned that talk is cheap. To the admiration of Nkrumah‟s opponents, the NLC let
out all political detainees and bid those in exile home. However, they soon learned that
turning around an economy in free fall, is a much harder trick to pull off than using
executive order to let out political detainees. The government turned to multilateral
channel foreign creditors who offered yet more loans that deepened Ghana‟s economic
woes. According to some economic analysts, “Foreign aid has become a powerful
political actor in Ghana,” a political tool of the ruling class that constantly feeds Ghana‟s
patrimonialism.68
Severe hardship from the ill management of Ghana‟s economy and the open
plunder by the Busia government before, and the Acheampong government after, created
a groundswell of support when Flt. Lt. Jerry John Rawlings burst on the scene with
67
/69 See Kim, Jiyoung‟s. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7
(2015): 1333-1348. He makes the case that Korea achieved industrialization and integration into the world
market due to better utilization of foreign assistance that Ghana failed to use to its benefit. Kim‟s
scholarship is one of myriads that generalize foreign assistance among countries it considers Korea‟s peers.
https://bit.ly/2F5Rr5b Google Scholar
68
40
promises to rid the national leadership of corruption. This culminated in the execution by
firing squad of three former heads of state. Rawlings announced caps on the prices of
goods to curb inflation. He rolled his sleeves and joined volunteers in a nationwide
cleaning exercise. He participated in a cocoa evacuation campaign from the hinterland to
the ports thereby boosting exports. The hardship continued unabated thereby negating
any meaningful reform under him. When he overthrew the Hilla Liman government in
1981, Rawlings‟ PNDC government brimmed with pro-Marxist rhetoric but had to set
aside its anti-Western sentiments to solicit World Bank-backed Structural Adjustment
Program (SAP) loan. Ghana‟s governments following Nkrumah‟s overthrow, just kept
kicking the can down the road without committing to the steps to get out of debt and
industrialize. Like other SAP recipients, the aid conditionality threw price control out the
window and in came trade liberalization and an inflexible demand to balance the budget.
Market-friendliness flooded Ghana‟s market with cheap imports against which local
industries stood no chance. Export earnings remained low as the country still exported
primary agricultural goods, which made imports of capital equipment impossible.
Despite abiding by the IMF and World Bank‟s austere dictates, assessment of the
SAP‟s impact on the country‟s economy was ambiguous. Ghana became a member of the
HIPC amid its ever rising foreign debt and mixed results of its economic reform. The
upsides of HIPC membership are bilateral grants and debt relief.
The SAP prescribed divestiture of state assets over which Rawlings presided, was
criticized for its opacity and flagrant favoritism. Korea similarly divested assets of
41
departing Japanese in the aftermath of World War II with businesses and individuals
paying less than half the value of the assets.69 However, the assets were rehabilitated and
came online to help rebuild Korea‟s export sector whereas Ghana‟s did not significantly
boost exports. Despite evidence supporting the state‟s pivotal role in Korea‟s success, the
terms of Ghana‟s SAP structural adjustment loan to Ghana limited the state‟s role to the
divestiture of state-owned assets. State-led outward-oriented economic strategy worked
satisfactorily in Korea. Ghana‟s limited capital severely challenged its ambition to grow
its economy. Korea‟s export-based industrialization relied on state-guided strategy to
mobilize and allocate foreign aid funds to enhance national wealth. Although far from
being exact, the point here is to draw attention to IMF‟s attempt to deemphasize the
crucial role of the state despite evidence to the contrary.
69
Kim, Kwan S. The Korean miracle (1962-1980) revisited: myths and realities in strategy and
development. Helen Kellogg Institute for International Studies, University of Notre Dame, 1991.
https://bit.ly/3gEBsbU Google Scholar
42
CHAPTER 4
KOREA AND AMERICA
The Korean peninsula was a ruined, desolate landscape when the Korean War Armistice
was signed in the summer of 1953. It was a construction site into which the United States
deployed its massive economic, military and political power in an effort for bottom-up
nation-building. Three million Koreans died, millions more displaced. The North suffered
more devastation due to „American saturation bombing‟.70 When hopes of uniting the
peninsula fizzled, America channeled its development grants through the Economic
Cooperation Act (ECA) which Congress already passed in 1948. The United States led a
coalition of a well-funded drive to rehabilitate South Korea under the aegis of the United
Nations Korea Reconstruction Agency (UNKRA).71 A concurrent Sino-Soviet
„international socialist alliance‟ stood in solidarity with North Korea‟s rehabilitation.
70
Armstrong, Charles K. "Fraternal Socialism': The International Reconstruction of Korea, 1953-
62." COLD WAR HISTORY-LONDON-FRANK CASS- 5.2 (2005): 161.
https://bit.ly/31tuUXs Google Scholar
71
Armstrong, Charles K. "Fraternal Socialism': The International Reconstruction of Korea, 1953-
62." COLD WAR HISTORY-LONDON-FRANK CASS- 5.2 (2005): 161.
https://bit.ly/31tuUXs Google Scholar
Korea‟s push for self-reliance rested on building new electrical grid, steel mills, and
chemical industries in the south to replace the pre-war ones located in the northern part of
the peninsula. Power generation and fertilizer production took precedence to compensate
for the North terminating power along the 38th Parallel. North Korea‟s invasion of the
South exacerbated the ideological clash between the United States and the Soviet Union.
It also underscored Korea‟s geopolitical importance which it used to its advantage to
bargain for increased American aid. Korea‟s post-war reconstruction solidified the
geopolitical boundaries of Asia-Pacific. America saw an opportunity to showcase the
viability of the market-based international capitalist system versus the Soviet-style
socialist economics on the Korean peninsula.
The preparatory work to make Korea ready for post-war reconstruction began
with a thorough assessment and review of its constitution. Syngman Rhee initially
resisted American coercive nudge to amend articles of the constitution from the existing
socialist economy to a liberal market economy as a condition to secure American aid.72
The new “Post-Korean War Constitution” adopted in 1954, emphasized the power of
organizational structure and puts competition above equality. The constitution had
government involvement as well as combined elements of a planned economy, and a
liberal market economy. In general, the new constitution embraced limited elements of a
72
Yahuda, Michael. The International Politics of the Asia Pacific. Routledge, 2011.
https://bit.ly/35bCeJ6 Google Scholar
44
Soviet-style social market economic system but added state control with market
orientation to make it uniquely Korean, the so-called “third way” or “third form”.73
In a preview of the steps behind Korea‟s future as an industrial giant, the
government channeled some of the grant money to the private big firms. It then instituted
the Economic Performance Agency as oversight in specific industries to bring about
desired results. The state‟s militaristic methods attended the post-war reconstruction
drive. Strict compliance was enforced and any semblance of messy workers protests and
organizing were brutally suppressed. This kept a lid on the cost of wages and rendered
Korea‟s labor force cheap, a critical factor in rapid development. Korea benefited
considerably from the infusion of massive foreign assistance from America which
nudged Japan to facilitate transfer of technology and expertise.
Even when working under the auspices of UNKRA during the post-Korean War
reconstruction, the United States was the agency‟s singularly biggest contributor.
America contributed up to $93 million in cash and kind of UNKRA‟s $140 million
received in 1957. America contributed $1.8 billion of the total $2 billion to the Republic
of Korea. America continued aid and relief funding through various channels when
UNKRA exhausted all funds and was disbanded. Furthermore, America pledged $200
million annually in post-conflict economic aid to Korea. This is outside of direct military
73
Park, Myung Lim. "Constitution, National Agenda, and Presidential Leadership: Focusing on a
Comparison between the Articles on Economy in the “National Founding Constitution” and the “PostKorean War Constitution”." (2011).
https://bit.ly/3kqCc6G Google Scholar
45
assistance to Korea, and underscores America‟s financial influence and total obligation to
the Korean cause.74 Although America supplied much of the grant assistance for Korea‟s
reconstruction, Korean‟s ambitions did not always follow American guidelines.
The Economic Cooperation Administration – the predecessor of the US Agency
for International Development - took over aid issues from the Army. The focus of the
ECA was to establish a sound educational system as the essential base of an economic
growth in an independent and democratic state. Part of American foreign aid to Korea
paid for overseas education and training for thousands of Koreans who returned to roles
of policy formation experts, and technical leadership in industry to fill the void left by
departed Japanese technocrats and teachers. Later in 1966, foreign aid paid for the
establishment of the Korea Institute for Science and Technology, charged with the
acquisition and adaptation of foreign technology for Korean use. The Korean
Development Institute was established in 1971 and devoted to the rigorous analysis of
developmental policies. These official capacity-building programs as well as technology
rub-off from the US military, solidified Korea‟s expansion of industrialization and
institutional base. This underscored the proof that Korea started better off than each of
the focus countries in the 1950s-1960s. During the 1953-1962 decade that spans the
conclusion of the Korean War and industrial take-off, Korea had in place relatively
highly educated workers with literary and technical skills, internal security provided by
74
Lyons,
Gene
M.
"American
Policy
and
the
United
Nation's
Program
for
Korean
Reconstruction." International Organization 12.2 (1958): 180-192. https://bit.ly/2DFfIhA Google Scholar
46
its authoritarian government, a modern sector of the economy, and, a highly dependable
foreign patron, America, leading to rapid substantial capital accumulation. The
absorption of foreign innovative technology results when a balanced ratio of human and
physical capital is reached, making Korea positioned for aggressive economic growth. It
is clear Ghana had nothing comparable.
The path
to Korea‟s economic
growth
zigzagged around its initial
industrialization, a political upheaval, a devastating civil war, and uninterrupted postKorean War growth along a reasonably well-defined industrial path blazed by Japan.
Ghana had nothing comparable.
Korea‟s successful utilization of foreign aid for sustainable economic
development while Ghana did not is a recurrent theme in most scholarship comparing the
two countries. However, the type of foreign aid each country received is much less
generally emphasized. Unlike Korea whose foreign aid comprised largely of treaty-based
development grants from the United States, Ghana received loans with high interest rates
from multiple International Financial Institutions (IFIs). The high interests on the loans
had Ghana on hook for decades, digging the country deeper into external debt.
Furthermore, SAP prescribed trade liberalization policies had diluted the competitive
spur of Ghana‟s local industries and placed them at a competitive disadvantage from
cheap imports. Upstart Ghanaian businesses drowned in the deluge of international
competitive pressure and standards.
47
CHAPTER 5
BILATERAL VS. MULTILATERAL CHANNEL AID
Foreign aid is hard to categorize. To a donor, the advantages of bilateral aid go
beyond disbursement choice. When rich countries give bilateral aid directly to poor
governments, there is usually an alignment of policy between it and the recipient. This
bilateral channel is what America provided Korea. Korea‟s donors were mainly America
and Japan, whereas Ghana had to contend with multitude donors. The problems that
multi-channel donors present to a country versus having a couple of donors, are well
documented. As is argued by Bernie Bishop, multilateral donors and their conditionality
lead to policy cacophony and confusion. Differences within various IFIs policies and the
state lead to stagnation of policy implementation due to confusion.75 Furthermore, multichannel donors routinely challenge state capacity, legitimacy and effectiveness. Aid from
multiple donors often result in disconnected systems whereby projects are discontinued
or fall into disarray when funding is interrupted. This was the case with Ghana in which
few projects work well. The project size that Ghana‟s foreign assistance could fund are
75
Bishop, Bernie. Foreign direct investment in Korea: The role of the state. Routledge, 2019.
https://bit.ly/2C6IOpB Google Scholar
often negligible. Although it has lately pursued nation-building in „insignificant‟ states,
America‟s nation-building priorities seemed to follow conservative columnist Charles
Krauthammer who believes nation-building be „limited to strategically important states
that count.76 Ghana‟s foreign assistance is small potatoes compared to Korea‟s. Whereas
treaty-backed aid guarantees from America assures policy stability, aid cutoff in aiddependent country like Ghana causes anxiety in long term policy planning. Little foreign
assistance here and there makes the assistance susceptible to disruptive effects such as
inflation.
Also missing from the Korea success narrative is the contextual details about the
specific characteristics of foreign assistance Korea received compared to Ghana. IMF
structural adjustment loans to Ghana were partially responsible for the erosion of the
standard of living for Ghanaians. As the fulcrum of Korea‟s development, America
provided Korea reliability and assurance to allow for long-term planning, while
America‟s help to Ghana and Brazil were episodic and random. It is known that aid from
nonstate donors complicates coordination by recipient governments. It has been known
that sizeable portions of aid go to foreign experts and advisers whose multiple POVs
complicate recipient country‟s policy.
Ghana‟s external debt grew from US$1067 million in 1977 to $3287 million in 1987 and
reached $7510 million in 1999, with a corresponding IMF‟s share of Ghana‟s debt
76
Ottaway, Marina. "Nation building." Foreign Policy (2002): 16-24.
https://bit.ly/3ot83FV Google Scholars
49
service a solid 37% in 1987, 29% in 1995 and 13.7% in 1999.77 A country can hardly
accumulate capital for development when a sizeable portion of its resource goes into debt
servicing. Compounding interests on loans saddle Ghana with debt. This explains
Ghana‟s failed use of foreign aid, as opposed to Korea‟s.
As shown in Table 1, Ghana‟s economy began to contract in 1970 and got worse
from 1973 onwards. Its GNP growth registered a negative growth in 1973, and its GDP
growth percent for the same period contracted to 2.88 from the previous 9.72 in 1970.
Korea‟s remarkable growth during the period was because its investment in infrastructure
and outward orientation of its economy has started to pay off. Table 1 as used by Jiyoung
Kim failed to tie Korea‟s growth during the period to its prior massive investment which
would not have been possible without its capital accumulation through grants from
America. As argued elsewhere, thousands of Korean technocrats, trained with American
grant money, returned in mid-1970s to contribute their share to the economy. Among
others, it can be inferred from the table that the 1970s oil shocks sent Ghana‟s GDP and
GNP reeling into negative growth while Korea absorbed it.
77
Jiyoung
Kim (2015) Aid
and
state
transition in
Ghana
and
South
Quarterly, 36:7, 1333-1348, DOI: 10.1080/01436597.2015.1038339 Google Scholar
https://bit.ly/2F5Rr5b Google Scholar
50
Korea, Third
World
Table 1:
Year
GDP (constant 2000 US$
million)
GDP growth
(annual %)
GDP per capita
(constant 2000 US$)
GDP per capita
growth (%)
Ghana
South Korea
Ghana
South
Korea
Ghana
South
Korea
Ghana
South
Korea
1961
1967.24
30,356.299
3.43
4.94
282.716
1180.010
0.22
2.28
1964
2185.555
36,643.076
2.21
7.56
287.167
1316.349
−0.63
4.87
1967
2186.366
46,089.969
3.08
6.10
268.254
1541.546
1.00
3.68
1970
2552.423
63,643.235
9.72
8.34
293.996
1993.648
7.23
6.06
1973
2694.293
80,627.951
2.88
12.03
285.543
2375.962
−0.04
9.82
1976
2432.027
101,238.555
−3.53
10.57
240.342
2824.027
−5.40
8.82
1979
2630.301
129,963.323
−2.51
6.78
246.644
3462.549
−4.37
5.18
1982
2373.570
145,875.768
−6.92
7.33
204.183
3709.398
−9.96
5.68
1985
2586.447
186,569.643
5.09
6.80
200.936
4572.113
1.75
5.76
1988
3011.867
253,698.106
5.63
10.64
214.965
6044.029
2.82
9.59
1991
3443.142
323,368.202
5.28
9.39
226.282
7473.611
2.36
8.38
1994
3873.943
394,387.464
3.30
8.54
234.006
8872.010
0.50
7.57
1997
4395.924
482,107.174
4.20
4.65
246.198
10,491.082
1.71
3.67
2000
4982.849
533,384.028
3.70
8.49
259.991
11,346.665
1.27
7.58
2003
5696.959
610,885.293
5.20
2.80
276.405
12,764.272
2.67
2.29
2006
6778.672
698,799.258
6.40
5.18
305.751
14,446.359
3.85
4.67
2009
8137.279
753,760.393
3.99
0.32
341.552
15,325.940
1.55
-0.16
2011
10,053.617
830,523.428
14.39
3.63
402.695
16,684.213
11.76
2.87
Source: Jiyoung Kim: assessed 6/8/202078 Google Scholar
78
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348.
51
State Leadership
Park‟s state leadership was critical to successful state transition in Korea. Park‟s
government guided the state‟s industrialization policy. He generally relied on the big
private businesses, the chaebol. Kwan S. Kim‟s analysis deconstructing Korea‟s postKorean war ascent, posits three distinct phases: import substitution (1954-1960); outward
orientation (1961-1979); and balance and stabilization (post-1980).79 Park crucially built
on the physical and human capital infrastructure development began under his
predecessor, Syngman Rhee. Park controlled the phases of industrialization and used both
public and private enterprises to achieve his transitional goals. He turned to state
enterprises for the successful Pohang Iron Steel Company (POSCO). With the steel mill
on line, Park initiated the Heavy Chemical Industries (HCI) strategy in his economic
development plan. A few of the giant Korean private enterprises like Samsung, LG, and
Hyundai, begin during this period due to heavy political and financial support and
protection from foreign competition. When he took power, Park had an uneasy
relationships with the chaebols whom he considered corrupt. However, the leaders of
these private enterprises would later advise and work closely with him in planning
Korea‟s industrialization push. Granted Park‟s leadership accomplishments in Korea, the
regrettable 1966 removal of Nkrumah from government was a big blow to Ghana‟s
https://bit.ly/2F5Rr5b Google Scholar
79
Kim, Kwan S. "The Korean Miracle (1962–80) Revisited: Myths and realities in strategies and
development." Asian industrialization and Africa. Palgrave Macmillan, London, 1995. 87-143.
https://bit.ly/31xGNeG Google Scholar
52
aspiration to industrialize. Kwame Nkrumah‟s stab at modernity and development
following Ghana‟s independence, was short lived. His attempt to simultaneously
industrialize Ghana and be the face of Africa‟s liberation and unification without a
wealthy Global power patron, proved an impossible task. Moreover, Nkrumah‟s
commitment to continental unification under one government, guaranteed that the
Akosombo hydro-electric dam, and the Tema aluminum smelter were the only significant
projects America helped underwrite.80
President Park Chung Hee was assassinated in 1979. By then however, he had
crucially led Korea through the most crucial phase of Korea‟s development which was
the successful outward orientation of the economy. By contrast, Nkrumah was toppled
before he could usher in Ghana‟s modernity. At the time of his overthrow, Ghana was at
pre-embryonic import substitution stage, which in development transition, is early.
Korea’s Democracy
A commonly held view among comparative economists is that Korea
simultaneously achieved both democracy and unprecedented economic growth between
1962 and 1981. However, we know economic reconstruction in Korea was not in
lockstep with democracy building. In fact, Korea was governed by some of the „harshest
conservative autocrats in the world.‟ Moreover some scholars think delayed democracy
80
Miescher, Stephan F. "“Nkrumah‟s Baby”: the Akosombo Dam and the dream of development in Ghana,
1952–1966." Water History 6.4 (2014): 341-366.
https://bit.ly/3ijfg7B Google Scholar
53
might have contributed to Korea‟s rapid industrialization. Political commentator and
scholar Fareed Zakaria has argued that Korea‟s decades-long evolution of autocracy
through “liberalizing autocracy,” strengthened the democracy it eventually had.
According to Zakaria liberalizing autocracies were regimes that held back democracies
until they grew the economy, liberalized religious “rites of worship” and travel.
According to Zakaria by emphasizing political stability, and economic development over
becoming “democratic right away,” helped create the right environment for democracy to
thrive in some post-WW II nation-states like Korea. Scholarships on Korea‟s political
economy have demonstrated “clear connections between the country‟s rapid
industrialization and the ability of its governments to intervene in the economy without
popular input.”81 Korea‟s growth flourished while its democratic institutions and press
freedom lagged. In fact, America accepted the retardation of democracy as it prioritize
economic stability over democracy. Francis Fukuyama sees political liberalism following
economic liberalism at a slower pace albeit inevitable. In one instance of political
intolerance, growing frustration with labor laws among Koreans led to demonstrations in
May 1980 in the city of Kwangju. The violent suppression of the demonstration resulted
in hundreds of civilian deaths. Whereas the Korean economy flourished, democratic
institutions and a free press often did not.82 Korea‟s Fourth Republic 1972-1981 was a
81
Brazinsky, Gregg A. Nation building in South Korea: Koreans, Americans, and the making of a
democracy. Univ of North Carolina Press, 2009.
https://bit.ly/32umkbY Google Scholar
82
South Korea: A Country Study. United States, Diane Publishing Company, 1997.
54
period of upheaval for the country. There was a coup in December 1979 following the
coup in which Park was assassinated, and another one barely five months later in May
1980. According to Fukuyama, urbanized Korea, with its well-educated middle class,
seems to be intolerably „ruled by an anachronistic military regime‟. On the other hand,
although Ghana is lauded for its peaceful democratic elections even when incumbents
lose by slim margins, incoming governments often see the mandate to govern as
opportunity to award new contracts to party loyalists. This lack of continuity which is a
bane for many developing countries unfortunately plagues Ghana as well. However,
sustained bilateral aid could induce growth in Ghana. Furthermore usurious loans from
IFIs and lack of direct foreign investment compounds the problems of Ghana aiming to
climb out of debilitating debt.
Africa and the Cold War
WW II was an era of phenomenal expansion in human ingenuity and creativity
but also destruction. Humans possessed the power to utterly destroy creation when it split
the atom. The Cold War that came on the heels of WW II tested ideologies even more. To
gain an upper hand if even sheer numbers, the United States entered into relationship of
alliances with select countries it considers indispensable to its strategic security interests.
America‟s East Asia push came from two events. One was Soviets breaking America‟s
atomic weapon monopoly in August 1949, and the other was the North Korean surprise
https://bit.ly/2JIPM7F Google Scholar
55
attack on the South on 25 June 1950, Yahuda, 95.83 In an instant, Korea became a country
in a region whose stability America has suddenly considered supremely important.
America‟s first reaction was to deploy its military, economic, and political power in
Korea. Korea became the staging ground in America‟s fight to check Sino-Soviet
expansion and power in East Asia. According to Timothy Savage, America‟s perception
of Korea went from “a remote nation of little concern, to a perplexing problem of policy,
and finally to the earliest testing ground of the Cold War.”84 In Washington, debates
raged between its idealists and pragmatists about how to sow and nourish a seed of liberal
democracy on the peninsula. Washington‟s ideologues weighed the stakes. As if to say,
“the devil you know is better than the angel you don‟t know” Washington reached a
compromise to support Rhee‟s dictatorship. The stakes were too high to do otherwise.
From then on, America worked to win over governments in its ideological war but also
undermined governments it perceives sympathetic to Communism and Socialism, using
among others, threat of aid termination as deterrent.
The heightened ideological rivalry between the East-West played out beyond
Asia-Pacific and Europe. The early decades of the period was Africa‟s liberation decade,
and 1960 regarded particularly auspicious; their annus mirabilis. Although newly
83
Yahuda, Michael: The International Politics of the Asia Pacific. Routledge, 2011
https://bit.ly/3hX518s Google Scholar
84
Savage, Timothy L. "The American response to the Korean independence movement, 1910-
1945." Korean Studies 20.1 (1996): 189-231.
https://bit.ly/33RstPD Google Scholar
56
liberated, many African countries lacked the freedom to resource shop in either bloc for
the development of their economies. America viewed with suspicion, East-leaning
African countries and resorted to covert and overt methods to signal its displeasure.
America‟s well-resourced Central Intelligence Agency (C.I.A.) was implicated in the
coup that toppled Ghana‟s Kwame Nkrumah owing to his avowed neutrality in the EastWest ideological war.85 America manipulated aid allocations and restrictions to prop up
puppet regimes like Zaire‟s Mobutu, and removed progressive nationalists leaders like
Ghana‟s Nkrumah from power.
In East Asia, America‟s war to check communist expansion provided the premise
for it to stabilize Korea and rebuild its war-ravaged critical infrastructure and economy.
Some say it was nation-building. Nation-building would be discussed later. Moreover,
Korea‟s shining success, and North Korea‟s continued isolation had come to illustrate the
communist-capitalist ideological dichotomy - the DPRK and ROK; the one
impoverished, underdeveloped and with crumbling infrastructure, the other, a
technological marvel, a symbolic triumph of liberal democratic ideals.
Ghana and Korea differed in several ways. A significant difference that most
impacted the trajectory of their future political economies is the value placed on their
respective geographies during the Cold War. As two countries in two different
geographical regions, Korea reaped benefits from its unique position in East Asia as a
85
Blum, William. Killing hope: US military and CIA interventions since World War II. Zed Books, 2003.
https://bit.ly/3a4RqcY Google Scholar
57
bulwark where the lines are drawn in America‟s ideological war against the advance of
communism and socialism. Today Korea experienced fast integration into the world
economy going from aid recipient (ODA) to OECD donor, while international
conferences and policies continue to address Ghana‟s poverty and indebtedness. Ghana
would have been at par with its Asian counterparts if it too were to benefit from the
geopolitical dividends Korea enjoyed from America. What is important in the KoreaGhana dynamic is not that the latter chose to remain unaffected by the larger forces of
developmental trend as if it were averse to progress. The central issue is that Ghana
succumbed to the strong pull of liberal democracy only to be sabotaged by the very
proponent of liberal democratic ideal, the United States. Like a moth to a flame was
Ghana to the beacon of liberal democracy, only to be smote down by the powerful hand
of America.
Brazil
In 2003, economic experts considered Brazil a limping dog among a pack of agile
hounds following Brazil‟s inclusion in “BRIC” alongside Russia, India and China, as one
of four “key growth engines of the global economy.”86 Skeptics point to a recent
International Monetary Fund capital injection as substantive reason to doubt Brazil‟s
viability. Only when the nation‟s sovereign debt was classified „investment grade‟ did
86
Moreira, Mauricio Mesquita. "Brazil‟s Trade Policy." Brazil as an Economic Superpower?:
Understanding Brazil's Changing Role in the Global Economy (2009): 137.
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58
analysts sigh. In land size and population, Brazil is ranked the world‟s fifth largest
country.87 Brazil‟s vast arable lands – most of it unexploited – together with its vast
internal market makes it an “object of fascination and speculation” among international
investors. The burgeoning ranks of the world‟s middle class projected to reach 1.8 billion
by 2020, and a strong global demand would translate into a surge of revenue for Brazil‟s
commodities and manufactures. It is expected that Brazil‟s impressive investments in the
renewable energy industry could sustain it in post-Kyoto Protocol climate pressure to
curb carbon emission. The state, is a formidable presence in Brazil; it owns 38 of Brazil‟s
100 largest firms. Moreover, Brazil‟s public sector, reputed to be the „largest outside the
former Communist bloc‟ is an albatross around its neck. Some analysts believe Brazil
needs to trim its bloated bureaucracy to guarantee lean growth. Some fear Brazil‟s vast
social safety-net - Bolsa Familia – (the health and nutrition assistance to Brazil‟s needy
and underprivileged populations) would sink some of the country‟s economic gains. The
program‟s rapid expansion (24 percent of the population benefits from it) and popularity
among politicians and Brazil‟s poor, dooms any prospect of fat-trimming.88 Moreover,
although strong commodity prices tend to be fleeting, enthusiasm for Brazil‟s economy is
never lacking as aircraft manufacturing, biofuels, and petrochemicals have individually
87
Sandoval, Lindsay. "The effect of education on Brazil‟s economic development." Global Majority E-
Journal 3.1 (2012): 4-19.
https://bit.ly/2FsKXNX Google Scholar
88
Hall, Anthony. "Brazil's Bolsa Família: A double‐edged sword?." Development and change 39.5 (2008):
799-822.
https://bit.ly/3iHMNsw Google Scholar
59
experienced „prominent successes‟. However, the state in Brazil lacks the kind of
meticulous coordination the state of Korea exerted on industry sectors in its post-war
development. However, sound macroeconomic investments and divesting into other
sectors of the economy could ensure steady growth for Brazil. The country continues its
integration into the global economy with sustained economic growth under stable
democracy. New oil finds together with middle class growth in India and China combine
to assure Brazil‟s status among its peers in the world‟s rising economic powers.
Brazil‟s global economic powerhouse status notwithstanding, human development
paradoxically lags. As the country‟s economic gains rise, inequality becomes surprisingly
more rampant which greatly affects the quality of Brazil‟s human capital. According to
Lindsay Sandoval, poor education is the culprit in the widespread income inequity that
plagues the country. Brazil enjoys the unflattering reputation as the 12th most unequal
society in the world.89 Brazil is tone death to clarion calls to use improvements in
education as proxy to tackle widespread systemic inequities. There is mounting evidence
that low quality education begets low income, which in turn leads to low quality
workforce. However, Brazilian leaders seem to lack a coherent plan to disrupt this selfperpetuating vicious cycle. Brazil suffers from one the highest rates of grade repetition
and dropout rates in the world. Like most aspects of Brazilian life, disparities in
89
Sandoval, Lindsay. "The effect of education on Brazil‟s economic development." Global Majority E-
Journal 3.1 (2012): 4-19.
https://bit.ly/2FsKXNX Google Scholar
60
education quality are entrenched across urban and rural populations. Although Brazil
spends identical percentage of its GDP on education as its Latin neighbors, gaping
inefficiencies in its „education system undermine this investment.‟ Many consider its
education substandard. Brazil is sluggish in its embrace of policy tools and pedagogical
regulatory reforms that can reverse its chronic teacher and student absenteeism. Brazil
lacks teacher-tracking oversights although rampant teacher absenteeism is a known
morale and reading efficiency killer. Little impact can be made without supervision and
tracking of teachers‟ use of school time. Targeted reforms of its education system can
result in significant increase in attendance, and mitigate dropout rates, waste, and
systemic failures. Education reforms should emphasize quality over high enrolment
figures. Brazil seems oblivious to the role quality education plays as a driver of economic
growth and its effect on poverty alleviation. Pragmatic investments in education with
strong oversight could bring the much needed modernization to Brazil‟s education
system.
61
CHAPTER 6
ANALYSIS
Among my focus countries, Korea benefited most from the Cold War when its
geographic location is considered supremely important to America‟s foreign policy
objectives in Asia. Korea achieved geopolitical relevance as two rival superpowers stare
down each other in palpable tension across the 38th parallel in their uneasy co-existence.90
The Soviet Union presented expansionist threat to America and challenged America‟s
promotion of liberal democracy and global capitalism during the Cold War.91 Korea‟s
geographic value especially during the Cold War, has given rise to the 1980s growing
body of international relations branch of study called „critical geopolitics.‟92 The
privileging of Korea‟s geography compelled America to underwrite the „financial
90
Sungjoo, Han. "South Korea and the United States: the alliance survives." Asian Survey 20.11 (1980):
1075-1086.
https://bit.ly/31skJlO Google Scholar
91
Dodds, Klaus. "Cold war geopolitics." A companion to political geography (2003): 204.
https://bit.ly/3a7se5E Google Scholar
92
Dodds, Klaus. "Cold war geopolitics." A companion to political geography (2003): 204.
https://bit.ly/3a7se5E Google Scholar
requirements of Korea‟s subsistence and defense [which] accounted for up to 10% of
Korea‟s GNP in that period.‟93 Comparatively, Ghana was hurt the most following
Nkrumah‟s removal (decapitation) leading to the derailment of Ghana‟s attempt to
industrialize. It is possible that Nkrumah‟s Marxist leanings and ideologically
antagonistic rhetoric put him in America‟s crosshairs. To be sure the decade of African
liberation, the sixties, was anxious time for America and the Soviet Union. Their war of
ideological dominance worked against Africa‟s progressive leaders like Patrice
Lumumba and Nkrumah. African leaders and their countries became proxies in the
ideological war between the two superpowers. The Truman doctrine preceded Ghana‟s
independence by a decade. And although the doctrine espoused to “support free peoples
who are resisting attempted subjugation by armed minorities or by outside pressures,” 94
America did little to aid Ghana‟s resistance of British subjugation. Was it because Britain
pushed back on America‟s pressure, or was America‟s thinking at the time „tempered by
the need to shore up the weakened West European countries and their fragile democracies
against the perceived communist and Soviet threat‟?95
93
Sungjoo, Han. "South Korea and the United States: the alliance survives." Asian Survey 20.11 (1980):
1075-1086.
https://bit.ly/31skJlO Google Scholar
94
Yahuda, Michael. The International Politics of the Asia Pacific. Routledge, 2011.
https://bit.ly/3hX518s Google Scholar
95
Yahuda, Michael. The International Politics of the Asia Pacific. Routledge, 2011.
https://bit.ly/3hX518s Google Scholar
63
This paper is about the political economic development among Ghana, Brazil, and
Korea, three countries with similar but distinct histories. The paper‟s focus on Korea
follows the forces that shape it. I attempt to examine the rest of the cohorts through these
forces. These are colonialism and the Cold War. These incidentally impact all three. The
evidence I presented support my thesis that America‟s special relationship with Korea
was driven by its Cold War imperative to prevail against the threat of Communism, and
to check its expansion anywhere. Colonialism impacts each of the focus countries on a
similar scale to the Cold War. I have proven that geography is of supreme importance
during the Cold War. The nature of America‟s uneven involvement in my focus countries
impacts aid disbursement among them. Countries tilting East in deed or words, kindle
America‟s resentment and wrath.
Ghana and Korea differed in the specific characteristics of the type of foreign
assistance each received. Ghana had to contend with multi-channel aid with high interest
rates and contesting agenda, while Korea received interest-free bilateral grants largely
from the United States and Japan.
Portability of the Korean Model
Scholars have studied the success of the Korean „miracle‟ because of its policy
implications for stagnating African and Latin American countries. Some scholars see
discernible patterns behind Korea, Taiwan, and other East Asian „miracle‟ economies.
According to Sherry Gray, scholars have three factors that explains the economic boom
in Asia in general. Some see Weberian influence that align with the region‟s Confucian
64
cultural practices of strong work ethic, postponement of gratification, and thrift, as a
factor. The second factor is the Cold War as a historical accident that induced the United
States „prosperity spending‟ via the military and economic spending in Korea. The third
factor is the role of the state in imposing social conditions conducive to capital
accumulation. Although some scholars have moved away from the cultural Confucian
factor and the historical accident of the Cold War as strong factors, some components of
these remain relevant. For instance, while the historical accident of the Cold War may not
be duplicated or exportable, its massive spending component could be exported. I focus
on this component because of the experiences of Ghana. Major, consistent spending over
time in a country could make the great difference in most stable but poor economies.
America‟s long term, open-ended commitment to ensure political stability and economic
growth in Korea could be duplicated elsewhere in a country like Ghana. Not all „breakout
nations‟ have American foreign assistance. Lacking the magnitude and duration of
American support, the kind that fueled Korea‟s ascent, Ghana could accumulate
sufficient capital from its oil revenue and rents from its mineral sector to self-finance its
transition. Oil wealth and foreign aid did not make Nigeria a developmental nation
although it helped Indonesia escape the so-called „resource curse‟ in the 1960s in stride
with the „Asian Tigers‟ in the mid-1990s. Although America provided the funding, the
vision behind Korea‟s industrialization were all its own. To some experts, Korean agency
was the most potent factor in the country‟s developmental transformation. Korea suffered
assassination and coups that challenged its vision, but remained committed to its long65
term goal of achieving developmental growth. Many Koreans adapted quickly to the
American influence having lived under Japanese colonialism that exposed them to
„authoritarian model of development‟ that endured to when „American nation builders
arrived.
66
CHAPTER 7
FINDINGS AND CONCLUSIONS
The rise of the Korean state out of subjugation and a war not officially ended, to
„arguably the premier development success story of the last half century,‟96 has been
widely canvassed in political economy literature. There is no simple and straightforward
explanation why Korea succeeded at industrialization between the sixties and eighties,
although Korea‟s success at weaning itself off the foreign assistance that it once received
with its peers like Ghana, has continued to generate frequent comparisons between the
two countries. My mission here is to find substantive explanation underlying Ghana‟s
failed transformation. The reasons advanced for Ghana‟s abortive industrialization often
wrongly assume that Ghana accomplished less with identical foreign assistance with
which Korea blazed out of helpless poverty. This is not so. Favorable foreign aid spurred
Korea‟s rapid ascent. Though there are now hundreds of empirical papers comparing the
96
Noland, Marcus. "Korea's growth performance: Past and future." Asian Economic Policy Review 7.1
(2012): 20-42.
https://bit.ly/2DvFTaO Google Scholar
impact of foreign assistance on Korea and Ghana, relatively few focus on the different
foreign aid each received. Even so, these are inundated by the crush of scholarship that
echo the superficial.
There are inherent biases in the models used to compare Korea‟s successful aid
utilization to Ghana and Brazil. Attribution problems and the disregard of contextual
factors behind Korea‟s industrialization render these comparisons unfair. Korea, Ghana,
and Brazil had different experiences with foreign aid. The comparisons are hard to defend
when the recurring theme behind Korea‟s success remains its „efficient foreign aid
utilization while it peers did not.‟ Korea received substantial foreign aid to implement its
development policy preferences. Japan laid the industrial foundation which Korea scaled
during its post-war reconstruction. It had the funding which America generously
provided. Korea‟s quandary became how to grow the country using the grants, not from
worrying over where to get funds. The spigot of Washington‟s financial assistance to
Korea ran fast and long leading to the rapid capital accumulation which is critical to its
achievement of developmental transformation within three decades. On the other hand,
Ghana had limited foreign assistance and took out short-term and high-interest rate loans
in the 1970s and 1980s. Nkrumah‟s missteps delayed Ghana‟s development. For much of
his presidency, it was doubtful what mattered more to Nkrumah. Was it his Africa
emancipation quest or the fulfilling of his mandate to Ghana?97 Ghana‟s inability to
97
Onwumere, Obima. "Pan-Africanism: The impact of the Nkrumah years, 1945–1966." Trans-Atlantic
Migration: The Paradoxes of Exile (2008): 229-41.
68
achieve equitable and sustainable economic growth during this period marked the origins
of the divergence of the Ghana-Korea GDP gap which grew wider the more Korea
consolidates its industrialization and Ghana retrogresses.
Japan‟s colonial assimilation policy introduced modernity and development to
Korea which stands in sharp contrast to Ghana‟s colonial experiences under British
subjugation. Japan‟s successful penetration into Korea is aided by their geographic
proximity and cultural similarity. Britain focused on mineral extraction and agricultural
export and limited its infrastructure investment to mining and farming areas, to the
exclusion of the rest of the country. It is argued elsewhere that the schools the British
established in colonial Ghana had at its core, the grooming of colonial administrative
support, not transformation to modernity. Various economic models are used to illustrate
Ghana, Korea and Brazil as contemporaneous with identical GDP in the 1960s. Evidence
of the chronology of events, supports the contrary. By the 1945 division of the Korean
Peninsula, Korea already had in place the building blocks for growth which included an
educated population, property rights, and some modest land reform that boosted
productivity.98 Ghana was not even a country in 1945. Moreover, in the first four years of
Ghana‟s independence, Nkrumah‟s government had little economic control over the
https://bit.ly/35KWWS3 Google Scholar
98
Noland, Marcus. "South Korea's experience with international capital flows." Capital Controls and
Capital Flows in Emerging Economies: Policies, Practices, and Consequences. University of Chicago
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69
country which retards the state capacity. According to John D. Esseks, at independence,
most if not all African countries were challenged politically and economically, with the
foreign control of significant sectors of their economy. This gives foreign private
enterprises control over the countries‟ natural, physical-capital, manpower, and financial
resources.”99 With limited state capacity, even the nationalization of enterprises Nkrumah
attempted yielded nothing more than the token, „internal marketing of cocoa and the
foreign sales of timber logs.‟ This was a severe blow to an ambitious president prancing
to quickly change the face of entrepreneurship in his young republic. Thus the CPP
government‟s quest to get the upper hand in the control of the country‟s economy,
amounted essentially to a „strategy of competitive coexistence,‟ with the dominant
foreign enterprises. The competition exposed the state‟s real capacity and bargaining
power which was dismissive. Moreover, the lack of loans and other modes of credit to
local businessmen only kept the competition firmly in the grip of the foreign enterprises
to the frustration of a government eager to enable entrepreneurial self-sufficiency for its
citizens. Around this same period, the inflow of American foreign assistance to the
Korean state undergirded its negotiating power with the country‟s powerful conservative
opposition whose alliance with colonial Japan underscores its intent on maintaining the
status quo. Curiously, capital accumulation combined with the acumen of Korea‟s
leadership to steel its resolve to defy Washington‟s insistence to stay agrarian. Thus even
99
Esseks, John D. "Political independence and economic decolonization: the case of Ghana under
Nkrumah." Western Political Quarterly 24.1 (1971): 59-64.
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70
the big private enterprises - the Chebols, - were at the mercy of the state over its
monopoly on funding. The state in Korea was central, powerful, and had the capacity to
sidestep crippling bottlenecks to development that Nkrumah‟s state in Ghana lacked.100
Korea‟s resource poorness led to more pragmatism and reliance on practical skills and
technology. The prevailing literature often blurred the stark distinctions between loan and
grant regimes in foreign aid, and fails to address the benefits of grants versus the vicious
cycle of retrogression which loans perpetuate. Foreign aid financed most of Korea‟s rapid
capital accumulation which at its peak in the late 1950s, accounted for more than half of
its imports leading some experts to claim that Korea‟s poverty after the Korean war was
exaggerated. Thanks to consistent grants from the United States, and financial controls,
which enabled Korea to embark on straightforward paths for industrial upgrading based
on imitating the prior trajectories of the more advanced economy of Japan. Ghana‟s
capital inadequacy contributed to its failure to execute its development policies besides
foreign debt servicing. Moreover, unlike Korea, Ghana lacked any prior technological
base on which to build a modern, sustainable economy.
Cold War imperatives forced America‟s hand to underwrite Korea‟s security and
internal stability as a bulwark against Sino-Soviet expansionism in the East. Ghana
lacked any Global power ally singularly dedicated to its development. The same Cold
War that was a boon to Korea was a bane to Ghana. Nkrumah‟s professed neutrality (he
100
Noland, Marcus. "Korea's growth performance: Past and future." Asian Economic Policy Review 7.1
(2012): 20-42.
https://bit.ly/2DvFTaO Google Scholar
71
was a founding member of the Non-Aligned Movement) in the East-West ideological war
did not appease Western governments led by the United States of America. America saw
through his cloak of neutrality and used his rabid nationalistic rhetoric as grounds to
classify him (alongside Patrice Lumumba) rising radicals to be feared and silenced.
Already a target of conspiratorial plots of assassination for his „tyranny‟, Nkrumah had
internal as well as external adversaries biding their time for his overthrow. Evidence of
America‟s implication is circumstantial. Much of this evidence came from former
American ambassadors to Ghana who confess their implication decades after Nkrumah‟s
overthrow. He was targeted and help from overseas was provided for his removal from
power, thereby derailing Ghana‟s ambition to industrialize.
The stars seemed lined up for Korea‟s rise. The Japanese technology rub-off
during its colonial period combined with a future America‟s major assistance to
accelerate Korea‟s historic ascent. Korea continues to build upon even after its
independence. According to Gregg Brazinsky, thousands of Koreans gained invaluable
experience in new modes of governance and production‟ through modern heavy Japanese
industries on the peninsula, military enlistment and „participation in the extensive
colonial bureaucracy‟.101 On the other hand, Britain left little technological influence on
Ghana. Furthermore, Ghana lacked a consistent national development plan. Although it
has consolidated its democracy, there are jarring discontinuities of development policies
101
Brazinsky, Gregg A. Nation building in South Korea: Koreans, Americans, and the making of a
democracy. Univ of North Carolina Press, 2009.
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72
between Ghana‟s successive governments. Often at great expense to the country,
incoming governments usually scrap viable development plans of the outgoing
government for graft from new contracts. While elections are at the center of a
democracy, in Ghana, an electoral success of one government is often a win for the
dominant ethnic representation in that government. Individuals and groups in the
government become the beneficiaries of spoils from elections at the expense of the
general welfare of the society. Korea‟s homogeneity gives it one less problem to contend
with in its development aspiration unlike Ghana whose fragmentation along ethnic lines
paralyzes its decision making. The state in Ghana takes a backseat to the strong draw of
ethnicity. Ethnicity constantly tested the cohesion of the country and appropriates the
common good to itself. This makes Ghana unable to escape the trap of the widely applied
terms of kleptocracy and clientelism that have become synonymous with some resourcerich African countries. Some scholarships highlight these structural and institutional
factors as reasons behind Ghana‟s growth collapse. Ghana could duplicate Korea‟s
success if it harnesses its resources much more sensibly. As a developing country, Ghana
could attract private investment if it creates conditions where investments are secure and
profits high.
CONCLUSION
In this thesis, I made extensive references to the Cold War and the legacy of
colonialism because of their impact on my focus countries. Recent decades have seen
growing scholarship of how resource-poor countries successfully used foreign aid to
73
build their economies while their resource-rich counterparts continue to be aid dependent.
Korea is especially lauded for its dynamism in weaning itself off foreign assistance at
historic brisk pace, while its cohorts Ghana and Brazil did not. How Korea got there is
controversial due to attribution factors. Some writers generalize foreign aid or gloss over
critical distinguishing components of the foreign aid regime from nation-building. I argue
that nation-building in Korea accounted for the country‟s sixties-to-eighties
transformational leap ahead of its cohorts. Nation-building and institution-building by
America scarcely come up in much of the literature mediating Korea‟s rise. What appears
most often is „bilateral aid‟ that Korea and other nations received but which Korea
comparatively „utilized better than its peers‟. In the aftermath of the Korean War,
America made an open-ended commitment of money and power to see its nation-building
exercise in Korea through to the end. Reconstruction in Korea included rebuilding
institutions that make a modern state run effectively. Korea had a makeover of its
judiciary, civil service, and a restructured government bureaucracy and the establishment
of a central bank. America‟s post-conflict stabilization and reconstruction in Korea, gave
it an auspicious start, thereby erasing its so-called resource „poorness.‟ Is that nationbuilding? I draw my answer from the way Korea turned out. Korea substantiates the
utility of nation-building, with its developmental transition going from aid recipient to
donor in record time. Therefore it is nation-building when a Global power makes an
open-ended commitment to see the transformation through. It is nation-building when
America hitched Korea‟s success to its own success. It is nation-building when the
74
United States fears it would “suffer a tremendous loss of prestige if it abandoned its
commitment there.”102 All of this was understandable granted the United States is the
face of liberal capitalism and was the occupying presence at the time of North Korea‟s
invasion of the South. How much bilateral aid is considered nation-building grade?
Following the Korean War, America carried out both reconstruction and development
which meets Francis Fukuyama‟s definition of nation-building. Fukuyama defines
reconstruction as the repair of a society‟s war destruction to its pre-conflict state, and
development as, „the creation of new institutions and the promotion of sustained
economic growth, events that transform the society open-endedly into something that it
has not been previously.”103 The enormous cost of the model makes it prohibitive. The
major commitments of money and armies of personnel it requires to properly execute
makes it an unlikely model to prescribe to other places. America‟s global leadership has
lots of contradictions: it is a dominant agent in Korea‟s industrialization while a reluctant
participant in Ghana and Brazil; a tremendous Cold War nation-builder in Korea, but a
saboteur of Ghana‟s development. This makes using Korea‟s development as a
benchmark for comparisons with countries like Ghana, disingenuous. America‟s
extensive Cold War engagement in Korea assured innovative success and precluded
failure. Again this is understandable granted Korea‟s critical geography. However,
102
Brazinsky, Gregg A. Nation building in South Korea: Koreans, Americans, and the making of a
democracy. Univ of North Carolina Press, 2009.
103
Fukuyama, Francis, ed. Nation-building: beyond Afghanistan and Iraq. JHU Press, 2006.
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75
political economy writers enthusiastically continue to tout Korea‟s success story, not by
comparing it to countries that similarly benefited from major bilateral aid flows like
Israel, but with countries like Ghana whose interest-laden foreign assistance continue to
sink the country in accrued debt. Brazil is classified an NIE which makes Ghana, the least
economically successful among its cohorts. America‟s asymmetrical engagement with
my focus countries results in the nature of uneven access to aid flow them. Moreover, it is
hard to defend a comparison between a country like Korea, which benefitted from
bottom-up nation-building, with a country like Ghana that thrives on chump change from
IFIs. This is the crux of my thesis: comparing apples to oranges.
76
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Development11.3
(1991):
245-255.
HOW GHANA‟S POLITICAL ECONOMY
TRULY COMPARES WITH SOUTH KOREA, AND BRAZIL
By
Daniels Dodzi Tornyenu, B.A.
New Jersey City University of New Jersey
A Thesis Submitted in Partial Fulfillment of
the Requirements for the Degree of Master of Arts in Political Science
to the office of Graduate and Extended Studies of
East Stroudsburg University of Pennsylvania
December 19, 2020
SIGNATURE/APPROVAL PAGE
The signed approval page for this thesis was intentionally removed from the online copy by an
authorized administrator at Kemp Library.
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Extended Studies. Please contact Theses@esu.edu with any questions.
ABSTRACT
A Thesis Submitted in Partial Fulfillment of the Requirements for the Degree of
Master of Arts in Political Science to the Office of Graduate and Extended Studies of
East Stroudsburg University of Pennsylvania.
Student‟s Name: Daniels Dodzi Tornyenu
Title: Apples & Oranges: How Ghana‟s Political Economy Truly Compares with South
Korea, and Brazil
Date of Graduation: December 19, 2020
Thesis Chair: Samuel Quainoo, Ph.D.
Thesis Member: Ko Mishima, Ph.D.
Thesis Member: Adam McGlynn, Ph.D.
Abstract
This paper calls for a reexamination of the standard literature why Korea successfully
used foreign aid while its peers continue to be aid dependent. My focus is on Ghana,
Brazil, and South Korea, - the most representative examples of countries which used
foreign assistance, had similar per capita gross domestic product (GDP) in the early
1960s, but which end up differently sixty years later. Salutary scholarship to South
Korea‟s leapfrog industrialization and democracy between 1962-1980 is mainstream.
Much of these unfairly presume my focus countries had identical aid flows to
industrialize. This qualitative paper reappraises the key building blocks of Korea‟s
successful development transition to clarify Ghana‟s growth collapse and Brazil‟s
delayed ascent. The paper considers the weighty broader implications of America‟s Cold
War policy objectives in addressing the replicability of the Korean “miracle” to other
countries.
DEDICATION
To my wife Ruby Bortey, my daughter Marie-Chantal Tornyenu, and my son JeremyAjanou Tornyenu. You bid the sun to delay its descent until I prevail. To Vincent Twum,
the constant nudger.
iv
TABLE OF CONTENTS
LIST OF TABLES ______________________________________________________vii
CHAPTER 1 ___________________________________________________________ 1
INTRODUCTION ______________________________________________________ 1
Methodology ................................................................................................................... 6
CHAPTER 2 ___________________________________________________________ 9
COLONIAL LEGACIES: GHANA, KOREA, AND BRAZIL GREAT BRITAIN AND
THE UNITED STATES __________________________________________________ 9
Ghana ............................................................................................................................ 11
Brazil ............................................................................................................................. 18
Korea ............................................................................................................................. 27
CHAPTER 3 __________________________________________________________ 34
FOREIGN ASSISTANCE _______________________________________________ 34
Ghana ............................................................................................................................ 35
CHAPTER 4 __________________________________________________________ 43
KOREA AND AMERICA _______________________________________________ 43
CHAPTER 5 __________________________________________________________ 48
BILATERAL VS. MULTILATERAL CHANNEL AID ________________________ 48
State Leadership ............................................................................................................ 52
Korea‟s Democracy ...................................................................................................... 53
Africa and the Cold War ............................................................................................... 55
Brazil ............................................................................................................................. 58
v
CHAPTER 6 __________________________________________________________ 62
ANALYSIS ___________________________________________________________ 62
Portability of the Korean Model ................................................................................... 64
CHAPTER 7 __________________________________________________________ 67
FINDINGS AND CONCLUSIONS ________________________________________ 67
Conclusion .................................................................................................................... 73
REFERENCES ________________________________________________________ 77
vi
LIST OF TABLES
Table 1:_______________________________________________________________51
vii
CHAPTER 1
INTRODUCTION
This paper focuses on Ghana and her peers, Brazil and South Korea. All three
countries are examined although it focuses on South Korea (hereafter, Korea) which, in a
single generation, experienced an exponentially high growth and democracy ahead its
1960s GDP peers, Ghana, and Brazil. These three countries, are the most representative
examples of countries that had similar GDP in the 1960s but whose divergent paths now
put them in different economic brackets. According to Jiyoung Kim, Korea‟s GDP was
comparable to some poorer countries of Asia and Africa in the 1960s.1 Korea‟s
ascendance as a „breakout nation‟ began with a growth spurt in the 80s and 90s that led to
an astonishing $1.410 trillion GDP in 2014, and lands it in the high-income bracket.2
Brazil is regarded upper middle-income country with $2.346 billion G.D.P while Ghana‟s
1
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348.
https://bit.ly/2F5Rr5b Google Scholar
2
Sharma, Ruchir. Breakout nations: In pursuit of the next economic miracles. WW Norton & Company,
2012. https://bit.ly/3j6inAA Google Scholar
G.D.P. is $38.62 million and is ranked lower middle income.3 Korea, which declared
independence on August 15, 1948, is the premier development success story of the last
half century. Korea went from aid recipient to donor. It hosted the G20 summit, the
„unofficial steering committee of the world economy‟ in November 2010. The broad facts
of the Korean case are now relatively well known, though the contextual facts mediating
its spectacular developmental transition, and how it truly compares with other poor
countries like Ghana, are still unfolding. Given the infrequency of successful
developmental economy on the African continent, understanding how a sure star like
Ghana plummeted is important.
This paper focuses on the 1960-1980 period because it the most often cited period
during which Korea experienced its transformational growth. Second, because it was the
period during which the sharp divergence of the economies of my focus countries began
to distinguish them. Third, the period coincides with the Cold War during which the
uneven nature of America‟s involvement in each country became particularly evident.
Foreign aid regime, America‟s overarching Cold War foreign policy objectives,
and state leadership have been dealt with individually in the comparative political
economies of my focus countries. However, their interplay brings new perspectives that
make a compelling case for a reexamination of how the countries truly compare. Korea‟s
3
Sharma, Ruchir. Breakout Nations: In Search of the Next Economic Miracles. WW Norton & Company,
2012
https://bit.ly/3j6inAA Google Scholar
2
successful developmental experience, dubbed a „miracle‟ by some writers, has become a
prescribed economic model to countries aspiring to industrialize. The portability of the
Korean experience to other countries and the difference it could make in changing
Ghana‟s fortunes or its influence on Brazil‟s development policy choices during the
period is consequential.
The competition among nations to be economically self-sustaining, is often a
fierce engagement that is tilted in the favor of nations which specialized in products or
services that is of advantage to the economies of scale.4 The power that trade
specialization and dominance confer makes it an inherently „contentious and prominent
international issue.‟5 Trade disputes and their occasional escalation into military conflicts
challenge the conventional wisdom that bilateral trade promotes peace, and leaders are
rational.6 Powerful nations use trade to exact concessions or acquiescence from weak
ones. Immanuel Wallerstein‟s three-tier hierarchy World Systems Theory, has at its core
the advanced capitalist economies which run roughshod over weaker nations at the
4
Hazlitt, Henry Foreign Investment vs. Foreign Aid
https://bit.ly/3d0U84z Google
5
Topik, Steven C. Trade and gunboats: the United States and Brazil in the age of empire. Stanford
University Press, 1996.
https://bit.ly/3iPZzW1 Google Scholar
6
Martin, Philippe, Thierry Mayer, and Mathias Thoenig. "Make trade not war?." The Review of Economic
Studies 75.3 (2008): 865-900.
https://bit.ly/30nfBzR Google Scholar
3
periphery.7 The story of my focus countries is their scramble to escape the poverty trap of
the periphery for the core. The success of their integration into the capitalist world system
depends on factors including the forces of history, statecraft, and chance.
Korea is the benchmark among its cohorts due to its preeminent economic
success. A key distinction among my cohorts is also how they are distinguished
geographically and also by their policy choices to get ahead. For instance, Brazil
preoccupied itself with inter-American commerce while Korea oriented outward to a
global market. This thesis uses comparative historical analysis to better understand the
reasons my focus countries started similarly but end up differently six decades on. It is
my hope that understanding the facts behind Korea‟s economic success would prevent
countries like Ghana from the pursuit of doomed policies at the expense of viable ones.
Korea‟s success story, Brazil‟s half-fledged take-off, and Ghana‟s diminished
capacity has become a common subject of research in development economics. Generally
credited with Korea‟s success is its superior economic policy, efficient utilization of
foreign aid, and the role of the state. Beyond macroeconomic mismanagement as well as
badly implemented development strategy, the facts of the Ghana, and Brazilian cases are
far less understood, yet carry enormous interest for development economists.8 By
7
Cohn, Theodore H. Global political economy. Routledge, 2015.
https://bit.ly/2Gr6aYS Google Scholar
8
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348.
https://bit.ly/2PzLbV2 Google Scholar
4
focusing on the development of Korea‟s political economy, I have sought to return to the
fundamentals of Ghana‟s failure to achieve development and modernization – but with
one very important difference: whereas political economy theorists focus on Korea‟s
success as a template for other countries trying to industrialize, I use it to better
understand what went wrong with Ghana. Most scholarship comparing Korea‟s rapid
economic development with its peers often generalizes foreign assistance, a key factor in
capital accumulation, or, foreign debt. New literature reveals a better understanding of
how my focus countries actually measure up, and whether their comparison with Korea is
even fair. The scholarly attention Korea‟s superior development receives perpetuates
flawed mainstream conclusions about Ghana‟s failure. For policy makers as well as
development strategists, it is informative to analyze not only what Korea did well, but
also the factors that potentially held back Ghana, and Brazil. The need for the
reexamination of the standard literature of Korea‟s fast integration into the world‟s
economy would help debunk the generally held belief that sub-Saharan Africa is doomed
and incapable of rising even when granted all the funding that fueled Korea‟s rise. Using
historical records, my thesis reveals that Ghana could have achieved a parallel
developmental transition to Korea‟s if it too were to benefit from the identical
circumstances that transformed Korea. Moreover, the true underlying factors of Korea‟s
rise are glossed over or obfuscated. The more obvious means by which Korea achieved
its “great leap forward” are often minimized in the literature devoted to its rise. As Korea
is the yardstick by which successful developmental transition is measured, my new
5
perspective would be to use the building blocks of its success to elucidate Ghana‟s
comparative mediocrity. It takes one to better understand the other.
METHODOLOGY
This paper is qualitative in character and resorts to quantitative charts for
illustrative purposes. I used existing literature to find out why Korea used aid to achieve
rapid economic development and democracy from 1962-1980 ahead of Ghana and Brazil.
I focus on the colonial legacies of the countries, as well as aid flows to them. If there is
any, analyzing existing literature in each decade during, and, following Korea‟s rise, will
expose a discernible pattern of the minimization of aid distinction among the focus
countries. A qualitative comparison is compatible with the more nuanced, deeply
penetrating examination of the economic trajectory of the countries for a better
understanding.
Great leaders transform nations. Some have motivation to follow clear visions to
economic greatness. At other times, great leaders are made because of the choices they
make during unusual historical events. Great national leadership identifies and harnesses
resources to get ahead. Once lumped together as “Third world” countries, Korea roared
out of the bracket following great, consistent strides it made towards industrialization
beginning from early 1960s. Similarly, Brazil is regarded by political economists as one
of the rising new economies, the so-called, NIEs. A plethora of comparative literature
exists about how Korea used foreign aid successfully while Ghana and Brazil did not.
The true picture is different.
6
Ghana, Brazil and Korea are illustrative examples of successes and failures of
policies geared towards developmental transformation. The three countries have come to
symbolize the story of nations who started similarly but follow different developmental
paths. Korea achieved economic transformation going from a desolate agricultural
economy in the 1960s, to an industrial powerhouse. Korea is the world‟s 12th largest
GDP. Sixty years later, Ghana remains at the lower rungs of middle-income countries.
Ghana, Brazil and Korea have used foreign assistance on state-owned enterprises,
however, the relationship of the state with their SOEs varied in each country. My focus
countries have different experiences with international capital flows, with different
impacts on their development.
As the first country in sub-Saharan Africa to wrestle independence from a
reluctant colonial power, a lot was riding on how Ghana‟s ambitious bid for self-rule
bodes for its people, and other countries agitating for same. Of course, decolonization has
its limits in solving the problems of African states. The continued muddling of the
contextual facts mediating Ghana‟s economic and technological retardation, stigmatizes
sub-Saharan African countries as unabashedly anti-reform, anti-progressive, anti-liberal,
hence the need for substantive clarity. To be sure, there are a number of missteps in
Ghana‟s march to modernity. A call for the reexamination of the premises of Ghana‟s
lack of progress is as an attempt to clear the fog shrouding Korea‟s historical fast-track
industrialization. It is time to reexamine the facts behind Korea‟s rise and reassess
Ghana‟s arrested development. The story of Korea using American foreign assistance to
7
industrialize adapting Japan‟s industrial influences is by now a familiar story. Francis
Fukuyama believes, “Korea‟s adaptation of transplanted Western capitalism with
elements of Japanese industry organization in such a way as to be scarcely recognizable”9
is an ode to the triumph of liberal democratic capitalism. A simplistic explanation of the
Korean „miracle‟ presuppose the inevitability of Korea‟s rise but not Ghana, due to the
latter‟s so-called „African address,‟ a patronizing term of sub-Saharan Africa‟s docility.
Theories are plentiful about how influences of history and culture shaped my
focus countries. Moreover, fresh perspectives emerging in the academic community are
helping to better clarify the subtle factors behind the economic success of some countries
in overcoming adversities, and the futility of others in trying.
9
Fukuyama, Francis. Have we reached the end of history?. RAND CORP SANTA MONICA CA, 1989.
https://bit.ly/3fUPm8w Google Scholar
8
CHAPTER 2
COLONIAL LEGACIES: GHANA, KOREA, AND BRAZIL GREAT BRITAIN
AND THE UNITED STATES
Few events reshaped the world like the 18th century industrial revolution which
Britain ignited, and the emergent United States of America‟s rearrangement of the global
power structure following World War II. The former enabled Britain‟s Victorian boast
that theirs is the „empire over which the sun never sets‟ and whose bounds nature has not
yet ascertained.10 It is established that, at its peak in the 1890s, imperial United Kingdom
was the most powerful country on earth. It controlled roughly a quarter of the population,
territories and resources on the globe, and the Royal Navy „dominated nearly all
oceans.‟11 With about one-fortieth the land size of the United States, historians are
astonished by Britain‟s global footprint. Sources of revenue for imperial Britain were vast
and varied. Its ships were involved in the Atlantic slave trade, and profits from slavery
netted it trillions of dollars. According to some, this endeavor stains Britain‟s luster as the
10
Newsinger, John. The blood never dried: a people's history of the British Empire. Bookmarks, 2013.
https://bit.ly/33DBc7S Google Scholar
11
Ferguson, Niall. Empire: How Britain Made the Modern World. Penguin UK, 2012.
https://bit.ly/2CdNpX4 Google Scholar
most significant contributor to the making of the modern world. The resources Britain
marshalled from colonization following the abolition of the slave trade, enriched it yet
more. At the end of WW II America successfully supplanted Britain as the preeminent
global superpower. For my focus countries, the seismic shifts produced by the two
countries impacted their destinies.
How the Cold War helped or hurt Korea, Brazil, or Ghana is a central theme in
my thesis. I examined the role geopolitical significance plays as a contributing factor in
Korea‟s economic rise, Brazil‟s aspiration, and Ghana‟s paralysis. Why did America find
it compelling to help create a prosperous liberal democracy on the Korean peninsula, but
not Ghana? To what extent does Brazil‟s size, population and geographic location
influence its industrializing aspirations? How has the unique historical relations between
each of these countries and the West enabled or hurt their economic progress? How has
the ideological leanings of leaders of developing countries aided or impeded their access
to Western technology, funding, or even sabotage? Could Brazil, and Ghana replicate
Korea‟s greatness absent the overwhelming support Korea enjoyed from the United
States.
Colonial experience leaves long-standing impacts on the people and the
institution-building capacity of a country. In what follows, I examine the colonial
legacies inherited by the three countries form their colonial histories. Like Ghana, both
Brazil and Korea have colonial pasts.
10
Ghana
Ghana experienced a century-long colonialism by the British, an experience that
had a tremendous impact on some governmental institutions in the country and the
cohesion of the polity. The legacy of colonialism on the people of Ghana has endured
long past the lowering of the Union Jack and the raising of the red, gold, and green flag
on the eve of Ghana‟s independence. For good or bad, Britain‟s affairs in Ghana laid the
foundations for the country‟s future political economy. Similarly, Korea and Brazil are
shaped by the tenor of their experiences of subjugation under their respective colonial
masters, Japan and Portugal.
Slaves were forcefully removed from West Africa as early as 1570s and brought
to Brazil. For centuries, endless wars raged for the capture and selling of Africans for
harrowing odysseys to North America, Europe, and the Caribbean. On a scale unmatched
in history, the African continent was besieged and its energetic and productive youth
hauled away to foreign lands. The slave trade disrupted the economies and productivity
on the continent. Colonialism came on the heels of the inhuman trade in slaves when
European powers scrambled to carve up and plunder Africa in the 19th century.
According to Matthew Lange, „colonization of foreign lands has been a cataclysmic
series of events that dramatically transformed the lifestyles of peoples throughout the
world.‟12 Whole native populations were annihilated while colonists went to live in far-
12
Lange, Matthew. "British colonial state legacies and development trajectories: a statistical analysis of
direct and indirect rule." States and Development. Palgrave Macmillan, New York, 2005. 117-139.
11
off places as cogs in a sprawling colonial machine. Chaotic transformations were
unleashed over which the natives had no control. Colonial authorities imposed colonial
rule on the continent and drew arbitrary boundaries that lumped disparate ethnicities
together, but separated people with common ancestry in a typical „divide and conquer‟
strategy. This vast disruption of peoples‟ lives and cobbling multi-ethnicities together
underscores the extreme power of the European imperialists in Africa and also the
revolutionary changes that colonization began.‟13 Global colonization by which Spain,
Portugal, France, and Britain expanded their territorial influence, brought them enormous
wealth and power, while the people it dominated, remained exploited and poor for
extended periods of time.14
Some post-colonial intellectuals such as Frantz Fanon drew attention to the
inherent destructive aspects of colonialism while others like Niall Ferguson and likeminded scholars, courted controversy by describing colonialism as a “period of
trusteeship” whereby the technologies Europeans brought to the colonies offset the
hardships wrought on the them.
https://bit.ly/3gE1got Google Scholar
13
Lange, Matthew. "British colonial state legacies and development trajectories: a statistical analysis of
direct and indirect rule." States and Development. Palgrave Macmillan, New York, 2005. 117-139.
https://bit.ly/3gE1got Google Scholar
14
Yülek, Murat A. "The Old World Order: Trade Before the Empires on which the Sun Never Set." How
Nations Succeed: Manufacturing, Trade, Industrial Policy, and Economic Development. Palgrave
Macmillan, Singapore, 2018. 5-12.
https://bit.ly/2G9nUsc Google Scholar
12
The Asante empire emerged in the 17th century, and consolidated in the 18th
century, with Kumasi as its capital. At its peak, Asante dominion over vassal states like
the Bono and Akwapim, ensured the flow of tribute, most importantly gold, over which
the Asante held supremacy. That was the closest Ghana came to having a centralized
state. The lure of gold prospered West African kingdoms of antiquity, and enriched states
along the established trans-Saharan trade routes that stretched to the Atlantic coast of
West Africa. Gold, also drew Portuguese merchants to establish the first European
settlement in the Gold Coast in 1491.15 Britain was a late entrant to the lucrative trade in
gold and other resources in the Gulf of Guinea although before 1850, slaves were shipped
in British vessels to destinations in the New World and elsewhere.16 Britain used treaties,
coercion and warfare to emerge the dominant European power in the Gold Coast by early
nineteenth century and ushered in Ghana‟s colonial period.17
During most of the nineteenth century, the Asante state engaged in territorial
expansion and a push of trade from the Akan interior to the coast. This ambition collided
with the states that surrounded it. The Asante‟s uncompromising quest for direct,
15
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348.
https://bit.ly/2F5Rr5b Google Scholar
16
Ferguson, Niall. Empire: How Britain made the modern world. Penguin UK, 2012.
https://bit.ly/2CdNpX4 Google Scholar
17
Jiyoung
Kim (2015) Aid
and
state
transition in
Ghana
Quarterly, 36:7, 1333-1348, DOI: 10.1080/01436597.2015.1038339
13
and
South
Korea, Third
World
unimpeded trade with European merchants in the Gold Coast led to several armed
confrontations with the southern states which benefited as middlemen from their levies
on Asante goods. When they arrived, the British formed pacts with some of these states
to protect them from the Asante. The Asante was intransigent to the pressures exerted on
it by colonial Britain. Moreover, the Asante resented the growing intrusion of the British
in the interior of Ghana which it regarded its territory. The Asante viewed any meddling
in their quest for direct trade disagreeable and fought to protect their right to trade. The
mutual animosity between the Asante and the British led to frequent clashes.18 In these
clashes, the Asante “bore the brunt of British colonial army”19 assault until their
indomitable spirit was broken. The Asante capital Kumasi was sacked during their defeat
in the Yaa Asantewaa war of 1900. By then, the Asante overextended itself in reining in
rebellious vassal states. Also, its „weak internal structure‟, and challenge from the British
colonial army hastened the collapse of the empire. The British had full reign to extend its
rule into the interior of the Gold Coast having brought pockets of resistance under
control.
Britain established the Gold Coast Colony in 1874, a colony associated with
European commerce for over four hundred years. Like the line of European nations
before it, Britain too was eager to get its hands on gold, the most important mineral long
18
19
Jiyoung Kim: https://www.tandfonline.com/doi/full/10.1080/01436597.2015.1038339
Quainoo, Samuel Ebow. Transitions and consolidation of democracy in Africa. Global Academic
Publishing, 2008.
https://bit.ly/346Hj50 Google Scholar
14
associated with ancient and contemporary Ghana.20 Curiously, until the 1890s, gold
extraction relied on crude traditional methods like panning. In 1890, the British Crown
used the dubious “Foreign Jurisdiction Act” to seize lands, upturn treaties, and allocate
grants to themselves in the Gold Coast. In 1897, Britain acquired the Ashanti Goldfields
Corporation an extensive holdings in excess of 160 square kilometers for the commercial
prospecting of gold. Although relatively small, the Gold Coast was a profitable colony
for the British. Earned receipts from cocoa, bauxite, diamonds, gold, and other products
make it so. Cacao pods brought to the country in 1878 became the „king‟ crop and
thereafter contributed to colonial Gold Coast economic boom. Railway lines sprang up
conservatively connecting mining and farming areas to the ports.
The goal of the British was the exploitation of mineral resources in the colonies
and expansion of markets for Western produced goods. Britain‟s adopted methods
towards Ghanaians during the colonial period were repressive and blatantly
discriminatory. The mining concession Britain operated relied on expatriate labor to the
exclusion of Ghanaians. This practice is perpetuated even in post-independent Ghana
where plum jobs remain the exclusive preserve of expatriates. The British attempt to
introduce Western education system in the Gold Coast was a feeble and a far cry from
their own type of good schools and representative government in Britain. Even the core
20
Berry, LaVerle Bennette, ed. Ghana: A country study. Vol. 550. No. 153. US Government Printing
Office, 1995.
https://bit.ly/2XGLH8d Google Scholar
15
curriculum of the educational system Britain introduced in the colonies was mainly “the
creation of a group of educated Africans … „rooted in their own culture‟21 in order to
support its own colonial exploitative interests. In both education policies and interactions
in British, and French colonial territories, Britain promoted “adjustive” policies with little
emphasis on the kind of diffusion that undergirds France‟s “assimilation” policy of
“creating a Black Frenchman.” This comparison by no means signify a picking of sides.
Britain and France and their two systems of absolute subjugation of Africans are two
faces of the same coin.
The British devised indirect rule in „grudging recognition of the sovereignty of the
traditional Chiefs‟ only after relentless assaults to “strangle this institution” and strip the
political powers of Chiefs failed.22 The so-called British „native‟ administration is a token
of traditional authority, and relied on Ghanaian chiefs for its execution. Indirect rule
therefore is the “colonial policy of using the African elite, specifically the elders and
chiefs” as the main agents of local colonial administration.23 The influence traditional
leaders had over their subjects made the practice a success although it denied the colony
21
Clignet, Remi P., and Philip J. Foster. "French and British colonial education in Africa." Comparative
Education Review8.2 (1964): 191-198. https://bit.ly/31SWa1R Google Scholar
22
Samuel Ebow Quainoo: Transitions and Consolidation of Democracy in Africa, State University of New
York Press, Albany, New York, 2008, p.74
23
Akurang-Parry, Kwabena O. "„Disrespect and Contempt for Our Natural Rulers‟: The African
Intelligentsia and the Effects of British Indirect Rule on Indigenous Rulers in the Gold Coast c. 1912–
1920." The International Journal of Regional and Local Studies 2.1 (2006): 43-65.
https://bit.ly/2DvcRIk Google Scholar
16
the homogeneity it needs to forge a cohesive nation out of its diverse peoples. British
tolerance of the coexistence of traditional chieftaincy alongside colonial bureaucratic
authority, proved fateful as it seeded conflicting loyalty Ghanaians developed towards the
new state. Consequently, harbored feuds and lingering resentments among tribes
predating the colonial period, crept into post-independent Ghanaian politics.
In events preceding WW II, the British colonial government seized upon seismic
tremors that rocked Accra on June 22 1939 to whip up war anxiety propaganda in
colonial Gold Coast. The quake left sixteen dead and “sizable damage to residential,
business and government properties.‟24 In the absence of immediate explanation for the
sudden devastation, local press echoed British colonial government propaganda that
German ambitions for war to reclaim lost territories in Africa was imminent. The Gold
Coast Regiment prepared for war believing the Gold Coast would be drawn into the‟
rumbling European war.‟ Up to 70,000 soldiers and support staff from the Gold Coast
served under the British in WW II.25
There is consensus among historians that African nationalism increased in the
aftermath of World War II.26 Returning Gold Coast soldiers joined the agitation for
24
Holbrook, Wendell P. "British Propaganda and the Mobilization of the Gold Coast War Effort, 1939-
1945." Journal of African History (1985): 347-361.
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25
Killingray, David. "Military and labour recruitment in the Gold Coast during the Second World
War." Journal of African History (1982): 83-95.
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26
Money, Jacob Louis. "The Impact of WW II on African Nationalism and Decolonization." (2018).
17
political independence when veterans were fired upon during a peaceful march to present
a petition to the colonial administration to honor its pledge. The murders immediately
raised the tenor of the fight for self-rule. It outraged the populace and mobilized them to
make “Full Self-government Now” the future rallying call of Kwame Nkrumah‟s CPP
movement. Ghanaians won the fight for self-rule after a century enduring beatings,
arrests, and imprisonments. Nkrumah and his party went from “irresponsible and unruly
veranda boys”27 to lead the successful struggle for the emancipation of the Gold Coast.
The transition to self-rule was peaceful considering it was birthed from violence.‟28 The
parliamentary democracy Nkrumah‟s CPP established at independence, was overthrown
in 1966, followed by alternating military and civilian governments. Ghana‟s post-colonial
trade balance, strong at independence in 1957, became negative since 1980s. Its transition
in the late 1960s-1980‟s was more from one military junta to the other; not
developmental.
Brazil
Europeans reached what would be modern day Brazil in April 1500, and stumbled
on a linguistically and culturally homogeneous Amerindians living on the coast and the
basin of the Parana and Paraguay Rivers. The Amerindians consist of the Tupi-Guarani
https://bit.ly/3mDlYsk Google Scholar
27
Nkrumah, Kwame. "Movement for colonial freedom." Phylon (1940-1956) 16.4 (1955): 397-409.
https://bit.ly/2FjhKVv
28
Apter, David Ernest. Ghana in transition. Princeton University Press, 2015.
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18
and the Tapuia, the former, a variant of the Indians who spoke a different language. Tales
of cannibalistic rites were rampant among the Tupi who were famous for their ferocious
resistance against subjugation. The Portuguese‟s interest in the land led to a colony at Sao
Vicente in 1532. The sheer size of Brazil presented a challenge to the colonial authority
whose push into the hinterland necessitated expense and time. Like the rest of Latin
America, Brazil became an exporter of „highly important foodstuffs or minerals for
European commerce‟.29 In spite of this designation, not much was collected in revenue
from Brazil. In fact, tribute from the colony throughout the 16th century amounted to a
negligible 2.5 percent of the crown‟s income compared to 26 percent from trade with
India. Black slaves were imported mainly from West African beginning in the 1570s to
replace Indian slaves, due to cost and the intensity of the „compulsory labor‟ demands of
the European-run sugar economy. Indian slaves got by with little and deeply resented the
„notion of constant work.‟ Moreover, the Africans slaves had experience working with
iron implements and cattle raising.30
The state and the Catholic church were the two institutions responsible for
Brazil‟s colonization. Their roles overlap but the state fundamentally guaranteed
Portuguese sovereignty over the colony, while the state religion, Catholicism, took on the
manifest responsibility of molding people‟s behavior. Catholicism emphasized obedience
29
Boris, Fausto, and Sergio Fausto. "A concise history of Brazil." (1997).
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30
Boris, Fausto, and Sergio Fausto. "A concise history of Brazil." (1997).
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19
to the state, living a sinless life through this „vale of tears.‟ The church was a constant
presence throughout important events in people‟s lives. The church baptized and gave the
sacraments, blessed marriages, and in death, buried them. This „cradle-to-grave‟ presence
in parishioners‟ lives made the church a significant institution leading to its being courted
as a partner of the colonial crown in Portugal.
Moreover, even Brazilian Catholicism was based on the notion of „purity of
blood‟ which pitted Old Christians (more Catholic) against New Christians (less
Catholic). The so-called New Christians were discriminated against, routinely arrested,
and often victims of the Inquisition. Thankfully, the Inquisition was not as widespread in
Brazil as in the Spanish American colonies. So, although the Portuguese colonists
chanced upon a homogenous people, the splinter of the populace presented unique
challenges. Brazilian colonial society is divided into masters and slaves, with wealthy
rural landowners and merchants perched on the privileged apex of the social pyramid.
The society was further divided into broad categories of „nobility, clergy, and folk‟.
Manual labor is socially scorned and regarded as „something just for blacks‟, a prejudice
against blacks that persists to this day. Throughout its colonial history, Brazil‟s colonial
administration bureaucracy worked to dilute the royal power of the absolutist crown king
in Lisbon resulting in tension between the two institutions.31
31
Boris, Fausto, and Sergio Fausto. "A concise history of Brazil." (1997).
https://bit.ly/2F2Kodo Google Scholar
20
Brazil declared independence from Portugal on September 7, 1822 amid Don
Pedro‟s shouts of “Independence or death!”32 Most Brazilians were „unaware‟ of who
governed them at the time, its independence was without the „convulsive legacy of
revolution suffered‟ by Spanish colonies in the hemisphere. It ended the period of
Portuguese crown control over Brazil and ushered in a monarchy under the reign of Don
Pedro as emperor. Following Brazil‟s independence, Pedro I sent emissaries to America.
Two years later in 1824, Brazil was formally recognized by the United States, followed
by Portugal.
A new constitution centralized the government and divided the country into
provinces governed by „presidents‟. Traditional agricultural products like coffee and
timber fluctuate in growth and income with coffee dipping and soaring the most mainly
because global demand and supply often lacked balance. Brazil‟s transition to a republic
in 1889 had big implications for the country. The agricultural barons used their newly
found influence as key players in the national economy to negotiate policy space that
affect their sector.33 They became more vocal and used their visibility to wrestle
32
Worcester, Donald E. "Independence or Death! British Sailors and Brazilian Independence, 1822–1825:
Vale, Brian: London and New York: IB Tauris, 219 pp., Publication Date: 1996." History: Reviews of New
Books 25.3 (1997): 115-115.
https://bit.ly/2XFJrhx Google Scholar
33
Dinius, Oliver. "Francisco Vidal Luna and Herbert S. Klein, The Economic and Social History of Brazil
since 1889 (New York and Cambridge: Cambridge University Press, 2014), pp. xvi+ 439, $90.00, $32.99
pb;£ 55.00,£ 19.99 pb." Journal of Latin American Studies 48.1 (2016): 182-183.
https://bit.ly/3a3oLoI Google Scholar
21
favorable terms to shield their sector from undue attention. Slavery was outlawed in 1850
which greatly reduced the constant injection of fresh slave populations into Brazil,
exerting a stress on the country‟s existing labor force. European immigration intensified
following the emancipation of slaves and transition to free labor. Mass European
immigration helped introduce the modern state in Brazil with improvements in treated
water, garbage disposal, and in public education which improved literacy. Moreover,
democratic gains lagged as regional oligarchs denied voting to illiterates. This purposeful
isolation of the majority peasantry was done to further entrench the barons‟
predominance in political decision making.
Brazil has fought on the side of the United States in both world wars. During WW
II, it contributed troops – the Brazilian Expeditionary Force - in the fight against fascism
in Europe, a move that accords with the United States foreign policy objectives. For
Brazil, participation in World War II was out of Germany‟s relentless sinking of Brazil‟s
merchant ships.‟34 This practical act of protecting its merchant fleet led to security
alliance with the United States. Despite 200 years of shared history as trading partners,
relations between Brazil and the United States is characterized by ebb and flow of tension
but never war. Political engagement between the two countries is shallow as best as
political leaders often „seem to talk past, rather than to, each other.‟35 From 1591 to 1808,
34
Ellis; Evan: “The Strategic importance of Brazil,”
https://bit.ly/3gCudBi Google
35
Smith, Joseph. Brazil and the United States: Convergence and divergence. University of Georgia Press,
2010.
22
the paranoid crown in Portugal closed off colonial Brazil ports to foreign ships, which
could partially explain why Brazil and the United States have diplomatic archives of the
other but little by way of actual interaction. America regards Brazil as peripheral to its
foreign policy interests. Brazil resents being indiscriminately lumped together with many
of its smaller Latin American neighbors.36 As a regional power, Brazil frowns on
America‟s adventurism and hemispheric ambitions in its backyard.37 America‟s quest for
sphere of influence in Latin America clashed with Brazil, the region‟s predominant
power. In the ensuing uneasy relation, trade and friendship take a backseat to the rivalry
between them.
Brazil‟s history as a huge political entity engaged in a long struggle to occupy,
control, and develop vast interior spaces, is not different from the origins of the United
States. Its land borders measure in the thousands of kilometers and stretch across three
time zones, (four, if one includes Brazil‟s offshore islands). Brazil‟s extensive use of
slave labor have traditions of African and Asian influences much like America. Native
values and practices persist although European traditions dominate native cultures and
claims to land rights. Brazil dominated world production of coffee, however, its interior
https://bit.ly/2EZW2Wh Google Scholar
36
Smith, Joseph. Brazil and the United States: Convergence and divergence. University of Georgia Press,
2010.
https://bit.ly/2EZW2Wh Google Scholar
37
Ellis; Evan: “The Strategic importance of Brazil,” https://theglobalamericans.org/2017/10/strategic-
importance-brazil/
23
where the coffee is grown is traversed by mule trains. Only when Brazil started
manufacturing automobiles in the 1950s were its first major roads into the interior
developed.
According to Evan Ellis, in size of territory, population and economy, Brazil
accounts for approximately half of South America‟s total. Its military is larger than the
„rest of the Armed Forces on the continent combined,‟ and many of its neighbors are
furnished by Brazil‟s domestic arms industry. Furthermore, Brazil‟s claim to the same
„exceptionalism‟ with which America regards itself, accounts for nothing in America‟s
concept of „partners‟ in the hemisphere. America did not blink at the $46.8 billion
Chinese investment „across 87 projects‟ in Brazil. Neither did the extensive military
cooperation with China elicit a wink from America.38
Brazil‟s modernization was strengthened with strides in its industrialization, and
agriculture. Thanks to Brazil‟s strong anti-communist stance, and the successful space it
negotiated with the US by its geopolitical importance during the Cold War. Like Korea,
America supported the Brazilian government and helped modernize its university system
especially its agricultural research program through international credit agencies such as
the IRBD and IDB. Analysts say such cooperation give Brazilian products a competitive
edge over American agricultural exports.39
38
Ellis; Evan: “The Strategic importance of Brazil,” https://theglobalamericans.org/2017/10/strategic-
importance-brazil
39
Herbert S. Klein & Francisco Vidal Luna: “Brazilian Politics During the Cold War”
https://bit.ly/3gHcJUr Google
24
Brazil acknowledges America‟s status as the most powerful actor in the world
with an unchallenged military primacy in global affairs. Aware that voiced strong antiAmerican sentiments in foreign policy forums could draw Washington‟s ire, Brazil has
kept from inflammatory rhetoric in its relationship with the US. Although Brazil aligned
with the United States during the major world wars, it stayed away from the Korean War
in the 1950s, Vietnam War in the 1960s, the US Central American policy of the 1980s,
and the Persian Gulf War in the 1990s. This has upset successive US administrations.
Brazilians are frustrated why bonds of friendship between their two governments do not
translate into national favors from the richer America. This leads to faulty expectations in
their relations. From such unfulfilled expectations come lingering disappointments.
However, America recognized Brazil‟s blood sacrifices during the World War II which
went beyond force contribution in the campaign in Italy. It included naval base sharing
on Brazilian soil in the event of a massive attack on American homeland during the war.
Of immediate benefit of the war time cooperation with America was the building
of the heavily subsidized South America‟s first steel mill at Volta Redonda in the state of
Rio de Janeiro completed in 1946. America calculated the symbolism of the gesture
would keep Brazil out of the German camp during the war. The steel mill was an
exclusive privilege to Brazil as it was denied to its neighbor and rival, Argentina. This
gift of American technology is considered an essential element in the industrialization of
Brazil.
25
Brazil‟s 70,000 strong army veterans returning from WWII with bleak job
prospects, „very alarmed‟ the Vargas government which feared the army “would likely
overthrow the civilian government.”40 America shared Brazil‟s fears that safety of the
Panama Canal could be jeopardized when a pro-fascist government takes hold in Brazil
with Italians and Germans pouring veterans into the country at war‟s end. Uruguay and
Argentina also had large German and Italian populations that could endanger security of
the hemisphere.
Monica Hirst writes about a new phase of America and Brazil relationship at the
end of World War II. Hirst breaks down Brazil‟s litany of „unmet expectations‟ from
America by the decades. It begins with 1950‟s lack of special acknowledgement for
having fought against the Axis powers and was frustrated when not granted more support
for its economic development policies in the aftermaths of World War II; in the mid1960s, when it did not receive economic compensation for having contained „domestic
communist forces‟; and in the mid-1970s, for not being upgraded to „key country‟ status
in US foreign policy. In the mid-1980s Brazil, together with other Latin American
countries, regretted the lack of US help in dealing with the debt crisis and, in the mid1990s, the lack of American support in a period of global financial turmoil.41
40
McCann, Frank D. Brazil and the United States During World War II and Its Aftermath: Negotiating
Alliance and Balancing Giants. Springer, 2018.
https://bit.ly/2DzA1NN Google Scholar
41
Hirst, Mônica. The United States and Brazil: a long road of unmet expectations. Routledge, 2005.
https://bit.ly/2DzerZD Google Scholar
26
The way Brazil and the United States perceive constitutional rule account for
some of their differences. The United States acts to „defend and promote constitutional
government,‟ and values civilian supremacy over the military; the same cannot be said of
Brazil. America‟s impersonal bureaucracy functions in ways that Brazil‟s does not. Laws
are openly bent to favor civilian and military elite in Brazil. Brazil‟s strong domestic
economy has in the past generated few emigrants to the United States. However,
Brazilians are now building a steady presence sustained through networks of familyunification provisions of US legislation. Over the years, Brazilian presence in America
has fueled an increasing appetite in the production and consumption of their culture –
including music, book publishing, and television programing. At home, Brazil is not
immune from the pressure of American environmental groups on how the Brazilian
Amazon is managed and exploited. Environmental activists want to see the Amazon a
relatively serene island insulated from rapid deforestation for timber products and for the
development of living spaces and industries.
Korea
The disastrous civil war that accounted for the modern-day North-South split
aside, Korea‟s homogenous ethnicity has a long history dating back millennia (500,000
yrs.).42 Koreans migrated from China to occupy the Korean Peninsula and established the
42
“Country Profile: South Korea” May 2005
https://bit.ly/30DxhI4 Google
27
city of Pyongyang.43 Japan‟s geopolitical perch at the confluence of American, Russian,
and Chinese interests during the nineteenth century presented it with a quandary as
Western countries began flexing their imperial muscle. Stronger European states overrun
neighboring weaker ones, then pounced on non-Western nations in distant lands and
dominated them. As in the natural world of the strong dominating the weak, Social
Darwinism was the norm. Japan calculated correctly that it would have to act swiftly to
keep from being subjugated themselves aware they were surrounded by hostile states.
Japan realized there was no stopping European momentum on their colonization spree in
Asia. Rather than wait and fall like other “lesser breeds,” the Meiji leadership in Japan
embraced the European, „dog-eat-dog‟ adventurism and looked overseas for conquests of
its own.
In 1876, Japan went to Choson, (Korea) on a diplomatic mission signing an
Unequal Treaty with terms favorable to itself. The favorable wind it wanted to complete
its takeover of Korea came in the form of a peasant rebellion in 1894. Tokyo pounced. It
sent in its army and navy, goading the Chinese which sent in its Yellow Sea fleet. China
was roundly defeated in what became the Sino-Japanese War of 1894-95,44 and ushered
in a period of Japanese empire building. Moreover, it was Japan‟s victory over Russia in
the Russo-Japanese War (1904-1905), the first Asian country to defeat a European power
43
“Country Profile: South Korea” May 2005
https://bit.ly/30DxhI4 Google
44
Miller, John H. Modern East Asia: an introductory history. ME Sharpe Incorporated, 2008.
28
in modern times, that gave it „Great Power‟ status. That paved the way for total control
over Korea, which Japan declared a protectorate in 1905. Meiji celebrated Japan‟s
membership in the Western imperialist club believing that becoming imperialist
themselves helped escape the Asian stigma of cultural inferiority.
When Europeans arrived in the East, they replaced the Asian form of sociopolitical relationship based on paternalistic authority. They imposed „legalistic concept‟
of interstate relationship. The European concept of equality among a community of
sovereign states was alien to the Asian suzerainty with which Japanese were familiar. The
Asian pecking order rested on the warrior code of „overlordship of superiors over
inferiors.‟45 That concept explains why conflicts between equally-matched adversaries
perpetuated until the scale of power shifted in favor of one side. Japan‟s domination of
Korea at the turn of the twentieth century, reversed to the shared Asian concepts of
benevolence, paternalistic leadership and of dependency. Koreans identified with
Japanese suzerainty; the way Japanese lived in lofty imperial style and did not flinch
from the use of brute force in the imposition of their will on Koreans. However, Japanese
also resorted to trade and cultural exchange, secret diplomacy and alliances, of
compromise and even collaboration when opposition mounted against their domination.
In Korea, the Japanese colonial power oversaw a people with common ancestry.
The Japanese presence in Korea as statesmen, administrators, businessmen, ended almost
45
Miller, John H. Modern East Asia: an introductory history. ME Sharpe Incorporated, 2008.
29
three centuries of national isolation. Japanese are conflicted in their relation with their
colonies: they regard themselves superior with nothing in common with their fellow
Asians but curiously pushed assimilation in China and Korea in order to make them
become „Japanese of sorts.‟46
Japan‟s empire builders assumed the „civilizing mission‟ and „cultural
assimilation‟ rationale of some Europeans. They set aside all pretenses of kinship and
lived posh lifestyles in exclusive enclaves shielded from the „inferior‟ Koreans. The total
assimilation policies Japan pushed during its thirty-six years of Korean occupation had
the ambitious objective of “Naisen ittai” „(literally, Japan-Korea, one body).‟47 Japan
forbade use of Korean language, and encouraged Koreans to be „loyal imperial subjects,‟
who recognize the divinity of Japan‟s emperor. Furthermore, Japanese colonial
authorities proscribed Korean newspapers and made it illegal to form political groups.
The cornerstone of Korean growth is the perfusion of culture and technology that
resulted from Japanese occupation. Japan located some manufacturing plants and
corollary industries in Korea and granted access to Koreans who acquired critical
technical skills in the process. Although many Koreans were hired at entry level
positions, determined ones worked their way to comfortable perches at senior levels. This
participation in Japan‟s expansive bureaucracy and technical environment, offered
46
Yahuda, Michael: The International Politics of the Asia-Pacific, 3rd ed, p. 160
47
Caprio, Mark E. Japanese assimilation policies in colonial Korea, 1910-1945. University of Washington
Press, 2011.
https://bit.ly/31q61fa Google Scholar
30
Koreans the chance to taste and participate in modernity. Many authors agree Korea‟s
modern economic growth owes much to the era of Japanese imperialism,48 during which
GDP reportedly grew at a faster pace. President Park Chung-Hee‟s state-directed
development was a legacy of the Japanese colonial period. Japan‟s heavy investment in
education, infrastructure and health, contributed to Korea‟s „industrial take-off‟ barely
two decades later.49 The British were standoffish in their contact with the Gold Coast
expending most of their resource in mineral extraction, and the push of selling European
made goods. Their interest to modernize Ghana was feeble at best, whereas Japan was
immersed in Korea to the extent that the Korean capital of Seoul became a „little Tokyo
in Seoul.‟50 This integration of Koreans contrasts with the British whose discriminatory
policies, segregated the mines and largely kept out Ghanaians except for token low
positions.
Japan abdicated its hold on Korea at the end of World War II. The United States
emerged the most powerful and visible presence in post-war South Korea. Although
America‟s effort in the reconstruction of Korean economy was to ensure political
48
Nicolas Grinberg: “From Miracle to Crisis and Back: The Political Economy of South Korean Long-
Term Development” 25 March 2014
https://bit.ly/30EhyIM Google
49
Hassink, Robert. "South Korea's economic miracle and crisis: Explanations and regional
consequences." European Planning Studies 7.2 (1999): 127-143.
https://bit.ly/31oWogA Google Scholar
50
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348.
https://bit.ly/2F5Rr5b Google Scholar
31
stability, it had overarching geopolitical interests and the desire to promote American
values on the Korean Peninsula. However, skepticism about an „industrialized South
Korea‟ made American foreign policy advisors stress a traditional, agrarian economy for
Korea, and actually „impeded its industrialization‟ efforts.51 Nonetheless, Korean acumen
to industrialize prevailed, resulting in rapid technology-driven economic growth,
suggesting a nation can come back strong from a debilitating war.52 Korea became
America‟s anchor in a line of defense that stretches around the globe to where
Communist, and Western democratic forces face-off in Germany and Eastern Europe.
Korea‟s geostrategic importance to America got development grants flowing from
Washington. The grants, coupled with Korea‟s willingness to fight for development,
made their country a “telling front-line illustration of the superiority of the free way of
life.”53 America supported Korea‟s Syngma Rhee amid allegations of being considered
corrupt by some. America‟s armistice agreement in 1953 led to an appeasement with
„promises of aid and by a treaty-based guarantee of military security from the United
51
Lie, John. "Aid Dependence and The Structure Of Corruption: The Case of Post‐Korean War South
Korea." International journal of sociology and social policy (1997).
https://bit.ly/33K2tHz Google Scholar
52
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348.
https://bit.ly/2F5Rr5b Google Scholar
53
John Lie: Aid Dependence and the Structure of Corruption: The Case of Post-Korean War South Korea;
https://bit.ly/3gCZ3tJ Google Scholar
32
States‟.54 As with the Truman, and Eisenhower administrations before him, Kennedy
signaled America‟s renewed commitment to prevail against the hemisphere‟s growing
threat of Chinese-led communist guerilla insurgencies with his, „pay any price, bear any
burden …in the defense of liberty‟ inaugural speech.55 Unlike Korea, Ghana lacked the
geostrategic position that would have made it a country of value to America‟s foreign
policy goals. Although America committed to „help those resisting subjugation by
minorities,‟ Ghana‟s fight against British colonialism was largely ignored by America.
Korea‟s industrialization has been chalked to strong central government
leadership of the state in steering the economy in trade, technology and development. An
elite bureaucracy staffed by great managerial talent with oversight powers to discipline
large firms, was instrumental in the government‟s strong command over the efficient
allocation of resources to the private (chebols) and public sectors.
54
Yahuda, Michael. The International Politics of the Asia Pacific. Routledge, 2011.
https://bit.ly/34jwxbD Google Scholar
55
Yahuda, Michael: The International Politics of Asia-Pacific: 3rd ed, p. 99
33
CHAPTER 3
FOREIGN ASSISTANCE
Ghana, Korea and Brazil have all been recipients of foreign aid. Foreign aid has evolved
over time to become an essential conduit of foreign policy. The size, composition, and
purpose of foreign aid, make it the subject of legislative debate of donor countries. Its
flexibility as „both carrot and stick‟ has been the focus of economic analysts and
generated volumes of literature. According to Clair Apodaca, aid can be withheld to
wreak economic hardship on an adversarial regime, or conversely extended as incentive
for compliance.56 Policy experts agree that politics is at the center of the successful use of
foreign aid for development. Because most foreign aid essentially goes through
government channels, both ends of the foreign aid regime - donor and recipient - is often
tainted by contrasting aspirations.57 This makes the state‟s role in foreign aid the focus of
56
Apodaca, Clair. "Foreign aid as foreign policy tool." Oxford research encyclopedia of politics. 2017.
https://bit.ly/3d6thEp Google Scholar
57
Lawson, Marian L., and Emily M. Morgenstern. "Foreign aid: An introduction to US programs and
policy." Congressional Research Service (R40213) (2019).
https://bit.ly/3gCZ3tJ Google Scholar
development policy analysts. Foreign aid is evaluated on the success or failure of the
state effectiveness in aid utilization and is a crucial criterion of developmental policy. At
the center of this is the „effective state.‟ Comparative case studies of aid success in
Ghana, and Korea, and, Korea and Brazil, credit Korea‟s frugal fiscal policies „and often
the capacity and commitment of the state in devising and enforcing these policies‟ to help
the state achieve growth.58
Ghana
Ghana‟s relationship with foreign assistance is better understood through a brief
history of the country‟s post-independence political economy development. The agitation
for political self-determination among several African colonies intensified after World
War II when the colonial powers proved too weak to slow their momentum or chose to
grant them. Britain was a diminished power in the aftermath of WWII, but defiant in the
face of America‟s enthusiasm to quickly dismantle the old colonial system over which
regressive traditional powers like France, and Britain, presided. Churchill‟s declaration
that “Britain would not cede any of its territories without war”59 was a well understood
growl heard by an emergent America to curb its exuberance scuttling the moribund
colonial system. America feared the consequent hardship and possible collapse of the
economies of colonial powers and stayed its hand. America‟s ambivalence was a mixed
58
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348. https://bit.ly/2F5Rr5b Google Scholar
59
Yahuda, Michael. The International Politics of the Asia Pacific. Routledge, 2011.
https://bit.ly/3g5TWRr Google Scholar
35
message to Africans pushing for independence. Many historians believed that many
African countries exist because colonial powers voluntarily granted them independence.
At the vanguard of Ghana‟s drive for political autonomy were some former graduates of
the colonial school system, like Kwame Nkrumah. Furthermore, American sentiment
after WW II signaled the end of „old-world‟ colonialism.
In the Gold Coast, Kwame Nkrumah‟s Convention People‟s Party (CPP) won
over the UGCC making him Ghana‟s first prime minister when Britain granted
independence on March 6, 1957. Three years later in 1960, a new constitution declared
Ghana a republic and Nkrumah was elected president. In due time, he was proclaimed
president for life. He used constitutional and party powers to skillfully combine different
registers of power and legitimacy to detain his opponents often without trial. Opinion on
his rule differed remarkably between his ardent supporters who believe in his agenda and
policies, and those who regard his human rights abuses excessive.
The coherence of Nkrumah‟s plan lies in how he accelerated the groundwork for
Ghana‟s transformation as he embarked on public projects like the Akosombo Dam and
the Volta Aluminum Company. He expanded healthcare and school enrolment, built
roads, and brought development to the overlooked Northern Territories. He began the
basic step with specific sectors with intent of scaling upon this initial foundation, and
initiated import-substitution. He improved upon the atomic energy project in
Kwabenya,60 and brought a drydock and shipbuilding infrastructure to the industrial city
60
Ghana Atomic Energy Commission. "Ghana Atomic Energy Commission: at a glance. 3." (1998).
36
of Tema. He envisioned a Ghana with reliable fast trains and good roads, an advanced
healthcare system with nuclear components as basis for industrialization. Despite the
gains from investments in select industries, the returns on Nkrumah‟s import-substitution
industrialization were negligible as Ghana‟s strong currency made exports too
expensive.61 The bolts and nuts of Nkrumah‟s stated industrialization plan relied on his
capacity to exercise eminent domain, suppress labor cost, and roll out excellent
infrastructure. With these in place, secondary sector products labeled, “Made in Ghana,”
was a ripe, low-hanging fruit. However, things did not pan out. Rather than remain
focused on prioritizing Ghana‟s development transition and pulling the country ahead,
Nkrumah habitually strayed off course, hitching Ghana‟s developmental vision with the
total political emancipation of the rest of Africa. Under him, Ghana championed African
international relations during the decolonization period, a costly distraction. An
influential advocate of pan-Africanism and founding member of the Organization of
African Unity, Nkrumah‟s message to the Fifth Pan-Africanist movement conference he
attended in Manchester, UK in 1945 was the call for all Africa to unite against colonial
economic exploitation by the West. Of most appeal to him and the movement was a
federal United States of Africa that would supplant colonialism with African socialism.
He look to synthesize “traditional aspects with modern thinking” to be achieved by non-
https://bit.ly/3isRfec Google Scholar
61
“Ghana: A Country Study” 11/1994
https://bit.ly/2XGLH8d Google
37
violent means, if possible.62 The movement believed the Western exploitation of Africa
may morph but continue nonetheless. In Nkrumah‟s view, even the United States, with no
prior colonial ties to Africa, was poised in, „an advantageous position to exploit
independent Africa unless preventive efforts were taken.‟63 Nkrumah‟s investment in
Pan-Africanism competed with Ghana‟s limited resources for his envisioned publicsector projects. His emphasis on economic independence made him suspicious of the
conditionalities of international financial institutions (IFIs). This led to a stagnation of the
economy under him. Soon, facts on the ground had little in common with his stated
ambitions to industrialize and propel Ghana into modernity. Nkrumah‟s government
borrowed to finance important imports when foreign currency reserves dried up. Unlike
Korea which instituted strong oversights over state spending, Ghana‟s lack of oversight
of how foreign assistance was utilized for development, led to paternalism and
widespread corruption. By mid-1960s, continued borrowing for debt financing drowned
Ghana in further debt, and rising inflation eroded the standard of living for Ghanaians.
His opponents believed Nkrumah was wasting state resources on external programs. To
crack down on nationwide dissent, Nkrumah centralized power and declared Ghana a
one-party state. In these early days of Ghana‟s attempt to industrialize, order is what
mattered to Nkrumah, not fairness. His ambitions led to centralized power to the
62
Nkrumah, Kwame. "Kwame Nkrumah." Education 4 (1959): 1.
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63
“Ghana: A Country Study” 11/1994
https://bit.ly/2XGLH8d Google Scholar
38
exclusion of the opposition. Several opposition members disappeared, some only to reemerge either chastened or on trial in so-called kangaroo courts with pre-determined
judicial outcomes. Judging from Korea‟s experience, it is a fair price that must be paid to
cultivate the healthy environment for less distraction and concentration while the country
attempts an industrial lift-off. Deepening economic problems necessitated passing an
austerity budget in 1961. Ghanaians opposed the state‟s policies as they implicitly
assumed that government should behave as a benevolent social guardian. To further
concentrate power, the state formed alliances with the elites and patrons. However, this
did not prevent his overthrow in 1966.64
The intervening years after Nkrumah‟s overthrow were dire for Ghana. Jiyoung
Kim referred to the years 1966 to 1983 as, “the black years,”65 a period in which Ghana‟s
military churned out one military junta after another as if in musical chairs fashion,
registering six military coups since its independence.66 The country‟s chaotic political
instability in the 1970s frightened an already ethnically diverse citizenry into their
regional bubbles. The result is that, already an abstract construct, the nation-state had lost
64
“Ghana: A Country Study” 11/1994
https://bit.ly/2XGLH8d Google
65
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348.
https://bit.ly/2F5Rr5b Google Scholar
66
“Congress: Ghana: A Country Study” 11/1994
https://bit.ly/2XGLH8d Google
39
its prominence to local, ethnic, and regional interests. Benefits and opportunities became
politicized and apportioned along ethnic lines and meaningful political participation
ceased. Moreover, the government‟s attempt to bring Ghanaians together is often viewed
with suspicion especially if such feverish calls come in the runup to an election.
The National Liberation Council (NLC) which overthrew Nkrumah with
“assurances of more democracy, more freedom,”67 and more prosperity for the Ghanaian,
soon learned that talk is cheap. To the admiration of Nkrumah‟s opponents, the NLC let
out all political detainees and bid those in exile home. However, they soon learned that
turning around an economy in free fall, is a much harder trick to pull off than using
executive order to let out political detainees. The government turned to multilateral
channel foreign creditors who offered yet more loans that deepened Ghana‟s economic
woes. According to some economic analysts, “Foreign aid has become a powerful
political actor in Ghana,” a political tool of the ruling class that constantly feeds Ghana‟s
patrimonialism.68
Severe hardship from the ill management of Ghana‟s economy and the open
plunder by the Busia government before, and the Acheampong government after, created
a groundswell of support when Flt. Lt. Jerry John Rawlings burst on the scene with
67
/69 See Kim, Jiyoung‟s. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7
(2015): 1333-1348. He makes the case that Korea achieved industrialization and integration into the world
market due to better utilization of foreign assistance that Ghana failed to use to its benefit. Kim‟s
scholarship is one of myriads that generalize foreign assistance among countries it considers Korea‟s peers.
https://bit.ly/2F5Rr5b Google Scholar
68
40
promises to rid the national leadership of corruption. This culminated in the execution by
firing squad of three former heads of state. Rawlings announced caps on the prices of
goods to curb inflation. He rolled his sleeves and joined volunteers in a nationwide
cleaning exercise. He participated in a cocoa evacuation campaign from the hinterland to
the ports thereby boosting exports. The hardship continued unabated thereby negating
any meaningful reform under him. When he overthrew the Hilla Liman government in
1981, Rawlings‟ PNDC government brimmed with pro-Marxist rhetoric but had to set
aside its anti-Western sentiments to solicit World Bank-backed Structural Adjustment
Program (SAP) loan. Ghana‟s governments following Nkrumah‟s overthrow, just kept
kicking the can down the road without committing to the steps to get out of debt and
industrialize. Like other SAP recipients, the aid conditionality threw price control out the
window and in came trade liberalization and an inflexible demand to balance the budget.
Market-friendliness flooded Ghana‟s market with cheap imports against which local
industries stood no chance. Export earnings remained low as the country still exported
primary agricultural goods, which made imports of capital equipment impossible.
Despite abiding by the IMF and World Bank‟s austere dictates, assessment of the
SAP‟s impact on the country‟s economy was ambiguous. Ghana became a member of the
HIPC amid its ever rising foreign debt and mixed results of its economic reform. The
upsides of HIPC membership are bilateral grants and debt relief.
The SAP prescribed divestiture of state assets over which Rawlings presided, was
criticized for its opacity and flagrant favoritism. Korea similarly divested assets of
41
departing Japanese in the aftermath of World War II with businesses and individuals
paying less than half the value of the assets.69 However, the assets were rehabilitated and
came online to help rebuild Korea‟s export sector whereas Ghana‟s did not significantly
boost exports. Despite evidence supporting the state‟s pivotal role in Korea‟s success, the
terms of Ghana‟s SAP structural adjustment loan to Ghana limited the state‟s role to the
divestiture of state-owned assets. State-led outward-oriented economic strategy worked
satisfactorily in Korea. Ghana‟s limited capital severely challenged its ambition to grow
its economy. Korea‟s export-based industrialization relied on state-guided strategy to
mobilize and allocate foreign aid funds to enhance national wealth. Although far from
being exact, the point here is to draw attention to IMF‟s attempt to deemphasize the
crucial role of the state despite evidence to the contrary.
69
Kim, Kwan S. The Korean miracle (1962-1980) revisited: myths and realities in strategy and
development. Helen Kellogg Institute for International Studies, University of Notre Dame, 1991.
https://bit.ly/3gEBsbU Google Scholar
42
CHAPTER 4
KOREA AND AMERICA
The Korean peninsula was a ruined, desolate landscape when the Korean War Armistice
was signed in the summer of 1953. It was a construction site into which the United States
deployed its massive economic, military and political power in an effort for bottom-up
nation-building. Three million Koreans died, millions more displaced. The North suffered
more devastation due to „American saturation bombing‟.70 When hopes of uniting the
peninsula fizzled, America channeled its development grants through the Economic
Cooperation Act (ECA) which Congress already passed in 1948. The United States led a
coalition of a well-funded drive to rehabilitate South Korea under the aegis of the United
Nations Korea Reconstruction Agency (UNKRA).71 A concurrent Sino-Soviet
„international socialist alliance‟ stood in solidarity with North Korea‟s rehabilitation.
70
Armstrong, Charles K. "Fraternal Socialism': The International Reconstruction of Korea, 1953-
62." COLD WAR HISTORY-LONDON-FRANK CASS- 5.2 (2005): 161.
https://bit.ly/31tuUXs Google Scholar
71
Armstrong, Charles K. "Fraternal Socialism': The International Reconstruction of Korea, 1953-
62." COLD WAR HISTORY-LONDON-FRANK CASS- 5.2 (2005): 161.
https://bit.ly/31tuUXs Google Scholar
Korea‟s push for self-reliance rested on building new electrical grid, steel mills, and
chemical industries in the south to replace the pre-war ones located in the northern part of
the peninsula. Power generation and fertilizer production took precedence to compensate
for the North terminating power along the 38th Parallel. North Korea‟s invasion of the
South exacerbated the ideological clash between the United States and the Soviet Union.
It also underscored Korea‟s geopolitical importance which it used to its advantage to
bargain for increased American aid. Korea‟s post-war reconstruction solidified the
geopolitical boundaries of Asia-Pacific. America saw an opportunity to showcase the
viability of the market-based international capitalist system versus the Soviet-style
socialist economics on the Korean peninsula.
The preparatory work to make Korea ready for post-war reconstruction began
with a thorough assessment and review of its constitution. Syngman Rhee initially
resisted American coercive nudge to amend articles of the constitution from the existing
socialist economy to a liberal market economy as a condition to secure American aid.72
The new “Post-Korean War Constitution” adopted in 1954, emphasized the power of
organizational structure and puts competition above equality. The constitution had
government involvement as well as combined elements of a planned economy, and a
liberal market economy. In general, the new constitution embraced limited elements of a
72
Yahuda, Michael. The International Politics of the Asia Pacific. Routledge, 2011.
https://bit.ly/35bCeJ6 Google Scholar
44
Soviet-style social market economic system but added state control with market
orientation to make it uniquely Korean, the so-called “third way” or “third form”.73
In a preview of the steps behind Korea‟s future as an industrial giant, the
government channeled some of the grant money to the private big firms. It then instituted
the Economic Performance Agency as oversight in specific industries to bring about
desired results. The state‟s militaristic methods attended the post-war reconstruction
drive. Strict compliance was enforced and any semblance of messy workers protests and
organizing were brutally suppressed. This kept a lid on the cost of wages and rendered
Korea‟s labor force cheap, a critical factor in rapid development. Korea benefited
considerably from the infusion of massive foreign assistance from America which
nudged Japan to facilitate transfer of technology and expertise.
Even when working under the auspices of UNKRA during the post-Korean War
reconstruction, the United States was the agency‟s singularly biggest contributor.
America contributed up to $93 million in cash and kind of UNKRA‟s $140 million
received in 1957. America contributed $1.8 billion of the total $2 billion to the Republic
of Korea. America continued aid and relief funding through various channels when
UNKRA exhausted all funds and was disbanded. Furthermore, America pledged $200
million annually in post-conflict economic aid to Korea. This is outside of direct military
73
Park, Myung Lim. "Constitution, National Agenda, and Presidential Leadership: Focusing on a
Comparison between the Articles on Economy in the “National Founding Constitution” and the “PostKorean War Constitution”." (2011).
https://bit.ly/3kqCc6G Google Scholar
45
assistance to Korea, and underscores America‟s financial influence and total obligation to
the Korean cause.74 Although America supplied much of the grant assistance for Korea‟s
reconstruction, Korean‟s ambitions did not always follow American guidelines.
The Economic Cooperation Administration – the predecessor of the US Agency
for International Development - took over aid issues from the Army. The focus of the
ECA was to establish a sound educational system as the essential base of an economic
growth in an independent and democratic state. Part of American foreign aid to Korea
paid for overseas education and training for thousands of Koreans who returned to roles
of policy formation experts, and technical leadership in industry to fill the void left by
departed Japanese technocrats and teachers. Later in 1966, foreign aid paid for the
establishment of the Korea Institute for Science and Technology, charged with the
acquisition and adaptation of foreign technology for Korean use. The Korean
Development Institute was established in 1971 and devoted to the rigorous analysis of
developmental policies. These official capacity-building programs as well as technology
rub-off from the US military, solidified Korea‟s expansion of industrialization and
institutional base. This underscored the proof that Korea started better off than each of
the focus countries in the 1950s-1960s. During the 1953-1962 decade that spans the
conclusion of the Korean War and industrial take-off, Korea had in place relatively
highly educated workers with literary and technical skills, internal security provided by
74
Lyons,
Gene
M.
"American
Policy
and
the
United
Nation's
Program
for
Korean
Reconstruction." International Organization 12.2 (1958): 180-192. https://bit.ly/2DFfIhA Google Scholar
46
its authoritarian government, a modern sector of the economy, and, a highly dependable
foreign patron, America, leading to rapid substantial capital accumulation. The
absorption of foreign innovative technology results when a balanced ratio of human and
physical capital is reached, making Korea positioned for aggressive economic growth. It
is clear Ghana had nothing comparable.
The path
to Korea‟s economic
growth
zigzagged around its initial
industrialization, a political upheaval, a devastating civil war, and uninterrupted postKorean War growth along a reasonably well-defined industrial path blazed by Japan.
Ghana had nothing comparable.
Korea‟s successful utilization of foreign aid for sustainable economic
development while Ghana did not is a recurrent theme in most scholarship comparing the
two countries. However, the type of foreign aid each country received is much less
generally emphasized. Unlike Korea whose foreign aid comprised largely of treaty-based
development grants from the United States, Ghana received loans with high interest rates
from multiple International Financial Institutions (IFIs). The high interests on the loans
had Ghana on hook for decades, digging the country deeper into external debt.
Furthermore, SAP prescribed trade liberalization policies had diluted the competitive
spur of Ghana‟s local industries and placed them at a competitive disadvantage from
cheap imports. Upstart Ghanaian businesses drowned in the deluge of international
competitive pressure and standards.
47
CHAPTER 5
BILATERAL VS. MULTILATERAL CHANNEL AID
Foreign aid is hard to categorize. To a donor, the advantages of bilateral aid go
beyond disbursement choice. When rich countries give bilateral aid directly to poor
governments, there is usually an alignment of policy between it and the recipient. This
bilateral channel is what America provided Korea. Korea‟s donors were mainly America
and Japan, whereas Ghana had to contend with multitude donors. The problems that
multi-channel donors present to a country versus having a couple of donors, are well
documented. As is argued by Bernie Bishop, multilateral donors and their conditionality
lead to policy cacophony and confusion. Differences within various IFIs policies and the
state lead to stagnation of policy implementation due to confusion.75 Furthermore, multichannel donors routinely challenge state capacity, legitimacy and effectiveness. Aid from
multiple donors often result in disconnected systems whereby projects are discontinued
or fall into disarray when funding is interrupted. This was the case with Ghana in which
few projects work well. The project size that Ghana‟s foreign assistance could fund are
75
Bishop, Bernie. Foreign direct investment in Korea: The role of the state. Routledge, 2019.
https://bit.ly/2C6IOpB Google Scholar
often negligible. Although it has lately pursued nation-building in „insignificant‟ states,
America‟s nation-building priorities seemed to follow conservative columnist Charles
Krauthammer who believes nation-building be „limited to strategically important states
that count.76 Ghana‟s foreign assistance is small potatoes compared to Korea‟s. Whereas
treaty-backed aid guarantees from America assures policy stability, aid cutoff in aiddependent country like Ghana causes anxiety in long term policy planning. Little foreign
assistance here and there makes the assistance susceptible to disruptive effects such as
inflation.
Also missing from the Korea success narrative is the contextual details about the
specific characteristics of foreign assistance Korea received compared to Ghana. IMF
structural adjustment loans to Ghana were partially responsible for the erosion of the
standard of living for Ghanaians. As the fulcrum of Korea‟s development, America
provided Korea reliability and assurance to allow for long-term planning, while
America‟s help to Ghana and Brazil were episodic and random. It is known that aid from
nonstate donors complicates coordination by recipient governments. It has been known
that sizeable portions of aid go to foreign experts and advisers whose multiple POVs
complicate recipient country‟s policy.
Ghana‟s external debt grew from US$1067 million in 1977 to $3287 million in 1987 and
reached $7510 million in 1999, with a corresponding IMF‟s share of Ghana‟s debt
76
Ottaway, Marina. "Nation building." Foreign Policy (2002): 16-24.
https://bit.ly/3ot83FV Google Scholars
49
service a solid 37% in 1987, 29% in 1995 and 13.7% in 1999.77 A country can hardly
accumulate capital for development when a sizeable portion of its resource goes into debt
servicing. Compounding interests on loans saddle Ghana with debt. This explains
Ghana‟s failed use of foreign aid, as opposed to Korea‟s.
As shown in Table 1, Ghana‟s economy began to contract in 1970 and got worse
from 1973 onwards. Its GNP growth registered a negative growth in 1973, and its GDP
growth percent for the same period contracted to 2.88 from the previous 9.72 in 1970.
Korea‟s remarkable growth during the period was because its investment in infrastructure
and outward orientation of its economy has started to pay off. Table 1 as used by Jiyoung
Kim failed to tie Korea‟s growth during the period to its prior massive investment which
would not have been possible without its capital accumulation through grants from
America. As argued elsewhere, thousands of Korean technocrats, trained with American
grant money, returned in mid-1970s to contribute their share to the economy. Among
others, it can be inferred from the table that the 1970s oil shocks sent Ghana‟s GDP and
GNP reeling into negative growth while Korea absorbed it.
77
Jiyoung
Kim (2015) Aid
and
state
transition in
Ghana
and
South
Quarterly, 36:7, 1333-1348, DOI: 10.1080/01436597.2015.1038339 Google Scholar
https://bit.ly/2F5Rr5b Google Scholar
50
Korea, Third
World
Table 1:
Year
GDP (constant 2000 US$
million)
GDP growth
(annual %)
GDP per capita
(constant 2000 US$)
GDP per capita
growth (%)
Ghana
South Korea
Ghana
South
Korea
Ghana
South
Korea
Ghana
South
Korea
1961
1967.24
30,356.299
3.43
4.94
282.716
1180.010
0.22
2.28
1964
2185.555
36,643.076
2.21
7.56
287.167
1316.349
−0.63
4.87
1967
2186.366
46,089.969
3.08
6.10
268.254
1541.546
1.00
3.68
1970
2552.423
63,643.235
9.72
8.34
293.996
1993.648
7.23
6.06
1973
2694.293
80,627.951
2.88
12.03
285.543
2375.962
−0.04
9.82
1976
2432.027
101,238.555
−3.53
10.57
240.342
2824.027
−5.40
8.82
1979
2630.301
129,963.323
−2.51
6.78
246.644
3462.549
−4.37
5.18
1982
2373.570
145,875.768
−6.92
7.33
204.183
3709.398
−9.96
5.68
1985
2586.447
186,569.643
5.09
6.80
200.936
4572.113
1.75
5.76
1988
3011.867
253,698.106
5.63
10.64
214.965
6044.029
2.82
9.59
1991
3443.142
323,368.202
5.28
9.39
226.282
7473.611
2.36
8.38
1994
3873.943
394,387.464
3.30
8.54
234.006
8872.010
0.50
7.57
1997
4395.924
482,107.174
4.20
4.65
246.198
10,491.082
1.71
3.67
2000
4982.849
533,384.028
3.70
8.49
259.991
11,346.665
1.27
7.58
2003
5696.959
610,885.293
5.20
2.80
276.405
12,764.272
2.67
2.29
2006
6778.672
698,799.258
6.40
5.18
305.751
14,446.359
3.85
4.67
2009
8137.279
753,760.393
3.99
0.32
341.552
15,325.940
1.55
-0.16
2011
10,053.617
830,523.428
14.39
3.63
402.695
16,684.213
11.76
2.87
Source: Jiyoung Kim: assessed 6/8/202078 Google Scholar
78
Kim, Jiyoung. "Aid and state transition in Ghana and South Korea." Third World Quarterly 36.7 (2015):
1333-1348.
51
State Leadership
Park‟s state leadership was critical to successful state transition in Korea. Park‟s
government guided the state‟s industrialization policy. He generally relied on the big
private businesses, the chaebol. Kwan S. Kim‟s analysis deconstructing Korea‟s postKorean war ascent, posits three distinct phases: import substitution (1954-1960); outward
orientation (1961-1979); and balance and stabilization (post-1980).79 Park crucially built
on the physical and human capital infrastructure development began under his
predecessor, Syngman Rhee. Park controlled the phases of industrialization and used both
public and private enterprises to achieve his transitional goals. He turned to state
enterprises for the successful Pohang Iron Steel Company (POSCO). With the steel mill
on line, Park initiated the Heavy Chemical Industries (HCI) strategy in his economic
development plan. A few of the giant Korean private enterprises like Samsung, LG, and
Hyundai, begin during this period due to heavy political and financial support and
protection from foreign competition. When he took power, Park had an uneasy
relationships with the chaebols whom he considered corrupt. However, the leaders of
these private enterprises would later advise and work closely with him in planning
Korea‟s industrialization push. Granted Park‟s leadership accomplishments in Korea, the
regrettable 1966 removal of Nkrumah from government was a big blow to Ghana‟s
https://bit.ly/2F5Rr5b Google Scholar
79
Kim, Kwan S. "The Korean Miracle (1962–80) Revisited: Myths and realities in strategies and
development." Asian industrialization and Africa. Palgrave Macmillan, London, 1995. 87-143.
https://bit.ly/31xGNeG Google Scholar
52
aspiration to industrialize. Kwame Nkrumah‟s stab at modernity and development
following Ghana‟s independence, was short lived. His attempt to simultaneously
industrialize Ghana and be the face of Africa‟s liberation and unification without a
wealthy Global power patron, proved an impossible task. Moreover, Nkrumah‟s
commitment to continental unification under one government, guaranteed that the
Akosombo hydro-electric dam, and the Tema aluminum smelter were the only significant
projects America helped underwrite.80
President Park Chung Hee was assassinated in 1979. By then however, he had
crucially led Korea through the most crucial phase of Korea‟s development which was
the successful outward orientation of the economy. By contrast, Nkrumah was toppled
before he could usher in Ghana‟s modernity. At the time of his overthrow, Ghana was at
pre-embryonic import substitution stage, which in development transition, is early.
Korea’s Democracy
A commonly held view among comparative economists is that Korea
simultaneously achieved both democracy and unprecedented economic growth between
1962 and 1981. However, we know economic reconstruction in Korea was not in
lockstep with democracy building. In fact, Korea was governed by some of the „harshest
conservative autocrats in the world.‟ Moreover some scholars think delayed democracy
80
Miescher, Stephan F. "“Nkrumah‟s Baby”: the Akosombo Dam and the dream of development in Ghana,
1952–1966." Water History 6.4 (2014): 341-366.
https://bit.ly/3ijfg7B Google Scholar
53
might have contributed to Korea‟s rapid industrialization. Political commentator and
scholar Fareed Zakaria has argued that Korea‟s decades-long evolution of autocracy
through “liberalizing autocracy,” strengthened the democracy it eventually had.
According to Zakaria liberalizing autocracies were regimes that held back democracies
until they grew the economy, liberalized religious “rites of worship” and travel.
According to Zakaria by emphasizing political stability, and economic development over
becoming “democratic right away,” helped create the right environment for democracy to
thrive in some post-WW II nation-states like Korea. Scholarships on Korea‟s political
economy have demonstrated “clear connections between the country‟s rapid
industrialization and the ability of its governments to intervene in the economy without
popular input.”81 Korea‟s growth flourished while its democratic institutions and press
freedom lagged. In fact, America accepted the retardation of democracy as it prioritize
economic stability over democracy. Francis Fukuyama sees political liberalism following
economic liberalism at a slower pace albeit inevitable. In one instance of political
intolerance, growing frustration with labor laws among Koreans led to demonstrations in
May 1980 in the city of Kwangju. The violent suppression of the demonstration resulted
in hundreds of civilian deaths. Whereas the Korean economy flourished, democratic
institutions and a free press often did not.82 Korea‟s Fourth Republic 1972-1981 was a
81
Brazinsky, Gregg A. Nation building in South Korea: Koreans, Americans, and the making of a
democracy. Univ of North Carolina Press, 2009.
https://bit.ly/32umkbY Google Scholar
82
South Korea: A Country Study. United States, Diane Publishing Company, 1997.
54
period of upheaval for the country. There was a coup in December 1979 following the
coup in which Park was assassinated, and another one barely five months later in May
1980. According to Fukuyama, urbanized Korea, with its well-educated middle class,
seems to be intolerably „ruled by an anachronistic military regime‟. On the other hand,
although Ghana is lauded for its peaceful democratic elections even when incumbents
lose by slim margins, incoming governments often see the mandate to govern as
opportunity to award new contracts to party loyalists. This lack of continuity which is a
bane for many developing countries unfortunately plagues Ghana as well. However,
sustained bilateral aid could induce growth in Ghana. Furthermore usurious loans from
IFIs and lack of direct foreign investment compounds the problems of Ghana aiming to
climb out of debilitating debt.
Africa and the Cold War
WW II was an era of phenomenal expansion in human ingenuity and creativity
but also destruction. Humans possessed the power to utterly destroy creation when it split
the atom. The Cold War that came on the heels of WW II tested ideologies even more. To
gain an upper hand if even sheer numbers, the United States entered into relationship of
alliances with select countries it considers indispensable to its strategic security interests.
America‟s East Asia push came from two events. One was Soviets breaking America‟s
atomic weapon monopoly in August 1949, and the other was the North Korean surprise
https://bit.ly/2JIPM7F Google Scholar
55
attack on the South on 25 June 1950, Yahuda, 95.83 In an instant, Korea became a country
in a region whose stability America has suddenly considered supremely important.
America‟s first reaction was to deploy its military, economic, and political power in
Korea. Korea became the staging ground in America‟s fight to check Sino-Soviet
expansion and power in East Asia. According to Timothy Savage, America‟s perception
of Korea went from “a remote nation of little concern, to a perplexing problem of policy,
and finally to the earliest testing ground of the Cold War.”84 In Washington, debates
raged between its idealists and pragmatists about how to sow and nourish a seed of liberal
democracy on the peninsula. Washington‟s ideologues weighed the stakes. As if to say,
“the devil you know is better than the angel you don‟t know” Washington reached a
compromise to support Rhee‟s dictatorship. The stakes were too high to do otherwise.
From then on, America worked to win over governments in its ideological war but also
undermined governments it perceives sympathetic to Communism and Socialism, using
among others, threat of aid termination as deterrent.
The heightened ideological rivalry between the East-West played out beyond
Asia-Pacific and Europe. The early decades of the period was Africa‟s liberation decade,
and 1960 regarded particularly auspicious; their annus mirabilis. Although newly
83
Yahuda, Michael: The International Politics of the Asia Pacific. Routledge, 2011
https://bit.ly/3hX518s Google Scholar
84
Savage, Timothy L. "The American response to the Korean independence movement, 1910-
1945." Korean Studies 20.1 (1996): 189-231.
https://bit.ly/33RstPD Google Scholar
56
liberated, many African countries lacked the freedom to resource shop in either bloc for
the development of their economies. America viewed with suspicion, East-leaning
African countries and resorted to covert and overt methods to signal its displeasure.
America‟s well-resourced Central Intelligence Agency (C.I.A.) was implicated in the
coup that toppled Ghana‟s Kwame Nkrumah owing to his avowed neutrality in the EastWest ideological war.85 America manipulated aid allocations and restrictions to prop up
puppet regimes like Zaire‟s Mobutu, and removed progressive nationalists leaders like
Ghana‟s Nkrumah from power.
In East Asia, America‟s war to check communist expansion provided the premise
for it to stabilize Korea and rebuild its war-ravaged critical infrastructure and economy.
Some say it was nation-building. Nation-building would be discussed later. Moreover,
Korea‟s shining success, and North Korea‟s continued isolation had come to illustrate the
communist-capitalist ideological dichotomy - the DPRK and ROK; the one
impoverished, underdeveloped and with crumbling infrastructure, the other, a
technological marvel, a symbolic triumph of liberal democratic ideals.
Ghana and Korea differed in several ways. A significant difference that most
impacted the trajectory of their future political economies is the value placed on their
respective geographies during the Cold War. As two countries in two different
geographical regions, Korea reaped benefits from its unique position in East Asia as a
85
Blum, William. Killing hope: US military and CIA interventions since World War II. Zed Books, 2003.
https://bit.ly/3a4RqcY Google Scholar
57
bulwark where the lines are drawn in America‟s ideological war against the advance of
communism and socialism. Today Korea experienced fast integration into the world
economy going from aid recipient (ODA) to OECD donor, while international
conferences and policies continue to address Ghana‟s poverty and indebtedness. Ghana
would have been at par with its Asian counterparts if it too were to benefit from the
geopolitical dividends Korea enjoyed from America. What is important in the KoreaGhana dynamic is not that the latter chose to remain unaffected by the larger forces of
developmental trend as if it were averse to progress. The central issue is that Ghana
succumbed to the strong pull of liberal democracy only to be sabotaged by the very
proponent of liberal democratic ideal, the United States. Like a moth to a flame was
Ghana to the beacon of liberal democracy, only to be smote down by the powerful hand
of America.
Brazil
In 2003, economic experts considered Brazil a limping dog among a pack of agile
hounds following Brazil‟s inclusion in “BRIC” alongside Russia, India and China, as one
of four “key growth engines of the global economy.”86 Skeptics point to a recent
International Monetary Fund capital injection as substantive reason to doubt Brazil‟s
viability. Only when the nation‟s sovereign debt was classified „investment grade‟ did
86
Moreira, Mauricio Mesquita. "Brazil‟s Trade Policy." Brazil as an Economic Superpower?:
Understanding Brazil's Changing Role in the Global Economy (2009): 137.
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58
analysts sigh. In land size and population, Brazil is ranked the world‟s fifth largest
country.87 Brazil‟s vast arable lands – most of it unexploited – together with its vast
internal market makes it an “object of fascination and speculation” among international
investors. The burgeoning ranks of the world‟s middle class projected to reach 1.8 billion
by 2020, and a strong global demand would translate into a surge of revenue for Brazil‟s
commodities and manufactures. It is expected that Brazil‟s impressive investments in the
renewable energy industry could sustain it in post-Kyoto Protocol climate pressure to
curb carbon emission. The state, is a formidable presence in Brazil; it owns 38 of Brazil‟s
100 largest firms. Moreover, Brazil‟s public sector, reputed to be the „largest outside the
former Communist bloc‟ is an albatross around its neck. Some analysts believe Brazil
needs to trim its bloated bureaucracy to guarantee lean growth. Some fear Brazil‟s vast
social safety-net - Bolsa Familia – (the health and nutrition assistance to Brazil‟s needy
and underprivileged populations) would sink some of the country‟s economic gains. The
program‟s rapid expansion (24 percent of the population benefits from it) and popularity
among politicians and Brazil‟s poor, dooms any prospect of fat-trimming.88 Moreover,
although strong commodity prices tend to be fleeting, enthusiasm for Brazil‟s economy is
never lacking as aircraft manufacturing, biofuels, and petrochemicals have individually
87
Sandoval, Lindsay. "The effect of education on Brazil‟s economic development." Global Majority E-
Journal 3.1 (2012): 4-19.
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88
Hall, Anthony. "Brazil's Bolsa Família: A double‐edged sword?." Development and change 39.5 (2008):
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experienced „prominent successes‟. However, the state in Brazil lacks the kind of
meticulous coordination the state of Korea exerted on industry sectors in its post-war
development. However, sound macroeconomic investments and divesting into other
sectors of the economy could ensure steady growth for Brazil. The country continues its
integration into the global economy with sustained economic growth under stable
democracy. New oil finds together with middle class growth in India and China combine
to assure Brazil‟s status among its peers in the world‟s rising economic powers.
Brazil‟s global economic powerhouse status notwithstanding, human development
paradoxically lags. As the country‟s economic gains rise, inequality becomes surprisingly
more rampant which greatly affects the quality of Brazil‟s human capital. According to
Lindsay Sandoval, poor education is the culprit in the widespread income inequity that
plagues the country. Brazil enjoys the unflattering reputation as the 12th most unequal
society in the world.89 Brazil is tone death to clarion calls to use improvements in
education as proxy to tackle widespread systemic inequities. There is mounting evidence
that low quality education begets low income, which in turn leads to low quality
workforce. However, Brazilian leaders seem to lack a coherent plan to disrupt this selfperpetuating vicious cycle. Brazil suffers from one the highest rates of grade repetition
and dropout rates in the world. Like most aspects of Brazilian life, disparities in
89
Sandoval, Lindsay. "The effect of education on Brazil‟s economic development." Global Majority E-
Journal 3.1 (2012): 4-19.
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60
education quality are entrenched across urban and rural populations. Although Brazil
spends identical percentage of its GDP on education as its Latin neighbors, gaping
inefficiencies in its „education system undermine this investment.‟ Many consider its
education substandard. Brazil is sluggish in its embrace of policy tools and pedagogical
regulatory reforms that can reverse its chronic teacher and student absenteeism. Brazil
lacks teacher-tracking oversights although rampant teacher absenteeism is a known
morale and reading efficiency killer. Little impact can be made without supervision and
tracking of teachers‟ use of school time. Targeted reforms of its education system can
result in significant increase in attendance, and mitigate dropout rates, waste, and
systemic failures. Education reforms should emphasize quality over high enrolment
figures. Brazil seems oblivious to the role quality education plays as a driver of economic
growth and its effect on poverty alleviation. Pragmatic investments in education with
strong oversight could bring the much needed modernization to Brazil‟s education
system.
61
CHAPTER 6
ANALYSIS
Among my focus countries, Korea benefited most from the Cold War when its
geographic location is considered supremely important to America‟s foreign policy
objectives in Asia. Korea achieved geopolitical relevance as two rival superpowers stare
down each other in palpable tension across the 38th parallel in their uneasy co-existence.90
The Soviet Union presented expansionist threat to America and challenged America‟s
promotion of liberal democracy and global capitalism during the Cold War.91 Korea‟s
geographic value especially during the Cold War, has given rise to the 1980s growing
body of international relations branch of study called „critical geopolitics.‟92 The
privileging of Korea‟s geography compelled America to underwrite the „financial
90
Sungjoo, Han. "South Korea and the United States: the alliance survives." Asian Survey 20.11 (1980):
1075-1086.
https://bit.ly/31skJlO Google Scholar
91
Dodds, Klaus. "Cold war geopolitics." A companion to political geography (2003): 204.
https://bit.ly/3a7se5E Google Scholar
92
Dodds, Klaus. "Cold war geopolitics." A companion to political geography (2003): 204.
https://bit.ly/3a7se5E Google Scholar
requirements of Korea‟s subsistence and defense [which] accounted for up to 10% of
Korea‟s GNP in that period.‟93 Comparatively, Ghana was hurt the most following
Nkrumah‟s removal (decapitation) leading to the derailment of Ghana‟s attempt to
industrialize. It is possible that Nkrumah‟s Marxist leanings and ideologically
antagonistic rhetoric put him in America‟s crosshairs. To be sure the decade of African
liberation, the sixties, was anxious time for America and the Soviet Union. Their war of
ideological dominance worked against Africa‟s progressive leaders like Patrice
Lumumba and Nkrumah. African leaders and their countries became proxies in the
ideological war between the two superpowers. The Truman doctrine preceded Ghana‟s
independence by a decade. And although the doctrine espoused to “support free peoples
who are resisting attempted subjugation by armed minorities or by outside pressures,” 94
America did little to aid Ghana‟s resistance of British subjugation. Was it because Britain
pushed back on America‟s pressure, or was America‟s thinking at the time „tempered by
the need to shore up the weakened West European countries and their fragile democracies
against the perceived communist and Soviet threat‟?95
93
Sungjoo, Han. "South Korea and the United States: the alliance survives." Asian Survey 20.11 (1980):
1075-1086.
https://bit.ly/31skJlO Google Scholar
94
Yahuda, Michael. The International Politics of the Asia Pacific. Routledge, 2011.
https://bit.ly/3hX518s Google Scholar
95
Yahuda, Michael. The International Politics of the Asia Pacific. Routledge, 2011.
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63
This paper is about the political economic development among Ghana, Brazil, and
Korea, three countries with similar but distinct histories. The paper‟s focus on Korea
follows the forces that shape it. I attempt to examine the rest of the cohorts through these
forces. These are colonialism and the Cold War. These incidentally impact all three. The
evidence I presented support my thesis that America‟s special relationship with Korea
was driven by its Cold War imperative to prevail against the threat of Communism, and
to check its expansion anywhere. Colonialism impacts each of the focus countries on a
similar scale to the Cold War. I have proven that geography is of supreme importance
during the Cold War. The nature of America‟s uneven involvement in my focus countries
impacts aid disbursement among them. Countries tilting East in deed or words, kindle
America‟s resentment and wrath.
Ghana and Korea differed in the specific characteristics of the type of foreign
assistance each received. Ghana had to contend with multi-channel aid with high interest
rates and contesting agenda, while Korea received interest-free bilateral grants largely
from the United States and Japan.
Portability of the Korean Model
Scholars have studied the success of the Korean „miracle‟ because of its policy
implications for stagnating African and Latin American countries. Some scholars see
discernible patterns behind Korea, Taiwan, and other East Asian „miracle‟ economies.
According to Sherry Gray, scholars have three factors that explains the economic boom
in Asia in general. Some see Weberian influence that align with the region‟s Confucian
64
cultural practices of strong work ethic, postponement of gratification, and thrift, as a
factor. The second factor is the Cold War as a historical accident that induced the United
States „prosperity spending‟ via the military and economic spending in Korea. The third
factor is the role of the state in imposing social conditions conducive to capital
accumulation. Although some scholars have moved away from the cultural Confucian
factor and the historical accident of the Cold War as strong factors, some components of
these remain relevant. For instance, while the historical accident of the Cold War may not
be duplicated or exportable, its massive spending component could be exported. I focus
on this component because of the experiences of Ghana. Major, consistent spending over
time in a country could make the great difference in most stable but poor economies.
America‟s long term, open-ended commitment to ensure political stability and economic
growth in Korea could be duplicated elsewhere in a country like Ghana. Not all „breakout
nations‟ have American foreign assistance. Lacking the magnitude and duration of
American support, the kind that fueled Korea‟s ascent, Ghana could accumulate
sufficient capital from its oil revenue and rents from its mineral sector to self-finance its
transition. Oil wealth and foreign aid did not make Nigeria a developmental nation
although it helped Indonesia escape the so-called „resource curse‟ in the 1960s in stride
with the „Asian Tigers‟ in the mid-1990s. Although America provided the funding, the
vision behind Korea‟s industrialization were all its own. To some experts, Korean agency
was the most potent factor in the country‟s developmental transformation. Korea suffered
assassination and coups that challenged its vision, but remained committed to its long65
term goal of achieving developmental growth. Many Koreans adapted quickly to the
American influence having lived under Japanese colonialism that exposed them to
„authoritarian model of development‟ that endured to when „American nation builders
arrived.
66
CHAPTER 7
FINDINGS AND CONCLUSIONS
The rise of the Korean state out of subjugation and a war not officially ended, to
„arguably the premier development success story of the last half century,‟96 has been
widely canvassed in political economy literature. There is no simple and straightforward
explanation why Korea succeeded at industrialization between the sixties and eighties,
although Korea‟s success at weaning itself off the foreign assistance that it once received
with its peers like Ghana, has continued to generate frequent comparisons between the
two countries. My mission here is to find substantive explanation underlying Ghana‟s
failed transformation. The reasons advanced for Ghana‟s abortive industrialization often
wrongly assume that Ghana accomplished less with identical foreign assistance with
which Korea blazed out of helpless poverty. This is not so. Favorable foreign aid spurred
Korea‟s rapid ascent. Though there are now hundreds of empirical papers comparing the
96
Noland, Marcus. "Korea's growth performance: Past and future." Asian Economic Policy Review 7.1
(2012): 20-42.
https://bit.ly/2DvFTaO Google Scholar
impact of foreign assistance on Korea and Ghana, relatively few focus on the different
foreign aid each received. Even so, these are inundated by the crush of scholarship that
echo the superficial.
There are inherent biases in the models used to compare Korea‟s successful aid
utilization to Ghana and Brazil. Attribution problems and the disregard of contextual
factors behind Korea‟s industrialization render these comparisons unfair. Korea, Ghana,
and Brazil had different experiences with foreign aid. The comparisons are hard to defend
when the recurring theme behind Korea‟s success remains its „efficient foreign aid
utilization while it peers did not.‟ Korea received substantial foreign aid to implement its
development policy preferences. Japan laid the industrial foundation which Korea scaled
during its post-war reconstruction. It had the funding which America generously
provided. Korea‟s quandary became how to grow the country using the grants, not from
worrying over where to get funds. The spigot of Washington‟s financial assistance to
Korea ran fast and long leading to the rapid capital accumulation which is critical to its
achievement of developmental transformation within three decades. On the other hand,
Ghana had limited foreign assistance and took out short-term and high-interest rate loans
in the 1970s and 1980s. Nkrumah‟s missteps delayed Ghana‟s development. For much of
his presidency, it was doubtful what mattered more to Nkrumah. Was it his Africa
emancipation quest or the fulfilling of his mandate to Ghana?97 Ghana‟s inability to
97
Onwumere, Obima. "Pan-Africanism: The impact of the Nkrumah years, 1945–1966." Trans-Atlantic
Migration: The Paradoxes of Exile (2008): 229-41.
68
achieve equitable and sustainable economic growth during this period marked the origins
of the divergence of the Ghana-Korea GDP gap which grew wider the more Korea
consolidates its industrialization and Ghana retrogresses.
Japan‟s colonial assimilation policy introduced modernity and development to
Korea which stands in sharp contrast to Ghana‟s colonial experiences under British
subjugation. Japan‟s successful penetration into Korea is aided by their geographic
proximity and cultural similarity. Britain focused on mineral extraction and agricultural
export and limited its infrastructure investment to mining and farming areas, to the
exclusion of the rest of the country. It is argued elsewhere that the schools the British
established in colonial Ghana had at its core, the grooming of colonial administrative
support, not transformation to modernity. Various economic models are used to illustrate
Ghana, Korea and Brazil as contemporaneous with identical GDP in the 1960s. Evidence
of the chronology of events, supports the contrary. By the 1945 division of the Korean
Peninsula, Korea already had in place the building blocks for growth which included an
educated population, property rights, and some modest land reform that boosted
productivity.98 Ghana was not even a country in 1945. Moreover, in the first four years of
Ghana‟s independence, Nkrumah‟s government had little economic control over the
https://bit.ly/35KWWS3 Google Scholar
98
Noland, Marcus. "South Korea's experience with international capital flows." Capital Controls and
Capital Flows in Emerging Economies: Policies, Practices, and Consequences. University of Chicago
Press, 2007. 481-528.
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69
country which retards the state capacity. According to John D. Esseks, at independence,
most if not all African countries were challenged politically and economically, with the
foreign control of significant sectors of their economy. This gives foreign private
enterprises control over the countries‟ natural, physical-capital, manpower, and financial
resources.”99 With limited state capacity, even the nationalization of enterprises Nkrumah
attempted yielded nothing more than the token, „internal marketing of cocoa and the
foreign sales of timber logs.‟ This was a severe blow to an ambitious president prancing
to quickly change the face of entrepreneurship in his young republic. Thus the CPP
government‟s quest to get the upper hand in the control of the country‟s economy,
amounted essentially to a „strategy of competitive coexistence,‟ with the dominant
foreign enterprises. The competition exposed the state‟s real capacity and bargaining
power which was dismissive. Moreover, the lack of loans and other modes of credit to
local businessmen only kept the competition firmly in the grip of the foreign enterprises
to the frustration of a government eager to enable entrepreneurial self-sufficiency for its
citizens. Around this same period, the inflow of American foreign assistance to the
Korean state undergirded its negotiating power with the country‟s powerful conservative
opposition whose alliance with colonial Japan underscores its intent on maintaining the
status quo. Curiously, capital accumulation combined with the acumen of Korea‟s
leadership to steel its resolve to defy Washington‟s insistence to stay agrarian. Thus even
99
Esseks, John D. "Political independence and economic decolonization: the case of Ghana under
Nkrumah." Western Political Quarterly 24.1 (1971): 59-64.
https://bit.ly/3lKH0nF Google Scholar
70
the big private enterprises - the Chebols, - were at the mercy of the state over its
monopoly on funding. The state in Korea was central, powerful, and had the capacity to
sidestep crippling bottlenecks to development that Nkrumah‟s state in Ghana lacked.100
Korea‟s resource poorness led to more pragmatism and reliance on practical skills and
technology. The prevailing literature often blurred the stark distinctions between loan and
grant regimes in foreign aid, and fails to address the benefits of grants versus the vicious
cycle of retrogression which loans perpetuate. Foreign aid financed most of Korea‟s rapid
capital accumulation which at its peak in the late 1950s, accounted for more than half of
its imports leading some experts to claim that Korea‟s poverty after the Korean war was
exaggerated. Thanks to consistent grants from the United States, and financial controls,
which enabled Korea to embark on straightforward paths for industrial upgrading based
on imitating the prior trajectories of the more advanced economy of Japan. Ghana‟s
capital inadequacy contributed to its failure to execute its development policies besides
foreign debt servicing. Moreover, unlike Korea, Ghana lacked any prior technological
base on which to build a modern, sustainable economy.
Cold War imperatives forced America‟s hand to underwrite Korea‟s security and
internal stability as a bulwark against Sino-Soviet expansionism in the East. Ghana
lacked any Global power ally singularly dedicated to its development. The same Cold
War that was a boon to Korea was a bane to Ghana. Nkrumah‟s professed neutrality (he
100
Noland, Marcus. "Korea's growth performance: Past and future." Asian Economic Policy Review 7.1
(2012): 20-42.
https://bit.ly/2DvFTaO Google Scholar
71
was a founding member of the Non-Aligned Movement) in the East-West ideological war
did not appease Western governments led by the United States of America. America saw
through his cloak of neutrality and used his rabid nationalistic rhetoric as grounds to
classify him (alongside Patrice Lumumba) rising radicals to be feared and silenced.
Already a target of conspiratorial plots of assassination for his „tyranny‟, Nkrumah had
internal as well as external adversaries biding their time for his overthrow. Evidence of
America‟s implication is circumstantial. Much of this evidence came from former
American ambassadors to Ghana who confess their implication decades after Nkrumah‟s
overthrow. He was targeted and help from overseas was provided for his removal from
power, thereby derailing Ghana‟s ambition to industrialize.
The stars seemed lined up for Korea‟s rise. The Japanese technology rub-off
during its colonial period combined with a future America‟s major assistance to
accelerate Korea‟s historic ascent. Korea continues to build upon even after its
independence. According to Gregg Brazinsky, thousands of Koreans gained invaluable
experience in new modes of governance and production‟ through modern heavy Japanese
industries on the peninsula, military enlistment and „participation in the extensive
colonial bureaucracy‟.101 On the other hand, Britain left little technological influence on
Ghana. Furthermore, Ghana lacked a consistent national development plan. Although it
has consolidated its democracy, there are jarring discontinuities of development policies
101
Brazinsky, Gregg A. Nation building in South Korea: Koreans, Americans, and the making of a
democracy. Univ of North Carolina Press, 2009.
https://bit.ly/3nId1yf Google Scholar
72
between Ghana‟s successive governments. Often at great expense to the country,
incoming governments usually scrap viable development plans of the outgoing
government for graft from new contracts. While elections are at the center of a
democracy, in Ghana, an electoral success of one government is often a win for the
dominant ethnic representation in that government. Individuals and groups in the
government become the beneficiaries of spoils from elections at the expense of the
general welfare of the society. Korea‟s homogeneity gives it one less problem to contend
with in its development aspiration unlike Ghana whose fragmentation along ethnic lines
paralyzes its decision making. The state in Ghana takes a backseat to the strong draw of
ethnicity. Ethnicity constantly tested the cohesion of the country and appropriates the
common good to itself. This makes Ghana unable to escape the trap of the widely applied
terms of kleptocracy and clientelism that have become synonymous with some resourcerich African countries. Some scholarships highlight these structural and institutional
factors as reasons behind Ghana‟s growth collapse. Ghana could duplicate Korea‟s
success if it harnesses its resources much more sensibly. As a developing country, Ghana
could attract private investment if it creates conditions where investments are secure and
profits high.
CONCLUSION
In this thesis, I made extensive references to the Cold War and the legacy of
colonialism because of their impact on my focus countries. Recent decades have seen
growing scholarship of how resource-poor countries successfully used foreign aid to
73
build their economies while their resource-rich counterparts continue to be aid dependent.
Korea is especially lauded for its dynamism in weaning itself off foreign assistance at
historic brisk pace, while its cohorts Ghana and Brazil did not. How Korea got there is
controversial due to attribution factors. Some writers generalize foreign aid or gloss over
critical distinguishing components of the foreign aid regime from nation-building. I argue
that nation-building in Korea accounted for the country‟s sixties-to-eighties
transformational leap ahead of its cohorts. Nation-building and institution-building by
America scarcely come up in much of the literature mediating Korea‟s rise. What appears
most often is „bilateral aid‟ that Korea and other nations received but which Korea
comparatively „utilized better than its peers‟. In the aftermath of the Korean War,
America made an open-ended commitment of money and power to see its nation-building
exercise in Korea through to the end. Reconstruction in Korea included rebuilding
institutions that make a modern state run effectively. Korea had a makeover of its
judiciary, civil service, and a restructured government bureaucracy and the establishment
of a central bank. America‟s post-conflict stabilization and reconstruction in Korea, gave
it an auspicious start, thereby erasing its so-called resource „poorness.‟ Is that nationbuilding? I draw my answer from the way Korea turned out. Korea substantiates the
utility of nation-building, with its developmental transition going from aid recipient to
donor in record time. Therefore it is nation-building when a Global power makes an
open-ended commitment to see the transformation through. It is nation-building when
America hitched Korea‟s success to its own success. It is nation-building when the
74
United States fears it would “suffer a tremendous loss of prestige if it abandoned its
commitment there.”102 All of this was understandable granted the United States is the
face of liberal capitalism and was the occupying presence at the time of North Korea‟s
invasion of the South. How much bilateral aid is considered nation-building grade?
Following the Korean War, America carried out both reconstruction and development
which meets Francis Fukuyama‟s definition of nation-building. Fukuyama defines
reconstruction as the repair of a society‟s war destruction to its pre-conflict state, and
development as, „the creation of new institutions and the promotion of sustained
economic growth, events that transform the society open-endedly into something that it
has not been previously.”103 The enormous cost of the model makes it prohibitive. The
major commitments of money and armies of personnel it requires to properly execute
makes it an unlikely model to prescribe to other places. America‟s global leadership has
lots of contradictions: it is a dominant agent in Korea‟s industrialization while a reluctant
participant in Ghana and Brazil; a tremendous Cold War nation-builder in Korea, but a
saboteur of Ghana‟s development. This makes using Korea‟s development as a
benchmark for comparisons with countries like Ghana, disingenuous. America‟s
extensive Cold War engagement in Korea assured innovative success and precluded
failure. Again this is understandable granted Korea‟s critical geography. However,
102
Brazinsky, Gregg A. Nation building in South Korea: Koreans, Americans, and the making of a
democracy. Univ of North Carolina Press, 2009.
103
Fukuyama, Francis, ed. Nation-building: beyond Afghanistan and Iraq. JHU Press, 2006.
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75
political economy writers enthusiastically continue to tout Korea‟s success story, not by
comparing it to countries that similarly benefited from major bilateral aid flows like
Israel, but with countries like Ghana whose interest-laden foreign assistance continue to
sink the country in accrued debt. Brazil is classified an NIE which makes Ghana, the least
economically successful among its cohorts. America‟s asymmetrical engagement with
my focus countries results in the nature of uneven access to aid flow them. Moreover, it is
hard to defend a comparison between a country like Korea, which benefitted from
bottom-up nation-building, with a country like Ghana that thrives on chump change from
IFIs. This is the crux of my thesis: comparing apples to oranges.
76
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