143

p The figures released by the Organisation for Economic Cooperation and Development (OECD) show that direct investments of its African members totalled $10.2 billion by the end of 1974.  [143•2  In 1977, it was estimated at $11 billion.

p Until recently the British and French monopolies held the strongest positions in African economy. In the post-war period US monopoly capital conducted large-scale expansion on the African continent. Africa remains the main object of Belgian capital investments. West German and Japanese monopolies are also steadily increasing their investments there.

p According to available information, investments are concentrated in the mining industry. Large investments have been made in wholesale trade, credit and banking, the tourist industry, etc. The extremely profitable exploitation of Africa’s mineral wealth, oil in particular, has enabled the foreign monopolies to make new heavy investments mainly by reinvesting.

p A very important development, the nationalisation of the property of foreign raw materials monopolies, took place in the early 1970s in the economic policy of the newly free 144 African countries. From 1971 to 1974 the state took over the greater part of the Algerian and Libyan oil industry, and a considerable portion of the Nigerian. The property of copper monopolies was nationalised in Zaire and Zambia. In 1974 the government of Mauritania assumed control over the property of large international iron and copper ore mining companies. Foreign property in Togo, Ghana and other African countries continued to pass into the hands of tlie state. As a result, by 1978 the positions of foreign monopolies, owning African raw materials resources, were seriously undermined.

p But having lost their direct control over some mineral resource, foreign monopolies are adapting to the new conditions and employ new methods which frequently enable them to remain in indirect control. The conclusion of longterm contracts for the purchase of raw materials has become a widespread practice. As a rule, the main purchasers are companies that had formerly mined them. In many cases foreign monopolies continue to be co-owners of mixed companies and influential “consultants”, and sign contracts under which they manage the nationalised enterprises, assume the functions of state sales organisations, etc.

As a result, in spite of the fact that its positions had been undermined, foreign capital in the 1970s continued to pocket enormous profits which surpassed the inflow of new investments into Africa many times over (Table 3).

Table 3 Exported Profits on Invested Private Capital and Inflow of Overseas Capital in African Countries (million dollars) 1968 1969 1970 1971 1972 1973 1974 1975 Exported profits 1.278.7 1,369.3 1,266.0 1,333.8 1,621.5 2,305.6 2,289.6 1.788.1 Inflow of private capital 310.4 205.6 737.2 826.5 1,069.6 844.7 745.5 2,208.1 Estimated on the basis of International Financial Statistics (Washington), Vol. XXIX, No. 8, August 1976; ECA Survey of Economic Conditions in Africa, 1970, Part I, pp. 304-07. 145

p The leading role in the plunder of African countries in that period was played by the oil monopolies which netted from 75 to 80 per cent of the exported profits.

During the 1970s there was a growth of foreign investments in those branches of the economy of the independent African states that catered to the domestic market, including the manufacturing industry. There were several reasons for this. The course of promoting the growth of tiie national economy pursued by many African countries broadened the domestic market: the living standards improved, the purchasing capacity of the working people increased, the urban population swelled and the development of commodity-money relations in the countryside heightened the demand for certain manufactured goods; the policy of many countries aimed at stimulating local production and protecting it against foreign rivalry by the introduction of high import dues and other protectionist measures led to a growth of prices on the domestic market and made many types of local production more profitable. All these factors have caused foreign investors to regard the domestic market in many African countries as a very profitable sphere of activity.