The Decline of the Open Economy

An ‘open economy’ has been briefly defined as one ‘that is heavily dependent on international trade, exports and imports being large in relation to the size of that economy’s national income’. By contrast, a ‘closed economy’ is one ‘that is not influenced by any form of international trade, that is, there are no exports or imports of any kind’. These are highly formal definitions; in practice, virtually no modern economy is entirely open or closed. But the economies of colonial Africa in which UAC and the other big European trading firms operated were, before decolonization, ‘open’ to a degree almost never found in the more developed West. That is, their economies were geared to production and export of certain raw materials and to importing a large proportion of their total consumption. To take as examples four of the countries with which UAC was most concerned, as late as 1968 trade (the sum of exports and imports) as a percentage of GNP was 21 per cent for Nigeria, 37 per cent for Ghana, 63 per cent for the Congo/Zaire, and 69 per cent for the Ivory

Consumption (sociology) · Economics · Economy · Exchange rate · International economics · International trade · Macroeconomics · Monetary economics · Open economy · Production (economics) · Small open economy · Terms of trade · African history and culture studies