ABSTRACT
Sub-Saharan Africa's rocky and volatile relationship with international capital markets has moved into a new phase. Over the past decade private capital flows have rocketed upward just at a time when public-sector aid flows have been leveling off and will likely soon start declining. Africa's headline economic growth rates, as measured by changes in real gross national income (GNI), in the immediate postindependence period were fairly positive, with income per capita rising about 2.6 percent per year during the 1960s. The vast majority of development policy debates remain stuck in the public sector, the role of the African state in promoting development, and what rich-world governments can do to help. Remittances are another important source of private capital for Africa that is often forgotten. Foreign direct investment is sometimes considered more development-friendly than portfolio flows because it is more stable and can often be visibly linked to things such as jobs, buildings, and tax payments.
