Before independence, both Algeria and Senegal traded mainly with their coloniser, France. In the fifteen years after independence, the share of Algeria’s exports that went to France collapsed, whereas Senegal’s trading ties to France declined more gently. Jan Bienek (MSc Global Economic History 2022-23) explores how these divergent trajectories can be explained, emphasizing the nature of the decolonization process: violent in Algeria, peaceful in Senegal.
The year 1962 marked the end of what historian Raymond Betts called the “terminal decade” of the French empire. With Algeria’s independence, most of its colonies had gained sovereignty. Colonial occupation had significantly strengthened the trade relations between colonies and mainland, metropolitan France.
Independence, however, brought major changes to trade between the former colonies and metropolitan France. How important trade with France remained for the former French colonies varied significantly. Similarly, the process by which African colonies gained independence varied greatly within the French empire. Comparing Algeria’s violent struggle for independence and the abrupt reduction in Franco-Algerian trade that followed, with Senegal’s peaceful decolonization and more gradual decline in trade with France provides insights into the different mechanisms at play.
Algeria’s War of Independence
The struggle for Algerian independence culminated in a brutal eight-year war. Despite the conflict’s severity, France remained Algeria’s main trade partner. In 1962, the Evian Accords were signed, formally granting Algeria independence. Independence brought about an abrupt mass emigration of European settlers, driven by the war’s violence and the antagonistic relationship between settlers and the Algerian population.
During the late colonial period, European settlers had consumed about sixty per cent of Algeria’s total imports. As settlers fled following independence, so too did the main consumers of French imports. Before the Evian Accords were signed, 82 per cent of Algeria’s imports came from France; five years after independence, this figure had dropped to 60 per cent. The exodus of the settler community significantly contributed to the decline in imports of French consumer durables, food, and capital goods.
During the colonial period, European settlers had also monopolised agricultural export production. As Peter Robson and D. Lury write in The Economies of Africa, “wine alone explains the heavy dependence on France as an export market”. Algerian wine exports were created for the French market, and in 1957, settlers produced 90 per cent of the wine, which accounted for over fifty per cent of total exports (excluding oil). Due to the European mass emigration following independence, the wine producing sector lacked skilled labour and perished. By 1980, the importance of agricultural products as exports goods had diminished. Moreover, the discovery of large oil and gas reserves in 1956 shifted the Algerian economy towards the extraction of these resources.
European settlers had occupied the leading economic positions in colonial Algeria. French merchants who controlled trade in the colonial empire were well connected. Their social networks promote trade by facilitating the transfer of information between distant markets, thereby reducing transaction costs. The rapid departure of European settlers disrupted these long-standing networks. After independence, leading Algerian merchants assumed control of these trade networks, but in 1967 President Boumédienne transferred the import-export trade to national public organisations.
The economic policy of newly sovereign Algeria was designed to end dependency on the former colonial power. The anticolonial struggle had created a new political and military elite. In 1963, Algeria’s newly independent government let by Ben Bella, nationalised several private enterprises, but subsidiaries of French companies maintained the ability to conduct their business. The second Algerian government under Boumédienne pursued a stricter economic policy, ideologically motivated by the revolutionary egalitarianism of the war. The government nationalised 51 per cent of every French oil corporation in Algeria and brought over four-fifths of the Algerian oil reserves under their ownership. This rupture in Franco-Algerian relations is also reflected in their bilateral trade pattern. The French share of Algeria’s exports had fallen by 71 per cent from 1961 to 1971 – less than ten years after independence.
The peaceful decolonisation of Senegal
In contrast to Algeria, decolonisation in Senegal happened via a peaceful transfer of power based on political negotiations. Independence movements were not revolutionary in character, as the growing prosperity in the 1950s created a cooperative attitude among the colonial authorities and the Senegalese national leadership. Following France’s decision to extend voting rights, Léopold Sédar Senghor’s electoral victory in 1957 heralded the start of a gradual transition. In 1960, Senegal proclaimed independence but remained closely affiliated with France through “accords of association” that ensured the continuation of trade, monetary and financial relations from the colonial period.
Following independence, Senegal retained the colonial tariff system that favoured imports from Franc Zone countries. Non-members of the tariff system had to pay import duty sometimes exceeding 100 percent. Throughout the 1960s, the tariff system secured France’s position as Senegal’s main source of imports. Additionally French aid to its former colonies in Sub-Saharan Africa remained on a similar level throughout the 1960s, while it declined abruptly for Algeria. The close interpersonal ties maintained through French aid enabled a French member of the Senegalese planning office, for example, to prevent the construction of an American fertiliser factory in Senegal, which would have reduced imports of French fertiliser.
Benefits flowed both ways in this relationship. France continued to subsidise Senegalese groundnut production into Independence, buying the entire country’s groundnut output at prices 17 per cent higher than the global market. Groundnuts were the primary export product of the colonial economy and France purchased Senegalese groundnuts at a preferential price. In the first years after independence, over 80 per cent of all Senegalese exports went to France. With the end of the preferential price for groundnuts, the French share in Senegalese total exports declined to 67 per cent in 1968.
French civil servants remained present in Senegal’s post-colonial government and influenced its economic policy. While their numbers were relatively small, their departure from the state apparatus was less drastic. Moreover, “their power and effectiveness far outweighed their numerical presence”, according to historian Rita Cruise O’Brien, as French bureaucrats “provided a kind of parallel administration in the first decade of independence”. From 1957 to 1970, French nationals acted as Senegal’s finance ministers, and French bureaucrats held high-level, strategic posts in all ministries. Furthermore, through the Economic and Social Council, set up in 1961 as an advisory body to the president, French industrialists, bankers and the chairmen of big French trading houses, directly influenced economic decision-making in the years after independence.
Senegal’s economic policy remained friendly towards French businesses. In contrast to post-colonial Algeria, Senegal’s government did not nationalise foreign enterprises. According Harvard historian Emmanuel Akyeampong, independent Senegal “combined African socialism with continued cooperation with France”. Senegal’s economic dependence on France subsided gradually towards the end of the 1970s, as export production diversified, and the government promoted the Africanisation of the economy.
Comparing, discussing and concluding
This comparison of the independence processes of Algeria and Senegal, highlights that while France’s role as a trade partner declined for both, the Algerian war accelerated this decline. Algeria’s violent decolonization disrupted business networks more than Senegal’s peaceful transition. Algeria’s nationalization of foreign companies worsened Franco-Algerian relations, rapidly reducing France’s trade share. In contrast, Senegal maintained close ties with France, reflected in preferential trade relations and a gradual decline in France’s trade share. French businessmen influenced the newly independent Senegalese government, which included French nationals. Based on these findings, I propose that war as part of an independence process should be considered as a factor accelerating the mechanisms that also contribute to the decline in trade between colony and metropole in peaceful independence processes.
This article appeared as a blog entry in November 2024. You can see later articles here.