Over the last decade, around the world, China has been buying up mountains and mines, agricultural land, and oil fields at an extraordinary rate. In 2007, a Chinese company bought the mineral rights to two billion tons of copper in a Peruvian mountain for U.S. $3 billion. This was relatively small change; in 2008 the same company spent $14 billion on a stake in Australia’s aluminum industry. Since 2005, China has engaged in nearly 500 direct foreign investments and large contracts, valued at U.S. $505 billion–roughly one billion U.S. dollars per week.

In June 2011, Secretary of State Hillary Rodham Clinton gave a speech in Zambia warning of a “new colonialism” threatening the African continent. “We saw that during colonial times, it is easy to come in, take out natural resources, pay off leaders and leave,” she said, in a thinly veiled swipe at China.

In 2009, China became Africa’s single largest trading partner, surpassing the United States. And China’s foreign direct investment in Africa has skyrocketed from under $100 million in 2003 to more than $12 billion in 2011.

Every day, about a billion people go hungry in the world. Nearly a third of these – 300 million people – live in sub-Saharan Africa. Yet 60 per cent of the world’s untilled arable land is also in Africa. Theoretically, these statements suggest three things: first, that Africa should be able to feed itself; second, that Africa should be a net supplier of food to the rest of the world; and third, that we are dealing with a structural problem – market failure.

Despite these well-known facts, a culture of foreign aid dependency has led to a situation where African governments lose the incentive to implement necessary policy reforms that would remedy these problems.

If I ruled the world, I would address the biggest threat to economic progress and political stability over the next decade: scarcity of resources. As an economist and author, I have travelled to every continent over the past two years, and the one common issue faced by every country I visited is the coming shortages of key commodities.

Although many countries have created strong economic growth and made significant strides in moving hundreds of millions of people out of poverty, the risk from commodity shortages promises to put a dent in all this good news. The world’s dwindling supplies of land, fresh water, energy and minerals—essential for food and “white goods” such as mobile phones, cars, televisions and washing machines—cannot meet the pressures rising from global demand.

In late March and early April, as average U.S. gasoline prices climbed above $3.80 per gallon, headlines warned that soaring prices could imperil President Obama’s chance of re-election. But just two months later, after average prices dropped by 30 cents per gallon, what once seemed like a deal-breaker for the election is no longer  considered an issue. This narrow focus on short-term fluctuations in the price of a single commodity blinds us to one of the biggest threats to the world’s economic progress and political stability in the decades to come: resource scarcity.

Capitalism is alive and well in Africa. Some observers will worry about the recent violence arising from the removal of fuel subsidies. The truth is that today’s Nigeria is strong enough to avoid a protracted crisis. This is down to the growing power of the African consumer. A decade or two ago, the rash subsidies decision taken by President Goodluck Jonathan could have brought the country near to a full political meltdown. But in 2012, Nigerian consumers want to buy their groceries and get back to work; they have too much vested in the economy. It’s a pattern mirrored across the continent.

Many will agree that a system of incentives is, and has been, the backbone of the success of the capitalist economic system. That over centuries, a network of incentives has driven innovation, which in turn has encouraged the inventiveness that has led to the unparalleled generation of ideas, goods, and services across America and the industrialized West.

Given the evidence and importance of positive incentives, why, over the past 50 years, have policymakers embarked on a systematic and deliberate strategy of putting in place a catalogue of policies that dis-incentivise citizens from acting in a manner that could be beneficial to their economies, and the world at large?

Americans who once believed they owned the future now look warily across the Pacific to an emerging China that is building the world’s largest network of high-speed trains, taking over the solar industry and producing the highest-scoring students on international tests.

Of course, China still has massive poverty and a per-capita income less than a tenth of that in the U.S. But as China gains rapidly, America will continue to fade slowly unless it sheds the habits, policies and practices of recent decades.

After a period of notable improvement in U.S. housing, the news again looks bleak. Foreclosures show no signs of abating, despite multiple attempts by the U.S. government to address this issue. Although Washington continues to intervene in the housing market, with subsidies on mortgages and tax breaks for home ownership, these attempts to stabilize prices clearly aren’t working.

A debate about whether the government should be such a central actor in the housing market is moot under the current circumstances. Uncle Sam is, has been and still plans to be involved in this important segment of the economy. The real question is how the government can optimize its role so that it benefits the taxpayers.

If one word appropriately characterises the current global economic and financial outlook, it’s uncertainty. Fundamental asset classes are pricing contradictory market signals, with equity markets suggesting the US economy remains well supported, but the US 10 year bond yield hovering at historical lows of around 2.5 per cent, signalling a renewed economic slowdown.

Despite this on-going uncertainty in the tactical trading environment, structurally, there seems to be one fact that many investors can reasonably be in broad agreement. This is that the Chinese economy is broadly on the right track, whereas the US economy (and Western European economies aswell), is broadly on the wrong track.

It is a year since the publication of Dead Aid, my book on the ineffectiveness of sending developmental aid to Africa, and I have spent much of that time on the road. I have met a range of audiences – agitated aid supporters, charming government ministers, frustrated development specialists – in a range of countries, from Rwanda to Russia, from Sweden to South Africa, and many places in between. By far and away the most interesting trip, however, was a homecoming – to Zambia, the country where I was born.

I have made regular trips back since leaving over a decade ago to study and work in the US and the UK, but this visit had particular significance. I’d heard that my book had sold out in the local bookstores in Zambia’s main cities but was uncertain about how people would react to the stark message that lies at the book’s core: that we must find alternative ways to finance development in Africa

For African governments it is clear that aid flows will go down in 2010, and dramatically so. Donor governments have slashed their aid budgets, and with most facing unfavourable demographic shifts and large deficits, to depend on their largesse is no longer sensible.

The good news is that the bond markets offer a real opportunity for Africa’s governments to be serious about financial discipline and transparency—and to escape from the yoke of aid.

What the most vociferous aid proponents never seem to ask themselves is what sort of society is their aid-approach producing?

In their blinkered view of the African continent they are happy to ignore the fact that in the worst case scenario aid continues to feed corruption (never mind fuelling inflation, increasing the debt burden unsustainably, and disenfranchising Africans). Even in the best case scenario, many African governments have nearly abdicated wholesale their responsibility to provide public goods to their citizens; instead, unlike anywhere else in the world, education, healthcare, infrastructure, and even security are handed over to aid-agencies around the world.

Africa still evokes in the minds of many some mix of corruption, disease, war, and poverty — the Four Horsemen of Africa’s Apocalypse. Indeed, the economic crisis has fueled a whole new round of such worries. But the perpetual hand-wringing over the continent’s dreadful state misses a broader trend: Africa is rising, and it could emerge from the crisis stronger than most people think.

Money from rich countries has trapped many African nations in a cycle of corruption, slower economic growth and poverty. Cutting off the flow would be far more beneficial, says Dambisa Moyo.

A month ago I visited Kibera, the largest slum in Africa. This suburb of Nairobi, the capital of Kenya, is home to more than one million people, who eke out a living in an area of about one square mile — roughly 75% the size of New York’s Central Park. It is a sea of aluminum and cardboard shacks that forgotten families call home. The idea of a slum conjures up an image of children playing amidst piles of garbage, with no running water and the rank, rife stench of sewage. Kibera does not disappoint.

As I touch down in Kigali, the capital of Rwanda, I am not sure what to expect. My flight has been smooth and incident-free, and the airport is as anonymously modern as any international airport. But it is hard to arrive in Rwanda without thoughts of the 1994 genocide of 1m people.

I have come to Rwanda at the invitation of President Paul Kagame, whose aides had seen an account of a Lunch with the FT that I had had a month or so ago in London with William Wallis, the paper’s Africa editor. Over lunch at Angela Hartnett’s chic new Italian restaurant we had discussed the World Bank (where I worked for a couple of years) and Dead Aid, a book I have just written arguing against dependence on foreign aid and offering alternative ways to finance development. Now I am here in Kigali to address senior cabinet officials and other leading Rwandans.

The capitalist model’s ability to help millions out of poverty is unrivaled – when the markets stabilise, Africa must be ready.

Since the publication of my book Dead Aid: Why Aid is Not Working and How there is Another Way for Africa (Penguin Press) earlier this month, I have received a number of messages both for and against my thesis that aid to Africa has failed, and that an engagement with the markets is the only way to deliver long-term growth and reduce poverty.