The XXIV Yasin International Academic Conference on Economic and Social Development Plenary Session: Africa in a Changing World 2023 Moscow, 6-7 April, 2023

Intervention by:

Ambassador Dr. Ezzat Saad El-Sayed

ECFA Director

 

Introduction:

Views regarding the African continent are usually divided between a pessimistic point of view that views the continent, with its multiple problems and crises, as a lost cause, and another point of view that is optimistic about a promising future for the continent and its population. In fact, each point of view has arguments supporting it.

For the pessimistic side, indicators show that about 30 million Africans have reached extreme poverty in 2021, while 22 million have lost their jobs due to the Coronavirus pandemic. In addition, the economic turbulences resulting from the crisis in Ukraine are expected to add four million new Africans to the extreme poverty line by the end of this year (2023). It is estimated that the continent may lose, on average, between 15.5% of its GDP due to climate change, and it is also expected that the climate finance gap for Africa will widen, reaching $ 1.2 trillion starting from now till 2030. This is in addition to the growing problems of food shortage due to drought, desertification, and escalating indebtedness reaching a tipping point in many African countries, with debt interests depleting up to 59.9% of GDP in some countries; besides armed conflict and terrorism, as statistics indicate an increase in terrorist operations in Africa by about 50% in 2022, especially in the Sahel, Somalia, the Lake Chad basin, Mozambique, and North Africa.

It is unfortunate, in this context, that the response of the donor community to the basic needs of the countries of the continent, especially the poorest, most of which are in Africa, appears to be very limited, as was evident from the results of an international conference held last March in Qatar to mobilize financing for these countries in terms of new loans and subsidies, as only about $1.4 billion was pledged, despite the appeal of the United Nations Secretary-General to provide large aid of about $500 billion together to achieve the UN Sustainable Development Goals, which include a plan to end poverty and support the health and education sectors by 2030.

With all these enormous challenges, there is still hope for a prosperous Africa that provides promising opportunities for its nationals and its partners at the same time. In 2022 alone, African partnership summits were held with the European Union, Turkey, Japan, and the United States. In July 2023, the second Russia-Africa summit will be held, just as the first Russia-Africa business forum was held in 2011, organized by the distinguished friend Professor Alexey Vasiliev, then “Special Presidential Representative for Cooperation with Africa” and Honorary President of the Institute for African Studies of the Russian Academy of Sciences. India will also hold an African summit this year.

There is no doubt that this diplomacy of partnerships reflects a growing global interest in Africa for many reasons, perhaps the most notable of which is that the continent is a repository of the most sought-after minerals and resources in the world (a source of more than 70% of the group of platinum, gold and uranium minerals, 60% of cobalt, 20% of (PGMs) and 10 percent of oil, and large proportions of needs of phosphate, copper, iron ore, diamond, and titanium). Investment returns in this market are also higher than global averages, and despite the slowdown in economic growth in Africa from 4.8% in 2021 to 3.8% in 2022, amid the major challenges posed by the Ukrainian crisis, there are about 53 African countries that recorded growth last year. There are also expectations that Africa will outpace the rest of the world in terms of economic growth, with an average GDP for leaders of about 4% during the years 2023/2024.

1. Promising future for the African continent:

There are a number of considerations that give rise to cautious optimism about a promising future for Africa, mainly:

1- Africa is the youngest continent in the world in terms of demography (population 1.3 billion people, or about 17% of the world’s population, of whom 40% are under fifteen). This young generation provides a great opportunity for the continent, which appears in the field of African startups and the state of venture capital in the continent, which increased by 29% in 2022 compared to the previous year, in various fields such as financial technology, payment methods, e-commerce, artificial intelligence and renewable energy. ..etc.

2- The African Free Trade Area, which treaty entered into force in May 2019, and according to which the state parties agreed to reduce tariffs by 88% of the original tariff lines gradually over three years. And in February 2023, three new additional protocols to the treaty were adopted on investment protection, property rights, and competition protection. Member states are currently negotiating to add a protocol to encourage women and youth to enter the free market, by financing their small and micro enterprises, by providing incentives that allow them to integrate faster into the free trade zone.

In September 2022, a commercial initiative to facilitate trade transactions, under the laws of the free trade area, was launched in eight countries, and the payment and settlement system in local African currencies was launched for cross-border goods to facilitate payment for merchants.

Experts estimate that the main sectors that represent the highest returns on investment under the free trade agreement are: the automobile industry, pharmaceuticals, agricultural products, and agricultural-related industries, all of which provide promising opportunities for Russian investments.

3- It goes without saying that the African continent needs large investments in infrastructure. According to estimates by the African Development Bank, the continent needs between 130 and 170 billion USD annually. Unfortunately, there is a financing gap here in the range of 68 to 108 billion USD. As an example of the continent’s urgent needs in this regard, we point out that about 600 million African citizens still lack electricity, and only about 43% of the continent’s population has access to the Internet.

Moreover, there are many African countries which started issuing dollar bonds and debt instruments to bridge the financing gap. China alone invested about $23 billion in infrastructure projects in the continent between 2007 and 2020, which is $8 billion more than the top eight donor countries combined.

The bottom line here is that Africa is now standing at a crossroads, and the international community must provide assistance after a long history of depleting the continent’s resources. African countries face enormous challenges that they must face, but there are countless opportunities that the countries of the continent must seize and exploit to the fullest. There is no doubt that Africa’s success and attractiveness are determined by adopting coherent and sustainable development policies to address structural economic problems, defining the continent’s strategic direction, and thus reassuring government partners and the private sector of the continuation of positive trends within the continent.

 

1. Global competition for Africa:

It is acceptable to say that global competition for Africa began decades ago, and even as early as the post-decolonization era. In the midst of the Cold War, the main objective of the Western alliance was to fight communism, and it was not preoccupied with the issue of developing or helping the countries of the continent. This was embodied in the silence of the United States on the rule of the white minority in South Africa and in Southern Rhodesia, along with numerous American interventions in the affairs of the continent under the pretext of fighting communism. Let’s not forget in this regard that Ronald Reagan (1981-1989), whose policy towards Africa was characterized by cynicism and indifference, condemned the economic sanctions that most countries of the world were calling for against the apartheid regime in South Africa. Until Obama’s visit to Ghana on July 11, 2009, Africa and its development were not among the interests of the United States. During his second term, when he noticed – belatedly – the growing and long-standing Chinese economic partnership with Africa, one of the most common warnings issued by Obama was that Beijing sought to export its political model to the continent. During that period, then-Secretary of State Hillary Clinton often warned African leaders to be careful about their approach to China, asserting that they had a lot to learn from the West, criticizing China for “supposedly” encouraging its partners in Africa to avoid Western-style democracy and adopt Beijing’s authoritarian methods instead, especially by controlling information and the Internet.

The United States and its allies have remained locked in their vision of Africa as an arena for influence, hegemony and plundering of resources. Biden acknowledged this in his African Summit speech last December, when he referred to the “unimaginable cruelty” of my nation’s “original sin” of slavery, adding that countries of the continent deserve to enter partnerships on their own terms and according to their own needs.

Reality today testifies that the priorities of U.S. foreign policy in Africa still center around what it says is Chinese and Russian growing political and economic influence. The Biden administration’s political rhetoric confirms this focus on geopolitical competition and confronting China and Russia at the expense of African priorities.

III. Strategic shifts in Africa following the Ukrainian crisis:

The crisis in Ukraine came to contribute to the transformation of the continent into a new arena for competition, and even an arena for settling the scores with the major powers involved in the crisis, which was reflected in the divergence of the African position on the crisis since its outbreak. For example, during the African vote at the United Nations on a draft resolution condemning Russia, only 25 countries supported the resolution. Similarly, in April 2022, only ten African countries voted in favor of suspending Russia’s membership in the United Nations Human Rights Council.

This African position came as a surprise to many Western countries, who believed that the countries of the continent did not have the luxury of dispensing with economic and financial aid from Western countries. Many experts estimate that this voting pattern reflects a significant amount of Africa’s distrust of the West on the one hand, and also the increased Russian influence in the continent, and other countries that have chosen to take neutral or balanced positions on the crisis such as China, India, and in fact most countries of the Global South.

Perhaps the most important lesson learned from this African position is that Africa may have finally decided to reshape and reformulate its role on the international arena in the next stage, in light of the growing international interest in obtaining its wealth, as it has realized that the existing international order does not take into account its interests and that what is going on in Ukraine is not really its own battle.

In this regard, the following strategic shifts can be noted in connection with the crisis in Ukraine:

• Africa is the most affected by the crisis, which has catastrophic repercussions on food security, as Africa relies on imports to cover 63% of its wheat needs, energy prices and unprecedented inflation rates, at a time when the continent did not overcome the economic effects of the Covid-19 pandemic yet.

• Africa found itself an arena for proxy conflict: In this context, the continent became a theater for diplomatic confrontations between the major powers. Western/Russian tension – due to polarization attempts and massive Western pressure on the countries of the continent – prompted Moscow to turn towards Africa to restore its global influence, strengthen Africa’s political support for it and open new markets. In this context, Minister Sergey Lavrov has conducted three African tours since the start of the crisis: in July 2022, January 2023 and February 2023, which included Egypt, Congo, Uganda, Ethiopia, Eritrea, Angola, South Africa, the Kingdom of Eswatini, Sudan, Mali and Mauritania. While President Emmanuel Macron toured Africa in July 2022, which included: Cameroon, Benin, Guinea-Bissau and Algeria. He also conducted another tour in Central Africa in early March 2023 – which included Gabon, Angola, Congo and Democratic Republic of the Congo – to test the new partnership he wants to build with the continent, where French influence is declining. This is his eighteenth tour in Africa since the start of his first term in 2017. Macron started his last tour two days after announcing – in Paris – an African strategy for the next four years. Acknowledging a growing resentment towards France, Macron called for “building a new relationship that is balanced, reciprocal and responsible”. Macron had called – in a speech he delivered on the new French policy in Africa on February 27, 2023 – for “humility” and “responsibility”. As we know, since August 2022, and at the request of the ruling military council in both Mali and Burkina Faso, the French army withdrew from the two countries. Burkina Faso also announced, at the end of February 2023, the suspension of the “military assistance agreement” that it concluded with France during its independence from it in 1961. It was remarkable that three of the four countries included in Macron’s tour: Gabon, Congo and Angola, abstained from voting on a draft resolution in the United Nations General Assembly calling for the withdrawal of Russian forces from Ukraine.

As for the U.S. Secretary of State, Antony Blinken, he held a tour in November 2021, which included Kenya, Nigeria, and Senegal, and another in March 2022, which included Morocco and Algeria, and a third in August 2022, in: South Africa, the Democratic Republic of the Congo and Rwanda, a few months before the start of the U.S.-Africa summit hosted by Washington in December 2022 to discuss partnerships and common issues between the two sides. He also held another tour in mid-March, which included Ethiopia and Niger. Finally, Vice-President Kamala Harris’s tour from 25 to 31 March 2023 included Ghana, Tanzania and Zambia. In addition to Chinese Foreign Minister Qin Gang’s tour to the continent in January 2023, to five countries: Egypt, Ethiopia, Angola, Gabon and Benin.

The tours of some senior Western officials witnessed a mixture of pressures and incentives to create a state of regional alignment for African governments, and this was evident during the visit of the Ukrainian Foreign Minister to Africa, the first of its kind, in October 2022, which included Senegal, Cote d’Ivoire, Ghana and Kenya, hinting at the possibility of supplying more grains and wheat to African countries in an attempt to win over them.

3- Enhancing the strategic value of the continent: This was evident in the rush of international powers to form broad alliances with African countries with the aim of ensuring the loyalty of the African voting bloc in the United Nations, which exceeds 25% of the total member states in its General Assembly, which gives these countries political weight that prompted Russia and Western countries to attempt to attract them in order to line up behind any of the two camps.

The African continent has also emerged as a strategic arena for international competition between the major active powers with the aim of gaining further political, economic and security influence there. It also represents the broad geopolitical theater that contributes to easing the breaking of the Western blockade against some powers such as Moscow, which is an addition to the strategic importance that the African continent enjoys at the international level.

4- While experts’ expectations indicated the catastrophic repercussions of the Ukrainian crisis on African countries in general, including food insecurity and a decrease in the volume of trade, international aid and direct investments, the war paved the way for the continent’s oil and gas-producing countries to gain more influence, in light of the increasing energy demand in the world due to sanctions. In this context, the crisis provided an opportunity for African oil producers such as Nigeria, Angola, Libya and Algeria to benefit from the revenues from oil exports to Europe.

5- The expansion of Russian influence in Africa: There are strategic shifts taking place in some regions in Africa, especially the Sahel region. There is a popular welcome to the Russian presence in some countries in the region and the deployment of the Wagner Special Security Forces in order to combat terrorism there, especially after France’s gradual withdrawal from some countries, such as Mali and Burkina Faso, based on the demands of these countries’ governments.

Some estimate that Russia is attempting to offer an alternative path for Africans, relying on what some writings call “memory diplomacy” or “nostalgia” for the Soviet era against Western countries and the United States and the political and economic conditionals that are considered a pillar in the West’s relations with Africa, which have become resentful of this policy, and began looking for a new international alternative.

Therefore, Moscow has a chance to strengthen its economic presence in Africa, especially in the basic sectors, including the energy sector, in addition to its political and security presence. In the coming stage, Russia will have to make efforts to increase its direct investments in the continent, as well as to develop its economic cooperation and increase the volume of its trade with Africa, in line with its growing political and security influence in the continent, as reflected in the refusal of most African countries to condemn the war in Ukraine despite U.S. pressures.

Russia’s trade with the continent (2021) does not exceed $14 billion compared to the volume of the European Union’s trade with the continent ($295 billion), China ($254 billion), the United States ($65 billion) or India ($90 billion). Egypt often stresses in its contacts with the Russian side, most recently during the 14th session of the Joint Ministerial Committee for Economic and Technical Cooperation, which was held in Cairo on March 18-21, the importance of speeding up the completion of the Russian industrial zone in East Port Said, which could be a window for Russia’s exports to Africa, benefiting from the African Free Trade Area, of which Egypt is a member.

In conclusion, the crisis in Ukraine may carry with it a package of opportunities for African countries, if they succeed in exploiting them in their favor at the expense of the opportunism of Western countries that extended over the past long decades. African countries are skeptical regarding the credibility of the American initiatives to support it, which remain modest and unable to meet the growing development needs of more than 50 African countries. Most of these contributions are also subject to congressional approval. i.e., there are no guarantees that these initiatives will continue or be funded in the event of a change in the administration in the White House or the partisan majority in Congress.

On the other hand, there is an opportunity for the continent to enhance its position in the global order, including international institutions, amid predictions of important strategic shifts in the structure of the international order during the next stage, so that Africa will not always be an arena for international competition among the major powers that have been draining its resources and wealth for centuries.

There is no doubt that Russian and Chinese realism represents a kind of comparative advantage for them versus the United States, which always links its economic plans and investment to political considerations, which is what makes the African partner skeptical about the usefulness of the American approach and the transformation of its pledges from mere promises into actual projects and programs on the ground. Unfortunately, the United States did not take into account African concerns and interests in its foreign policy, which was evident in many situations, the latest of which was the Ukrainian crisis, and the ensuing economic sanctions imposed by the United States and its allies, by which African countries were the most affected.

The United States and its allies must realize the impossibility of shaping the world in the Western image, and recognize that there are many multilateral frameworks that exist today, embodying different levels of consensus on the standards and rules of conduct of the state and its domestic economic and political choices. This reality testifies to the rapid erosion of the global order that is dominated by the West, which should not lead to a conflict among the major powers.

Finally, Africans can view the current geopolitical crisis as an opportunity to reduce their countries’ dependence on food imports from outside the continent, and to accelerate the implementation of many agricultural projects in cooperation with international entities by taking advantage of the vast arable areas amounting to about 60% of the total arable land in the world in order to achieve self-sufficiency in food and export to the global market, in order to achieve food security for the continent during the coming period.