Africa News blog
African business, politics and lifestyle
Some eye-catching numbers from Standard Bank out today on the influence of BRICs countries -- Brazil, Russia, India and China -- on Africa.
First off, the bank says the global recession and its recovery have been nourishing these so-called South-South ties. But it is all now ready to take off. The bank estimates:
-- By 2015, BRIC-Africa trade will have incresed threefold, to $530 billion from $150 billion this year.
-- BRICs share of Africa's total trade will increase from one-fifth today to one-third in the next five years.
Tom Cargill, Assistant Head of the Africa Programme at Chatham House, writes on the West’s relationship with Africa:
French President Nicholas Sarkozy put it best this week, when he spoke of the increasing important of Africa in Global Affairs: “Africa’s formidable demographics and its considerable resources make it the main reservoir for world economic growth in the decades to come.”
For telecoms-tycoon-turned-philanthropist Mo Ibrahim, it’s one step forward, two steps back. For Benno Ndullu, governor of the central Bank of Tanzania, the whole thing is bound to stall unless problems are ironed out first.
For many Tanzanians, it’s a threat to their jobs, language and prospects.
But for the leaders of the five-member East African Community (EAC), signing the common market protocol on Friday represents the future fortunes of Burundi, Kenya, Rwanda, Tanzania and Uganda combined.
U.S Secretary of State Hillary Clinton’s 10 day trip to Africa ends this week with many commentators viewing it at least partly as being aimed at offsetting China’s growing economic clout on the African continent.
In public, Clinton has delivered Washington’s traditional messages on the importance of fair elections and of fighting corruption and human rights abuses.
But the fact that top oil producers Angola and Nigeria are both on the tour has made clear the importance of the visit from the perspective of ensuring access to resources – an area of huge importance to China too.
Sudath Perera has every reason to be content. He started up his textiles factory outside the Kenyan capital Nairobi nine years ago; today, he employs 1500 workers and turns over between 18 and 20 million U.S. dollars a year.
“We are contributing to the local economy by creating employment,” he says. “And indirectly there are a lot of local suppliers also relying on us.”
The overthrow of Madagascar’s leader may have had nothing to do with events elsewhere in Africa, but after four violent changes of power within eight months the question is bound to arise as to whether the continent is returning to old ways.
Three years without coups between 2005 and last year had appeared to some, including foreign investors, to have indicated a fundamental change from the first turbulent decades after independence. This spate of violent overthrows could now be another reason for investors to tread more warily again, particularly as Africa feels the impact of the global financial crisis.
Earlier this month, Zambian economist Dambisa Moyo argued that Africa needs Western countries to cut long term aid that has brought dependency, distorted economies and fuelled bureaucracy and corruption. The comments on the blog posting suggested that many readers agreed. In a response, Savio Carvalho, Uganda country director for aid agency Oxfam GB, says that aid can help the continent escape poverty – if done in the right way:
In early January, I travelled to war-ravaged northern Uganda to a dusty village in Pobura and Kal parish in Kitgum District. We were there to see the completion of a 16km dirt road constructed by the community with support from Oxfam under an EU-funded programme.
If anyone in Africa was worried that the global financial crisis might dim China’s interest in the continent, President Hu Jintao will be visiting this week to give some reassurances – as well as possibly to temper any unrealistic hopes for the amount of assistance to be expected.
As Chris Buckley reported from Beijing, this visit is also about China showing the wider world that it is a responsible power.
Far from being all bad news for Africa, the global financial crisis is a chance to break a dependence on development aid that has kept it in poverty, argues Zambian economist Dambisa Moyo, who has just published a new book “Dead Aid”.
Moyo’s book, her first, comes out at a time when Western campaigners, financial institutions and some African governments have been warning of the danger posed to Africa by the crisis and calling for more money from developed countries as a result. The former World Bank and Goldman Sachs economist spoke to Reuters in London.
Three African trading blocs comprising some 527 million people and with an estimated gross domestic product of $624 billion, have agreed to move towards a free trade area. It would span 26 countries from Egypt to South Africa, and would go a long way towards streamlining some of the continent’s numerous trading blocs. Africa is home to some 30 regional trade arrangements, and on average each nation belongs to about four groups, according to international financial institutions. This has led to conflicting and overlapping agreements.
So in a move to ease some of these issues, heads of state who chair the Common Market for Eastern and Southern Africa (COMESA), East African Community (EAC), and the Southern African Development Community (SADC), met in the Ugandan capital to draw up a pact on integration, and eventually hoping to have a unified customs union. Ugandan President Yoweri Museveni said at the meeting’s opening that: “The greatest enemy of Africa, the greatest source of weakness has been disunity and a low level of political and economic integration.” The meeting’s final communiqué said a timeframe for integration would be considered in one year. Rwandan President Paul Kagame cautioned delegates that African nations must make sure to enforce the protocols and treaties that they’ve adopted. Heads of state at the meeting stressed the need to create economies of scale, bigger markets equal more opportunities to grow, they said.