Economy
Russia’s Politics of Writing Off Africa’s Debt
By Kestér Kenn Klomegâh
During the International Parliamentary conference Russia-Africa held March 19-20 in Moscow, Russian President Vladimir Putin, in a speech at the plenary session, reminded African parliamentarians that the partnership between Russia and African countries had gained additional momentum and is reaching a whole new level. He said the current geopolitical changes present an opportunity to build on the strong momentum in boosting economic cooperation.
“We are ready to shape the global agenda jointly, strengthen fair and equal interstate relations, and improve mechanisms for mutually beneficial economic cooperation. Thanks to our assistance, many industrial enterprises have been built on the continent, entire industries have been created, and vital infrastructure and social facilities have been built. At the same time, Russia wrote off the debt to African states of more than $20 billion,” Putin emphasized in a copy of his text posted on the Kremlin’s website.
Putin further offered spiteful goal-setting policy outlines and some aspects of lofty Russia’s economic policy directions for Africa. Most of these directions considered significant have, over these years, featured prominently in all his previous speeches on Russia’s relations with Africa. But what strikes many listeners and readers relates to historical references intended to draw on sympathy and enlist support from Africa. By simple description, Africa consists of 55 member states. Africa is not a country but a continent; thus, Africa’s debt could mean the entire of Africa.
Long seen as a strategic partner, Russia has opened a new chapter and started building better relations with Africa, and most significantly, made its move by writing off a number of African countries’ debts accumulated from the Soviet era. After the Soviet collapse, Russia first attempted to collect its debts. Indeed, these Soviet-leaning debt-trapped African countries were unable to pay them (these debts) back to Russia.
During the Soviet era, Moscow forged alliances with African countries, especially those that supported its communist idealogy, supplied them with military equipment and offered technical assistance on a bilateral basis. In particular, supplied arms went to Angola, Algeria, the Democratic Republic of Congo (DRC), Ethiopia, Namibia, Mozambique, Morocco and South Africa. That Soviet-era form of diplomatic engagement left those African countries indebted to an amount of $20 billion, according to official documents.
In an interview with TASS, Russian State News Agency, ahead of the first Russia-Africa Summit, Russian President Vladimir Putin explained the Soviet’s role in the liberation of the continent and support for the struggle of their people against colonialism, racism and apartheid. In addition, the enormous help offered to those African countries to protect their independence and sovereignty, gain statehood, support national economies, and create capable armed forces for Africa.
“Our African agenda is positive and future-oriented. We do not ally with someone against someone else, and we strongly oppose any geo-political ‘games’ involving Africa,” he said during that interview and categorically referred to the debts write-off to Africa. “Let me point out that in the post-Soviet period, at the end of the 20th century, Russia cancelled $20 billion of African countries’ debts to the Soviet Union. This was both an act of generosity and a pragmatic step because many of the African states were unable to service those debts. We, therefore, decided that it would be best for everyone to start our cooperation from scratch,” said President Putin during that interview in 2019.
On 23 October 2019, President Vladimir Putin and the President of the Arab Republic of Egypt, African Union Chairman and Co-Chairman of the Russia-Africa Summit Abdel Fattah el-Sisi took part in the Russia-Africa Economic Forum. During the plenary session held under the theme “Russia and Africa: Uncovering the Potential for Cooperation” and attended by top officials, politicians and business leaders, and almost 2,000 Russian and foreign companies, the question of debts write-off as the basis for economic growth and for developing long-term relations featured prominently.
“Economic issues are an integral part and a priority of Russia’s relations with African countries. Developing close business ties serves our common interest, contributes to sustainable growth, helps to improve quality of life and solves numerous social problems,” Putin said, and then added, “Russia provides systematic assistance to developing the African continent. Our country is participating in an initiative to ease the African countries’’ debt burden. To date, the total amount of write-offs stands at over $20 billion. Joint programmes have been launched with a number of countries involving the use of debts to finance national economic growth projects.”
On 5 September 2017, President Putin attended a meeting of BRICS leaders with delegation heads from invited states, including the Heads of State and Governments of Egypt, Tajikistan, Mexico, Guinea and Thailand. The meeting discussed the implementation of the 2030 Agenda for Sustainable Development and prospects for further developing their partner relations. Before the meeting, the BRICS leaders and delegation heads from invited states had a joint photo session. President Putin informed that “Russia has been working actively to implement the 2030 Agenda for Sustainable Development. We have written off over $20 billion of African countries’ debts through the Heavily Indebted Poor Countries Initiative.”
On 30 January 2015, President Putin sent his greetings to the 24th Ordinary Session of the Assembly of the African Union Heads of State and Government. The message stated in part: “The Russian Federation’s relations with our African partners are developing positively. We have established a substantial political dialogue and work actively together in international affairs. Russia’s decision to write off much of African countries’ debt and the preferential conditions we offer the majority of Africa’s traditional export goods open up new possibilities for trade, economic and investment cooperation.”
On 27 March 2013, in Durban, South Africa, in a speech at a meeting with Heads of African states, President Putin explicitly noted, “Over the course of many decades, Russia has provided direct assistance to the African continent. I would like to note that we have written off over 20 billion dollars in debt; we have written off far more than any other G8 nation. We plan to take additional measures to ease the debt burden.”
According to the Russian leader, the BRICS group’s companies are working actively in the African market; there is a growing influx of investments into various sectors in Africa’s economies, from traditional mineral extraction and farming to high technologies and banking. He added BRICS countries are championing the rights and interests of Africa and other nations with emerging economies, speaking out in favour of increasing their role and influence in the global governance system, particularly international financial and economic organizations.
On 28 June 2002, in Kananaskis, Canada, there was a media conference after the G8 Summit. There was one specific question regarding Africa. The G8 approached the plan submitted by African countries in a creative way. What can be Russia’s role and place in addressing the global problem of combating poverty?
President Vladimir Putin answered: “As regards Russia, it has traditionally had very good relations with the African continent. We are very perceptive of the problems on the African continent. I must say that Russia has been making a very tangible contribution to solving Africa’s problems. Suffice it to say Russia is making a big contribution to the initiative adopted here, a multi-lateral initiative, including the writing off part of African debts. Of all the African debts that are to be written off, 20% are debts to the Russian Federation. That is $26 billion.”
On 21 May 2007, The Kremlin made available Excerpts of the Transcript of the Cabinet Meeting. Finance Minister Aleksei Kudrin on the meeting of G8 finance ministers. The issue is about supporting and helping African countries. Minister Kudrin told the cabinet meeting, “We discussed the implementation of a number of initiatives that should improve the management and transparency of public finances in those countries, including by better employing revenues from the extraction of mineral resources in Africa to fight against poverty.”
“We discussed responsible lending and relations with countries that have benefited from debt relief. We are writing off debt, reducing these countries’ debt burden, and meanwhile, their opportunity to incur new debts is increasing simultaneously. And a number of countries are starting to make huge loans to these countries, taking advantage of the fact that they are no longer in debt and lending to them at such a rate that these countries will once again require help. These instances exist. In fact, this practice is liable to be perceived in a negative way. A number of leading countries in the world are engaged in this practice,” he said.
At Sochi’s summit, Putin’s announcement about the “debt write-off” was, therefore, nothing new. Africa’s debts write-off debt has been played for years. It has, several times since his appointment, re-occurred in Foreign Minister Sergey Lavrov’s speeches; these texts are available at the official website of the Foreign Affairs Ministry.
He said: “Russian development assistance is invariably aimed at solving the most pressing challenges faced by the countries in need. In these efforts, we are neither trying to lecture our partners on how they should build their lives nor impose political models and values. Poverty eradication is the key objective of Russia’s state policy in the area of international development assistance at the global level.” (Remarks by Foreign Minister Sergey Lavrov at the UN Summit for the Adoption of the Post-2015 Development Agenda, New York, September 27, 2015 (1814-27-09-2015).
“Debt relief is an effective tool in this regard. Under the Heavily Indebted Poor Countries Initiative (HIPC), our country has written off over $20 billion of the principal debt owed by African countries alone. Russia also contributes to reducing the debt burden of the poorest countries beyond the HIPC through debt-for-aid swaps. We also take other steps towards the settlement of a debt owed to Russia, both within multilateral and bilateral formats,” he added.
As it is known, Russia has written off over $20 billion in debt to African states. We are undertaking steps to further ease the debt burden of Africans, including through the conclusion of agreements based on the scheme “debt in exchange for development,” according to the Foreign Minister (Speech by the Russian Foreign Minister Sergey Lavrov at the reception on the occasion of Africa Day, Moscow, 22 May 2014 (1243-22-05-2014).
In April 2014, President Vladimir Putin approved the new State policy concept of the Russian Federation in the area of contribution to international development. Its practical implementation will contribute to the build-up of our participation in the area of assistance to the development of states of the African continent, according to the report posted on the website.
“Russia has done a great deal to alleviate the debt burden, particularly in the framework of the Enhanced Heavily Indebted Poor Countries Initiative and in writing off multilateral debts to the IMF and the International Development Association. The overall amount of the African countries’ indebtedness cancelled by us, including on a bilateral basis, exceeds 20 billion dollars, of which about one-half in the last two years,” Lavrov told the gathering on Africa Day in 2008 (Transcript of Remarks by Minister of Foreign Affairs of the Russian Federation Sergey Lavrov at Reception on Occasion of Africa Day, Moscow, May 26, 2008 (751-26-05-2008).
As far back as May 2007, the Foreign Ministry showed interest in Africa’s debts. “We are helping our African partners reduce the burden of foreign debt. We have written off African debt within the framework of the initiative to reduce the indebtedness of the poorest nations,” Foreign Minister Sergey Lavrov said at May 25 gathering of a group of ambassadors, diplomats and ministry officials marking Africa Day.
The move signalled Russia’s intention to fulfil its commitments made at that time in Group of Eight (G8) meetings, as well as paving the way to increased trade with the African continent. It was then signed into law on March 10, ratifying the agreement between Russia and African countries it aided during the Soviet era. Russia continued discussions on a full debt write-off on a bilateral basis, and African countries owed nearly $20 billion. The debt was primarily through weapon deliveries, according to the official transcript.
“The most important aspect of economic cooperation in our foreign policy is to encourage African countries to trade with us and to not only depend on development aid. Always looking for aid makes these countries less productive, and funds for projects end up in foreign banks at the expense of the suffering population,” Lavrov said.
In March 2019, President Vladimir Putin chaired a meeting of the Commission for Military-Technical Cooperation with Foreign States, and the Kremlin’s website transcript pointed to the geographic reach of military-technical cooperation as constantly expanding, with the number of partners already in more than 100 countries worldwide.
Since then, President Putin has repeatedly called for renewed efforts not only to preserve but also to strengthen Russia’s leading position in the global arms market, primarily in the high-tech sector, amid tough competition. He further called for reliance on the rich experience in this sphere and building up consistent military technology cooperation with foreign states.
“We strictly observe international norms and principles in this area. We supply weapons and military equipment solely in the interests of security, defence and anti-terrorism efforts. In each case, we thoroughly assess the situation and try to predict the developments in the specific region. There are no bilateral contracts ever targeted against third countries, against their security interests,” he explained.
According to the Kremlin website, Russia targeted global export contracts worth $50 billion in 2018. Russia’s export priority is to expand its scope and strengthen its position in the market.
Over the past years, strengthening military-technical cooperation has been a strong part of the foreign policy of the Russian Federation. Russia has signed bilateral military-technical cooperation agreements with many African countries. On the other hand, Moscow’s post-Cold War relations with Africa undoubtedly, lean toward military support and arms trade. Analysis by the Stockholm International Peace Research Institute (SIPRI) indicates that between 2014 and 2018, Russia accounted for 49% of arms imports to North Africa and 28% to Sub-Saharan Africa.
Africa has started accumulating debts. For example, Johan Burger’s article details crucial information in relation to Russia’s military interests in Africa. Russia has established or intends to establish military bases in Sudan along the Red Sea Coast, Somaliland, and Egypt. Another publication highlights Russia’s military bases in Madagascar, Mozambique, and Guinea. Lately, the Central African Republic intends to host a Russian military base.
October 2019, the President of the Arab Republic of Egypt, African Union Chairman and Co-Chairman of the Russia-Africa Summit, Abdel Fattah el-Sisi, noted in his speech at the plenary session of the Russia-Africa Economic Forum: Africa welcomes the efforts to encourage an open door policy and cooperation with its partners with a view to making a breakthrough in developing its economy. Russia and other foreign countries, as well as international financial organizations, have to develop cooperation and invest in Africa.
The Egyptian leader urged international and regional financial organizations to take part in funding Africa’s economic growth and to give it financial guarantees on consolidating its economic potential. This would help promote trade and investment. He further urged foreign countries to grant African states generous terms for their projects and development programmes, which would help Africa reach its dream – to embark on the road of progress, modernization and sustainable development.
Before concluding his speech, President Abdel Fattah el-Sisi emphasized that cooperation with Africa must be based on common interests in the protection of African property, which would allow Africa to promote comprehensive sustainable development by carrying out three major goals.
First, it is necessary to accelerate economic reforms and create a businesslike atmosphere by establishing close partnerships with the private sector. Second, it is essential to implement social justice principles with the broad participation of society. Third, it is necessary to consolidate peace and stability in accordance with the African Union’s Agenda 2063 and Sustainable Development Goals 2030.
The 15-member UN Security Council has unanimously adopted a resolution welcoming AU initiatives for infrastructure development and pledging support for “African solutions to African problems” in an attempt to achieve the Sustainable Development Goals (SDGs).
Significantly noting that African Union officials have repeatedly urged African leaders to prioritize Africa’s Agenda 2063 – a strategic framework for delivering on Africa’s goal for inclusive and sustainable development – and the United Nations Sustainable Development Goals (SDGs).
Economy
Adedeji Urges Nigeria to Add More Products to Export Basket
By Adedapo Adesanya
The chairman of the Nigeria Revenue Service (NRS), Mr Zacch Adedeji, has urged the country to broaden its export basket beyond raw materials by embracing ideas, innovation and the production of more value-added and complex products
Mr Adedeji said this during the maiden distinguished personality lecture of the Faculty of Administration, Obafemi Awolowo University (OAU), Ile-Ife, Osun State, on Thursday.
The NRS chairman, in the lecture entitled From Potential to Prosperity: Export-led Economy, revealed that Nigeria experienced stagnation in its export drive over three decades, from 1998 to 2023, and added only six new products to its export basket during that period.
He stressed the need to rethink growth through the lens of complexity by not just producing more of the same stuff, lamenting that Nigeria possesses a high-tech oil sector and a low-productivity informal sector, as well as lacking “the vibrant, labour-absorbing industrial base that serves as a bridge to higher complexity,” he said in a statement by his special adviser on Media, Dare Adekanmbi.
Mr Adedeji urged Nigeria to learn from the world by comparative studies of success and failure, such as Vietnam, Bangladesh, Indonesia, South Africa, and Brazil.
“We are not just looking at numbers in a vacuum; we are looking at the strategic choices made by nations like Vietnam, Indonesia, Bangladesh, Brazil, and South Africa over the same twenty-five-year period. While there are many ways to underperform, the path to success is remarkably consistent: it is defined by a clear strategy to build economic complexity.
“When we put these stories together, the divergence is clear. Vietnam used global trade to build a resilient, complex economy, while the others remained dependent on natural resources or a single low-tech niche.
“There are three big lessons here for us in Nigeria as we think about our roadmap. First, avoiding the resource curse is necessary, but it is not enough. You need a proactive strategy to build productive capabilities,” he stated, adding that for Nigeria, which is at an even earlier stage of development and even less diversified than these nations, the warning is stark.
“Relying solely on our natural endowments isn’t just a path to stagnation; it’s a path to regression. The global economy increasingly rewards knowledge and complexity, not just what you can dig out of the ground. If we want to move from potential to prosperity, we must stop being just a source of raw materials and start being a source of ideas, innovation, and complex products,” the taxman stated.
He added that President Bola Tinubu has already begun the difficult work of rebuilding the economy, building collective knowledge to innovate, produce, and build a resilient economy.
Economy
Nigeria Inaugurates Strategy to Tap into $7.7trn Global Halal Market
By Adedapo Adesanya
President Bola Tinubu on Thursday inaugurated Nigeria’s National Halal Economy Strategy to tap into the $7.7 trillion global halal market and diversify its economy.
President Tinubu, while inaugurating the strategy, called for disciplined, inclusive, and measurable action for the strategy to deliver jobs and shared prosperity across the country.
Represented by Vice-President Kashim Shettima, he described the unveiling of the strategy as a signal of Nigeria’s readiness to join the world in grabbing a huge chunk of the global halal economy already embraced by leading nations.
“As well as to clearly define the nation’s direction within the market, is expected to add an estimated $1.5 billion to the nation’s Gross Domestic Product (GDP) by 2027. It is with this sense of responsibility that I formally unveil the Nigeria National Halal Economy Strategy.
“This document is a declaration of our promise to meet global standards with Nigerian capacity and to convert opportunity into lasting economic value. What follows must be action that is disciplined, inclusive, and measurable, so that this Strategy delivers jobs, exports, and shared prosperity across our nation.
“It is going to be chaired by the supremely competent Minister of Industry, Trade and Investment.”
The president explained that the halal-compliant food exports, developing pharmaceutical and cosmetic value chains would position Nigeria as a halal-friendly tourism destination, and mobilising ethical finance at scale,” by 2030.
“The cumulative efforts “are projected to unlock over twelve billion dollars in economic value.
“While strengthening food security, deepening industrial capacity, and creating opportunities for small-and-medium-sized enterprises across our states,” he added.
Allaying concerns by those linking the halal with religious affiliation, President Tinubu pointed out that the global halal economy had since outgrown parochial interpretations.
“It is no longer defined solely by faith, but by trust, through systems that emphasise quality, traceability, safety, and ethical production. These principles resonate far beyond any single community.
“They speak to consumers, investors, and trading partners who increasingly demand certainty in how goods are produced, financed, and delivered. It is within this broader understanding that Nigeria now positions itself.”
Tinubu said many advanced Western economies had since “recognised the commercial and ethical appeal of the halal economy and have integrated it into their export and quality-assurance systems.”
President Tinubu listed developed countries, including the United Kingdom, France, Germany, the Netherlands, the United States, Canada, Australia, and New Zealand.
“They are currently among the “leading producers, certifiers, and exporters of halal food, pharmaceuticals, cosmetics, and financial products.”
He stated that what these developed nations had experienced is a confirmation of a simple truth, that “the halal economy is a global market framework rooted in standards, safety, and consumer trust, not geography or belief.”
The president explained that the Nigeria national halal economy strategy is the result of careful study and sober reflection.
He added that it was inspired by the commitment of his administration of “to diversify exports, attract foreign direct investment, and create sustainable jobs across the federation.
“It is also the product of deliberate partnership, developed with the Halal Products Development Company, a subsidiary of the Saudi Public Investment Fund.
“And Dar Al Halal Group Nigeria, with technical backing from institutions such as the Islamic Development Bank and the Arab Bank for Economic Development in Africa.”
The Minister of Industry, Trade and Investment, Mrs Jumoke Oduwole, said the inauguration of the strategy was a public-private collaboration that has involved extensive interaction with stakeholders.
Mrs Oduwole, who is the Chairperson, National Halal Strategy Committee, said that the private sector led the charge in ensuring that it is a whole-of-government and whole-of-country intervention.
The minister stressed that what the Halal strategy had done for Nigeria “is to position us among countries that export Halal-certified goods across the world.
The minister said, “We are going to leverage the African Continental Free Trade Area (AfCFTA) to ensure that we export our Halal-friendly goods to the rest of Africa and beyond to any willing markets; participation is voluntary. “
She assured that as the Chairperson, her ministry would deliver on the objectives of the strategy for the prosperity of the nation.
The Chairman of Dar Al-Halal Group Nigeria L.td, Mr Muhammadu Dikko-Ladan, explained that the Halal Product Development Company collaborated with the group in developing the strategy.
“In addition to the strategy, an export programme is underway involving the Ministry of Trade and Investment, through which Nigerian companies can be onboarded into the Saudi Arabian market and beyond.£
Mr Dikko-Ladan described the Strategy as a landmark opportunity for Nigeria, as it creates market access and attracts foreign direct investment.
Economy
UK, Canada, Others Back New Cashew Nut Processing Plant Construction in Ogun
By Adedapo Adesanya
GuarantCo, part of the Private Infrastructure Development Group (PIDG), has provided a 100 per cent guarantee to support a $75 million debt facility for Robust International Pte Ltd (Robust) to construct a new cashew nut processing plant in Ogun State, Nigeria.
GuarantCo, under the PIDG is funded by the United Kingdom, the Netherlands, Switzerland, Australia, Sweden and Canada, mobilises private sector local currency investment for infrastructure projects and supports the development of financial markets in lower-income countries across Africa and Asia.
Nigeria is one of Africa’s largest cashew producers of 300,000 tonnes of raw cashew nuts annually, yet currently less than 10 per cent are processed domestically. Most raw nuts are exported unprocessed to Asian and other countries, forfeiting up to 80 per cent of their potential export value and adding exposure to foreign exchange fluctuations.
According to GuarantCo, this additional plant will more than double Robust’s existing cashew processing capacity from 100 metric tonnes per day to 220 metric tonnes per day to help reduce this structural gap.
The new plant will be of extensive benefit to the local economy, with the procurement of cashew nuts from around 10,000 primarily low-income smallholder farmers.
There is an expected increase in export revenue of up to $335 million and procurement from the local supply chain over the lifetime of the guarantee.
Furthermore, the new plant will incorporate functionality to convert waste by-products into value-added biomass and biofuel inputs to enhance the environmental impact of the transaction.
It is anticipated that up to 900 jobs will be created, with as many as 78 per cent to be held by women. Robust also has a target to gradually increase the share of procurement from women farmers, from 15 per cent to 25 per cent by 2028, as it reaches new regions in Nigeria and extends its ongoing gender-responsive outreach programme for farmers.
Terms of the deal showed that the debt facility was provided by a Symbiotics-arranged bond platform, which in turn issued notes with the benefit of the GuarantCo guarantee. These notes have been subscribed to in full by M&G Investments. The transaction was executed in record time due to the successful replication of two recent transactions in Côte d’Ivoire and Senegal, again in collaboration with M&G Investments and Symbiotics.
Speaking on the development, the British Deputy High Commissioner, Mr Jonny Baxter, said: “The UK is proud to support innovative financing that mobilises private capital into Nigeria’s productive economy through UK-backed institutions such as PIDG. By backing investment into local processing and value addition, this transaction supports jobs, exports and more resilient agricultural supply chains. Complementing this, through the UK-Nigeria Enhanced Trade and Investment Partnerships and the Developing Countries Trading Scheme, the UK is supporting Nigerian businesses to scale exports to the UK and beyond, demonstrating how UK-backed partnerships help firms grow and compete internationally.”
Mr Dave Chalila, Head of Africa and Middle East Investments at GuarantCo, said: “This transaction marks GuarantCo’s third collaboration with M&G Investments and Symbiotics, emphasising our efforts to bring replicability to everything we do so that we accelerate socio-economic development where it matters most. The transaction is consistent with PIDG’s mandate to mobilise private capital into high-impact, underfinanced sectors. In this case, crowding in institutional investors in the African agri-processing value chain.
“As with the two recent similarly structured transactions, funding is channelled through the Symbiotics institutional investor platform, with the notes externally rated by Fitch and benefiting from a rating uplift due to the GuarantCo guarantee.”
Adding his input, Mr Vishanth Narayan, Group Executive Director at Robust International Group, said: “As a global leader in agricultural commodities, Robust International remains steadfast in its commitment to building resilient, ethical and value-adding supply chains across origin and destination markets. This transaction represents an important step in advancing our long-term strategy of strengthening processing capabilities, deepening engagement with farmers and enhancing local value addition in the regions where we operate. Through sustained investment, disciplined execution and decades of operating experience, we continue to focus on delivering reliable, high-quality products while fostering inclusive and sustainable economic growth.”
For Ms María Redondo, director at M&G Investments, “The guarantee gives us the assurance to invest in hard currency, emerging market debt, while supporting Robust’s new cashew processing plant in Nigeria. It’s a clear example of how smart credit enhancement can unlock institutional capital for high-impact development and manage currency and credit risks effectively. This is another strong step in channelling institutional capital into meaningful, on‑the‑ground growth.”
Also, Ms Valeria Berzunza, Structuring & Arranging at Symbiotics, said: “We are pleased to continue our collaboration with M&G Investments, GuarantCo, and now with Robust through a transaction with a strong social and gender focus, demonstrating that well-structured products can boost commercially attractive, viable, and impactful investments.”
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