Feature/OPED
The Second Russia-Africa Summit: A Continent at a Crossroads
By Samir Bhattacharya
From 27-28 July 2023, the second Russia-Africa Summit took place in Russia’s St Petersburg. Initially, the summit was scheduled in Addis Ababa in October 2022. However, the summit got postponed, most likely due to complications emerging from Russia’s war against Ukraine. Despite the presence of 49 out of 54 African nations, there were Ministers from only twenty-seven countries: 17 Heads of state and 10 Prime Ministers. This is in high contrast with the 2019 summit, where 43 African Heads of state and two vice presidents were in attendance, along with 109 ministers and the Heads of the African Union (AU) Commission, the African Export–Import Bank and several regional economic communities.
Similar to the last summit, the agenda of this year’s summit included technology transfer and development of industry and critical infrastructure in Africa, developing power engineering, agriculture and mineral extraction, and ensuring food and energy security. As the 2023 edition expanded to include a humanitarian element, a Russia-Africa Economic and Humanitarian Forum also took place in parallel. Additionally, there were exhibitions and a platform for holding business meetings.
At the end of the summit, both parties agreed upon a 74-point joint Declaration for collaboration on security, trade, and the environment. However, with the frequent use of words such as neo-colonialism, neo-Nazism, neo-fascism, Russophobia, illegal sanctions, import substitution, and traditional values, the document appears to be an implicit African endorsement of Russia’s justification for its war against Ukraine. Indeed, the 4,000-plus words document contains multiple statements subtly used to encourage Africa to back Moscow’s position in the war.
In the wake of the summit, ever-deteriorating food security was the key concern for African policymakers. On 17 July, nearly one year after it was signed in Istanbul, Russian President Vladimir Putin decided to withdraw from the Black Sea Grain Initiative (BSGI). The BSGI was intended to ease the Russian blockade, thus allowing Ukraine to export grain to Africa. During the summit, Cyril Ramaphosa of South Africa, Abdel Fattah el-Sisi of Egypt, and five other leaders who were part of the African Peace initiative urged President Putin to change his mind. But their request was firmly rejected. Instead, the declaration attributed the entire blame for the food shortages to Western sanctions.
Definitely, the pledge from President Putin to deliver 25,000 to 50,000 tons of free grains to six countries, namely Burkina Faso, Zimbabwe, Mali, Somalia, Central African Republic and Eritrea, is encouraging for these poor nations. However, it will not be done immediately but within three or four months- too little for a continent of 54 countries.
Decoding the summit’s achievement: Advantage Russia
Africa presently imports five times as much as it exports to Russia, resulting in a $12 billion trade imbalance. Following the 2019 Russia-Africa Summit, President Putin planned to increase Russia’s trade with Africa from roughly $16.8 billion to $40 billion annually within five years. Instead, it is now stuck at approximately $18 billion annually or about 2% of all trade on the continent. Moreover, 70 per cent of the total trade is restricted to only four countries: Algeria, Egypt, Morocco, and South Africa. During the first summit, the organisers subsequently boasted of dozens of agreements that were signed, worth an estimated $15 billion, but according to some reports, most of those were memorandums of understanding (MOU) and not legally binding. Further, Russia’s direct investment in Africa is currently about 1 per cent of the total inflow.
Indeed, Russia has waived off a large part of its debt to different African nations worth $23 billion. This is almost 90% of the total African debt. According to President Putin, this leaves Africa with no more “direct” debts for Russia but some financial obligations. However, given Russian loan to Africa is only a tiny part, this will have minimal impact on this highly indebted continent. Putin added that his government would also provide over $90 million for development purposes at the request of African countries. Last but not least, Russia announced that it will spend about US$13 million on “large-scale assistance” to healthcare systems in Africa.
Indeed, Russia lacks the resources to compete with the US, France, Germany and Japan or China as a bilateral development donor. However, it does have some cards to play. Last year it was Africa’s largest source of fertiliser, supplying 500,000 tonnes. It is also a significant power in oil, gas and mining. Another significant effort by Russia to strengthen ties with Africa is its commitment to education. In 2023, Russia offered a record 4,700 scholarships to African students, a considerable increase from the 1,900 scholarships awarded in 2019. Currently, there are about 35,000 African students in Russia, and about 6,000 of them are on different government scholarships.
Arms trade consists the most successful pillar of Russia’s conventional trade with Africa, which is mostly managed by state-controlled Rosoboronexport. Currently, Russia accounts for 44 per cent of major arms imports to the continent between 2017 and 2021, surpassing other major players like the US (17 per cent), China (10 per cent), and France (6.1 per cent). Alrosa, which manages diamond projects in Angola and is exploring possibilities in Zimbabwe; Rusal, which mines bauxite in Guinea; and Rosatom, which is constructing a nuclear power station in Egypt, are some other Russian companies with substantial interests in Africa. During the latest summit, Ethiopia and Zimbabwe signed nuclear development contracts with Rosatom.
In addition to importing weapons, many African nations have hired Russian mercenaries. These Russian mercenaries in Africa work under the Wagner Group, a company connected to Yevgeny Prigozhin, a personal friend of Vladimir Putin. About the future of the Wagner group in Africa, particularly in the backdrop of mutiny by the Wagner group, both Foreign Minister Sergey Lavrov and Wagner chief Yevgeny Prigozhin, in separate statements, have clarified that the group will continue to operate in parts of Africa. And the cameo appearance of Prigozhin during the summit and his celebratory statements on the coup in Niger make it clear that Wagner will continue to expand in Africa.
An evaluation in lieu of a conclusion
Russia has shown a remarkable commitment to engaging with Africa, with Foreign Minister Sergey Lavrov making three visits to the continent this year. These diplomatic efforts underscore the increasing importance Moscow places on support from African countries. Clearly, Russia wanted to demonstrate its strong support base of many old and loyal allies from Africa in its fight against Western hegemony. And from that perspective, the gathering served the Russian purpose. And for Africa, except for some of these garden-variety announcements, African leaders have very little concrete to take home from the event.
However, it was also crucial for African leaders to demonstrate to other foreign powers that they were open to hearing various points of view. African leaders are used to foreign leaders making bold promises but falling short of keeping them. The low attendance at the summit may also suggest that African leaders are readjusting their place in the multipolar world.
And they realised that in the new age of multilateralism, jeopardising their relationships with either the West or Russia is not the best diplomacy. Almost all African nations are nonaligned, eschewing global power blocs and resenting Western pressure. This is also probably why the Heads of State and Ministers stayed away but sent their representatives. Africa’s representation in the summit can be hailed as a statement from Africa: blind loyalty to one state is no longer the norm. Therefore, Africa had gained nothing from the conference mirrors Macbeth’s half-truth instrument of darkness: it is neither a simple fact nor a deliberate lie.
Samir Bhattacharya, Senior Research Associate with the Vivekananda International Foundation
By Luke Kyohere
The global payments landscape is undergoing a rapid transformation. New technologies coupled with the rising demand for seamless, secure, and efficient transactions has spurred on an exciting new era of innovation and growth. With 2025 fast approaching, here are important trends that will shape the future of payments:
1. The rise of real-time payments
Until recently, real-time payments have been used in Africa for cross-border mobile money payments, but less so for traditional payments. We are seeing companies like Mastercard investing in this area, as well as central banks in Africa putting focus on this.
2. Cashless payments will increase
In 2025, we will see the continued acceleration of cashless payments across Africa. B2B payments in particular will also increase. Digital payments began between individuals but are now becoming commonplace for larger corporate transactions.
3. Digital currency will hit mainstream
In the cryptocurrency space, we will see an increase in the use of stablecoins like United States Digital Currency (USDC) and Tether (USDT) which are linked to US dollars. These will come to replace traditional cryptocurrencies as their price point is more stable. This year, many countries will begin preparing for Central Bank Digital Currencies (CBDCs), government-backed digital currencies which use blockchain.
The increased uptake of digital currencies reflects the maturity of distributed ledger technology and improved API availability.
4. Increased government oversight
As adoption of digital currencies will increase, governments will also put more focus into monitoring these flows. In particular, this will centre on companies and banks rather than individuals. The goal of this will be to control and occasionally curb runaway foreign exchange (FX) rates.
5. Business leaders buy into AI technology
In 2025, we will see many business leaders buying into AI through respected providers relying on well-researched platforms and huge data sets. Most companies don’t have the budget to invest in their own research and development in AI, so many are now opting to ‘buy’ into the technology rather than ‘build’ it themselves. Moreover, many businesses are concerned about the risks associated with data ownership and accuracy so buying software is another way to avoid this risk.
6. Continued AI Adoption in Payments
In payments, the proliferation of AI will continue to improve user experience and increase security. To detect fraud, AI is used to track patterns and payment flows in real-time. If unusual activity is detected, the technology can be used to flag or even block payments which may be fraudulent.
When it comes to user experience, we will also see AI being used to improve the interface design of payment platforms. The technology will also increasingly be used for translation for international payment platforms.
7. Rise of Super Apps
To get more from their platforms, mobile network operators are building comprehensive service platforms, integrating multiple payment experiences into a single app. This reflects the shift of many users moving from text-based services to mobile apps. Rather than offering a single service, super apps are packing many other services into a single app. For example, apps which may have previously been used primarily for lending, now have options for saving and paying bills.
8. Business strategy shift
Recent major technological changes will force business leaders to focus on much shorter prediction and reaction cycles. Because the rate of change has been unprecedented in the past year, this will force decision-makers to adapt quickly, be decisive and nimble.
As the payments space evolves, businesses, banks, and governments must continually embrace innovation, collaboration, and prioritise customer needs. These efforts build a more inclusive, secure, and efficient payment system that supports local to global economic growth – enabling true financial inclusion across borders.
Luke Kyohere is the Group Chief Product and Innovation Officer at Onafriq
In a heartfelt statement released today, the Conference of Nigeria Political Parties (CNPP) has extended its warmest congratulations to Ghana’s President-Elect, emphasizing the importance of learning from Ghana’s recent electoral success as Nigeria gears up for its 2027 general elections.
In a statement signed by its Deputy National Publicity Secretary, Comrade James Ezema, the CNPP highlighted the need for Nigeria to reclaim its status as a leader in democratic governance in Africa.
“The recent victory of Ghana’s President-Elect is a testament to the maturity and resilience of Ghana’s democracy,” the CNPP stated. “As we celebrate this achievement, we must reflect on the lessons that Nigeria can learn from our West African neighbour.”
The CNPP’s message underscored the significance of free, fair, and credible elections, a standard that Ghana has set and one that Nigeria has previously achieved under former President Goodluck Jonathan in 2015. “It is high time for Nigeria to reclaim its position as a beacon of democracy in Africa,” the CNPP asserted, calling for a renewed commitment to the electoral process.
Central to CNPP’s message is the insistence that “the will of the people must be supreme in Nigeria’s electoral processes.” The umbrella body of all registered political parties and political associations in Nigeria CNPP emphasized the necessity of an electoral system that genuinely reflects the wishes of the Nigerian populace. “We must strive to create an environment where elections are free from manipulation, violence, and intimidation,” the CNPP urged, calling on the Independent National Electoral Commission (INEC) to take decisive action to ensure the integrity of the electoral process.
The CNPP also expressed concern over premature declarations regarding the 2027 elections, stating, “It is disheartening to note that some individuals are already announcing that there is no vacancy in Aso Rock in 2027. This kind of statement not only undermines the democratic principles that our nation holds dear but also distracts from the pressing need for the current administration to earn the trust of the electorate.”
The CNPP viewed the upcoming elections as a pivotal moment for Nigeria. “The 2027 general elections present a unique opportunity for Nigeria to reclaim its position as a leader in democratic governance in Africa,” it remarked. The body called on all stakeholders — including the executive, legislature, judiciary, the Independent National Electoral Commission (INEC), and civil society organisations — to collaborate in ensuring that elections are transparent, credible, and reflective of the will of the Nigerian people.
As the most populous African country prepares for the 2027 elections, the CNPP urged all Nigerians to remain vigilant and committed to democratic principles. “We must work together to ensure that our elections are free from violence, intimidation, and manipulation,” the statement stated, reaffirming the CNPP’s commitment to promoting a peaceful and credible electoral process.
In conclusion, the CNPP congratulated the President-Elect of Ghana and the Ghanaian people on their remarkable achievements.
“We look forward to learning from their experience and working together to strengthen democracy in our region,” the CNPP concluded.
By Kenechukwu Aguolu
The proposed tax reform, involving four tax bills introduced by the Federal Government, has received significant criticism. Notably, it was rejected by the Governors’ Forum but was still forwarded to the National Assembly. Unlike the various bold economic decisions made by this government, concessions will likely need to be made on these tax reforms, which involve legislative amendments and therefore cannot be imposed by the executive. This article highlights the purposes of taxation, the qualities of a good tax system, and some of the implications of the proposed tax reforms.
One of the major purposes of taxation is to generate revenue for the government to finance its activities. A good tax system should raise sufficient revenue for the government to fund its operations, and support economic and infrastructural development. For any country to achieve meaningful progress, its tax-to-GDP ratio should be at least 15%. Currently, Nigeria’s tax-to-GDP ratio is less than 11%. The proposed tax reforms aim to increase this ratio to 18% within the next three years.
A good tax system should also promote income redistribution and equality by implementing progressive tax policies. In line with this, the proposed tax reforms favour low-income earners. For example, individuals earning less than one million naira annually are exempted from personal income tax. Additionally, essential goods and services such as food, accommodation, and transportation, which constitute a significant portion of household consumption for low- and middle-income groups, are to be exempted from VAT.
In addition to equality, a good tax system should ensure equity and fairness, a key area of contention surrounding the proposed reforms. If implemented, the amendments to the Value Added Tax could lead to a significant reduction in the federal allocation for some states; impairing their ability to finance government operations and development projects. The VAT amendments should be holistically revisited to promote fairness and national unity.
The establishment of a single agency to collect government taxes, the Nigeria Revenue Service, could reduce loopholes that have previously resulted in revenue losses, provided proper controls are put in place. It is logically easier to monitor revenue collection by one agency than by multiple agencies. However, this is not a magical solution. With automation, revenue collection can be seamless whether it is managed by one agency or several, as long as monitoring and accountability measures are implemented effectively.
The proposed tax reforms by the Federal Government are well-intentioned. However, all concerns raised by Nigerians should be looked into, and concessions should be made where necessary. Policies are more effective when they are adapted to suit the unique characteristics of a nation, rather than adopted wholesale. A good tax system should aim to raise sufficient revenue, ensure equitable income distribution, and promote equality, equity, and fairness.
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