World
African Great Game: Russia Playing the Catchup
By Kester Kenn Klomegah
After Soviet collapse, Russia has maintained strong and time-tested relations with African countries, and of course, the Soviet Union had played an important role during the decolonisation of Africa. The African continent comprises a diverse collection of countries, each with its own set of development setbacks and challenges. The political culture and investment climate are, in fact, diverse but are important forces in the economy.
According to several development reports, Africa is one of the fastest growing regions in the world: the average annual GDP growth rate reaches from 3.5% to 5% on the continent. The reports have strongly encouraged African leaders to prioritise sustainable development as a step towards raising the living standards of millions of impoverished population and further guide against the revival of neo-colonialism, the destructive attitude towards the resouces in Africa.
In this wide-ranging exclusive interview, George Nyongesa, Senior Associate at Africa Policy Institute (Nairobi, Kenya) discusses, with Kester Kenn Klomegah, attitudes and perceptions toward Russia, economic cooperation between the two regions as well as Russia’s role in sustainable development in Africa and expectations from the forthcoming summit in Sochi, Russia.
African leaders and business people will be in Sochi for the first Summit. What are the perceptions and attitudes toward this new dawn in the relations? How do the political and business elites interpret the benefits of the new relationship for both Africa and in Russia?
The impending Russia-Africa Summit is a timely and opportune congregation given current global events involving Africa’s traditional partners – the US’ recent years’ protectionist policy, China’s trade wars with the US, Brexit from the European Union – all of which directly impact Africa’s economic reality. For African leaders and business people, the utility and strategic importance of the Russia-Africa Summit is tied to how aptly it addresses this immediate reality and outlines future prospects.
To-date the US, European Union, China, India and Japan have partnered with African leaders to pursue development goals for mutual benefit. Accordingly, these partners have long articulated their engagement plans for Africa through comprehensive frameworks such as the US-Africa Leaders’ Summit and Power Africa Initiative, the European Union-Africa Summit, the Forum for China Africa Cooperation, the India-Africa Summit and Tokyo International Conference for African Development. The first Russia-Africa Summit therefore signals the dawn of deeper and stronger relations between Russia and Africa as Russia takes on a more active presence.
At Sochi, African leaders and business community will be looking to understand the proposed Russian framework for political and economic cooperation going forward, particularly long-term cooperation that takes into account Africa’s risk profile and the current competitive landscape for those seeking to invest. The business community will be keen to identify in-roads and opportunities for African businesses to grow and thrive in Russia vis-a-vis Africa’s development priorities on Agenda 2063, SADC’s industrialisation strategy and AfCFTA platform.
During the parliamentary conference held in July, the Chairman of the State Duma stressed that “it is necessary to prevent the revival of neo-colonialism, the destructive attitude towards the African resources.” How would you explain neo-colonialism by foreign players in Africa? What countries are the neo-colonizers in your view?
Neo-colonialism could be viewed as the renewed interest and methods employed from western and eastern countries in relation to exploitation and management of Africa’s rich resources – both from an economic and political paradigm. Traditionally, Western aid for African development has been laced with conditionalities tagged to defending human rights and promoting good governance via anti-corruption campaigns. This approach has seen compliant countries favored and non-compliant ones sanctioned by such Western nations. The interference with independent states has widely been castigated as neo-colonialism in many quarters. The alternative development model offered under the Belt and Road Initiative has facilitated the rise of China to displace the West as Africa’s largest development partner.
With the entire African continent (save for one country) signed up to BRI, Western countries’ worries about China expansionism has escalated. In this regard, BRI has been hit with accusations of debt trap diplomacy as far as its roll out in Africa. This is because the projects are run by Chinese businesses and where African nations struggle to repay the debt, then China is primed to step in and run the projects. The warning is that these seemingly friendlier loan terms could foster unsustainable debt and economic drain on African economies.
Outside of the economic dynamic, China has been accused of supporting authoritarian governments by its loan terms, and that in default situations, China’s remedies result in significant geopolitical expansion for China. To counter the growing Chinese influence, the United States has itself set up an African focused development agency that facilitates American businesses to flourish in developing Africa. These hegemonic tussles make for the neo-colonial danger that sees these development partners prosper to the exclusion of Africa itself.
In fact, Africa needs investment in infrastructure, agriculture and industry, to create employment for the young graduates. What role can Russia play here, we are referring to Sustainable Development Goals?
Africa’s regional development priorities are largely articulated by the African Union’s Agenda 2063, the SADC’s Industrialisation Strategy and Roadmap, 2015-2063 and the implementation of the recently adopted African Continental Free Trade Area (AfCFTA). Briefly, these priorities include industrialisation for economic and technological transformation; competitiveness; and regional integration. Africa is keen to shift away from industrialisation powered by increased labour and capital investment, to one powered by efficient resource deployment in production processes. AfCFTA particularly presents a significant consolidated voice for African states to negotiate economic and trade opportunities in e-commerce, technology transfers, manufacturing growth, scholarship and training; and infrastructure financing. Additionally, each of Africa’s 54 states have nationally articulated development priorities. These development goals have been designed as steps in pursuit of the attainment of the Millenium Development Goals.
Towards achieving these goals China has offered as much as US$60 billion, Japan US$32 billion, and India US$25 billion, while large investment funds have also come from the United States and the European Union. Similarly, Russia could design a funding vehicle focused on supporting Africa’s development priorities, particularly industrialisation and trade facilitation, for mutual benefit. Russia could further share knowledge on its own steps towards the MDGs and train professionals with the relevant skills for development projects. Such training could either be by the rollout of inter-university student exchange programs or the collaboration amongst academia to teach relevant skills in local curriculum in vocational institutions.
With trade specifically, there are surging competition, rivalry and trade wars in Africa, and recently the adoption of African continental free trade. What is your interpretation of all these and how profitable could it be for corporate Russian exporters?
Russia has progressively engaged Africa on bilateral basis at country level, as well as through regional blocs such as AU and SADC, at continental level. The adoption of the largest trade agreement since the WTO, the AfCFTA, signals the exponential potential of Africa as a trading bloc, going forward. The intention of AfCFTA is to provide a significant consolidated voice for African states to negotiate economic and trade opportunities in e-commerce, technology transfers, manufacturing growth, scholarship and training; and infrastructure financing. It is anticipated that there will be an additional 1.3 billion people in Africa by 2050. This is a massive market for Russian corporates to explore if they can leverage mutually beneficial engagement at the AfCFTA level.
In your expert view, what are the key challenges and problems facing Russian companies and investors that wanted business operations in Africa?
Africa’s active business development partners have been the United States, European Union, China, India and Japan, but less so Russia. As such, there’s limited shared knowledge on the value proposition of development and business collaboration between the two. Additionally, the absence of an articulated collaboration framework has meant that African and Russian policy makers are yet to design appropriate collaboration channels and tools that would facilitate mutually beneficial investment and ease of doing business. Related gaps include the prevailing language and cultural barrier that is, as yet, to be actively addressed. These, coupled with other prevailing hurdles to doing business in Africa such as limited infrastructure, high local unemployment rates, semi-skilled workers and protection of local industries, have hindered the set up of local business operations by Russian companies and investors.
On the other hand, why the presence of African companies on the Russian market is extremely low? Why Russia is not attractive to African exporters? Under the circumstances, what should be done to improve the current situation, a two-way trade?
The African perception of Russia and vice versa has largely been painted by other Western powers that are active on the African continent. That public persona is not one that has been enticing for African exporters. As such, Africa’s knowledge of the opportunities in trading with Russia is significantly limited. Opportunities for driving up trade relations between Russia and Africa include the facilitation of trade expos that create a platform for investors and businesses from both parties to interact and understand the opportunities and challenges to their export and import businesses. In addition, continued interaction between Russia and Africa, such as through exchange programs for students, or business cultural trips, will facilitate the chipping away at the language and cultural barrier that in turn hinders easy trade. If both Russia and Africa are able to showcase the available market for each other’s products, then trade engagement is likely to increase.
Could we finally talk about media cooperation between Russia and Africa, social platforms and the use of soft power as important instruments for strengthening the relations? What are your suggestions to these aspects in the existing relations between the Russia and Africa?
As part of Russia’s desire to adopt a comprehensive strategic roadmap for a more integrated cooperation and to find effective ways of improving public diplomacy in Africa, the Russian government is supporting a pilot programme organised for African media groups for a two-year period from 2018 to 2020. The utility of this approach is to develop a cohort of champions that will facilitate a positive post-Soviet economic and cultural narrative, as well as demystify Russia for Africa’s political, business and general population. Through this, Russians and Africans will be able to leverage soft power to build trust from shared experience, shift towards normalisation of relations through increased familiarity, set the stage for increased reciprocity such as Russia granting accessibility for African correspondents to match Russia’s increased media presence in Africa. In a nutshell, there will be an avenue for demystification and contextualisation (getting to know the truth about each other through moderated content) and so help counter any negative public persona, share cultural experiences and begin to wear down language barriers.
Interview made by Kester Kenn Klomegah in Nairobi, Kenya.
By Kestér Kenn Klomegâh
Never underestimate the power of the Economic Community of West Africa States (ECOWAS), also known as CEDEAO in French and Portuguese, created on 28th May 1975 as a regional political and economic union bringing together fifteen (15) countries of West Africa. Per the date of its establishment, this so-called regional bloc marks its 50th year in 2025, a significant historical celebration.
Considered one of the pillar regional blocs of the continent-wide African Economic Community (AEC), ECOWAS generally has its primary common goal of working consistently towards achieving, what is first referred to, as “collective self-sufficiency” for its member states by creating a single large trade bloc by building a full economic and trading union. Additionally, ECOWAS aims to raise the living standards of an estimated population of over 425 million people and to promote economic development based on the principles of interdependence, solidarity, and cooperation.
Until writing this article, ECOWAS has frequently been discussing and reviewing the Abidjan-Lagos Corridor Highway Development Project, one single regional infrastructure project these several years. It has shown its total commitment to looking for funding while billions have been siphoned by leaders into foreign banks. African leaders are quick negotiating and paying for foreign military weapons but are grossly unsuccessful in soliciting similar assistance from these external partners to invest in infrastructure development such as the Abidjan-Lagos Corridor Highway Development Project.
West African Highway Launched in 2017
The construction of this proposed grandiose West African highway has its chequered history. The proposed project was successfully launched in 2017, and since then it has had a series of high-powered meetings and conferences, technical studies have been conducted, and the construction to its feasibility and practical operationalization. The Abidjan-Lagos highway, the six-lane dual carriage highway, is estimated at $15.1 billion.
On resource mobilization, it was explicitly noted that ECOWAS had adopted a new regulatory framework on the Public Private Partnership (PPP) – an incentive for the entry of the private sector in large investments like the nature of this project. The African Development Bank (AfDB) on behalf of the development partners offered its assurance for unwavering commitment to the realization of the highway.
Akinwunmi Adesina, President of the African Development Bank (AfDB) has several times highlighted the importance of the Abidjan-Lagos highway as an infrastructure project in West Africa that would ease the free movement of people, goods and services, generate social and economic activities, and ultimately promote cross-border trade within the region, its economic viability and enormous potentials especially now that African Union looks to implement the African Continental Free Trade Area (AfCFTA). Noticeably, Africa has long been considered a frontier for manufacturing, technology, for food production. Africa is getting ready for business, it is busily building the world’s largest single market of 1.4 billion people.
Special Meetings and Technical Consultations
Several meetings upon meetings and meetings have been held since the project was proposed in 2017. Since 2017, paid meetings have been held, and experts have been paid. The latest of such a paid meeting was held on November 10-11, 2024. This roundtable was initiated following the instructions given to the ECOWAS Commission. Late September 2024, such a roundtable meeting was held in Abidjan, the capital city of Côte d’Ivoire, under the auspices of the Commission of the Economic Community of West African States (ECOWAS), the African Development Bank (AfDB) and the ECOWAS Bank for Investment and Development (EBID).
The highway corridor is calculated to be approximately 1,080 km long. It will connect some of the largest and most economically dynamic cities Abidjan, Accra, Cotonou, Lomé and Lagos while covering a large proportion of West Africa’s population. It will also link very vibrant seaports in West Africa. In addition, it will serve all the landlocked ECOWAS member-states, for example, Burkina Faso, Mali and Niger in the region. Nearly 40 million people are estimated to be living along the Abidjan-Lagos corridor while 47 million people travel along the axis every year. These are expected to be direct beneficiaries of the development of the project touted to be a real backbone of trade in the region.
According to official documents, this highway project falls in line with the key objectives of the ECOWAS Vision 2050, including (i) facilitating the movement of people and goods, and (ii) accelerating trade and transport, regional and international, improving road infrastructure. It is eventually expected that the transport corridor will be transformed into a development corridor to stimulate investment, sustainable development and poverty reduction within the entire region.
West African Highway and AfCFTA
The focal point of controversy and debate, these several years, are centred on the mechanism of financing, and the state-of-the-art management of this new mega-highway – from planning through practical construction to its final commissioning, ready for cutting-edge usage by the transport industry. The idea of prioritizing highway innovation, signalling a bold leap in West Africa’s transportation infrastructure, is its recognizable potential transformative impact. Simply intended to improve and facilitate the movement of services, goods and people across the region. The Abidjan-Lagos Highway highlights its potential to enhance regional connectivity and drive economic growth, especially with the establishment of the African Continental Free Trade (AfCFTA), the ambitious flagship of the African Union (AU).
According to ECOWAS’ latest document issued after their two-day special meeting held on November 11 in Abidjan, Côte d’Ivoire, “experts have lauded findings of the study which has among others, unveiled a potential $6.8 billion investment prepared and ready to be implemented to unlock economic growth and enhance the viability of the proposed highway.” The overall objective is to identify and unlock the inherent and latent economic potential (short, medium and long-term) and commercial viability of economic and industrial value chain projects. These economic projects, once implemented, will also generate trade volumes and traffic to augment the viability of the highway.
The final draft reports were issued after groups revisited (that was not the first time) several tolled bridges and roads in Abidjan for knowledge and experience sharing strategy envisaged for the Abidjan-Lagos Highway. At the end of the exercise, the study report (re)validated commitment to unlock the inherent and latent economic potential of the highway construction and estimated $6.8 billion in potential investment in the region.
Final Construction Still Out of Sight
For the past few years, significant attention has been drawn by the widely publicized announcement of securing enough funds from African banks and external sources for the construction of this regional highway which could become a cornerstone, and the public narrative of achievement by ECOWAS, which marks its 50th year in 2025. However, transport industry analysts, researchers and experts have already cast serious doubts and skyline scepticism if ECOWAS could live up to this onerous task. Grandiose ceremony-infested ECOWAS future task of achieving its primary target of constructing a ‘speed-highway’ remains an eternal dream. Noticeably, ECOWAS has little to celebrate, except its existence by name, (the golden jubilee) at its 50th year in May 2025. At least, Africans will rather jubilate over the authenticity of reforming and transforming the Economic Community of West African States (ECOWAS).
By Adedapo Adesanya
After many delays and negotiations, richer countries agreed to take the lead on raising at least $300 billion per year by 2035 to support climate adaptation and emissions reduction projects in developing nations.
This came after two exhausting weeks of chaotic bargaining and sleepless nights at the Conference of Parties (COP29) held in Baku, Azerbaijan.
Other donors — including less wealthy countries, development banks, and private investors — were also invited to chip in. The agreement also called on all these parties to work, on a voluntary basis, toward the goal of $1.3 trillion.
The figures are far lower than what many in Baku had hoped for with delegates from countries like India, Kenya, and Vanuatu among others lamenting the agreed amount. Expectations were around $2.3 trillion.
“The amount that is proposed to be mobilised is abysmally poor. It’s a paltry sum,” said Indian delegate Chandni Raina.
“This document is little more than an optical illusion. This, in our opinion, will not address the enormity of the challenge we all face.”
“The commitments made in Baku — the Dollar amounts pledged and the emissions reductions promised — are not enough. They were never going to be enough,” said Ralph Regenvanu, climate envoy from the island nation Vanuatu. “And even then, based on our experience with such pledges in the past, we know they will not be fulfilled.”
“This COP has been a disaster for the developing world,” said Mohamed Adow, the Kenyan director of Power Shift Africa, a think tank.
“It’s a betrayal of both people and planet, by wealthy countries who claim to take climate change seriously.”
Nations struggled to reconcile long-standing divisions over how much rich nations most accountable for historic climate change should provide to poorer countries least responsible but most impacted by Earth’s rapid warming.
The climate envoy of the European Union, Wopke Hoekstra said COP29 would be remembered as “the start of a new era for climate finance”.
Despite repeating that no deal is better than a bad deal, this did not stand in the way of an agreement, despite it falling well short of what most of these delegates wanted.
The final deal commits developed nations to pay at least $300 billion a year by 2035 to help developed countries green their economies and prepare for worse disasters.
A group of 134 developing countries had pushed for at least $500 billion from rich governments to build resilience against climate change and cut emissions of planet-warming greenhouse gases.
UN climate chief, Mr Simon Stiell acknowledged the deal was imperfect.
“No country got everything they wanted, and we leave Baku with a mountain of work still to do. So this is no time for victory laps,” he said in a statement.
The United States and EU have wanted newly wealthy emerging economies like China — the world’s largest emitter — to chip in.
The final deal encourages developing countries to make contributions on a voluntary basis, reflecting no change for China which already provides climate finance on its own terms.
The deal posits a larger overall target of $1.3 trillion per year to cope with rising temperatures and disasters, but most would come from private sources.
Wealthy countries and small island nations were also concerned by efforts led by Saudi Arabia to water down calls from last year’s summit in Dubai to phase out fossil fuels.
A number of countries also accused Azerbaijan, an authoritarian oil and gas exporter, of lacking the experience and will to meet the moment, as the planet again sets temperature records and faces rising deadly disasters.
The next COP will hold in Brazil in 2025.
By Adedapo Adesanya
Stablecoin-based infrastructure provider, Yellow Card, has been issued a Crypto Asset Service Provider (CASP) licence by the Financial Sector Conduct Authority (FSCA) in South Africa.
This is coming after the company announced the closing of its Series C financing valued at $33 million led by Blockchain Capital, with participation from Polychain Capital, Third Prime Ventures, Castle Island Ventures, Block, Inc., Galaxy Ventures, Blockchain Coinvestors, Hutt Capital, and Winklevoss Capital in October.
Yellow Card, which launched in South Africa in 2020, has facilitated over $3 billion in transactions in the last several years and now operates in 20 countries across the continent.
Commenting on the FSCA’s decision to issue the licence to Yellow Card Financial South Africa, Mr Chris Maurice, Yellow Card’s co-founder and CEO, said, “The CASP licence underscores Yellow Card’s commitment to its customers in South Africa and regulatory compliance across the continent. This achievement reflects our dedication to providing secure, compliant and transformative solutions for our customers both in South Africa and across Africa.”
With the licensing and funding, the company plans to expand its B2B offerings by enhancing its stablecoin rails, upgrading infrastructure, and advancing its B2B API and Widget.
This will further help to drive stablecoin adoption, which is surging throughout Africa, with sub-Saharan Africa having the highest adoption rate in the world at 9.2 per cent.
In South Africa alone, where the number of total users of crypto assets is estimated to amount to 5.8 million people, stablecoins have experienced growth of 50 per cent month over month since October 2023, displacing bitcoin as the country’s most popular cryptocurrency. Stablecoins are cryptocurrencies pegged against the Dollar.
“As the stablecoin landscape continues to evolve, Yellow Card is committed to leading the charge in making digital assets accessible and secure for businesses across Africa,” Yellow Card said in a statement.
“These efforts will empower businesses with seamless solutions for liquidity management and their general operations,” the firm added.
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