Role of Africa in International Affairs is Growing—Lukyanov
By Kestér Kenn Klomegâh
In this insightful interview conducted by our media executive Kestér Kenn Klomegâh with Fyodor Lukyanov, Chairman of the Council on Foreign and Defense Policy, Research Director at the Valdai Discussion Club, and Editor-in-Chief of Russia in Global Affairs journal, focused largely on Russia and Africa relations, and a few aspects of the emerging new world order. Lukyanov also discussed, at length, Russia’s engagement with Africa as well as the expectations from Africa. Here are the interview excerpts:
During the late October Valdai gathering, Vladimir Putin’s speech underscored the fact that Russia was looking for its Soviet-era allies and “non-Western friends” to create a new world order. What are the implications, from historical perspectives, relating to Africa?
The role of Africa in international affairs is growing; no one can deny it. Russian credit record in relationship with Africa is not easy – from very tight contacts in the decolonization era and period when African countries were building their statehood through the bumpy road in the 1990s when Russia suffered a huge economic and geopolitical setback and was forced to the emergency survival to the slow, but steady re-establishment of ties in 21st century. It should be noted that the renaissance of Russian interest vis-à-vis Africa started much earlier than Russia – West relations collapsed due to the Ukrainian war. And it was a result of the realization that Africa would be increasingly important in decades to come.
As far as the Russian vision of the world order is concerned, it should be a polycentric and pretty complicated constellation of countries or a group of countries (regional groupings) with a permanently shifting balance and steady work on adjustment of different interests. Not easy, but a vaccine against anybody’s hegemony and an opportunity to be flexible in pursuing own needs. Africa, as a big group of countries with interests which are both intertwined and contradicting can serve both as a model of the future global picture and a strong unit in this world if needed. Notwithstanding all that, Africa has its strengths and weaknesses based on history, but the balance is positive in this new world. Most of the potential success depends on African countries themselves and their ability to build up relations with outside powers on a rational and calculated basis.
The Soviet Union, of course, enormously supported Africa’s liberation struggle to attain political independence in the 60s. African leaders are looking for external players with funds to invest and transform their economy. In practical terms, what could be Russia’s role in fighting what is frequently referred to as “neocolonialism” in Africa?
Unlike former colonial powers and, to some extent, China, it is quite clear that Russia doesn’t envisage an exclusive or an ultimately leading role in Africa. There are no political disadvantages associated with Russian relations with Africa. The practical input could be huge, in case Russia does its homework. Russian resources to invest massively are not comparable with what China or Western states can do. But, Russia has a lot of services which are on the highest international level, while much more cost-effective, and they can be offered to African partners. Russia has, for example, developed one of the best systems of digital state services in the world; Russian tax authorities are better equipped with modern technology than most of the developed countries. Russian experience in the raw material sector is unique, as many technological solutions are independent of other great powers, which is getting more and more important now. As I said, the Russian problem is to complete its homework – to list all we can offer and manage those offers in a transparent way, and understandable for partners. It will be done soon because now it gets very vital for Russian development.
Do you think Russia is much more critical of the United States and European Union’s hegemony in Africa? How can we interpret African elites feeling (after the first 2019 summit) about Russia’s renewed economic interests in Africa?
Russia is much more critical of the US hegemony where ever it exists, Africa is not an exemption. Russian economic and political focus on Africa is obvious, and skills to implement it in a contemporary way acceptable for partners will increase now.
What are your views about Russia’s public outreach diplomacy with Africa? How would you evaluate Russia’s engagement, particularly in sustainable development in Africa?
Russia was not very advanced in its diplomatic outreach to Africa until a certain moment, the situation started to improve in the 2010s, and now we have entered a new stage. Minister Sergey Lavrov’s activity all over the continent is very telling. As for sustainable development, this concept is a product of a particular political period; I would call it advanced liberal globalization. This period is over; we are moving towards something else. Frankly, I don’t believe that Russia will be much interested in current circumstances to be part of international efforts to promote sustainable development as understood by international organizations and bureaucracy. But Russia will certainly be eager to work together with particular countries on particular projects.
Geopolitical confrontation, rivalry and competition in Africa. For now, Russia has too many initiatives and bilateral agreements with African countries. What are your suggestions here for strengthening Russia and African relations, especially in the economic direction?
You are right, optimization is needed. Fewer projects and initiatives, more practical outcomes. That is what I mentioned earlier as a necessity to do homework. Combination of very well-calibrated regional initiatives and bilateral projects where Russia has a clear competitive advantage – be it technology, security or food – should be priorities. And they should be numbered, not endless. Africa is certainly not the main topic for the BRICS agenda; those countries prefer to focus on global issues, where they don’t have any major differences (if any), while the regional level is more controversial. Anyway, there is no intention to build a unified front against US and EU. BRICS is by default not confrontational; there is no goal to counterwork the West, but rather to bypass it.
In Africa, each BRICS member will have its own agenda, and no coordination is expected. But then, Africa is represented in BRICS by South Africa. And I would suggest that it would be a natural task for South Africa to promote the African agenda in this group. Of course, each BRICS state has its own hierarchy of interests, and this is normal. But as BRICS aspires greater international role and Africa is growing in significance as an essential part of the world, I see the field for common interests. As far as a confrontation with the West is concerned, there is no such goal for most BRICS countries indeed. But if we look at international trends and the speed with which the previous international system collapsed and overall competition spreads, I would not be so sure to predict how the international situation and stance of BRICS will evolve in years to come.
Can Russia Increase Trade With Africa Beyond Rhetoric
By Kestér Kenn Klomegâh
Russian President Vladimir Putin spoke at the International Parliamentary Conference Russia – Africa in a Multipolar World held in Moscow under the auspices of the State Duma of the Russian Federal Assembly on March 20.
The partnership between Russia and African countries has gained additional momentum and is reaching a whole new level, he noted in his speech, and along the line, adding that additional opportunities are opening up by the process of establishing the African Continental Free Trade Area (AfCFTA), which began in 2021, which in the future will become a continental market which favours developing ties both through the Eurasian Economic Union and bilaterally.
“Mutual trade is growing every year, which reached almost $18 billion last year. It is unlikely that such a figure can fully suit us, but we know that this is far from the limit. The development of counter-commodity exchanges will undoubtedly be facilitated by a more energetic transition in financial settlements to national currencies and the establishment of new transport and logistics chains,” he added.
During the African leaders’ summit at the Black Sea city of Sochi in 2019, Putin rolled out a comprehensive roadmap, particularly questions relating to the development and consolidation of beneficial partnerships with Africa and that Russia would strengthen overall ties in line with the 2063 concept (agenda) developed by the African Union. In his speech, Putin
Putin based his arguments on the fact that Africa is increasingly becoming a continent of opportunities. It possesses vast resources and potential economic attractiveness; Putin further noted that interest in developing relations with African countries is currently visible not only on the part of Western Europe, the United States and the People’s Republic of China but also on the part of India, Turkey, the Gulf states, Japan, the Republic of Korea, Israel, and Brazil.
With a view to expanding trade and cooperation, a memorandum of understanding has been signed between the Eurasian Economic Commission and the African Union Commission at the Sochi Summit. In 2018, Putin’s assessment was that Russia’s trade with African countries grew more than 17 per cent and exceeded $20 billion. Putin would like to bring it (the trade figure) to at least $40 billion over the next few years.
Admittedly Russia’s trade is consistently straddling since 2019 after Sochi, a position which officials seem to accept. “Despite illegal sanctions imposed by Washington, Russia and African states are developing trade and economic cooperation. The trade turnover is increasing: at the end of 2022, it reached $17.9 billion,” according to Chairman of the State Duma Vyacheslav Volodin, addressing African parliamentarians at the plenary session Russia-Africa in a Multipolar World.
Russia, of course, has its approach towards Africa. It pressurizes no foreign countries, neither it has to compete with them, as it has its own pace for working with Africa. With the same optimism towards taking emerging challenges and opportunities in Africa, Russia still has to show, in practical terms, commitment, especially with its policy initiatives.
On 29 April 2021, the Russian International Affairs Council (RIAC), a Russian NGO that focuses on foreign policy, held an online conference with the participation of experts on Africa. Chairing the online discussion, Professor Igor Ivanov, former Foreign Affairs Minister and now RIAC President, made an opening speech, pointing out that Russia’s task in Africa is to present a strategy and define priorities with the countries of the continent, build on the decisions of the first Russia-Africa Summit.
“Russia’s task is to prevent a rollback in relations with African countries. Russia must define its priorities explicitly: why are we returning to Africa? Some general statements of a fundamental nature were made at the first Summit; now it is necessary to move from general statements to specificity,” he suggested.
During his address at the opening of the special panel session on Africa at the St. Petersburg International Forum held in June 2021, Rwandan Prime Minister Edouard Ngirente called upon Russians to consider increasing investment in Africa. That Africa has great opportunities that investors from Russia can take advantage of; among these are the continent’s young population and workforce, the fast rate at which urbanization is taking place, and the huge potential that has been demonstrated in technological progress in areas like telecommunications and digitization of the society.
“Therefore, advancing our common prosperity agenda would translate the existing business opportunities into reality. And this calls for important flows of investments in priority areas,” he said. In addition, Prime Minister Edouard Ngirente pointed at the African Continental Free Trade Area (AfCFTA) and regional integrations of economic communities as another priority to advance Africa’s growth agenda quickly and position the continent as an investment destination.
“This could be an opportunity for Russian businesses to invest in infrastructures such as roads, railways, ports, hydropower plants, and internet connectivity that facilitate trade on the continent of 1.3 billion consumers. The investment required is estimated at $130 billion to $170 billion per year,” explained Prime Minister Edouard Ngirente.
South African business tycoon, Sello Rasethaba, questioned how Russia would establish a thriving trade relationship with Africa for the benefit of all. In reality and effective practical terms, how does Russia want to reposition itself in relation to Africa? With business relationships, Russia has to consider practical strategies in consultation with African countries. The fact that the middle class is growing in leaps and bounds in Africa makes this market even more attractive and opens more opportunities for Russian businesses.
“The current investment and business engagement by foreign players with Africa is increasing. There are so many unknowns up there in Russia; it’s crucial that Russia has a clear vision of the relationship it wants with Africa. Russia and African countries, must set up sovereign wealth funds using the resources and power of those countries,” he said.
In an interview with Steven Gruzd, Head of the African Governance and Diplomacy Programme at the South African Institute of International Affairs (SAIIA), explained that Africa is a busy geopolitical arena, with many players, both old and new, operating, apart from EU countries, China and the US. There are players such as Iran, Turkey, Israel, the UAE, Japan and others. Russia has to compete against them and distinctively focus on its efforts with strategies.
On the other side, Russia uses the rhetoric of anti-colonialism in its engagement with Africa, and it is fighting neo-colonialism from the West, especially in relations with its former colonies. It sees France as a threat to its interests, especially in Francophone West Africa, the Maghreb and the Sahel. It, therefore, focuses on anti-western slogans as its main trading commodity across Africa. The African Continental Free Trade Area (AfCFTA) could be the strongest dimension of Russia’s dealings in Africa.
Many other factors, including the geo-political changes, are influencing the United States, European and Asian investors to intensify exploring several opportunities in the African Continental Free Trade Area (AfCFTA), a policy signed by African countries to make the continent a single market. As monitored, foreigners are looking at the market for new partnerships. The AfCFTA has unlocked value chains for – especially US investors – in key sectors such as pharmaceuticals, automobiles, agro-processing, and financial technology.
Unlike Russian ministries, institutions and organizations, the Corporate Council on Africa (CCA), for instance, shares insights on critical issues and policies influencing the US-Africa economic partnership. It facilitates trade and investment issues for potential investors interested in pursuing public-private partnerships that support the United States and African businesses, including women-owned and led Small and Medium-Scale Enterprises. The U.S. Agency for International Development is working closely with African institutions and organizations. According to documents, there are an estimated 1,200 U.S. companies operating in Africa.
The Bill & Melinda Gates Foundation has made a resonating announcement that the foundation will spend $7 billion over the next four years to improve health, gender equality and agriculture across Africa. Strengthening and supporting these sectors have become necessary due to increasing complaints about lack of funds and, worse, due to the negative impact of geopolitical changes. It will further continue to invest in researchers, entrepreneurs, innovators and healthcare workers who are working to unlock the tremendous human potential that exists across the continent.
In another related development, U.S. Trade Representative Katherine Tai has signed a memorandum of understanding with the African Continental Free Trade Area that aims at exploring work on the next phases of the U.S.-African trade relationship. United States sees enormous opportunities to improve the longstanding African Growth and Opportunity Act (AGOA) system of trade preferences, which is due to expire in 2025.
“The world that we’re living in today certainly has been transformed by significant events that we have experienced since 2015, the last time the program was reauthorized,” Tai noted during a meeting of trade ministers from Sub-Saharan Africa to discuss AGOA as part of a U.S.-Africa summit in Washington. “We’ve consistently seen that there are opportunities for the program to be better; there could be much better uptake and utilization of the program.”
In fact, AGOA offers an irreversible solid ground as a “stepping stone to address regional and global challenges,” especially with Africa’s young and entrepreneurial population, she said, before concluding that “the future is Africa, and engaging with this continent is the key to prosperity for all of us.”
Similarly, at least, after its historic UK-Africa Investment Summit held in January 2020, the UK has increased its support for business on the continent, a step that aims at strengthening aspects of the planned economic cooperation with Africa. In our random research after the summit, we have noticed different priorities – all of which are supporting and strengthening economic partnerships in a number of countries on the continent. The significance of these is to help unlock opportunity, spread prosperity and thus transform lives in Africa.
The Department for International Trade said in a media release that it would cut import taxes on hundreds more products from some of the world’s developing countries to boost trade links. It explained further that the measure was part of a wider push by the UK to use trade to “drive prosperity and help eradicate poverty” as well as reduce dependency on aid. The scheme covers developing countries and will affect around 99% of goods imported from Africa.
South Africa and Nigeria, the continent’s two largest economies, make up 60% of the entire UK-Africa trade relationship. Only eight nations from sub-Saharan Africa, mostly former colonies, count the UK in their top 10 export destinations, including Rwanda, Mauritius, Seychelles, Sierra Leone, Ghana, Mozambique, Kenya and South Africa.
Our monitoring shows that American, Asian, and European Union members, particularly British investors, are strategically leveraging into trade platforms, working to support the creation of an African Continental Free Trade Area (AfCFTA) because trade integration is such a powerful tool to accelerate economic growth, create employment and alleviate or reduce poverty.
The AfCFTA provides a unique and valuable platform for businesses to access an integrated African market of over 1.3 billion people. The growing middle class, among other factors, constitutes a huge market potential in Africa. Quite challenging, though, but there are new legislations that stipulate localizing production and distribution inside Africa.
Under the current circumstances, what has Russia done to help Africa? It only contributes to deepening social dissatisfaction, increases the fear of vulnerable groups among the population, to rising the prices of commodities and consumables throughout Africa. Nevertheless, it is so common to reiterate that Russia has always been on Africa’s side in the fight against colonialism. The frequency of reminding again and again about Soviet assistance, which was offered more than 60 years ago, will definitely not facilitate the expected beneficial trade and investment ties under these new conditions.
Afreximbank President and Chairman of the Board of Directors, Dr Benedict Okey Oramah, says Russian officials “keep reminding us about Soviet-era,” but the emotional link has simply not been used in transforming relations. Oramah said one of Russia’s major advantages was goodwill. He remarked that even young people in Africa knew how Russia helped African people fight for independence. “So an emotional link is there,” he told Inter-Tass News Agency.
The biggest thing that happened in Africa was the establishment of the African Continental Free Trade Area (AfCFTA). That is a huge game-changer, and steps have been made lately in African countries to create better conditions for business development and shaping an attractive investment climate. “Sometimes, it is difficult to understand why the Russians are not taking advantage of it. We have the Chinese; we have the Americans, we have the Germans who are operating projects…That is a very, very promising area,” Oramah said in his interview in 2021.
Secretary-General of the African Continental Free Trade Area Secretariat, Wamkele Mene, has several times highlighted the underlying fact of developing intra-African trade, and even with external players that “the next wave of investment in African markets must focus on productive sectors of Africa’s economy in order to drive the continent’s industrial development in the decades to come. For foreign investors and traders, it is necessary to support local entrepreneurs to build scale, and therefore improve productivity.”
For example, the total United States (US) two-way trade in Africa has actually fallen in recent years to about $60 billion, far eclipsed by the European Union (EU) with over $200 billion and China with more than $200 billion, as stated by the Brookings Institution in Africa in Focus post. According to the African Development Bank (AfDB), Africa’s economies are growing faster than those of any other region. Nearly half of Africa’s countries are now classified as middle-income countries – the number of Africans living below the poverty line fell to 39 per cent as compared to 51 per cent in 2021, and around 350 million of Africa’s one billion people are now earning good incomes – rising consumerism – that makes trade profitable.
As official Russia Ministry of Foreign Affairs website indicated – it is evident that the significant potential of the economic cooperation is far from being exhausted, much remains to be done in creating conditions necessary for interaction between Russia and Africa. At a meeting of the Ministry’s Collegium, Lavrov unreservedly suggested taking a chapter on the approach and methods adopted by China in Africa.
Lavrov said: “It is in the interests of our peoples to work together to preserve and expand mutually beneficial trade and investment ties under these new conditions. It is important to facilitate the mutual access of Russian and African economic operators to each other’s markets and encourage their participation in large-scale infrastructure projects. The signed agreements and the results will be consolidated at the forthcoming second Russia-Africa summit.”
After the first Russia-Africa summit held in 2019, expectations are high as it offers the impetus to substantially increase investment in the economy, industry, transport, telecommunications and tourist infrastructures, as well as in high technology, healthcare, urban development, and other fields that are vital to the quality of life. On the contrary, Russians are consistently trading anti-Western slogans and engaged in geo-political rhetoric instead of investment and business.
Is Russian torn between the challenges of its own assumptions and understandings about forging trade cooperation with Africa? Are pragmatic measures not necessary for promoting trade between the two regions? Is Russia only paying lip service to the summit promise of doubling trade with Africa?
Now at the crossroad, it could be meandering and longer than expected to make the mark. Russia’s return journey could take another generation to reach the destination in Africa. With the current changing geopolitical world, Russia has been stripped of as a member of many international organizations. As a direct result of Russia’s “special military operation” aims at “demilitarization and denazification” since late February 2022, Russia has come under a raft of stringent sanctions imposed by the United States and Canada, the European Union, Japan, Australia, New Zealand and a host of other countries.
Alibaba Splits Into Six Subsidiaries For Market Competitiveness
By Adedapo Adesanya
The Chinese e-commerce company, Alibaba, has announced plans to split its company into six business groups as part of efforts to raise funding and also push for an initial public offering (IPO).
In an announcement on Tuesday, the Chinese e-commerce giant said that each business group will be managed by its own CEO and board of directors.
Alibaba said in a statement that the move is “designed to unlock shareholder value and foster market competitiveness.”
The move comes after a tough couple of years for Alibaba, which has faced slowing economic growth at home and tougher regulation from China, which fears it was becoming too powerful.
Following this, Alibaba has struggled with growth over the past few quarters and is now looking to reinvigorate growth with the reorganization.
The six business groups include the Cloud Intelligence Group, which Alibaba CEO, Mr Daniel Zhang, will head. It will house the company’s cloud and artificial intelligence activities.
Taobao Tmall Commerce Group cover the company’s online shopping platforms, including Taobao and Tmall while Local Services Group will see Mr Yu Yongfu be its CEO, and the business will cover Alibaba’s food delivery service Ele.me as well as its mapping.
Cainiao Smart Logistics will be headed by Mr Wan Lin, who will continue as CEO of the business which houses Alibaba’s logistics service.
Global Digital Commerce Group will be led by Mr Jiang Fan as CEO. This unit includes Alibaba’s international e-commerce businesses, including AliExpress and Lazada.
Digital Media and Entertainment Group are entrusted to Mr Fan Luyuan as CEO. The unit includes Alibaba’s streaming and movie business.
Each of these units can pursue independent fundraising and a public listing when they’re ready, the company said.
The exception is the Taobao Tmall Commerce Group, which will remain wholly owned by Alibaba.
Alibaba’s fintech affiliate Ant Group was forced by regulators to cancel its mega-public listing in November 2020. And in 2021, Alibaba was fined $2.6 billion as part of an antitrust probe.
The reorganisation also comes at a time when there are signs that China is seeking to revive economic growth in the world’s second-largest economy after it replaced anti-COVID curbs.
Cote d’Ivoire Abandons Import Substitution Policy, Goes For Russian Grains, Others
By Kestér Kenn Klomegâh
The Republic of Côte d’Ivoire has abandoned its import substitution policy and other economic measures, including the budgetary allocation for modernizing local agriculture and support for boosting domestic agricultural production. It, however, boasts around 64.8 per cent of arable and agricultural land, which largely remains uncultivated.
Arguably, Côte d’Ivoire, located on the Gulf of Guinea (Atlantic Ocean), could support its fishing industry by spending adequate funds on acquiring simple fishing equipment for local people and even start its own large-scale fish ponds but instead plans to increase fish imports into the country.
It was gathered that the West African country might spend an estimated $100 million on exports of Russian food and agricultural products this second quarter of 2023.
The Russian Agriculture Ministry’s Agroexport Center said it was ready to export such products to Côte d’Ivoire as its market is promising for exports, including grain, fish, sunflower and soybean oil, processed grain products and prepared meat products, among others.
Russian exports of agribusiness products to Côte d’Ivoire more than doubled to $41.6 million in 2021 from $18 million a year earlier, the report said. This included 96,100 tonnes of wheat worth $26.2 million, 12,900 tonnes of fish worth $8.7 million, 1,100 tonnes of sunflower oil worth $1.7 million and 400 tonnes of ice cream worth $0.5 million.
Statistics show that imports from the Côte d’Ivoire are far higher and grew to $237.5 million in 2021 from $223.7 million in 2020, although by the volume they dropped to 72,600 tonnes from 74,500 tonnes. These imports included 43,800 tonnes of cocoa beans worth $141.8 million, 18,100 tonnes of cocoa paste worth $69.3 million and 3,400 tonnes of cocoa powder worth $8.5 million.
“The decrease in Russian imports by volume was due to the reduction of purchases of cocoa beans and cocoa powder. At the same time, cocoa paste imports showed significant growth: 27% by volume and 37.2% by value,” the report said.
Around 7.5 million people made up the workforce. The workforce took a hit, especially in the private sector, with numerous economic crises since the 2000s. Decreasing job markets posed a huge issue as unemployment rates grew.
With rising unemployment, especially among the youth, experts suggested the government engage in economic diversification, focus on support for improving local production. Therefore, preliminary solutions proposed to decrease unemployment included diversifying the economy and increasing financial support in addressing domestic food security.
With an estimated population of 29 million, the economy of Côte d’Ivoire has grown faster than that of most other African countries since independence. One possible reason for this might be taxes on exported agriculture. It is the world’s largest exporter of cocoa beans. In 2021, cocoa-bean farmers earned $2.53 billion for cocoa exports. Generally, it is the fourth-largest exporter of general goods in sub-Saharan Africa (following South Africa, Nigeria, and Angola)
By geographical description, Côte d’Ivoire is a country in western sub-Saharan Africa. It borders Liberia and Guinea in the west, Mali and Burkina Faso in the north, Ghana in the east, and the Gulf of Guinea (Atlantic Ocean).
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