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Russia Chasing Missed Opportunities in Nigeria

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russia-nigeria Opportunities in Nigeria

By Kester Kenn Klomegah

Under the aegis of the newly established Nigeria-Russia Chamber of Commerce and Industry, Russians are now gearing up to revamp the Ajaokuta Steel Industry that was abandoned after the collapse of the Soviet Union, and further take up energy, oil and gas projects in Nigeria, as well as facilitate trade between Nigeria and Russia.

After the Soviet’s collapse, Russia has been struggling to find ways of regaining part of its Soviet-era economic influence throughout Africa, and Nigeria has been high on Russia’s agenda for reviving multifaceted business ties, at least to share its market and take up opportunities similar to the United States and China.

There had been a number of deals and business proposals previously, featured in Russia-Nigerian relations. As far back in June 2009, Dmitry Medvedev as the president visited Nigeria for the first time, held talks on possible nuclear energy, oil exploration and military cooperation.

According to Russia’s Rosatom, the protocol on nuclear offered the possibility of bilateral cooperation for the development of nuclear infrastructure and the joint exploration and exploitation of uranium deposits. The aim, two nuclear plants estimated to cost $20 billion, the bulk of it by Russia, is to boost Nigeria’s electricity supply.

Russia’s second-largest oil company, and privately controlled Lukoil, has gone forth and back these several years with plans to expand its operations in Nigeria, and in a number of West African countries.

Nigeria is an economic powerhouse in the West African region. As it is known, Nigeria is one of Africa’s fastest-growing economies and it boasts the largest population. Russia and Nigeria have some sort of economic relations, but these are not consistent with the long-standing cordial relations between both countries.

In addition, Nigeria is a vast market with huge potentials for prospective foreign investors and so is Russia. Regrettably, investors from both sides appear to know little or nothing about these opportunities. This is, usually attributed to the apparent inadequate knowledge of the many investment opportunities in both countries.

Statistics are extremely hard to obtain. By the end of 2018, Russia’s trade with Nigeria was almost US$600 million, still seen as far below the full potential of trade and economic cooperation between the two countries.

Stunningly, talking about bilateral economic footprints, both Russians and Nigerians are unprepared to give needed useful information about Russia’s investment in Nigeria. Seen as a two-way street, Nigeria’s presence in Russia is only the diplomatic representative office.

New windows, in practice, are still opening especially with the start of the African Continental Free Trade Area (AfCFTA), the most ambitious integration initiative embedded in the Agenda 2063 of the African Union. It stresses industrial hubs, localizing manufacturing and marketing goods and services throughout Africa.

Nigeria-Russia Chamber of Commerce and Industry, established and inaugurated in late September 2021, now has as its primary task to raise bilateral economic relations between the two countries. It will help implement some of the significant issues that were discussed during the historic first Russia-Africa summit held in October 2019 in Sochi, Russia.

President, Nigeria-Russia Chamber of Commerce and Industry, Dr Obiora Okonkwo told the visiting Russian delegation headed by Ambassador Oleg Ozerov, of the Ministry of Foreign Affairs of the Russian Federation and Head of the Secretariat of Russia-Africa Partnership Forum (RAPF), that establishment of the NRCCI was the first step towards resuscitating and strengthening existing relations between Nigeria and Russia.

He said the inauguration of the chamber shows the beginning of a new journey that will enable “Nigeria explore business relations with the Russian Federation, and will promote economic growth, technology transfer, development and foster better understanding between both countries.”

Reports indicated that the Nigeria-Russia Chamber of Commerce and Industry (NRCCI) was created and incorporated under the Companies and Allied Matters Act 1990, and has established beneficial relationships and contacts with numerous economic development organizations in the Russian Federation.

The principal objectives of NRCCI are to promote commerce, industry, trade and ancillary services; foster, advance and protect commercial, industrial, trade and professional enterprises.

“We are therefore seeking to establish an industrial development mechanism built on the principle of mutually beneficial relationships with their own business groups. The strategy is to establish and sustain business contacts with the existing numerous economic development organizations in Russia and Nigeria,” explained Okonkwo.

The Russian business delegation included Andrei Albeshchenko from the Association of Economic Cooperation with African States; Andrei Vladimirov, State Atomic Energy Corporation Overseas; Stepan Belanovich, Uralchem United Chemical Company JSC; Maksim Poltoradnev, Uralchem United Chemical Company JSC and other Russian business executives.

The business visit to Abuja was organized by AECAS with support from the Russian Foreign Ministry, assistance from the Russian Embassy in the Federal Republic of Nigeria. Ozerov and his delegation paid a courtesy call on Vice President Yemi Osinbajo at the Presidential Villa.

According to reports, Vice President Osinbajo has expressed keen interest in developing bilateral cooperation and the need to increase the presence of Russian companies in Nigeria. Vice President Osinbajo stressed the fact that the formal inauguration of a Nigeria-Russia Chamber of Commerce and Industry (NRCCI) will consolidate efforts to deepen the long-lasting relationship and invigorate business opportunities between the Federal Republic of Nigeria and the Russian Federation.

“We are interested in developing relations with Nigeria. It is one of the largest and most promising economies where we see a lot of opportunities. We were happy to hear that the Vice President supports the development of bilateral economic relations.

“Russia has a lot to offer, from new technologies to fertilizers, agriculture, energy and infrastructure projects. We must intensify cooperation to achieve tangible results prior to the second Russia-Africa summit,” Ozerov, Head of the Secretariat of the Russia-Africa Partnership Forum, told journalists during the press conference following the meeting.

Within the framework of the joint declaration adopted at the first Russia-Africa Summit, the Ministry of Foreign Affairs of the Russian Federation established the Secretariat of the Russia-Africa Partnership Forum. The Secretariat of the Russia-Africa Partnership Forum also moved to create AECAS.

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Proposed Amazon Headquarters in South Africa Under Threat

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amazon south africa

By Adedapo Adesanya

Plans by Amazon to establish its Africa headquarters in Cape Town, South Africa, could hit a snag if a legal challenge by indigenous activists is allowed to proceed, a Cape Town court heard on Thursday, January 20.

According to reports, construction is already underway for Amazon’s $262 million African headquarters on land that Khoisan communities hold sacred as a site of their early resistance to European colonisers in 1510.

Several Khoisan groups threw their support behind the project after the developers agreed to build a heritage, cultural and media centre that will be operated by indigenous groups.

However, the Goringhaicona Khoi Khoin Indigenous Traditional Council and a neighbourhood association have asked the Western Cape High Court to halt construction.

A lawyer for the property developers, the Liesbeek Leisure Property Trust, told the court that Amazon has signalled it will pull out of the project if the delay is granted.

According to an advocate, Mr Sean Rosenberg, “If Amazon has indicated, even directly, that it’s not going to tolerate any further delays, that’s not hearsay evidence.

“That’s direct evidence of what Amazon’s intentions are.”

“The much more likely possibility is that this project will not go ahead, given what has happened up until now, given Amazon’s impatience, given Amazon’s indication,” he added.

Amazon itself is not named in the case but the hearing is expected to conclude Friday.

Once hunter-gatherers, known under the now-discarded label of Bushmen, the Khoisan suffered deeply under colonisation and apartheid.

Many in their community say they still endure wide social inequalities and economic opportunities today, and their past remains overlooked.

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DR Congo Raises Stake in Shelter Afrique 2.46%

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DR Congo Shelter Afrique

By Aduragbemi Omiyale

The government of the Democratic Republic of Congo (DRC) has increased its shareholding in Shelter Afrique to 2.46 per cent, up from 1.68 per cent held previously.

This followed the payment of $1.7 million capital arrears in the pan-African housing development financier on December 22, 2021, to add to the initial $2.5 million.

DR Congo has now joined Tanzania, Morocco, Mali, Lesotho, Namibia, Togo and Zimbabwe as Shelter Afrique Class A shareholders who have fully paid their capital obligations.

“We are grateful to the government of the Democratic Republic of Congo as this is a show of strong belief in the role and mandates of Shelter Afrique in the provision of affordable housing in Africa, and particularly the DRC.

“We are particularly appreciative of the roles played by the Minister for Urban Planning and Housing, Mr Pius Mukala and the Minister for Finance, Mr Nicolas Kazadi, for making the disbursements,” the Group Managing Director and Chief Executive Officer of Shelter Afrique, Mr Andrew Chimphondah said.

“We wish to show our gratitude to the eight shareholders who have fully paid their capital subscriptions and to those who continue to increase their stakes in the company – it is a huge vote of confidence in our board approved strategy which is being implemented successfully by the management,” Mr Chimphondah added.

In the recent past, DRC has enhanced its engagement with Shelter Afrique. Consequently, the company has ramped up its activities in the country by actively pursuing large-scale, low-cost housing projects in DRC through public-private partnerships and equity investments.

Recently, Shelter Afrique approved a line of credit worth $11.4 million to a financial institution to finance 285 mortgages in the country.

Shelter Afrique is also keen on supporting urban regeneration projects in Lubumbashi and Goma, which is expected to develop 500 housing units – the company has set aside $20 million, pending board approval.

“Additionally, under our social housing plans, we are currently reviewing a housing project in Goma that seeks to develop 1000 housing units for families displaced by the eruption of Mount Nyiragongo and Kanyaja, which occurred in May and June 2021. When approved, we will invest $1 million in equity for a period of 7 years,” he further stated.

Other projects so far financed by Shelter Afrique in the DRC include Devimco’s 7-floor office building for rental purposes, La Tradition, Le Concorde, L’Ambassadeur; Azda; and a 10-storey building in Kinshasa developed by ELOLO SPRL.

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St. Petersburg to Hosts Second African Leaders Summit

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Second African Leaders Summit

By Kester Kenn Klomegah

With high optimism and a desire to strengthen its geopolitical influence, Russian authorities are gearing up to hold the second African leaders summit in St. Petersburg scheduled for early November 2022.

The gathering, as expected, will focus on enhancing further constructive cooperation and advancing integration processes within the framework of the African Union and a number of sub-regional structures.

In their first joint declaration, emerging from the Russia-Africa summit at the initiative of African participants a new dialogue mechanism—the Russia-Africa Partnership Forum—was created.

The declaration stipulated that all top-level meetings take place within its framework once every three years, alternately in Russia and in an African state. It says further that the foreign ministers of Russia and three African countries—the current, future and previous chairpersons of the African Union—will meet for annual consultations.

Understandably, St. Petersburg, the preferred venue, was chosen primarily due to the continuous political instability in Addis Ababa, Ethiopia. Initially, Moscow bagged hopes on using the Chinese financed and newly constructed African Union headquarters which has modern facilities for large-scale international conferences and the city itself easily accessible with effectively built first-class Ethiopian Airlines network to and from many African countries. An additional advantage is that African government representatives and heads of many international organizations work in this city.

South Africa and Egypt, as possible alternatives, were thoroughly discussed as South Africa and Russia are members of BRICS, and Egypt has excellent post-Soviet relations. Reminding that the first summit held in Sochi was co-chaired by President Vladimir Putin and Egyptian President Abdel Fattah el-Sisi, who also rotationally during that year headed the African Union.

The large-scale Russia-Africa summit, held in Sochi in October 2019 and described as the first of its kind in the history of Moscow’s relations with Africa, attracted more than 40 African presidents, as well as the heads of major regional associations and organizations.

According to official documents, there were a total of 569 working meetings that resulted in 92 agreements and contracts, and memoranda of understanding signed as part of the summit.

The first summit opened a new page in the history of Russia’s relations with African countries. Sochi witnessed a historic final communiqué and impressive pledges and promises were made in various speeches and discussions.

Last November, a group of 25 leading experts headed by Sergei A. Karaganov, the Honorary Chairman of the Presidium of the Council on Foreign and Defence Policy, released a report that vividly highlighted some spectacular pitfalls and shortcomings in Russia’s approach towards Africa.

It pointed to Russia’s consistent failure in honouring its several agreements and pledges over the years. It decried the increased number of bilateral and high-level meetings that yield little or bring to the fore no definitive results. In addition, insufficient and disorganized Russian African lobbying combined with a lack of “information hygiene” at all levels of public speaking, says the policy report.

Writing early January on the policy outlook and forecast for 2022, Andrey Kortunov, Director General of the Russian International Affairs Council (RIAC), acknowledged the absolute necessity for consolidating Russia’s positions in Africa.

“A second Russia-Africa summit is planned for the fall of 2022. Its first edition, held in Sochi in October 2019, raised many hopes for the prospects of an expanded Russian presence in Africa. Obviously, the COVID-19 pandemic has made some adjustments to these plans, preventing the parties from reaching the expected levels of trade and investment.

“Nevertheless, Africa still retains a considerable interest in interaction with Russia, which could act as an important balancer of the prevailing influence of the West and China in the countries of the continent,” he opined.

Kortunov suggested, therefore, that 2022 could become a “Year of Africa” for Moscow, a year of converting common political agreements into new practical projects in energy, transport, urban infrastructure, communications, education, public health, and regional security.

Some policy experts expect high symbolism at the 2022 Russia-Africa summit. For example, Andrey Maslov, Head of the Centre for African Studies at Moscow’s Higher School of Economics, said that preparations for the second summit would shape the Russia-African agenda; visits would become more frequent and Africa would receive greater coverage in Russian media.

Instead of measuring the success of the summit by how many African leaders attended, as happened in 2019, the parties will finally give greater attention to the substance of the agenda, which is already under development. Russia should try to increase its presence in Africa while avoiding direct confrontation with other non-regional and foreign players, he underlined.

According to him, the volume of Russian-African trade increased, for the first time since 2018, diversifying both geographically and in the range of goods traded. Shipments of railway equipment, fertilizers, pipes, high-tech equipment and aluminium are growing and work continues on institutionalizing the interaction between Russia and the African Union.

“A number of conflicts are also causing alarm, primarily those in Ethiopia, Libya, Guinea, Sudan and especially the Republic of Mali where France and the EU are withdrawing their troops. In 2022, Russia will try in various ways to play a stabilizing role for Africa and assist in confronting the main challenges it faces – epidemics, the spread of extremism and conflicts, and hunger,” Maslov told The Moscow Times.

A dialogue would begin on Africa formulating its own climate agenda, he said and added: “Africa is beginning to understand that it does not need a European-style green agenda and will demand compensation from the main polluting countries for the damage the climatic changes have caused to the ecosystems of African countries. Russia is likely to support these demands.”

In an emailed interview, Steven Gruzd, Head of the African Governance and Diplomacy Programme at the South African Institute of International Affairs (SAIIA), said Russia needs to upgrade or scale up its collaborative engagement with Africa. It has to consider seriously launching more public outreach programmes, especially working with civil society to change public perceptions and the private sector to strengthen its partnership with Africa. In order to achieve this, it has to surmount the challenges, take up the courage and work consistently with both private and public sectors and with an effective Action Plan.

He told IDN: “I would largely agree that there is a divide between what has been pledged and promised at high-level meetings and summits, compared to what has actually materialized on the ground. There is more talk than action, and in most cases, down the years intentions and ideas have been presented as initiatives already in progress. It will be interesting to see what has been concretely achieved in reports at the forthcoming second Russia-Africa summit scheduled for late 2022.”

Despite the challenges, Moscow plans to boost Russia’s presence in Africa noted Gruzd who also heads the Russia-Africa Research Programme initiated last year at SAIIA, South Africa’s premier research institute on international issues. It is an independent, non-government think tank, with a long and proud history of providing thought leadership in Africa.

Without doubts, Russia and African leaders will draw a comprehensive working map based on the discussions in St. Petersburg. The summit achievements will help to consolidate the aspirations of the African continent and African nations as fully as possible, and chart ways for materializing common priorities of Russia and the African countries within the framework of the African Union’s Agenda 2063 and the 2030 Agenda for Sustainable Development.

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