By Kester Kenn Klomegah
Russia has a long time-tested relationship with Africa. After the first symbolic Russia-Africa summit in the Black Sea city of Sochi on October 23-24, 2019 both Russia and Africa adopted a joint declaration, a comprehensive document that outlines the key objectives and necessary tasks that seek to raise assertively the entire relations to a new qualitative level.
In order to realize this, it requires a complete understanding of the tasks and the emerging challenges, identifies necessary support for new initiatives and, as always reiterated, commitment to dynamic work with Africa.
According to official documents, there has been a great interest in the further development of relations, and in deepening and intensifying Russian-Africa cooperation. Priority areas of economic cooperation in which concrete results could be achieved in the coming years were outlined.
The main areas identified were energy, included among others, renewables, infrastructure development and especially railway and housing construction, modern and high-tech extraction and processing of mineral resources, agriculture, digital technologies, oil and gas exploration, medicine, science and education.
Acknowledging that six of the ten fastest-growing economies in the world today are in Africa, and that presents an attractive condition for foreign investment, over 170 Russian companies and organizations submitted a total of 280 proposals to do projects and business in Africa.
Reports further show that 92 agreements, contracts and memoranda of understanding were signed at the Russia-Africa Summit and Economic Forum. Agreements worth a total of RUB 1.004 trillion ($12.5 billion).
Far before the summit, at least, during the past decade (2010-2020), several bilateral agreements were also signed. There have been several meetings of various bilateral intergovernmental commissions both in Moscow and in Africa.
Besides all that, pledges and promises consistently dominated official speeches – an approach primarily aims at signalling and further sustaining hope of leveraging to Africa.
Of great importance is that over the past few years, considerable steps taken in strengthening relations with the majority of African countries.
But now, as Russia prepares for the second African leaders’ summit 2022 in Addis Ababa, many policy experts are questioning agreements that were signed—many of them largely unfulfilled and some already forgotten—at least during the past years with African countries.
Experts, such as Professors Vladimir Shubin and Alexandra Arkhangelskaya from the Institute for African Studies in Moscow, have argued that Russia needs to deliver on its previous several pledges made to Africa countries.
“The most significant positive sign is that Russia has moved away from its low-key strategy to vigorous relations, and authorities are seriously showing readiness to compete with other foreign players.
Russia needs to find a strategy that really reflects the practical interests of Russian business,” said Arkhangelskaya, who is a Senior Lecturer at the Moscow High School of Economics and a researcher at the Institute for African Studies.
Currently, the signs for Russian-Africa relations are impressive. Declarations of intentions have been made; several important bilateral agreements have been signed. Now it remains to be seen how these intentions and agreements will be implemented in practice, she pointed out in an interview with InDepthNews.
The revival of Russian-African relations has to be enhanced in all fields. Obstacles to the broadening of Russian-Africa relations have to be addressed more vigorously. These include, in particular, the lack of knowledge or information in Russia about the situation in Africa, and vice versa, suggested Arkhangelskaya, adding the last Sochi summit has significantly rollout ways to increase the effectiveness of cooperation between Russia and Africa.
Ahead of the upcoming second Russia-Africa summit, the Coordination Council was established under the aegis of the Secretariat of the Russia-Africa Partnership Forum (RAPF), which is overseeing the organizational and practical preparations of future summits, has held its third meeting in the format of a videoconference. During the meeting, participants discussed preparations for the forthcoming second Russia-Africa summit, its concept, targets and a list of events.
The Council members deliberated the status of preparatory works and plans for the near future and significant issues necessary for enhancing the entire relations between Russia and Africa. They also discussed mechanisms to improve existing and planned projects as well as developing road maps for cooperation. The meeting approved the draft concept as well as the organizational and financial scheme for the second Russia-Africa summit.
Vsevolod Tkachenko, the Director of the Africa Department of the Russian Foreign Ministry, stated that “African partners expect concrete deeds, maximum substantive ideas and useful proposals.” The current task is to demonstrate results and highlight achievements to the African side. Over the past years, African countries have witnessed many bilateral agreements, memoranda of understanding and pledges.
Since the basis of the summit remains the economic interaction between Russia and Africa, “the ideas currently being worked out on new possible instruments to encourage Russian exports to Africa, Russian investments to the continent, such as a fund to support direct investment in Africa, all these deserve special attention,” Tkachenko says.
According to Oleg Ozerov, Head of the Secretariat of the Russia-Africa Partnership Forum (RAPF), African partners emphasize the importance of Russia’s participation in agriculture, major infrastructure development projects, energy development, mining and digitalization.
Early June 2021, a Russia-Africa dialogue aimed at business networking and intensifying policy discussions were also held on the sidelines of the St. Petersburg International Economic Forum (SPIEF). Discussions centred on identifying pathways, the necessary groundworks for addressing Russia’s weak economic presence in Africa.
Participants called for effective steps to support Russian business in Africa. Russian companies are known to be keen on exploring opportunities in Africa, but very slow in implementing agreements and, as a result, has few concrete results.
Alexander Saltanov, former Deputy Foreign Affairs Minister and now Chairman of the Association of Economic Cooperation with African States (AECAS) acknowledged that African countries no longer know as much about Russia as they did about its predecessor, Soviet Union.
Notwithstanding the setbacks down these years, Saltanov is currently working on a common information space project between Russia and Africa scheduled for October.
When talking about bilateral ties, the most common complaints are inadequate to support systems – both from the state and financial institutions.
Russian NGOs are also pushing for a diverse set of initiatives aimed at enhancing ties. The Coordination Committee for Economic Cooperation with African countries, a business and policy NGO, established as far back as 2009, proposes that funds be availed to support Russian business and investment in Africa.
Senator Igor Morozov, Member of the Committee for Economy Policy of the Federation Council (Senate) and Chairman of the Coordination Committee on Economic Cooperation with Africa observes that conditions that are opening up for Russian business today are not the same as those for businessmen from France, the European Union, India or China. Senator Morozov has therefore called for improving Russia’s competitive edge and taking advantage of the African Continental Free Trade Area (AfCFTA).
The search for effective financing of projects and business is still ongoing, according to official reports. “There is a lot of demanding work ahead, and perhaps, there is a need to pay attention to the experience of China, which provides its enterprises with state guarantees and subsidies, thus ensuring the ability of companies to work on a systematic and long-term basis,” Foreign Minister Sergey Lavrov said during a meeting of the Ministry’s Collegium.
In addition, Lavrov further suggested taking a chapter on the approach and methods adopted by China in Africa, and that was back in 2019. Russia could consider the Chinese model of financing various infrastructure and construction projects in Africa.
It was only in July 2021, that the Association of Economic Cooperation with the African States (AECAS) held the first meeting of the working group to discuss ways for adopting a suitable mechanism of financial support for Russian business and projects in Africa.
That meeting was a marketplace of tremendous ideas. Business leaders discussed the lack of credit lines and guarantees as barriers, and the next problem relates to poor knowledge of the business environment as it poses a challenge. On the other hand, Russian businesses are unprepared to invest in R&D a first preliminary step towards economic engagement with Africa.
Nikita Gusakov, Head of the Russian Export Credit and Investment Insurance Agency (EXIAR), reiterated that Africa was a priority for the agency, outlining a number of deals that EXIAR has been involved in on the continent.
“We have the desire and the capacity to finance projects in Africa. In our experience, there are two problems that need to be addressed: the low level of project planning by Russian companies wishing to enter the African market, and the lack of awareness among Russian companies of the opportunities available on the African market,” Gusakov told the special meeting on project finance held in July.
The 2019 Sochi summit was held under the theme ‘Russia and Africa: Uncovering the Potential for Cooperation and was co-chaired by President of the Russian Federation Vladimir Putin and President of the Arab Republic of Egypt Abdel Fattah Al-Sisi. During the past two decades, a number of foreign countries notably China, the United States, the European Union, India, France, Turkey, Japan, and South Korea have held such gatherings in that format with Africa.
AfDB, Sovereign Investors to Develop Climate Resilient Projects
By Adedapo Adesanya
The African Development Bank (AfDB), Africa50 and Africa Sovereign Investors Forum (ASIF) have signed a letter of intent to collaborate on developing green and climate resilient infrastructure projects across Africa.
The three entities will work together to galvanize financing and drive the development of skills and expertise within the infrastructure sector.
The signing took place on June 20, 2022, in Rabat, Morocco, during an event to launch the Africa Sovereign Investors Forum.
Under the high patronage of His Majesty King Mohammed VI of the Kingdom of Morocco, 10 African sovereign investors including Nigeria, agreed to set up the Forum.
The newly formed platform will accelerate coordination to mobilize patient capital for the continent’s development.
The signatories are Agaciro Development Fund of Rwanda, Fonds Souverain de Djibouti, Fonds Gabonais d’Investissements Stratégiques (FGIS), Fonds Souverain d’Investissements Stratégiques (FONSIS) of Senegal, Fundo Soberano de Angola (FSDEA), Ghana Infrastructure Investment Fund, (GIIF), Ithmar Capital (Morocco), Nigeria Sovereign Investment Authority (NSIA) and The Sovereign Fund of Egypt (TSFE).
Africa50 CEO, Mr Alain Ebobissé signed for his organization, African Development Bank Vice-President for Private Sector, Infrastructure and Industrialization, Mr Solomon Quaynor, signed on behalf of the Bank, and Ithmar Capital CEO, Mr Obaid Amrane, who will serve as the inaugural chair of ASIF, signed on the new initiative’s behalf.
Me Ebobissé said: “this is an important step to building strong collaboration between the right stakeholders to meet the substantial infrastructure financing needs of Africa. We must make key regional infrastructure projects attractive and bankable for both global and African private investors and today’s signing will go a long way to address the continent’s infrastructure deficit.
“It is therefore important that we leverage the strength of the African sovereign wealth funds on the continent, who manage significant domestic savings, to drive the growth of Africa’s economies through the development and successful implementation of strategic infrastructure”.
On his part, Mr Quaynor said: “The African Development Bank’s partnership with ASIF and Africa50 would enable stronger collaborations on project development and co-financing, mobilization of capital to fund resilient, green and sustainable infrastructure and identification of investment opportunities to promote Africa’s infrastructure and industrialization.
“This is a key part of the Bank’s strategy to harness the estimated $2 trillion of assets under management from African institutional investors including sovereign wealth funds, pension funds and insurance companies for the continent’s infrastructure and industrialization,” he said.
Mr Amrane said “ASIF main objective is to accelerate the development of investment opportunities and to mobilize patient capital. As sovereign investors, we see strong complementarities with African Development Bank and Africa50, especially since our visions are aligned with regard to project preparation and capital mobilization.
“We are pleased today to formalize ASIF, AfDB and Africa50’s mutual desire to collaborate together, for we have a common objective to foster investment in climate-resilient projects, among others, according to our respective mandate.”
The collaboration agreement will also seek to address the identification and preparation of projects, a critical success factor in attracting financing to any project.
The Era of Unipolar World Order Has Ended—Putin Tells US, Others
By Kestér Kenn Klomegâh
At the plenary session of the 25th year of the St. Petersburg International Economic Forum (SPIEF), Russia’s President, Vladimir Putin, lambasted the United States and its Western and European allies, wholeheartedly predicted the end of the unipolar system and bristled at the idea of creating a new global order that might ensure equality and drastically change living standards of impoverished millions around the world.
Putin believes that the United States sees itself as a “messenger of God on Earth”, who has interests but no responsibility. “The United States is ostensibly unaware that over the past decades, new powerful centres have emerged around the globe and their voice is heard ever louder. Each of them is developing its own political system and public institutions and implements its own model of economic growth and, of course, has the right to protect them and to ensure national sovereignty,” Putin stressed.
While emphasizing the problems currently faced by the world’s economy at large, unfair competition among states, trade and financial wars, sanctions, restrictions, and so on, he asserted that the era of the unipolar world order has ended. The United States for the sake of ambitions and in the name of preserving outdated geopolitical illusions really don’t understand that the world based on such dogmas is definitely unsustainable.
In his opinion, “we are witnessing objective processes and truly revolutionary tectonic changes,” in the world. “After claiming victory in the Cold War, the United States declared it was the messenger of God on Earth, who has no obligations, but only interests – and these interests are sacrosanct,” Putin said. A world order based on the dogmas of unipolarity is unstable. Western elites are largely “clinging to ghosts of the past,” thinking that Western dominance is “an unchangeable and everlasting thing. Nothing lasts forever.”
New world order is still emerging but it’s clear that its rules will be created by those “who aren’t moving along a path set out by others.” “Only strong and sovereign states can have a say in this emerging world order or they will have to become or remain colonies with no rights,” Putin noted.
He further described as “thoughtless” and “insane” unprecedented sanctions imposed on Russia by a number of Western countries. “The idea was clear: crush the Russian economy violently, in a swoop, and deal a blow to industries, finance and living standards of people by destroying business chains, forcibly pulling Western companies out of the Russian market and freezing domestic assets,” he said.
Putin highlighted six principles constituting the basis for the development of the national economy during the forum. These are openness, reliance on freedoms of entrepreneurship, balanced macroeconomic policy, social justice, advanced development of infrastructure and achievement of technological sovereignty.
State sovereignty cannot be partial or fragmentary in the 21st century, all of its elements have equal importance. They reinforce and complement each other. That is why it is important not only to defend the political sovereignty and national identity but also to strengthen everything that ensures the country’s economic independence, its self-sustainability and independence in the matters of finances, workforce and technology,” Putin explained.
The president said that Russia changed in recent years through a planned effort to create a sustainable macroeconomic structure, ensure food security, enable import substitution and establish its own payment system.
Nevertheless, the sanctions have brought about “numerous difficult tasks” that Russia has to solve, he continued. “On the other hand, this situation creates new opportunities for us. We are saying this quite often, but this is really so. All of this will be an incentive to build an economy whose technological, production, workforce and scientific independence and potential is full rather than partial,” Putin said.
In a clear and concise but tense language, he expressed optimism that Russia would become stronger than before, taking advantage of emerging opportunities and new initiatives to build a better economy. With Russia under wide sanctions after sending troops into Ukraine, Putin spoke at length acknowledging the economic difficulties Russia faces as it tries to promote itself to international businesses, and the evolutionary processes in the new global configuration.
Chinese President Xi Jinping and Egyptian President Abdel Fattah el-Sisi, by video link, took part in a plenary meeting together with Russian President Vladimir Putin and Kazakh President Kassym-Jomart Tokayev. The forum brought representatives from Latin America, Africa and mostly Asia. There were a number of international organizations as well as representatives from more than 90 countries, compared to 140 countries during the pre-corona pandemic years.
Under the chosen theme ‘New Opportunities in a New World’ that reflects the changing global situations, the conference from June 15 to June 18 marked the 25th year of the St. Petersburg International Economic Forum (SPIEF) since its establishment. Over the last 24 years, the forum has become a leading global platform for members of the business community to meet and discuss the key economic issues facing Russia, emerging markets, and the world as a whole. Since 2006, has been held under the auspices of the President of the Russian Federation.
43% of Africa’s Population Lack Access to Electricity—IEA
By Adedapo Adesanya
The International Energy Agency (IEA) has said that $25 billion in annual investments could bring full access to electricity to Africa by 2030.
This is as the number of Africans with access to electricity fell during the COVID-19 pandemic, the Paris-based agency said Monday.
The IEA said 600 million people, or 43 per cent of the continent’s population, lack access to electricity — mostly in sub-Saharan Africa.
The number of people living without electricity increased by four per cent, or 25 million people, between 2019 and 2021, after a decade of progress.
According to IEA chief, Mr Fatih Birol, speaking ahead of the release of the agency’s African Energy Outlook 2022.
He said before COVID, there had been “lots of good developments in countries such as Ghana, Kenya, Rwanda.
“But because of Covid and the economic difficulties, we see that this positive trend is reversing now,” Mr Birol said.
It was also revealed that Russia’s invasion of Ukraine has added to the economic strains on Africa from the COVID pandemic, as the conflict has sent the prices of energy, food and other commodities soaring.
“When I look at 2022, with the high energy prices and the economic burden on the African countries, I don’t see many reasons to be hopeful,” Mr Birol said.
But Africa could get universal access to electricity by the end of the decade with $25 billion in annual investment, according to the IEA.
Countries need to give international financial institutions, especially development banks, a “strong mandate” to make Africa and clean energy on the continent “an absolute priority”, Mr Birol said.
“It’s not the case now,” he added.
Africa is facing more severe effects from climate change than most other parts of the world, despite emitting less energy-related carbon dioxide (CO2) than any other region, the IEA said.
“We have to see a huge amount of investment coming in Africa in all parts of the energy system, but the most important one will be clean energy options,” Mr Birol added.
“We would need to double the energy investments to reach our energy and climate goals.”
Renewables — including solar, wind, hydropower and geothermal — could account for over 80 per cent of new power generation capacity in Africa by 2030, the IEA report said.
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