What Just Happened Africa?

Last week the President of the United States embarked on what some media appointed Africa analysts called an, or is it a historical, visit to our beloved Africa. This is not to say that since his appointment President Obama has not been to our fair, sometimes scary continent, according to the dominant (read Western) press, he has, but those were whistle stops between Europe and the Middle East so we’ll pretend they don’t count. No-one, well not that I’ve noticed, even seems to remember that he spoke in front of that ex-leader Hosni Mubarak’s parliament during his first term but then again, it is generally understood in these parts that to say you are in Africa only counts if you are south of the Sahara no?

Never having been north of the Malawian border-post closest to Zimbabwe I ask you to forgive my possible southern African bias in my analysis.

Last Friday I waited eagerly for the first tweet on my timeline announcing the arrival of Air Force One at the, ummm, now shall we say well known Waterkloof Air Force Base which I’ve been told is north of South Africa’s capital Pretoria. Somehow I got distracted and woke up on Saturday morning to nothing but second by second updates of the movements of America’s first family, most of them dubious. Despite my wife’s best intentions we found ourselves watching President Obama speak at the University of Johannesburg to the youth of Africa. I’ll admit I’ve been a fan of President Obama since he was first nominated as the democratic candidate in 2008 simply because of how much he achieved in such a short period of time since entering American politics but that’s a story for another blog. 

On Saturday afternoon I tuned in curious to hear what he had to say but somewhat expecting to hear the now usual lecture to Africa of how we can and should do for ourselves if we just get ourselves together. I ‘ll admit, it’s been a while since I was so wrong. President Obama spoke to so many things I relate to regarding the development of Africa that I started wondering if the NSA hadn’t passed on my tweets and Facebook posts to POTUS. Most notably:

1. Africa needs to start trading with Africa.

2. Africans need to seriously consider all investment proposals from all comers including and especially from the United States.

3. Africa needs electricity.

Since Saturday afternoon, southern African time, much has been said about President Obama’s speech, depressingly, mostly negative. Much of it has centred around how the US is late to the table and China has effectively locked up the best deals and made good on it’s promises. To an extent this has some bearing. Earlier this year China held it’s fifth China-Africa summit, President Obama announced the US’s first equivalent summit will happen next year in Washington and he is yet to send out invitations to our beloved leaders. However, what has gotten the most attention has been the $7 Billion Africa energy fund which is actually a $16 Billion fund after you throw in the $9 Billion private sector commitment already secured. This initiative is expected to double sub-Saharan Africa’s energy capacity over the next seven years. Considering that it takes South Africa, Africa’s most developed economy, about seven years to build a 4800 megawatt (MW) coal fired power plant, this is a very, very big deal. 

The skeptics and China fans were quick to write countless reams about why this won’t work. They talk of the timing of this initiative, saying President Obama is hoping to secure his legacy with one last big African deal like his two predecessors. I have a different perspective.

What if, just work with me here, the Obama administration has intentionally waited things out regarding Africa, watching the Chinese do what they do? Lest we forget, the Americans invented economic modelling, who in their right mind can assume that they missed the African renaissance? It’s simply not plausible. Consider first America’s experiences in Africa during the Clinton and Bush years, being run out of Somalia, the failure to act on the Rwanda genocide, the Kenya and Tanzania US embassy bombings. it only makes sense for them to have taken the time to seriously look at their relations with Africa and come up up with an economic plan they could pitch as mutually beneficial and I believe this is it. 

On Saturday afternoon President Obama spoke of how the US is willing to help make trade within the continent easier, he said something like, “why is it easier for Uganda to export to Europe than it is to transport those same goods to somewhere else in Africa?”. I’ve been asking the same of Southern African states for years. Whilst not much more was said on this I believe if the US pitches this properly, China will quickly become just another suitor to Africa’s development.

Think about it, by some estimates it is possible that Africa may already have more people than the Indian sub-Continent or even China, the world’s second biggest economy. One simply has to go into the wonderful world of Google to find that the United Nations projects that whilst developed regions’ populations are in decline, Africa’s population will double within the next 37 years making it the most populous single land mass in addition to having the highest known and estimated concentrations of yet to be exploited on or off-shore minerals, oil and gas. Managed properly, these resources could guarantee that Africa becomes one of the world’s leading economies within the next 30 years or less. If I am able to collate this from freely accessible news feeds and a keen interest in the continent, what more the most equipped government in the world?

I’m inclined to believe that whilst China has been espousing its policy of investment without sovereign interference, the US have been developing their “partnership with Africa” policy which they are now launching. This comes only a few months after BRICS nations announced their intention to create a development bank focused on Africa which will go live in five years. Unfortunately the President of the continent’s leading financial institution, the African Development Bank, Donald Kaberuka, has questioned the establishment of a BRICS bank whilst underfunded African financial institutions exist. On multiple occasions this year, Mr. Kaberuka has challenged African governments to fund the AfDB and focus on the continent’s infrastructure needs but this has only received lip service to the best of my knowledge, possibly a gap the US has identified.

In the meantime the Brits are not sitting still either. Just a few days ago, Afua Hirsch, the west Africa correspondent for a British paper, The Guardian, wrote about how the British government is considering establishing a development bank so as to better allocate resources to developing countries in the form of repayable loans rather than the current development aid model which has had, at best mixed results. This is supposed to relieve the British taxpayer but lets face it, loans come with interest and interest means profit for the lender so in a time of waning developed economies, anything that looks like it can make a buck is probably worth a look. Despite the fact that I have never been a fan of BRICS for Africa, even a devoted advocate will acknowledge that by the time their bank launches the world, especially Africa, will be a highly competitive place. Whoever is President of South Africa by then may have some tough questions to answer.

With all this attention on Africa, I’m willing to put my money on the US having a master-plan that will ensure that China remains, at best, the world’s second biggest economy and a BRICS bank nice dinner conversation for diplomats . Somebody poked the bear and the bear is putting EVERYBODY on notice. 

 

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