Eurasia Review -2 May 2022
Russia’s meandering return path to investing in Africa – OpEd
The United States, European Union and their Pacific allies’ sanctions are truely fast-driving Russia towards Africa. As the sanctions bite, Russia continues stepping up to realign with Africa, steadily stemming its policy with mountainous pledges of helping with sustainable development, increase trade through economic cooperation and strengthen relations. In addition, the sanctions have created the conditions for Russia to push its anti-Western and neo-colonialism agenda, reminiscent of the Cold War during the Soviet days. But such steps must necessarily and discernibly be implemented with renewed determination and decisiveness.
Late April, Russian Presidential Special Representative for Middle East and Africa, and Deputy Foreign Affairs Minister Mikhail Bogdanov explicitly explained in an interview to Interfax News Agency that Africa has always been an important region from the point of view of foreign policy for Russia. As oftentimes, he traced and renarrated, especially from 1950s and 1960s, the historical role the Soviet played in support for African peoples in attaining their statehood and political independence, the fight against colonial rule.
“After the collapse of the Soviet Union, many other problems emerged and pushed cooperation with Africa into the background. Regrettably, much has been lost over this period,” he told the media, and frankly admitted further that Western and European countries, China, Turkey, and India et cetera, have filled the vacuum that emerged after the ‘retreat’ from Africa.
According to Bogdanov, Africa is beyond any doubt a continent of the future, both from the point of view of human resources and because it is a storeroom of the world, one of the richest regions. But another issue is that colonial powers, as well as neocolonialists, have never let the Africans take advantage of the treasure which is literally right under their feet.
These past years, Russian diplomats have played the song of “neo-colonialism” and its negative effects on Africa, this song aims at winning the sympathy of African leaders. It has meanwhile embarked on fighting “neo-colonialism” which it considers as a stumbling stone on its way to regain part of its Soviet-era influence in Africa. Russia has sought to convince Africans over the past years of the likely dangers of neocolonial tendencies perpetrated by the former colonial masters and the scramble for resources on the continent.
Russian diplomats might have read Jamiacan Walter Rodney’s book “How Europe Underdevloped Africa” – as they similarly and consistently blames Western and Europeans for political, economic and social bottlenecks in Africa. Russia has expressed uttermost disatisfaction about Western and European engagement with Africa. All kinds of Soviet assistance rendered until many African states got the independece be simply considered as history.
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 remain focused its efforts with strategies. On the other side, Russia uses the rhetoric of anti-colonialism in its engagement with Africa, and that it is fighting neo-colonialism from the West, especially in relations with their former colonies. It sees France as a threat to its interests especially in Francophone West Africa, the Maghreb and the Sahel.
“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 mere intentions and ideas have been officially presented as initiatives already in progress. There needs to be a lot of tangible progress on the ground for the second summit to show impact. It will be interesting to see what has been concretely achieved in reports at the second Russia-Africa summit scheduled for this 2022,” he distinctively argued.
Steven Gruzd heads the Russia-Africa Research Programme initiated 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.
From Russian and African experts’ point of view, Africa’s most valuable asset is not only its natural resources, but its people, especially the youth. The population of the continent has already passed the 1.3 billion mark, with a median age of about 20. Around 60% of the population are young people under the age of 25. With digital technology, these young Africans have the benefit of several alternative perspectives, and choose the approach they feel is closest to them. The young African generation between 25 and 45 years now have different perceptions and approaches toward issues relating to politics, economics and social questions.
Given these numbers, for instance, United States and European countries are investing in the youth. China trains about 10,000 yearly, ranging from short-term courses to long-term academic disciplines. During the days of Barak Obama, the White House created Young African Leaders Initiative (YALI). It brings 500 Africans to the White House in Washington and this YALI still runs various academic and training programmes for Africans. Before the Covid-19, The The Times Higher Education index indicated that approximately 43,000 Africans enrolled into American universities. There are many African universities and institutes with joint agreements running programes, including fellowships, together with Westerners and Europeans. That compared, Russia’s annual scholarship of about 1,800.
The young African generation (that constitutes the electorate) expect their leaders to deliver on sustainable development and initiatives that focus on employment creation. Political leaders, highly desirous to consolidate their positions, are searching for external partners who are ready to invest in energy, transport, industry, agriculture, health and other viable economic sectors. Therefore, in practical terms, all such warnings on the existing or emerging neo-colonialism could fall on deaf ears as African leaders choose development partners with funds to invest in the economy.
In terms of working with the African continent, Russian business leaders say the African continent remains so little known in Russia. The historic Russia–Africa Summit and Economic Forum held three years ago played a crucial role in addressing this, as did the 2018 FIFA World Cup. But many issues stipulated in the joint political declaration largely remain untouched on the shelves of the Kremlin and the Russian ministries, departments and agencies. And who cares about those official files? The newly created Russian African Public Forum Secretariat and the Association of Economic Cooperation with African States (AECAS). People who work within these structures hardly talk about the African Continental Free Trade Area (AfCFTA). They faintly know, if nothing at all, that AfCFTA could also serve as a platform to strengthen business ties between Russia and Africa.
Nevertheless, the African Continental Free Trade (AfCFTA) promises creating a single borderless market, it offers various opportunities for localization, production and marketing of consumables throughout Africa. This should perhaps, be the strongest dimension of Russia’s dealings in Africa.
Currently, Russians know and strongly value only state-to-state cooperation, completely ignored the private sectors and civil society in their diplomacy with Africa. While the public sector has a responsibility to create an enabling environment for businesses to thrive, the private sector, equally plays a key role in among others, enhancing trade and investment, expanding innovations and resource mobilization for investment in socio-economic projects. Increased investment is a prerequisite for the realization of the UN Development Goals 2030 and the African Union’s Agenda 2063.
Unsurprisingly, both Russian and African experts have expressed their concern about official visits proliferating both ways, with little impact on the sustainable development currently needed by the majority of African countries. While some see official visits simply as diplomatic tourism. But a number of the African leaders wonder how to turn Russia’s focus towards realizing the Sustainable Development Goals (SDGs).
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 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.
The United States, EU representatives, China, India, Turkey and even the Gulf States are, these days, looking at Africa from different perspectives, but more importantly pushing for their economic footprints on the continent. For instance, fresh from their previous EU-AU summit, both agreed on several infrastructure and investment projects. EU is committing approx. €300 billion ($340 billion) for financing new investment initiatives – similar to China’s Belt and Road initiative – an investment programme the bloc claims would create links, not dependencies.
U.S. investment amounts to billions of dollars. At the 13th US-Africa Business Summit, organized by the Corporate Council on Africa (CCA), a leading reputable American business association, the American investors indicated that there are ways the continent can benefit from them, including in sectors like pharmaceuticals, automobiles, agro-processing and financial technology. On the other hand, American investors are looking forward to exploring several opportunities in the African Continental Free Trade Area (AfCFTA), a policy signed by African countries to make the continent a single market.
The United States is pursuing agreements that go beyond African Growth and Opportunities Act (AGOA). It will be pursuing public-private partnerships that support the US and African businesses, including women-owned and led Small and Medium Enterprises. Special focus is also on youth business especially technology, while looking to build more stronger relationships with willing Africans through bilateral engagement. There were diverse panel discussions that emphasized the growing trend of digitalization of SMEs and African business operations.
During the separate discussions with more than 20 former African ambassadors who served in the Russian Federation, they have abundantly made it clear how to stimulate African governments to explore best investment opportunities in Russia and woo Russian investors into developing Africa’s SDGs within a framework of bilateral cooperation.
Former South African Ambassador, Mandisi Mpahlwa, said that Sub-Saharan Africa has understandably been low on post-Soviet Russia’s list of priorities, given that Russia is not as dependent on Africa’s natural resources as most other major economies. The reason: Soviet and African relations, anchored as they were on the fight to push back the frontiers of colonialism, did not necessarily translate into trade, investment and economic ties, which would have continued seamlessly with post-Soviet Russia.
“Of course, Russia’s objective of taking the bilateral relationship with Africa to the next level cannot be realized without close partnership with the private sector. Africa and Russia are close politically, but they are geographically distant, and the people-to-people ties are still rather under-developed. This translates into a low level of knowledge on both sides of what the other has to offer. There is perhaps also a measure of fear of the unknown or the unfamiliar in both countries,” according to Mpahlawa.
On April 29, Russian International Affairs Council (RIAC), Russian NGO that focuses on foreign policy, held an online conference with participation of experts on Africa. Chairing the online discussion, Professor Igor Ivanov, former Foreign Affairs Minister and now RIAC President, made an opening speech, pointed 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.
On the development of cooperation between Russia and African countries, Professor Igor Ivanov pointed out a few steps here: “Russia’s task is to prevent a rollback in relations with African countries. It is necessary to use the momentum set by the first Russia-Africa Summit. First of all, it is necessary for Russia to define explicitly its priorities: why are we returning to Africa? Just to make money, strengthen our international presence, help African countries or to participate in the formation of the new world order together with the African countries? Some general statements of a fundamental nature were made at the first Summit, now it is necessary to move from general statements to specificity.”
In this context, Russia needs to face the new geopolitical realities and its challenges. Whether one likes it or not, Africa has become an arena for competition between various global powers. As Chinese President Xi Jinping emphasized at the Boao Forum, “We have to uphold the principle of indivisible positions on the global stage, continue building a balanced, effective and external sustainable economic architecture around the world.”
Foreign Minister Sergey Lavrov and AUC Chairperson, Chad’s Moussa Faki Mahamat have also been discussing the ways and means of encouraging Russian corporations’ participation in major infrastructure projects on the continent and expecially in Africa’s Fourth Industrial Revolution. Lavrov has many times assured that Moscow firmly supports the principle of “African solutions to African problems” within a framework of achieving the Sustainable Development Goals (SDGs) as developed by individual African countries, sub-regional organizations and the African Union.
Most importantly, given the sanctions imposed on Russia by the collective West, it would be necessary to substantially adapt mechanisms of cooperation to suit these new realities, primarily in the bilateral and multilateral relations. Lavrov, in one of his speeches posted to the official website, has noted frankly in remarks: “it is evident that the significant potential of our economic cooperation is far from being exhausted and much remains to be done so that Russian and African partners know more about each other’s capacities and needs. We still have to create conditions necessary for interaction between Russia and Africa.”
Now at the crossroad, it could be meadering and longer than expected to make the mark. Russia’s return journey could take another generation to reach destination Africa. With the current geo-political changing 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, Russia has come under a raft of sanctions imposed by the United States and Canada, European Union, Japan, Australia, New Zealand and a host of other countries.