Since the beginning of the 21st century, the race for raw materials has spawned increased interest in African countries by global actors. They want unfettered access to Africa’s natural resources. To them, this objective requires forging bilateral ties. At the same time, the African Union (AU) is slowly but resolutely moving in a different direction: industrialization through regional value chains, which is what Agenda 2063 is all about. It is the master plan designed to turn Africa into a global player. Beset with severe challenges, including lack of support from African countries, the AU struggles to impose this vision on the world.
Africa needs Agenda 2063. Here are some of the hurdles that it faces:
- First, it does not meet global powers’ needs. What global powers want from Africa are raw materials, some of which are listed as critical. Agenda 2063 wants to significantly reduce Africa’s reliance on primary goods.
- Second hurdle is national sovereignty. There’s an inverse relationship between the strength of national sovereignty and the speed at which regional integration progresses. Implementing Agenda 2063 requires diminishing state sovereignty, a resource vital to African heads of state. Most will not go along with that.
- Third, the African Union is in urgent need of reform. Lacking support from its own members, the AU cannot operate without aid from external donors, who do not consider Agenda 2063 a priority.
The African Union is the only regional organization thattraces its origins to a political ideology : Pan-Africanism, which unites all people of African descent. The AU embodies that African identity. The paradox is that although Pan-Africanism calls for economic cooperation and the unification of markets on the continent, Africa is the region of the world where trade between countries is the least dynamic. Last year, a United Nations report estimated that commodities “account for more than 60 % of total merchandise exports in 45 of the 54 countries of Africa”. These commodities are shipped outside of the continent for processing.
Since the beginning of the 21st century, the race for raw materials has spawned increased interest in African countries by global actors. They want unfettered access to Africa’s natural resources. To them, this objective requires forging bilateral ties. At the same time, the African Union (AU) is slowly but resolutely moving in a different direction: industrialization through regional value chains, which is what Agenda 2063 is all about. It is the master plan designed to turn Africa into a global player. Beset with severe challenges, including lack of support from African countries, the AU struggles to impose this vision on the world
In 2015, in an effort to reverse this situation, the AU approved Agenda 2063, The Africa We Want, the continent’s blueprint for sustainable development. Of its twenty priority goals, one is the ambitious African Continental Free-Trade Area (AfCFTA) expected to broaden and deepen economic integration so as to allow African countries to trade more with one another.
A new scramble for Africa
In the meantime,however, headwinds have been picking up. The past twenty years have seen renewed interest inAfrica on the part of foreign powers, a phenomenon termed “new scramble for Africa”, some 140 years after the first European-led scramble. The scale of foreign engagement on the continent is unprecedented. According to The Economist, between 2010 and 2016 more than 320 foreign diplomatic missions were opened in Africa, a number higher than on any other continent. Turkey, for instance has 43, up from only 12 two decades ago. Perhaps even more significant are those large summits for African leaders hosted by the European Union, Russia, England, France, Turkey, China and the United States.
The new “scramblers” may have put on different clothes and adopted a new discourse, but the aims remain the same: increase access to Africa’s defense and consumer markets and control supplies of natural resources.
The rise ofmega-conferences and bilateral agreements indicates not only that advanced countries still see Africa as an essential supplier of raw materials, but that each one of them, the United States, Europe, China, Japan, Turkey or Russia, has adopted strategic action plans targeting the most likely suppliers of those commodities.
Participants inthese large gatherings include dozens of African leaders, in addition to AU representatives. This is where the confusion lies. Talks with fifty African heads of state clearly indicate a marked preference for bilateral rather than regional trade relations. Under misleading catchwords such as “Partnership of Equals” and “Win-Win Cooperation”, lurks the old “divide-and-rule” strategy.
Indeed, theAfrican beneficiaries of the Belt and Road Initiative, the Economic Partnership Agreements (EPA) or the African Growth and Opportunity Act, are not regional groupings but individual states, many with gross national products smaller than thoseof a single U.S. state. There is no doubt that the power differential is huge.
Academic studies show how EPAs, for example, rather than promote African sustainable development, actually weaken regional integration and industrialization prospects: firstly, agricultural exports to Europe often compete with subsidized European goods; secondly, by focusing on individual players, EPAs clearly undermine basic customs union rules, thus creating divisions among their members.
For instance, onDecember 8, 2020, to promote its flower industry, Kenya signed an EPA with England, whereby it would gradually lower tariffs onUK products. The deal forced Nairobi to ignore a key decision of the East African Community (EAC), of which Kenya is a member, to raise their common external tariff to 35%. The UK demanded that its exports be exempted from the new tax charges. Of course, the situation created tensions with the other EAC countries,with some observers accusing Nairobi of betrayal.
The new “scramblers” may have put on different clothes and adopted a new discourse, but the aims remain the same: increase access to Africa’s defense and consumer markets and control supplies of natural resources
Another example of bilateral agreements conflicting with African regional arrangements is the July 2022 U.S.-Kenya Strategic Trade and Investment Partnership (STIP), which Washington claims supports African regional economic integration. Among other things, the STIP promises to foster “innovative agricultural technologies that would help achieve food security goals, increase farm productivity, and improve farmer livelihoods, while addressing climate change concerns.” Three months after ratifying the partnership, Kenya took the controversial decision to approve importation and cultivation of genetically modified organisms (GMO), a policy which other EAC countries oppose. In response, Tanzania’s Agriculture minister voiced concern over Kenya’s move and announced that his country would “step up vigilance against the importation of genetically modified crops [from neighboring Kenya]”.
One of the obvious reasons why global powers are able to successfully engage with individual African leaders and access natural resources, is that those leaders are sovereign and in a position to use domestic resources as they please. Consequently, bilateral deals get signed not necessarily because weak states are being coerced but because both parties benefit. Indeed, as resources from the deal help increase their ability to redistribute the proceeds, African leaders consolidate their power. They will therefore want to strengthen national sovereignty rather than dilute the state into regional blocks. This is why the African countries, which Crawford Young labeled “patrimonial autocracy”, presentsuch a challenge for the AU.
Another reason why African countries sign bilateral deals with non-African countries is because processing minerals is often technically complex. However, a few countries announced their decision to process natural resources locally.
In February 2020, the president of Ghana, Nana Akufo-Addo, on a state visit to Switzerland, unexpectedly announced that his country would no longer export raw cocoa beans, but rather do the processing in-country. Ghana is the second largest producer of cocoa beans and Switzerland is a major chocolate manufacturer.
In April 2022, the Democratic Republic of the Congo (DRC) and Zambia signed an agreement whereby the two countries will jointly develop a supply chain in the electric battery and clean energy sectors. The DRC has considerable cobalt deposits while Zambia is one of the world’s largest copper producers .
Talks with fifty African heads of state clearly indicate a marked preference for bilateral rather than regional trade relations
In October 2022, the military in Guinea ordered foreign companies to build refineries and process Guinea’s bauxite ore locally before export. If they failed to comply, foreign mining companies would be penalized. The decision will not only increase benefits, but also create many jobs. The country has the largest reserves of bauxite.
Finally, earlier this year ,authorities in Namibia and Zimbabwe decided to ban export of unprocessed lithium. Harare claims to be able to meet one-fifth of the world’s needs.
An increasingly dependent African Union
Despite its desire to serve as an engine of economic growth, the AU is currently powerless . Indeed, fewer than 40% of all members actually pay their contributions.However, the organization is severely dependent on external donors for up to 75% of its operations. AU’s largest department, Peace and Security, receives most of its resources from the United Nations and the European Peace Facility.
The organization has taken steps towards financial autonomy. In July 2016, it adopted the “Kigali Decision on Financing the Union” which is a significant first step towards independence. Even if the results are, so far, disappointing. Indeed, only about 10% of the amount expected by the organization has actually been paid by the countries thatdefaulted on payments. This again raises the question of commitment on the part of the members.
An African Union sorely dependent on foreign donors for much of its operations may find it increasingly hard to assume the role of influential global player . Should the AU fail in its quest for autonomy, could it soon become irrelevant?
Crédit photo : aa.com