New Scramble For Africa

US Secretary of State Hillary Rodham Clinton, (right), purchases a shirt, at the Heal Africa clinic in Goma, DR Congo.

Former President Bill Clinton’s March 1998 trip to Ghana, Uganda, Rwanda, South Africa, Botswana, and Senegal was the most extensive tour of the continent by a sitting U.S. President and the first substantial visit since former President Jimmy Carter’s trip to Africa.

Ten years later, President George Bush, in his last term in office, took a similar trip to Africa in February 2008. The trip took him to Ghana, Liberia, Rwanda and Tanzania.

The former President has been described in certain circles as a lame-duck President, who cannot visit real global players, so the visit to Africa was an effort to shore up the credentials of the neo- liberal forces in Africa, while promoting the conservative ideas of abstinence as the basis of the fight against the HIV AIDS pandemic.

But before the visit to Africa, former President Bush had announced that the Defence Department would create a new Africa Command to coordinate U.S. government interests African. This sent cold shivers in and outside Africa.

Under this plan, all government agencies of the US will fall under the military-USAID, State Department, US Department of Energy, Treasury, and Department of Education among others.

Be it as it may, George Bush visited Africa and as usual, he was accorded all the necessary red carpet treatment.

President Barack Obama, within six months of his reign as the 44th President of the United States, has made two important trips to Africa, first to Egypt and then to Ghana.

More importantly, the third most important person in the United States, the Secretary of State, Hillary Clinton followed the African tour of her boss to seven other African countries. Her trip took her to Kenya, South Africa, Angola, Democratic Republic of Congo, Nigeria, Liberia and Cape Verde.

In all the seven countries that Hillary Clinton visited, she stated in no uncertain terms how the Obama's administration was committed to making Africa a priority in US foreign policy.

She underlined America's commitment to partner with governments, the private sector, non-governmental organisations, and private citizens to build societies where each individual can realise their potential.

This, in fact, is the earliest in any US administration that both its President and Secretary of State have visited Africa.

Before some of these trips, other world leaders had made one trip or another to Africa.

In June this year, Russian President Dmitry Medvedev flew into Egypt, Namibia, Angola and Nigeria, the last two being Africa's biggest oil producers to underscore Moscow's intentions not to be left out.

Again in February this year, Chinese President Hu Jintao was in Mali, Senegal, Tanzania and Mauritius to shore up interest in Africa. Though these visits were more political in content, Africa should be in a position to derive some level of economic benefits from them.

Now India and Brazil are equally creeping into the Africa market in a very big way, even though Africa and India, for example, have long been trading patners.

The President of the World Bank, Robert Zoellick, has also made a three-nation tour to Africa to see for himself the damage inflicted on the region from the global financial crisis and the recession. The tour took him to three countries, namely.

The Democratic Republic of Congo, Rwanda and Uganda. The focus of his visit was to encourage businesses and donors to invest in Africa, as the global crisis seems to be easing in industrialised economies but still being felt in most of the developing world.

Trade relations

All these visits one way or another have one purpose -- economic reasons -- to shore up markets for their imports and exports as none wants to be left behind.

US officials are keen to trumpet a 28-per cent jump in 2008 in trade with sub-Saharan Africa to $104 billion, even if the increase is attributable mainly to the high price of oil, which accounts for more than 80 per cent of US imports from Africa.

However, there another statistics that say more about the direction of development on the poorest continent. This decade's tenfold increase in trade with China to $107 billion last year, narrowly eclipsing the United States.

Chinese companies have equally pushed deep into African mineral zone, with Zonghui Mining Group signing a $3.6 billion copper agreement with Zambia. Industrial and Commercial Bank of China (ICBC) is also working on up to 60 deals with Africa's biggest bank by assets, Standard Bank, in which it bought a 20-per cent stake for $5.6 billion in 2008.

The $23-billion bid by mobile phone firm Bharti Airtel of India to tie up with South Africa's MTN Group, Africa's biggest operator by subscribers, is the latest and biggest example of an Indian company on the prowl in the region.

Brazil is also making its presence felt, with offers of technology and know-how to boost food and biofuels production in Africa, where only a fraction of potential arable land is under cultivation.

Development assistance

In recent years, some African countries including Ethiopia, South Africa, Rwanda, Uganda, Mozambique, and Ghana, have become the top recipients of US aid to sub-Saharan Africa. While food aid and humanitarian assistance have fluctuated in response to specific needs, development assistance to the region equally declined steadily from $826 million in 1991 to a low of $541 million in 1996 before recovering slightly to $688 million in 1997.

To step up trade and investment in Africa, the US government passed the African Growth and Opportunity Act (AGOA) to expand African access to U.S. markets by extending, for a 10-year period, import tariff concessions under the Generalised System of Preferences (GSP) and by eliminating US import quotas on textiles and apparel manufactured in sub-Saharan Africa.

The US also established a $150-million equity fund and a $500 million infrastructure fund under the Overseas Private Investment Corporation (OPIC) to finance US private investment in sub-Saharan Africa; initiate planning for the creation of one or more US free trade zones in Africa; and created a US-Africa economic forum where officials from participating countries would meet annually to discuss economic matters of mutual concern.

Yet, trade between US and Africa has not been in favour of Africa. Last year, the 48 countries of SSA represented only 1.2 per cent of the $95 billion US apparel import market. Bangladesh alone captured 3.8 per cent, more than three times the trade of AGOA’s African beneficiary countries combined.

This tells you that Africa has not taken advantage of the AGOA to improve upon its textiles and garment industry.

Going down to memory lane, the last half-century has seen the developed world givening more than $2.3 trillion in official development assistance to the developing world.

According to the July edition, African Business during the same period, received $813 billion and between 1960 and 2003, the total amount of development assistance that came to Africa stood at $600 billion in financial and technical aid, but the continent still remains the poorest part on the planet.

The magazine further stated that empirical research showed that there was no link between financial aid and economic growth.For example, despite all the aid flows, from 1975 to 2000, per capita income in sub-Saharan Africa had fallen at an average annual rate of 0.6 per cent.

African countries lost ground in the 1990s despite receiving aid equivalent to an average of 12 per cent of their gross domestic product.

In fact, achieving economic development through exports and foreign investment in Africa is very much problematic where infrastructure and social services have deteriorated.

For two decades, falling commodity prices for most African agricultural and mineral exports have forced Africans to export twice as much to earn the same revenue.

Although the private sector can contribute to economic growth, market liberalisation has not done enough to reduce poverty, neither has it helped to promote development of local industries.

To achieve long-term success, trade and investment programmes must stimulate local investment, manufacturing, and the processing of export commodities, as well as encourage the development of regional production and marketing networks.

The visits of these world economic leaders must be translated into positive economic benefits. But the issue is what sought of issues do African leaders put on the table when these august visitors come down to Africa.

The visits of Carter, Clinton, Bush, Zoellick, Hu Jintao and Obama should not end up with long talks and promises, breakfast meetings and visit to historical sites.

There must be deliveries that will generate important initiatives in the area of poverty reduction, investment in education, job creation, healthcare, food production, and debt eradication among others.

As the scramble goes on, African countries must wake up and put their houses in order so that these high profile visits can be meaningful and beneficial to all Africans.

The continent is viewed from international circles as a den of corruption, conflict, famine and bad governance. Until these negative perceptions are eradicated, the continent will continue to suffer as these perceptions undermine the entrepreneurial spirit of the Africans and discourage any efforts by the global financial community and investors to Africa.

As President Obama stated, it is only Africans who can unlock the potential of the continent, it is not the Americans, the Chinese, the Russians or the Asians.

Article : Lloyd Evans