Africa speaks
World War 3? Africa’s opportunity
It has often been said that when elephants are fighting, the grass is the one that suffers the most. And this statement is highly applicable to Africa in the ongoing Russia-Ukraine conflict. Whereas the European countries are fighting a physical war, Africa’s fight against economic challenges such as poverty, unemployment, trade deficit and starvation is worsened by the conflict. Barely a fortnight into the conflict, global commodity prices have been on the rise and had adverse effects on import dependent countries. What lessons can African nations pick from the conflict and what low hanging opportunities can be explored?
Agricultural market
Both Russia and Ukraine are important players in agricultural production, supplying about 30 percent of the world wheat and barley. In 2020 alone, African countries imported agricultural products worth about $6.9 billion from the two countries. However, the conflict has caused a disruption in the global supply chain of agricultural products. Essentially drying up exports as evidenced by the supply ban imposed by Ukraine, resulting in higher prices and stockpiles reducing. The global citizen report estimates that over 500 million people would be forced into hunger because of the food crisis arising from the conflict. There is a supply gap created which will lead to importers to seek alternatives markets. And therein lies the opportunity for African countries to stand out as global suppliers of these agricultural products and fill the gap.
Historically, Africans are farmers who have survived on agricultural production mostly at a micro level. Africa is blessed with arable land and good climatic conditions that support the growth of various products but productivity has remained low over the years. To take advantage of this situation calls for deliberate efforts to direct resources into growing the agricultural products in large quantities and benefit from the sales. To boost productivity faster, farmers could be incentivised through the use of outgrower schemes. Which are systems that link networks of unorganized smallholder farmers with domestic and international buyers. The identified agricultural market requires that both farmers and countries expand their capacities by investing in equipment and modernisation for higher output. The after effects of the crisis are projected to last for extended periods of time but for those countries that will emerge as gap fillers stand to benefit for a long time.
Trade reorganisation
While it can be argued that globalisation and trade have been a key driver for growth and economic expansion for many nations, the gains have not been fairly distributed especially in Africa. Intra-Africa trade when compared to external trade accounts for a smaller percentage and hence the observed vulnerability of African trade to external factors. Imagine, while Africa is neither physically involved in the Russia-Ukraine conflict nor imposing any sanctions on these countries. The effects of these two factors in derailing economic progress is worse in most African countries. Oil is a key input in various sectors of economies and the affordability and access to it has an impact on economic growth.
The crude oil prices are daily breaking record prices and for the many oil importing countries especially in Africa are at the receiving end of the spillover effects. Such as high cost of doing business and rising inflation which is detrimental to their economies. It defeats economic logic that African countries import oil from outside the continent, spending huge funds on transportation despite having neighbouring oil producing countries. The oil producing African countries should consider prioritising African nations for their exports to ensure that the continent is oil secure and the economies are thriving. Where possible, a differentiated preferential price which should be lower than the global price should be considered to ensure affordability and support to African nations.
The implementation of the Africa Continental free trade area, which has been envisioned as a game changer in African trade, has stalled with frequent postponements to actualisation. The current European conflict should be viewed as a catalyst for trade reorganisation in Africa and ACFTA implementation. This is because the crisis has indeed created a gap in trade and there is no guarantee that African nations could be prioritised in importing from the European countries that also have pressing needs. Self-sustenance in intra-Africa trade should be the target because, decades after independence, Africans cannot forever be dependants. Who are vulnerable to external factors which do not directly concern them.
Strategizing opportunity
While the conflict has devastating effects on some countries, it actually creates an opportunity for others. The identification of the comparative advantage that nations have in either current production or potential production is what should preoccupy those not participating in the physical fight. The current capacity in most African countries to manufacture products may not be able to compete with developed countries that have advanced technology. But in terms of primary produce, African nations have huge unexploited potentials.
Each country should introspect, organise its people and resources in targeting the global market. This is a matter of expanding what is already being produced and organising smaller businesses in bundling their produce. Working out strategies that will see individual countries to be a solution to a looming global crisis and benefit their nations in the process. If the opportunity is well taken and African nations stand out as solution providers, it could be a turning point for them to recover from indebtedness and economic challenges they have perpetually faced.
The looming crisis could just be a test to examine the capability of developing countries to switch from being dependents to being solution providers. The focus should not be on the current investment costs to be incurred. But rather the benefits that have potential to erase economic challenges when potential is exploited and opportunities seized.
By: Nchimunya Muvwende, Economist
Ayomide Idogun is the co-founder at the New African Movement, an initiative aimed at ensuring Africa is conducive for Africans. Ayomide is a development strategist, policy analyst, and military historian with a major flair for transformative change through strategic thought, leadership, and empowerment.
Recently, he had the opportunity to be a delegate at the Arab Youth International Model United Nations Conference, now known as the Best Diplomats Conference, held in Dubai. Beyond the piquancy that came with meeting over 150 people from about 80 countries, and the experience of learning different cultures, the delegates were largely charged with proffering solutions to solving the global food crisis. Ayomide represented the great people of Guatemala, who sadly are no strangers to this phenomenon, with 4.6 million people at the least, facing the hunger crisis, and suffering hugely from food insecurity.
This led him to come up with prospective solutions, to ensure farmer empowerment, and the mitigation of factors hindering food supply minimized to the barest minimum, so as to ensure Guatemala does not just become self-sustaining, but grows to the point of exporting food produce to other Nations. His efforts did not go unrewarded as he bagged the Outstanding Diplomat Award, in recognition of his outstanding negotiation, leadership, and overall performance during the course of the conference.
He is a trainer and speaker with core area in leadership, capacity building and development. Some of his engagements amongst others, includes, training members of the African community in the United Arab Emirates, on capacity building and maximizing potentials, to ensure their time and resources are utilized to maximal effect. And at the maiden edition of DisruptHR Lagos, organized by OutsideinHR, where he spoke on the role COVID-19 played on priorities for humanity, and the ever-changing landscape of work.
Ayomide Idogun holds a degree in Policy and Strategic Studies from Covenant University, a second degree in History and Strategic Studies from the University of Lagos, and he is currently enrolled in the School of Politics, Policy and Governance, where he is undergoing the Public Leadership and Policy Programme.
Kamala Harris, U.S Vice President (Image: Reuters)
In a speech presented to a group of women entrepreneurs in Dakar, Senegal early this year, US Treasury Secretary Janet Yellen stated that the United States had come as a partner to help Africa realize its massive economic potential. Arguably, Africa has long been a continent of interest to Western countries, and in recent years, their influence has been growing at an unprecedented rate. Whether it is through economic investments, military partnerships, or cultural exchanges, Western nations have been making significant strides in establishing themselves as key players on the African continent. It appears that most developed countries are trying to grow their influence on the African continent in what appears like the rebirth of the scrabble for Africa of the 19th century, albeit not through direct colonization but other different forms of control and influence.
Unprecedented Visits
Could it be coincidental that nearly all world power countries are visiting Africa at intervals not seen in the recent past? The first quarter of 2023 witnessed the visit of US Vice President Kamala Harris to Ghana, Tanzania and Zambia, the visit of US Treasury Secretary Janet Yellen to Senegal, Zambia and South Africa, the visit of China’s foreign Minister Qin Gang to Ethiopia, Egypt, Gabon, Angola and Benin, the visit of Russian foreign minister Sergey Lavrov to South Africa, Botswana and Angola and the visit of France President Emmanuel Macron to the Democratic Republic of Congo, Gabon, Angola and the Republic of Congo. Each of these high-level visitors has argued that their visits are aimed at creating meaningful partnerships with African countries with France acknowledging that foreign powers are jostling for influence in Africa.
The French President added that Africa is a theatre of competition and advanced countries are seeking long term partnerships. In an interview at the white house after her recent trip to Africa, US vice President Kamala Harris argued that by 2050, one in four people occupying space of earth will be in Africa and as such, this presented a lot of opportunities in terms of the future and since Africa has a median age, the demographics have an impact on the entire globe. It appears the leaders from advanced countries are seeing the potential that Africa has and are each trying to clinch partnerships in the continent but can the same be said of African leaders? How many African leaders have taken time to visit each other to discuss the opportunities in their nations and work on actualising them?
The real question that African leaders should ask is, why is Africa becoming a theatre of Competition for foreign nations when it can be a centre of cooperation for the advancement of the continent? Is it not true that when elephants are fighting, it is the grass that suffers and in this case the grass will be Africa?
Trade potential
Africa is home to some of the world’s largest reserves of mineral resources such as diamonds, gold, platinum, copper, and iron ore, among others. Undoubtedly, Africa is the richest continent and therefore, its untapped trade potential is very attractive. It is no wonder that developed countries are competing to foster relations with African countries. However, it should be noted that the competition for Africa’s resources has a long history, dating back to colonial times when European powers scrambled for control of Africa’s land and resources. Today, the scramble for Africa is driven by a range of factors, which include the growing demand for natural resources, and Africa’s emergence as a key market for consumer goods and services.
The trade potential that each country in Africa has, if well exploited would be sufficient to end some of the major challenges faced. However, the focus has mostly been on external trade with developed countries rather than intra-Africa trade hence unfavourable outcomes. Trade with developed countries has mostly been unfair due to factors such as developed countries using their economic and political power to negotiate trade deals that favour their own interests at the expense of African countries.
Further, African countries often lack the bargaining power in trade negotiations due to being small compared to their trading partners and may be forced to accept unfavourable terms in order to access advanced markets. It is interesting that the pricing of commodities predominantly found in Africa is determined by the developed countries and Africa has no control whatsoever. The question remains, what voice do African countries have to decide on what and who to trade with as they seek to actualise their potential?
African countries should come to a realisation that their strengths lies in their numbers and the ability to work together. Why should Zambia order fuel from far countries and incur huge transport costs instead of importing from Angola, its neighbour? Africa will be respected on the global stage when economic decisions such as trade focus on inward solutions rather than continued dependency. The African Continental Free Trade Area (AfCFTA) which should be the world’s largest single market is a key weapon to boost Africa’s economic freedom. Africa should not come to the trade table as beggars but rather equal partners because the World needs what Africa has and not only the other way round.
Working in partnership with other countries is not the problem, but having only one partner benefiting is. While it is true that scrabble for Africa is history, its reoccurrence in the form of control, power and cultural change should be questioned. It’s a call for leaders, investors, Africans and interested stakeholders to ensure that African interests and viewpoints are prioritised by all in working towards bettering people’s lives. Africa has potential to be its own redeemer instead of being ripped apart in the fierce struggle resembling the scrabble for Africa. In the context of globalisation, Africa should seek meaningful and mutually beneficial deals that are only possible when it comes to the negotiating tables as equal partners, not as directionless people who need deliverance.
By: Nchimunya Muvwende
Economist- Zambia
Prof. Remi Duyile, Founder Legacy Premier Foundation
As Nigerians are gearing up and campaigning for the 2023 election begins, Business Africa Online asked Prof. Remi Duyile share her thoughts on what this election means to her and why everyone must be involved, why we cannot afford to get it wrong this time around, and advice to the youths. Excerpts.
Her Response:
I held a political role in Nigeria a few years ago, which provided me with a good understanding of the country’s political institutions. As we approach another year in the political chapters of Nigerian history, we must not only look forward with expectations but also reflect on our previous experiences in order to identify and choose the right leaders for our future.
We’ve all heard the saying “,those who fail to learn from history are likely to repeat it.” With elections approaching, it is critical that we look back and critically examine not only the people, but also the patterns that have led us here. We cannot build the Nigeria we want without learning from the past and making the necessary adjustments while preparing for the future. It takes time for change to occur, just like Rome did not rise overnight. Nevertheless, now is the time to lay the foundation for the Nigeria we seek to build, tomorrow.
There may be a question in your mind as to what these foundations are. There is first of all a sense of worth and worthiness in life. For any nation to fully develop, it must place a high value on the lives of its residents. As we prepare for the next elections, we must question which of these candidates prioritizes the worth of life and a sense of being Nigerian citizens. This includes: freedom of speech, equality and democratic processes at all levels. This is a priority because unless the worth of life and a sense of self are prioritized above all else, even the best-looking prospects will ultimately become unyielding and dictatorial.
Secondly, there is the growth of human capital and socioeconomic empowerment. It is common knowledge that every industrialized country prioritizes these two factors. No nation is more powerful than its economic potential. Our leaders must be intentional about this. Being a producing nation is one way to successfully enforce this. Nigeria is a great country, yet we are unable to enjoy the fruits of our labor.
All human capacities that can help to improve our economy include the capacity to create, invent, strategize, and engage. To think for ourselves, to maximize the potential of our teeming young people, to generate opportunities and employment, all of these are vital for progress and must be prioritized if we are to see any change in our nation.
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