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Africa Awaits Russia’s Investment

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Russia has been looking to raise its existing relationship with African countries and Afreximbank is now providing huge support in realizing that long term goal. The bank, with the task of transforming Russia’s trade with Africa, organized an economic conference for more than 1,500 participants from June 20-22 in Moscow. The economic conference and other Russia–African events in 2019 can be described as “the Year of Africa” in the Russian Federation.

The Afreximbank Annual Meetings included Seminar and Meeting of the Afreximbank Advisory Group on Trade Finance and Export Development in Africa and special meetings between Russian and African political and business leaders to discuss trade, industrialization, export, and the implementation of joint investment projects.

Russia continues to strengthen its relationship with Africa due to multiple factors such as untapped abundant natural resources, improvement of the business climate, the rise of the middle-level income class and economic growth, Prime Minister Dmitry Medvedev noted in his speech at conference. He further pointed to Africa’s growing appeal to and demand for high-tech, telecom investors and other products that could make swift business connection with Russia.

“All these things have already made Africa attractive for investments, and not merely in producing industries but, which is of particular importance, in high technologies and telecommunications,” Medvedev said.

According to certain estimates, about a half of the resource potential of the planet is in Africa, he argued “we therefore need to more efficiently use these resources and at the same time promote cooperation in this sphere, just like cooperation in other spheres.”

Besides those factors, there is high desire for mutual-cooperation. “It is also important to have a sincere internal desire, and such a sincere desire is present from the side of the Russian Federation and from the side of African states. We see this at different levels, including the top levels of cooperation,” Medvedev said.

Opening the conference, Foreign Minister Sergey Lavrov reminded conference participants that while relying on the long-time accumulated experience of constructive partnership, Russia and Africa are confidently moving along the road of comprehensively expanding Russian-African ties.

According to the Foreign Minister, the long years of solid friendship, which has been created, gives a fresh impetus to cooperation in many spheres and provides necessary conditions for building up trade, economic and investment exchanges, as well as cooperation in banking, and for encouraging business communities to implement mutually beneficial projects in African countries.

These include the construction of the country’s first nuclear power plant and the establishment of the Russian Industrial Zone in Egypt, as well as the projects that are being implemented in Africa by such leading Russian businesses as Rosneft, Lukoil, Rosgeo, Gazprom, Alrosa, Vi Holding, GPB Global Resources and Renova.

“We can report first achievements in this sphere. Mutual trade is growing – it exceeded US$20 billion last year – and becoming more diversified. Large projects are being implemented in Africa with direct financial support from Russia,” he assertively said, and added: “I am confident that cooperation with Afreximbank, which the Russian Export Centre (REC) has joined as a shareholder, will help promote long-term trade and economic relations between Russian businesses and their African partners.”

As expected, REC predicts the volume of Russian-African trade relations will double within the next 3-4 years. “The Russian Export Center maintains a close partnership with Afreximbank and has already entered the first deals that we are jointly implementing on the African continent. We intend to increase the volumes and we foresee the volume of the Russian-African trade ties in the next three to four years doubling,” said the Russian Export Center’s (REC) chief Andrei Slepnev.

“It goes without saying that the Russian Export Center sees the African region as an important area to promote Russian non-commodity export. Our objective is to use today’s positive market environment to open the access to African markets to as many exporters as possible and expand our geography,” he argued.

The African continent currently has enormous potential as a sales market. Many African countries are enacting economic reforms, demand is growing for high-quality, competitive products. Russian businesses are interested in this niche, and our goods are already competitive in terms of price and quality.

Basic financial instruments of supporting trade between Russia and Africa could be direct loans to foreign buyers (including those secured by the sovereign guarantee of the borrowing country) and loans to banks of foreign buyers under the insurance coverage Exiar, loans to sovereign borrowers, financing receivables against export earnings.

In 2018, for instance, the volume of export-supported Russian products to African countries amounted to US$2.47 billion. The main partners are Egypt, South Africa, Zambia, Morocco, Algeria, Nigeria and Kenya.

Advisor to the President of the Russian Federation, Anton Kobyakov, noting the importance of multilateral cooperation between Russia and Africa: “The current situation in the world is such that we are witnesses to the formation of new centres of economic growth in Africa. Competition for African markets is growing accordingly. There is no doubt that Russia’s non-commodity exporters will benefit from cooperating with Africa on manufacturing, technologies, finances, trade, and investment.”

Afreximbank President and Chairman of the Board of Directors, Dr. Benedict Okey Oramah, presented the 2019 African Trade Report, an analytical survey of African trade. “As we gather in this historic city of Moscow, we will explore how we can shape the future of trade and how we can transform our continent,” said Oramah. “Our collective endeavours will impact the economic future and wellbeing of Africans for generations to come.”

In the report, special attention was paid to practical cooperation in the spheres of finances, energy, mining, railway infrastructure, digital technologies, cybersecurity, healthcare, education, food security in Africa.

In 2017, the Russian Export Center became Afreximbank’s third largest non-African financial institution or organization shareholder, which has allowed for the rapid acceleration of investment, trade, and economic relations between Russia and African countries. It’s active in mining projects in Zimbabwe and Sierra Leone, and has expressed interest in attracting Russian partners to the implementation of projects in the oil industry in Africa.

Notable among the Russian-African foreign economic projects include the signing of a memorandum of cooperation between the REC and Joint company Afromet (Vi Holding) regarding the comprehensive development of the Darwendale platinum field project in Zimbabwe, which was signed during a visit by the President of Zimbabwe, Emmerson Mnangagwa, to the Russian Federation in January 2019.

According separate reports, Russia has been developing a number of projects in cooperation with Afreximbank, including a project concerning the shipment of Russian ground transport and projects to finance industrial infrastructure construction and modernization projects in Nigeria and Angola. At the end of 2018, REC, Russian Railways, and Afreximbank signed a memorandum of cooperation. As a result, a trilateral working group was created, tasked with studying export and investment project issues in the railway and related industries, as well as forms of project and investment financing.

The latest description of Africa, which consists of 54 states, to many experts and business investors, is the last frontier. It is the last frontier because it has huge natural resources still untapped, all kinds of emerging business opportunities and constantly growing consumer market due to the increasing population. It has currently become a new business field for global players.

That negative perceptions deeply persistent among political and business elite, middle class and the public towards Russia. For the two past decades, due to Russia’s low enthusiasm, lack of coordinated comprehensive mechanism and slowness in delivering on skyline investment pledges have been identified as the key factors affecting effective cooperation between Russia and Africa.

London based Business Research and Consultancy firm published a new report about global players set to continue broadening economic and business engagement across Africa. The publication has become largely important as Russia with its recognizable global status and among BRICS (Brazil, Russia, India, China and South Africa) dominated headlines that it has played less visible role in sub-Saharan Africa after Soviet’s collapse.

The Russian Export Center, as a state institution for the support of non-primary goods, providing Russian exporters with a wide range of financial and non-financial support, is also working on a number of projects with Afreximbank in various African regions. Afreximbank was founded in 1993 in Abuja, Nigeria, with the authorized capital of US$5 billion. The main objectives of the bank are the development of trade between African countries and abroad. The banks’ headquarters is located in Cairo, Egypt.

MD Africa Editor Kester Kenn Klomegah is an independent researcher and writer on African affairs in the EurAsian region and former Soviet republics. He wrote previously for African Press Agency, African Executive and Inter Press Service. Earlier, he had worked for The Moscow Times, a reputable English newspaper. Klomegah taught part-time at the Moscow Institute of Modern Journalism. He studied international journalism and mass communication, and later spent a year at the Moscow State Institute of International Relations. He co-authored a book “AIDS/HIV and Men: Taking Risk or Taking Responsibility” published by the London-based Panos Institute. In 2004 and again in 2009, he won the Golden Word Prize for a series of analytical articles on Russia's economic cooperation with African countries.

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A Fault Line Named Farmajo

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Somalia, a country of many political fault lines that indicate looming earthquakes of great magnitude, now has a new one- the Farmajo fault. Mohmed Abdullahi Farmajo is the malignantly polarizing president of Somalia.

Two of the Farmajo fault’s severe foreshocks or preliminary shakers have occurred on Thursday 18 February and Friday 19 February. In the first one, government troops have attacked two former presidents and current candidates at a hotel where they were organizing to lead a peaceful march against Farmajo’s illegally delayed election the next day.

The second one occurred on Friday when the government fired indiscriminately at a peacefully marching citizens led by Farmajo’s former prime minister, former ministers and a few other candidates. An estimate of twenty people was reported dead or seriously injured

That was the most callous act that any leader or ruler could have ordered at a time of high political volatility. It is the opinion of this author that that has ended Farmajo’s political future. He severely wounded himself in his first reckless attack and committed suicide in his second.

Nature of the Violation

According to Article 19 of the U.N. Universal Declaration of Human Rights:  

Everyone has the right to freedom of opinion and expression; this right includes freedom to hold opinions without interference and to seek, receive and impart information and ideas through any media and regardless of frontiers.

And, according to Article 20:

(1)   Everyone has the right to freedom of peaceful assembly and association

(2)   No one may be compelled to belong to an association.

These universal rights coupled with the freedoms expressed in Somalia’s provisional constitution, affirm that those whose Friday march was violently aborted had the right to protest and chant ‘Doorasho diid dooni meyno!’ which means we don’t want election refuser. No one should be bullied, violently attacked, injured, or killed for their verbal expressions of discontent.      

What was witnessed in Mogadishu in that bloody protest was something not seen in a number of decades. The protesters were not those often seen in the streets of Mogadishu- IDPs and other poor women draped in the Somali flags who are stationed in street corners, under the baking sun, to get paid a few dollars at the end of the day, and children shouting slogans that they do not understand.

Any government that resorts to violence in order to silence its opposition, activists, or dissidents inevitably loses its legitimacy. So more often than not, such government’s days become numbered.

Anyone who has been following my commentaries on Somalia knows that I neither support nor think the opposition (any one of the 14 presidential candidates) could help save this nation that is sinking deeply into quicksand of distrust, for that requires more than election. Yet, I—like many others who have no horse in this bloody race—am committed to defend their right to publicly and privately express their political views. 

 Spin Doctors of Halane

The aforementioned Friday violence occurred within a walking distance from Halane (Somalia’s Green Zone) and key actors in that compound were well aware, at least for a few days before the event, that an anti-Farmajo protest would led by a coalition of presidential candidates who felt scorned and disenfranchised by the ‘Madaxweynaha uu xiligiisu dhamaaday’ or the President whose term has ended.

In reaction, the UN Assistance Mission in Somalia (UNSOM) @UNSOM offered this solution “The UN in #Somalia notes that the clashes in #Mogadishu underscore the urgent need for Federal Government and Federal Member State leaders to come together to reach political agreement on the implementation of the 17 September electoral model.”

The U.S. Embassy in Somalia followed with a paraphrased version of the same statement from another planet. ” We urge an end to all violence and remind all parties of their commitment to immediately conclude an FGS-FMS agreement on #election implementation.”

Interestingly, the referenced ‘electoral model’ is at the heart of the presidential candidates’ grievance. They were denied to be part of it. These statements on behalf of the U.N. and U.S. were adding insult to an injury. As a result, the coalition of presidential candidates reasserted their position of not considering Farmajo as a legal president and that they would continue protesting until he comes back to his senses.

In solidarity with the disenfranchised presidential candidates, both the leader of Puntland federal-state and Jubbaland federal-state (who were at odds with Farmajo for long) have declared said agreement null and void. The 19 February bloody event has killed 17 September agreement.

In a no hold barred televised speech, President Said Abdullahi Deni of Puntland said “We are not going to a conference with Farmajo…” He described Farmajo as a “dictator” who has been dividing the country, and warned against regression into a renewed civil war.   

Recommendations

1)      Allow the candidates and all others who want to march to do so freely, and all domestic and foreign stakeholders should support their right to do so

2)      Farmajo must be pressured to step aside without being barred of participation in the election- a constitutional right that he cannot be denied

3)      The 2009 precedent should not be followed. When then controversial president, Abdullahi Yusuf, was pressured to step aside, his Prime Minister, Nur Adde, was asked to lead the country while a new government was being formed in Djibouti. Nur Adde was not seen as partisan as the current Prime Minister, Mohamed Hussein Roble, who recently declared to unilaterally conduct elections without Puntland and Jubbaland       

4)      Since no official in the Executive or the Lower and the Upper House branches has a mandate to lead the country while stakeholders are negotiating the right model of election and implementing it, the Speaker of the Upper House, Abdi Hashi, should be entrusted with that responsibility for the following reasons:

a)      He is a tower of patriotism among the current politicians

b)      He is the oldest, most ethical, and indeed most credible member of the parliament

c)      He is the only leader who has been playing by the rules

d)      He is the only one who refrained from the cut-throat politics that kept all others in a state of hyper-paranoia

e)      He is one of the Senators who represent Somaliland in the clan-based federal system

f)       He represents one of the four ‘major clans’ in the so-called 4.5 system that never held the presidency, even transitionally

g)      Once a new parliament is elected and a new president is elected or selected, Speaker Hashi clears the way for that new president

The Farmajo fault should not be underestimated. His prolonged stay could wholly tribalize the issue and subsequently make matters worse. Though the clan rhetoric has not been absent, so far the dichotomous divide between the political elite is not fueled by clan politics. Certain foreign actors possess more political leverage than the clans.

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African problems require African solutions

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In order to strengthen political dialogue and promote economic relations, Professor Robert Dussey, Minister of Foreign Affairs, African Integration and Togolese Abroad, held diplomatic talks on February 16, 2021 with his Russian counterpart Minister Sergey Lavrov in St. Petersburg. According to reports, Professor Dussey’s visit was on the invitation by Moscow, and came on exactly one year after their last meeting February 15 in Munich.

After their closed-door discussion, Lavrov told the joint news conference that there is a mutual interest in intensifying and deepening the entire scope of bilateral ties, including trade, the economy and investment, and have agreed to look for specific opportunities for joint projects in areas such as energy, natural resources, infrastructure, transport, and agriculture.

Regarding issues on the African continent, Lavrov re-emphasized that African problems (of which there are many) require African solutions. “We strongly support the African Union, the G5 Sahel, and the sub-regional organizations in Africa, in their efforts to resolve numerous local conflicts and crises. We specifically focus on supporting the fight against terrorism, which poses a real threat, including for our friends in Togo and other coastal countries in the region of the Gulf of Guinea,” he said.

In fact and as always, Lavrov reiterated Russia’s commitment to continue to act actively in pursuing peace and, to this end, called for the peaceful settlement of all kinds of differences, and reaffirmed support for sustainable development there in Africa.

Regarding issues from the last summit held in Sochi, Lavrov stressed: “We are interested in developing the resolutions of the Russia-Africa summit. We spoke in detail about the implementation of these agreements. The coronavirus pandemic has required adjustments. Nevertheless, the results on implementing the Sochi agreements are obvious. This year we will actively continue these efforts.”

The Association for Economic Cooperation with the African States was created in Russia following the 2019 Sochi summit. It includes representatives from the related departments and major Russian companies. The Russia-Africa Partnership Forum, which is a political association, was created, its secretariat is located at the Russian Foreign Ministry. The primary tasks of the Russia-Africa Partnership Forum includes preparation and organization of the next Russia-Africa summit scheduled for 2022. The venue to be chosen by African leaders.

“We are still slightly behind other states, but trade between Russia and the African countries has been growing quite rapidly lately. I think we will soon make up for the time we lost in the years when, at the dawn of the new Russian statehood, we were too busy to maintain proper ties with Africa. A very strong foundation was laid in Soviet times, though,” Lavrov said further at the news conference about the current situation with relations between Russia and Africa.

It has always been the wish of both Russia and Africa to have an excellent quality of cooperation and partnership relations between the two regions and to diversify and deepen them as best as possible in order to provide an appreciable geopolitical influence and strategic power balance in Africa.

Russia and Togo, as with many other African countries, have had long time-tested relations over the years. The most recent high-level meetings were between Russian President Vladimir Putin and Togolese President Faure Gnassingbe during sidelined bilateral meeting in October 2019, when Gnassingbe participated in the Russia-Africa summit in Sochi, and on the sidelines of the BRICS summit in Johannesburg in July 2018.

With an estimated population of about 7.9 million, Togo is among the smallest countries in Africa. Its economy depends highly on agriculture. Togo pursues an active foreign policy and participates in many international organizations. Relations between Togo and neighboring states are generally good. It is particularly active in West African regional affairs and in the African Union.

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Russia offers 300 million doses of Sputnik V vaccine to Africa

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As African countries continue to experience increasing coronavirus infections, with the overall number of cases exceeding 3.79 million mid-February, Russia is stepping in to supply 300 million doses of Sputnik V vaccine through the African Union (AU). It an effort to assist to stop further spread of the pandemic on the continent.

An official release said that the Africa Vaccine Acquisition Task Team, set up by the African Union to acquire additional vaccine doses so that Africa can attain a target immunization of 60%, has received an offer of 300 million Sputnik V vaccines from the Russian Federation. This includes a financing package for any member states wishing to secure this vaccine.

Meanwhile, the Task Team advises that the 270 million doses previously secured from AstraZeneca, Pfizer and Johnson & Johnsons were all taken up by the first allocation phase deadline through the African Medical Supplies Platform (AMSP). With these additional 300 million Sputnik V vaccines, AMSP accelerates online COVID-19 vaccines pre-orders for the 55 African Union member states.

The Sputnik V vaccine from the Russian Federation is now available on the AMSP for the consideration of our AU Member States, says Dr John Nkengasong, Director of the Africa Centers for Disease Control and Prevention (Africa CDC). Bilateral and private sector partnerships such as these aid our efforts to bringing the COVID-19 pandemic to an end.

Nkengasong is worried that vaccine apartheid will have dire consequences for Africans in the near future. According to him, the continent needed to be taken along by the developed world as they vigorously roll out inoculation efforts. Africa’s rollout has been relatively slower with over a third of African countries yet to receive doses.

About Africa’s lack of vaccines, he said:“That is absolutely one of our greatest concerns, that the vaccine situation will continue to exacerbate the inequality gap that exists in the world especially the north – south divide. My greatest fear is that once the United States and Europe get the vaccine, they begin to impose the need to have vaccine certificate to travel and that is extremely complicated for Africans to travel across the world.”

Nkengasongadded:“Africa has to team up with development partners to achieve its 60% continent-wide vaccination in the next two years. I think that is why we should as a collective of the continent, and of course, in partnership with the developed world make sure that Africa has a timely access to vaccines to meet our vaccination targets.”

While details, including clinical and technical information, are now accessible on the Africa Medical Supplies Platform (AMSP), Sputnik V vaccines will be available for a period of 12 months commencing by May 2021.

The African Union member states that wish to secure funding should approach the African Export-Import Bank through their Central Banks, as has been the case with the other vaccines that have been on offer. The lender approved US$2 billion for participating suppliers, allowing the finalization of supply contracts.

According to the Russian Direct Investment Fund (RDIF), Sputnik V is one of the world’s top three coronavirus vaccines in terms of the number of approvals issued by government regulators.

Sputnik V had been approved in Russia, Belarus, Argentina, Bolivia, Serbia, Algeria, Palestine, Venezuela, Paraguay, Turkmenistan, Hungary, UAE, Iran, Republic of Guinea, Tunisia, Armenia, Mexico, Nicaragua, Republika Srpska (entity of Bosnia and Herzegovina), Lebanon, Myanmar, Pakistan, Mongolia, Bahrain, Montenegro, Saint Vincent and the Grenadines, Kazakhstan, Uzbekistan, Gabon and San Marino.

Kirill Dmitriev, CEO of the Russian Direct Investment Fund, has said that Sputnik V has a number of key advantages:

• Efficacy of Sputnik V is 91.6% as confirmed by the data published in the Lancet, one of the world’s oldest and most respected medical journals; It is one of only three vaccines in the world with efficacy of over 90%; Sputnik V provides full protection against severe cases of COVID-19.

• The Sputnik V vaccine is based on a proven and well-studied platform of human adenoviral vectors, which cause the common cold and have been around for thousands of years.

• Sputnik V uses two different vectors for the two shots in a course of vaccination, providing immunity with a longer duration than vaccines using the same delivery mechanism for both shots.

• The safety, efficacy and lack of negative long-term effects of adenoviral vaccines have been proven by more than 250 clinical studies over two decades.

• The developers of the Sputnik V vaccine are working collaboratively with AstraZeneca on a joint clinical trial to improve the efficacy of AstraZeneca vaccine.

• There are no strong allergies caused by Sputnik V.

• The price of Sputnik V is less than $10 per shot, making it affordable around the world.

Russian Direct Investment Fund (RDIF) is Russia’s sovereign wealth fund established in 2011 to make equity co-investments, primarily in Russia, alongside reputable international financial and strategic investors. RDIF acts as a catalyst for direct investment in the Russian economy. RDIF’s management company is based in Moscow.

About the Afreximbank: The African Export-Import Bank (Afreximbank) is a Pan-African multilateral financial institution with the mandate of financing and promoting intra-and extra-African trade. Afreximbank was established in October 1993 and owned by African governments, the African Development Bank and other African multilateral financial institutions as well as African and non-African public and private investors. The Bank was established under two constitutive documents, an Agreement signed by member states, which confers on the Bank the status of an international organization, and a Charter signed by all Shareholders, which governs its corporate structure and operations.

About the Africa CDC: Africa Centres for Disease Control and Prevention (Africa CDC), is a specialized technical institution of the African Union that strengthens the capacity and capability of Africa’s public health institutions as well as partnerships to detect and respond quickly and effectively to disease threats and outbreaks, based on data-driven interventions and programmes.

About the AVATT: The African Vaccine Acquisition Task Team (AVATT), was established by African Union Chair, President Cyril Ramaphosa, as a component in support of the Africa Vaccine Strategy that was endorsed by the AU Bureau of Heads of State and Government on 20th of August 2020. The AVATT is chaired by President Ramaphosa and includes African Union Commission Chairperson Moussa FakiMahamat, Dr. Zweli Lawrence Mkhize, Mr. Strive Masiyiwa, Dr. Donald Kaberuka, Professor Benedict Oramah, H.E. Amira Elfadil, Dr. John Nkengasong and others, as to be nominated by the Chair of the African Union and the Chairperson of the Commission.

About the AMSP: The Africa Medical Supplies Platform (AMSP) is a non-profit initiative launched by the African Union as an immediate, integrated and practical response to the Covid-19 pandemic. The online platform was developed under the leadership of the African Union Special Envoy, Strive Masiyiwa and powered by Janngo on behalf of the African Union’s Africa Centers for Disease Control and Prevention (Africa CDC) and in partnership with African Export-Import Bank (Afreximbank) and United Nations Economic Commission for Africa (ECA) with the support of leading African and international Institutions, Foundations and Corporations as well as Governments of China, Canada and France.

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