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Africa: A Rising Star in the New Economic Order

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The African continent has been on top of the agenda of the policymakers in all periods. From the historical aspect, the conflict of interests was emerged in the era of colonization, when the global powers did not hesitate to conquer various parts of Africa for valuable resources such as gold, ivory, salt, and more. They all wanted these resources because they needed them for manufacturing. As time went on, Africans wanted to design their destiny by themselves, so today’s 54 African states emerged mainly starting from the middle of the 20th century. In modern times, however, with the sovereignty of African countries, the rules have changed so that familiar and new powers came not to conquer their lands but to invest in their markets.

Why is Africa so important?

In the global dimension, the resource-rich African continent is one of the fastest-growing consumer markets since household consumption has risen even faster than its GDP in the past years. Furthermore, the average annual gross domestic product growth has consistently surpassed the world average. Numerically, on the potential market of 1.35 billion people, since 2010, at a compound rate, consumer expenditure has increased 3.9 % annually and reached US$1.4 trillion in 2015. This figure’s expected level is US$2.1 trillion by 2025 and US$2.5 trillion by the end of 2030.

On the other hand, a massive increase in the continent’s youthful age segment in a rapidly growing population creates a suitable environment for industrial development. The median age on the continent is 19.7, while this number is 37.4 in China, 38.1 in the U.S., 42.9 in the EU, and 30.6 globally. Moreover, the significant youth factor enables the faster spread of access to the internet and mobile phones. Besides the traditional spheres, apparently, the digital industry’s future is bright as well in Africa. 

Africa’s significance partly lies in its geographical position, and thus the potentials it creates. The African ports are the vital gateways for domestic and worldwide export and import operations. Albeit currently, the African economies’ exports are mainly commodity-based; in the long run, monoculture economies will diversify as they will grow. So, the ports will play an essential role in ensuring the sustainability of the more robust, resilient, and diverse economic dynamics in the continent’s economies through the exports and imports of industrial products and other manufactured goods. Additionally, these ports will not solely serve African economies; it will substantially contribute to the global supply chain systems as modern transportation facilities.

The traditional and new players in Africa

Africa is very attractive for investors with respect to the positive trends and opportunities in economic growth. The EY’s 9th edition of the Africa Attractiveness report published in September 2019, denotes the African continent in the first place in the world according to the 2018 FDI (Foreign Direct Investment) to GDP data. 

According to UNCTAD’s World Investment Report 2020, the top 5 investors in the African continent are respectively the Netherlands (US$79 billion), France (US$53 billion), the United Kingdom (US$49 billion), the United States (US$48 billion) and China (US$46 billion). Interestingly, while other countries in the list lessened their direct investments between 2014 and 2018, only the Netherlands (US$20 billion) and China (US$14 billion) have increased their investments in Africa. 

The flow of investments is engrossingly intricate. The US has been warning countries that some security risks might accompany technology developed by Chinese firms like Huawei and ZTE. Nonetheless, Huawei and ZTE built and laid fiber-optic and submarine cables off Africa’s coasts. In this context, Chinese technological infrastructure constitutes the high-tech network’s backbone in some states on the continent within the “Digital Silk Road.” For instance, in Ethiopia, the direct investment in the tech sector was US$2.4 billion, while this figure was US$1.8 billion both in Niger and Zimbabwe. It seems China is in an advantageous position in Africa since it forms the “infrastructure of the future” by helping drive the growth of mobile phone and internet penetration, in contradistinction to the US.

Apart from the conventional forces, some new countries, such as Turkey and Russia, are eager to penetrate the African markets. Turkey’s Africa initiative started in 2003. In 15 years, the number of Turkish embassies in Africa has significantly risen from 12 to 44, direct Turkish investments have skyrocketed from 100 million to US$6,5 billion, and Turkey’s trade volume with the continental countries increased by six-fold, reaching US$17.5 billion. In addition, Turkey is the second-largest investor in Ethiopia with US$2.5 billion, and in recent years had increased its political influence on Northeastern Africa. 

Russia has a deep cooperation experience with the African states from the Soviet era. After the collapse of the USSR, successor Russia strived to perpetuate the relations but mostly failed due to a focus shift to its domestic affairs. Still, in this period, it preserved its political influence area to some extent in the specific regions of the African continent. However, bilateral relations were exposed to a radical renewal from the first Russia-Africa Summit in Sochi on October 23-24 in 2019.

In 2018, Russia’s trade with African countries increased by more than 17% and exceeded US$20 billion. At the Sochi summit, Russian President Vladimir Putin stated his expectation for at least double the volume of trade in the next 4-5 years, which means a jump from US$20 billion to US$40 billion. Recently, on November 23, at an interactive webinar organized by the Federation Council of Russia, Chamber of Commerce and Industry of Russia, and Business Russia Association, Russian officials have once again demonstrated their intention to restore the historic relationships through cooperation in numerous spheres. 

The obstacles and constraints

Albeit Africa provides innumerable opportunities, it has some structural problems accompanied by some inter-state and intra-state conflicts and disputes. Terrorism and disintegration are still the foremost challenges for the continent. The Armed Conflict Location & Event Data Project, which monitors incidents of conflict around the world, found that there had been 21.600 incidents of armed conflict in Africa till November 2019. For the same period in 2018, that number was just 15.874. That represents a 36% increase.

Many nations on the African continent have performed poorly in maintaining stable economic growth rates and achieving appreciable economic development levels. This might be linked to a list of factors, political instability in the first instance since it dramatically diminishes the economy’s productive and transactional capacities. It is estimated that there have been at least 100 successful coups in Africa in the past four decades, with more than twice the number of coup attempts. Consequently, there is an apparent correlation between the destabilization in the political theater and economic disbalance. 

Most of Africa lags the rest of the world in coverage of crucial infrastructure classes, including energy, road and rail transportation, and water infrastructure. For instance, nearly 600 million people in sub-Saharan Africa lack access to grid electricity, accounting for over two-thirds of the global population without power. Additionally, the infrastructure notion plays an essential role in the region in terms of efficiency. For example, agriculture is Africa’s largest economic sector, representing 15% of the continent’s total GDP, or more than $100 billion annually. Experts estimate that sub-Saharan Africa alone requires additional annual investments of as much as $50 billion to make the agricultural system work better. It can be clearly seen that from the economic development aspect, closing this infrastructure gap is vital for the continent as it would raise the quality of life and stimulate the growth of the business sector.

What to expect?

In light of numerous indicators, the future of the African continent seems to be quite complicated. According to recent UN forecasts, the continent is expected to double its population by 2050. If the investment inflow would not go up, Africa will face a major demographical challenge. Otherwise, the intellectual capital and human resources will contribute to a tiger economy supported by continuous investments, and this factor will be a path to prosperity.

A major step was taken towards integration-related hurdles in March 2018 with the signing of The African Continental Free Trade Area (AfCFTA) agreement by 54 African states. Namely, it presents a tremendous opportunity for African states by bringing 30 million people out of extreme poverty and to raise the incomes of 68 million others who live on less than $5.50 per day. The agreement also comprises the simplification of the customs procedures that would drive $292 billion of the $450 billion in potential income gains. Also, customs procedures simplifications imply the development of the supply chain systems in the continent. The agreement’s implementation can be an usher in the integrated development to enhance long-term sustainability in African countries.

It will undoubtedly be a long journey for the Africans to overcome all the issues. However, the emergence of a new generation with progressive thoughts might condition a different environment on the continent. The most crucial factors within the process will be innovation, discipline, and, foremost, patience. In that case, the sustainable and dynamic African economy will play an essential role in the global system. On the whole, still there are some positive signs to be optimistic about the future of Africa; as it says in the famous African proverb, “However long the night, the dawn will break.”

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Africa

Shaping the Future Relations between Russia and Guinea-Bissau

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Russian Foreign Minister Sergey Lavrov and Guinea- Bissau Suzi Carla Barbosa have signed a memorandum on political consultations. This aims at strengthening political dialogue and promoting consistency in good cooperation at the international arena.

Russia expects trade and economic ties with Guinea-Bissau will continue developing; they must correspond to the high level of the political dialog between the countries, Russian Foreign Minister Sergey Lavrov said in his opening remarks at the meeting with his counterpart from Guinea-Bissau Suzi Carla Barbosa.

“Probably, the next natural step will be to build up our trade-economic, investment cooperation in order to bring it to the level of our sound, confident political dialogue,” the Russian Minister added.

Speculation aside, the face-to-face diplomatic talks focus on effective ways for developing tangible cooperation in most diverse areas in Guinea-Bissau. The meeting agreed to take a number of practical steps, including reciprocal visits by entrepreneurs both ways.

“We talked about more efficient ways of developing our trade and economic cooperation. We agreed to undertake a range of specific steps, including the trips of businessmen from Guinea-Bissau to Russia and then from Russia to Guinea-Bissau,” Lavrov said.

Last year, Prime Minister of Guinea-Bissau Nuno Gomes Nabiam met with representatives of the Russian business community. The areas of interest mentioned in this respect included exploration of natural resources, construction of infrastructure facilities, as well as development of agriculture and fisheries.

Guineans are keen on deepening bilateral cooperation in fishing. The five Russian fishing trawlers have recently resumed their operations in the exclusive economic zone of Guinea-Bissau.

As explained the media conference, the topics discussed for cooperation included such spheres as natural resources tapping, infrastructure development, agriculture and fisheries

In terms of education, over 5,000 people have already entered civilian professions, and more than 3,000 people have acquired military specialties, which is important for Guinea-Bissau. In addition, military and technical intergovernmental cooperation agreement is about to enter in force. According to reports, Russia would continue to pursue military cooperation with the country.

Both ministers reviewed the situation in Mali, the Republic of Guinea and some other African areas, with an emphasis on West Africa and the Sahara-Sahel region.

Lavrov and Carla Barbosa discussed preparations for the second Russia-Africa summit planned for 2022. With high hopes that the collective attendance will include President of Guinea-Bissau Umaro Sissoco Embalo.

Guinea-Bissau, like many African states, has had political problems. In April 2020, the regional group of fifteen West African countries often referred to as ECOWAS, after months of election dispute finally recognized the victory of Umaro Sissoco Embaló of Guinea-Bissau.

Perspectives for future development are immense in the country. The marine resources and other waterbodies are integral part to the livelihood. Steps to increase agricultural production are necessary. The economy largely depends on agriculture: fish, cashew nuts and peanuts are its major exports. Its population estimated at 1.9 million, and more than two-thirds lives below the poverty line.

Sharing borders with Guinea (to the southeast), Gambia and Senegal (to the north), Guinea-Bissau attained its independence in September 1973. Guinea-Bissau follows a nonaligned foreign policy and seeks friendly and cooperative relations with a wide variety of states and organizations. Besides, Eсonomic Community of West African States (ECOWAS), Guinea-Bissau is a member of the African Union (AU) and the United Nations.

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Analyzing The American Hybrid War on Ethiopia

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photo: UNFPA/Sufian Abdul-Mouty

Ethiopia has come under unprecedented pressure from the U.S. ever since it commenced a military operation in its northern Tigray Region last November. Prime Minister Abiy Ahmed ordered the armed forces to respond to the Tigray People’s Liberation Front (TPLF), which used to be the most powerful faction of the former ruling party, after it attacked a military barracks. Addis Ababa now officially considers the TPLF to be a terrorist group. It fell out with PM Abiy after initially facilitating his rise to power as a result of disagreements over his fast-moving socio-political reforms.

The TPLF refused to join PM Abiy’s Prosperity Party upon its formation in December 2019. It also regarded his decision to postpone national elections last August until this June due to the COVID-19 pandemic as resulting in him illegitimately remaining in power. In response, the TPLF organized its own elections in the Tigray Region in September 2020 that were not recognized by the central government. This set a tense backdrop against which the group attacked the military a few months later in early November, which was what triggered the ongoing conflict.

The U.S. and its allies claim that Ethiopia is carrying out a campaign of ethnic cleansing in Tigray, which Addis Ababa, of course, denies. This set the basis upon which the U.S. began to sanction the country. The first sanctions were imposed in late May to target Ethiopian officials as well as some of their Eritrean allies who, the U.S. claimed, were supporting them in their military campaign. The Ethiopian National Defense Force (ENDF) pulled out of Tigray a month later in June, claiming that this unilateral move would facilitate the international community’s relief efforts in the war-torn region that had attracted so much global attention.

The conflict did not end, however, but actually expanded. The TPLF felt emboldened to invade the neighboring regions of Afar and Amhara, parts of which it continues to occupy. Addis Ababa suspected that the group was receiving various equipment and other forms of support under the cover of UN aid shipments. It also accused the TPLF of manipulating international perceptions about the region’s humanitarian crisis in order to generate more support and increase pressure on the Ethiopian government. PM Abiy published an open letter to U.S. President Joe Biden last month, urging him to reconsider his country’s policy towards the conflict.

It regrettably went unheeded but deserves to be read in full, since the Ethiopian leader compellingly argued that the American policy is counterproductive and influenced by the TPLF’s lobbyists. Shortly after that, his government expelled seven UN officials at the end of September, who it accused of meddling. In early October, CNN published a report claiming that Ethiopian Airlines was illegally transporting weapons to and from Eritrea during the early stages of the conflict. This, in turn, prompted more sanctions threats from the U.S. The situation is such that the U.S. is now actively working in support of the TPLF against PM Abiy’s government.

This American hybrid war on Ethiopia is waged in various ways that deserve further study. They closely resemble the American hybrid war on Syria in the sense that the U.S. is using humanitarian pretexts to justify meddling in the country’s internal affairs. Its motivations to backstab its regional ally are entirely self-interested and zero-sum. The U.S. is uncomfortable with PM Abiy’s geopolitical balancing between Washington and Beijing. Although the former TPLF-led government was also close to China, the U.S. likely expected PM Abiy to distance Ethiopia from it, considering the pressure that Washington exerts upon its partners to do so.

He came to power in early 2018 around the time when the U.S. began to intensify its ongoing New Cold War with China. From the American perspective, it is unacceptable for the country’s partners to retain close ties with its top geopolitical rival. It is for this reason why the US far from appreciates PM Abiy’s balancing act since it likely expected for him to move away from China. This leads to the next motivation for the American Hybrid War on Ethiopia, which is to return the TPLF to power there, if not in a national capacity, then at least in its home region. Such an explanation will now be elaborated on more at length.

Ethiopia finds itself at a crossroads whereby the country can either continue on the path of centralization, like PM Abiy has attempted to do, or pursue the course of further federalization to the point where its regions receive more autonomy than before. One of the TPLF’s primary criticisms of the Ethiopian leader is that he is allegedly going against the country’s post-civil war federal foundation. If it can succeed at least in securing broad autonomy for its home region by force after failing to do so peacefully, this might then trigger radical reforms that result in advancing its federal vision throughout the rest of the country.

The U.S. could exploit the broad autonomy that these regions might receive in order to individually pressure them to distance themselves from China. Ethiopia is, after all, Africa’s second most populous country and used to have one of the world’s fastest rates of economic growth before the COVID-19 pandemic. From a continental standpoint, the U.S. might believe that turning Ethiopia against China could eventually become a game-changer in the New Cold War’s African theater. In other words, everything that the U.S. is doing against Ethiopia is motivated by its desire to “contain” China. It is now time to explain its modus operandi in detail.

The U.S. immediately exploited the TPLF-provoked conflict in Ethiopia to pressure PM Abiy to treat the group as his political equals. This was unacceptable for him, since doing so would legitimize all other groups that attack the armed forces in pursuit of their political objectives. The Ethiopian leader rightly feared that it could also trigger a domino effect that results in the country’s “Balkanization”, which would advance American interests in the sense of taking the country out of the “geopolitical game” with China. In response to his recalcitrance, the U.S. alleged that his government was carrying out ethnic cleansing.

American officials knew that this would attract global attention that they could manipulate to put multilateral pressure upon his government. Even so, PM Abiy still did not relent but continued waging his war in the interests of national unity. With time, the U.S. began to portray him as a “rogue leader” who did not deserve his Nobel Peace Prize in 2019 for resolving his country’s frozen conflict with the neighboring Eritrea. Its perception managers presented him as a power-hungry dictator, who was ruthlessly killing the ethnic minorities that opposed his government, including by deliberately starving them to death.

The ENDF’s withdrawal from the Tigray Region over the summer was interpreted by the U.S. as having been commenced from a position of weakness. It believed that ramping up the pressure at this sensitive point in the conflict could lead to him politically capitulating to the TPLF’s demands. This was a wrong assessment since PM Abiy hoped that everything would stabilize after his decision facilitated international relief efforts to the war-torn region. These were unfortunately exploited, according to Addis Ababa, in order to provide more support for the TPLF, which is why his government recently expelled those seven UN officials.

The U.S. “humanitarian imperialism”, as one can now call its policy against Ethiopia, is very pernicious. It focuses solely on the humanitarian crisis in the Tigray Region while ignoring the ones that the TPLF caused in the neighboring Afar and Amhara regions. This policy also manipulates perceptions about the situation in Tigray in order to delegitimize PM Abiy, the ENDF and the political cause of national unity that they are fighting for. The purpose is to encourage more members of the international community to pressure Ethiopia to the point where it finally feels compelled to politically capitulate. This policy, however, has proven to be counterproductive.

Far from giving up the fight, Ethiopia is doubling down and is now more motivated than ever before to see the war to its end, though ideally through a political rather than military solution due to humanitarian considerations. This does not imply treating the terrorist-designated TPLF as an equal but envisions replacing its leadership in the Tigray Region with a pro-government/unity party instead. That is, of course, easier said than done, which is why military means might continue to be relied upon to this political end. Throughout the course of its struggle, Ethiopia has begun to be seen as an anti-imperialist icon across Africa and the rest of the Global South.

PM Abiy’s open letter to Biden was full of powerful statements articulating Ethiopia’s sovereign interests. It showed that African leaders can resist the U.S., which could inspire the Ethiopian leader’s counterparts who might also come under similar pressure from their partner sometime in the future—due to its zero-sum New Cold War geopolitical calculations. Ethiopia’s sheer size makes it an African leader, not to mention it hosting the headquarters of the African Union, so it can influence the rest of the continent. It also has a very proud anti-imperialist history which motivates its people not to submit to foreign pressure.

China, Russia and India have politically supported Ethiopia against the U.S. at the UN, thereby debunking The Economist’s lie last week that “Ethiopia is losing friends and influence”. To the contrary, Ethiopia is gaining friends and influence, especially among the rising powers and the rest of the Global South. Its principled resistance to the American hybrid war on it has shown others that there is an alternative to capitulation. It is indeed possible to fight back in the interests of national unity. Not all American destabilization plots are guaranteed success. Just like the U.S. failed to topple the Syrian government, so too has it failed to topple the Ethiopian regime.

Ethiopia, however, is many orders of magnitude larger than Syria. This makes its hitherto successful resistance to the American hybrid war all the more significant. The leader in the Horn of Africa is a very diverse country, whose many people could be pitted against one another through information warfare to provoke another round of civil war that would help the TPLF’s U.S.-backed anti-government crusade. That worst-case scenario has not materialized, though, due to the majority of the population’s commitment to national unity even among some of those who might have misgivings about the present government.

This year’s elections saw the Prosperity Party win by a landslide, which shows how much genuine support it and its founder have among the masses. Furthermore, PM Abiy’s concept of “medemer” (“coming together”) aims to counteract “Balkanization” processes by pragmatically reforming socio-political relations inside the country. It is a very promising idea that could inspire other very diverse states across the Global South and help them ideologically thwart divide-and-rule plots like the one presently waged against Ethiopia.

Assessing the strategic situation as it presently stands, the American Hybrid War on Ethiopia is expected to intensify on manipulated humanitarian pretexts. More sanctions and even the threatened revocation of Ethiopia’s access to the U.S. market through the African Growth and Opportunity Act (AGOA) could worsen the economic situation for millions of people. The purpose in doing so would be to provoke anti-government protests that the U.S. hopes would be violent enough to catalyze a self-sustaining cycle of destabilization throughout the country after the security services crack down on the rioters.

The supplementary purpose is to encourage some Ethiopians to join anti-government terrorist groups allied or working in coordination with the TPLF unless the U.S. succeeds in pulling off a Color Revolution. This modus operandi is identical to the one that it relied upon in its hybrid war on Syria. In the Ethiopian context, the U.S. hopes to forcefully “Balkanize” the country, whether de jure or de facto through an extreme form of federalization. The point is to punish Ethiopia for balancing between China and the U.S., which showed other Global South states that such a pragmatic approach is possible instead of the U.S.-practised zero-sum one.

Nevertheless, the U.S. might still fail. The ENDF and other security services retain control throughout all the country’s regions with the exception of Tigray. It is therefore unlikely that any Color Revolution or Unconventional War there will succeed. Furthermore, Ethiopia enjoys close ties with the rising multipolar powers like China, Russia and India who can help it weather the current crisis by neutralizing U.S. attempts to isolate the country. In addition, the “medemer” concept ensures that national unity remains at the core of the Ethiopian society, reducing the appeal of foreign-backed “Balkanization” narratives.

Altogether, it can be said that Ethiopia is successfully resisting the U.S. hybrid war against it. There have certainly been some serious costs to its international reputation, but it remains committed to the cause of national unity, and it does not seem likely to politically capitulate to the terrorist-designed TPLF’s foreign-backed demands. Expelling those seven UN officials for meddling was a major move which speaks to how serious the country is about protecting its sovereignty. The same can also be said about PM Abiy’s open letter to Biden which preceded that development and explained why the U.S. is wrong for meddling in Ethiopia.

The American Hybrid War on Ethiopia will likely continue since the US doesn’t like to lose. It keenly understands what’s at stake in the realm of international perceptions, and it’s that the US cannot afford to have an African country – let alone one as large and influential as Ethiopia is – successfully resist its pressure campaign. Ethiopia’s resolute resistance can inspire other countries across the Global South, which can complicate the US’ efforts to pressure them into curtailing ties with China in the New Cold War. Had the US simply accepted Ethiopia’s balancing act, then the conflict might have ended by now, but its zero-sum policies prevented that.

From our partner RIAC

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Reducing industrial pollution in the Niger River Basin

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The Niger River is the third-longest river in Africa, running for 4,180 km (2,600 miles) from its source in south-eastern Guinea, through Mali, Niger and Nigeria, before discharging via the Niger Delta into the Gulf of Guinea in the Atlantic Ocean. Tributaries that run through a further five countries feed into the mighty Niger.

Hundreds of millions of people in West Africa depend on the river and its tributaries, for drinking water, for fish to eat, for irrigation to grow crops, for use in productive processes, and for hydroelectric power.

The health of the Niger River Basin is vitally important for the people and for the environment of West Africa. But this health is endangered by land degradation, pollution, loss of biodiversity, invading aquatic vegetal species and climate change.

To both assess and address these environmental issues, a Global Environment Facility (GEF)-funded project has brought together international, regional and national entities to work on integrated water resources management for the benefit of communities and the resilience of ecosystems. (Project details can be found here.)

One part of the early project research found that as the Niger River passes through Tembakounda, Bamako, Gao, Niamey, Lokoja and Onithsa – major trading, agro-processing and industrial cities – wastewater and other polluting substances are discharged directly into the river, often without consideration for the environment. National governments of the countries which the river runs through are either unable to deal with the accumulated environmental problems and/or are ineffective at preventing, regulating, reducing and managing pollution from industrial activities.

For this reason, one component of the GEF project, implemented by the United Nations Industrial Development Organization (UNIDO), will facilitate the Transfer of Environmentally Sound Technology (TEST) to reduce wastewater discharges and pollution loads into the Niger River.

Despite the limitations on travel resulting from measures to halt the spread of the coronavirus, in August this year, UNIDO successfully identified and engaged with 19 pilot enterprises in various sectors, including pharmaceuticals, mining and agribusiness, operating in ‘pollution hotspots’ in the countries of the Niger River Basin. This number exceeds the original target of one enterprise per country. 

UNIDO experts are now introducing and sharing the Transfer of Environmentally Sound Technology (TEST) methodology with the pilot enterprises. In essence, this will mean the application of a set of tools including Resource Efficient and Cleaner Production, Environmental Management Systems, and Environmental Management Accounting, which will lead to the adoption of best practices, new skills and a new management culture.

Armed with these tools, the enterprises will be able to reduce product costs and increase productivity, while reducing the adverse environmental consequences of their operations. An awareness-raising campaign will be carried out so that the demonstration effect resonates across the Niger River Basin, prompting other enterprises to follow suit.

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