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Russia reappears in Africa

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Relations between Russia and Africa are long-standing and have always been characterised by their versatility. They ranged from the humanitarian aid of Tsar Nicholas II to the Ethiopian Empire in its struggle against Italy (late 19th century) to support for the liberation of Angola, Mozambique, Guinea-Bissau, Cape Verde and São Tomé and Príncipe from Portugal (late 1960s-1970s).

In the second half of the 20th century, Soviet engineers and specialists took an active part in the implementation of a number of large industrial projects in many African countries. Power plants (Aswan Dam), metallurgical, mining plants and processing plants, oil refineries, companies manufacturing machinery and other important items of the national economy were built.

How does Russia intend to develop economic cooperation with African countries and what course can this partnership follow in the near future?

Today, Africa is the world leader in terms of consumption growth. Agriculture, the chemical industry and agro-technologies, oil refining and extractive industries, energy and nuclear technologies for peaceful purposes are developing rapidly in Africa. Most countries are interested in infrastructure development, and the demand for cars and special equipment is growing. Russian business has something to offer in each of these sectors.

A continent with a population of 1.4 billion people is comparable to China. In 15-20 years’ time, Africa will determine the world’s demographic framework and influence the scale of global consumer demand significantly.

Russia, which is significantly limited and constrained in the Western direction of foreign economic activity as a result of sanctions, is looking for new markets for its products, mainly for exports. It is obvious that it will be practically impossible for Russia to solve these problems without Africa.

The Russian Foreign Ministry has noted that Africa remains one of the priorities of Russian foreign policy. In the near future, it is certainly possible to ensure the gradual growth of trade and economic ties between Russia and the African countries. This means increasing the number of mutually beneficial joint projects in the fields of energy, agriculture, subsoil use, infrastructure development, high technology and staff training.

At the same time, it should be recalled that the 54 African countries account for 27.98% of the seats in the United Nations, and the political support of such a large number of countries is also extremely important for Russia.

Russia has traditionally developed and continues to develop relations with the Maghreb and Southern African countries. Four North African countries, namely Egypt, Algeria, Morocco and Tunisia, as well as the Republic of South Africa account for over 70% of all trade with Africa. If we add Sudan and Nigeria, Russian trade with Africa reaches 85%.

Moreover, many countries in the sub-Saharan region are developing rapidly and record very high economic growth rates. They also have natural and economic resources that could be of interest to Russia.

One of the main tasks of Russian institutions in this regard is to catalyse trade with black African countries: there are plans to open agencies or representative offices there, to which local entrepreneurs and citizens can turn if they are interested in economic contacts or dialogue with their Russian counterparts.

In 2019, Russia’s foreign trade turnover with African countries amounted to 16.8 billion U.S. dollars, and exports to African countries regarded machinery, equipment and vehicles, foodstuffs, agricultural commodities, and mineral products. The rest of trade consisted of metals, chemicals, rubber, timber, paper products and precious minerals.

Africa is still characterised by an extensive diamond resource base and prospects for new discoveries of rare metals, which explains Russia’s interest in potential development in this region.

Conversely, in 2019 food and agricultural commodities accounted for the majority of Russian imports (56.8%). At the same time, the majority of Russia’s trade with African countries in 2019 materialized due to mutual trade transactions with Egypt (37.2%), Algeria (20.2%), Morocco (7.6%), the Republic of South Africa (6.6%), Senegal (4.3%), Tunisia (3.9%), Nigeria (2.5%), Togo (2.4%), Sudan (1.6%) and the Ivory Coast (1.6%).

In January-September 2020, due to the spread of the coronavirus infection, Russian-African trade turnover decreased by 20.5% compared to the same period in 2019 and amounted to 8.9 billion dollars.

Today, Russia is ready to act as a partner for all African countries in a number of sectors. These include projects to supply the latest Russian equipment for metallurgical and mining companies, as well as the development of a transport and logistics system – including not only the supply of rolling stock for railways, aircraft and helicopters of various classes and purposes, but also control and safety systems for the respective transport lines. Russia is also interested in participating in the creation of energy infrastructure in African countries – oil, gas and generation capacities, including hydroelectric and nuclear power – as well as in ensuring food security, developing a healthcare system and supplying medicines.

Russia does not offer individual export contracts, but projects that include both the supply of products and their maintenance, as well as training for specialists, and possible technology transfer and partial localisation. This enables African countries to develop their expertise in a variety of industries.

Africa is currently one of the sales markets that attracts long-term investment for national companies. In recent years, African countries have made a huge leap forward in creating the conditions for developing trade and a favourable investment climate.

Promising areas and niches for Russian exporters to Africa are the supply of finished automotive equipment, as well as accessories and spare parts for machinery; the construction and modernisation of railway infrastructure, and the supply of oil refining equipment. At the same time, Russian agricultural machinery suppliers and major car manufacturers are already working in African markets.

Projects for the maintenance and modernisation of power plants, for oil production and transport, as well as for the arrangement of facilities for the chemical and mining industries in Africa have been developed successfully. An important role in exports is played by the supply of agricultural and food products. Projects in new directions, such as modern technology, ‘smart’ cities, education and health, are beginning to be proactively developed.

At present, key countries in the promotion of non-resource exports are Egypt, which accounts for over one third of Russian-African trade turnover, the Republic of South Africa, Zambia, Angola, Algeria, Nigeria and Kenya.

From a strategic perspective, African countries’ sustainable development will be associated, inter alia, with the full use of investment potential, attracting companies interested in implementing projects on their territory.

The quality of Russian companies’ products meets international standards. Therefore, many African leaders are interested in projects involving the construction of airports, hydroelectric power stations, schools and universities, as well as in the cultural field.

At the same time, not only Western European countries, the United States and China, but also India, Turkey, as well as the Persian Gulf States, Japan, the Republic of Korea, Israel and Brazil are showing increasing interest in developing relations with African countries. Hence these activities of the world’s major powers inevitably lead to a significant increase in competition in virtually each of these areas.

One of the biggest projects of the Russian State company Rosatom in Africa is the construction of the al-Dabaa nuclear power plant in Egypt. Rosatom State Atomiс Energy Corporation is a Russian state-owned nuclear energy company with over 360 firms.

Nevertheless, this is not the only area of interest for the company in the region. Rosatom, in particular, develops non-energy cooperation not only in the nuclear sector, but also offers various options for turnkey basic research, medical and radiological facilities.

One of these facilities is the Centre for Nuclear Science and Technology (CNST). Rosatom is already proactively involved in the project to build the CNST in Zambia. The Centre includes a research reactor, a multipurpose irradiation centre, a nuclear medicine centre and several laboratories – a modern platform for a wide range of scientific research and practical applications of nuclear technologies.

The company also sees potential in staff training and provides a number of scholarships and educational programmes. For the past five years there has been a State scholarship programme for students wishing to master nuclear and engineering specializations at Russia’s leading universities. Each year, at Rosatom’s request, quotas are allocated to representatives from African countries.

Moreover, digital technologies, artificial intelligence and cyber security – of which the Russians are masters – are rapidly developing in Africa. Africans are interested in Russian information technologies – first and foremost in the Russian government services, such as tax collection programmes, cloud technologies, and everything related to online payment systems.

Africa is showing particular interest in agricultural projects. In particular, African countries are increasing their cereal production and the demand for fertilisers is growing. Therefore, over the last five years the volume of fertiliser consumption in African countries has grown by 4-5% per year, while the world average is 1.5-2%. There are huge prospects for the African market – consumption of nitrogen and phosphorous fertilisers in the region is currently five to seven times lower than the world average, while potash consumption is nine to eleven times lower than the world average.

In the first nine months of 2020, despite the pandemic, the company’s fertiliser supplies exceeded last year’s indicators and reached 445,000 tonnes. Over the next five years, the possibility of increasing the supply of ecologically standard products to Africa is being considered – an important contribution to ensuring food security in Africa, which the continent had until the 1960s and then lost due to neo-colonialism,

With a gradual and systematic development of market potential, it is entirely possible for Russian companies to take leadership positions, redirecting volumes and priorities from more distant markets and also from other ones.

The first Russia-Africa Conference was held in Soči on October 23-24, 2019 and saw the participation of 54 African representatives with 43 Heads of State. At the Summit Putin emphasised that cooperation between the parties waslong standing and long-term -and military, we would add. The new support point for the Russian Navy is in Sudan – the Treaty of December 8, 2020, and the docking of the frigate Admiral Grigorovic on February 28, 2021 in Port Sudan.

Russia’s reappearance in Africa is taking place in full swing.

Advisory Board Co-chair Honoris Causa Professor Giancarlo Elia Valori is an eminent Italian economist and businessman. He holds prestigious academic distinctions and national orders. Mr. Valori has lectured on international affairs and economics at the world’s leading universities such as Peking University, the Hebrew University of Jerusalem and the Yeshiva University in New York. He currently chairs “International World Group”, he is also the honorary president of Huawei Italy, economic adviser to the Chinese giant HNA Group. In 1992 he was appointed Officier de la Légion d’Honneur de la République Francaise, with this motivation: “A man who can see across borders to understand the world” and in 2002 he received the title “Honorable” of the Académie des Sciences de l’Institut de France. “

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Africa

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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Wagner: Putin’s secret weapon on the way to Mali?

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Soldiers from the Wagner Group (source: middleeastmonitor.com)

France is outraged at the prospect of Russian mercenaries from the Wagner group arriving in Mali. However, Paris is seeking a way out of an unwinnable conflict.

On September 13, a Reuters news agency article citing unnamed sources and reporting advanced negotiations between Mali and the Russian mercenary company Wagner sparked a firestorm of reactions. The United States, Germany, and the United Nations have all warned Bamako’s military against such collaboration. According to them, the arrival of Russian mercenaries – a thousand have been estimated – would jeopardize the West’s commitment to fighting the jihadists who control a large portion of Malian territory.

But France, understandably, is the most vocal against such a move. The former colonial power has maintained a military presence in the country since 2013, when it halted the jihadists’ advance on the capital. Florence Parly, the French Minister of the Armed Forces, visited Bamako on September 20th to warn Malian colonels in power following two coups in August 2020 and May 2021. Wagner’s choice, she said, would be that of “isolation” at a time when “the international community has never been so numerous in fighting jihadists in the Sahel”.

What the minister does not mention is that France’s commitment to Mali is waning. Emmanuel Macron used the second Malian coup d’état last June, less than a year before the French presidential election, to announce a “redeployment” of French forces in Mali. Although Paris refuses to discuss a de facto withdrawal, even if it is partial, the truth is that the tricolored soldiers will abandon the isolated bases of Kidal, Timbuktu, and Tessalit in the country’s north by next year, concentrating on the area further south of the three borders with Niger and Burkina Faso.

Europeans, who are expected to be more supportive of France, are also perplexed. The humiliation of the Western withdrawal from Afghanistan has served as a wake-up call. The Afghan government’s sudden collapse in the face of the Taliban has demonstrated how difficult it is to build a strong army and institutions. This scenario appears to be repeating itself in Mali.

The possibility of a rapprochement between Bamako and Moscow is taken seriously because Putschists in Mali have always been sensitive to Russian offerings. Colonel Sadio Camara, Mali’s Defense Minister, visited Russia on September 4. Disagreements over a reversal of Mali’s alliances are said to have been one of the causes of the Malian colonels’ second coup, which ousted the civilian transitional government last May.

Russia also acts as a boogeyman for the Malian military. According to a Daily Beast investigation, the Malian army organized a supposedly spontaneous demonstration last May demanding Russian intervention. This was also a warning to the international community, which is growing weary of the country’s poor governance and repeated coups.

Is Mali transitioning from the French to the Russian spheres of influence? Since Moscow gained a foothold in the Central African Republic, the scenario is not a figment of the imagination. Russian instructors and Wagner’s mercenaries have proven their worth in this former French backyard. Even though the UN condemns Russia’s atrocities in this conflict, the Russians were able to push back the rebels who were threatening the capital Bangui last December with the help of UN peacekeepers and Rwandan reinforcements.

The Kremlin denies any involvement with the Wagner group. However, the company is actually run by a close associate of Vladimir Putin. The use of private mercenaries allows Moscow to avoid military commitments abroad, as it did previously in Ukraine and Libya. “Russia is not negotiating a military presence in Mali,” said a Kremlin spokesman in mid-September. When questioned by the magazine Jeune Afrique on September 20th, Central African President Faustin-Archange Touadéra swore that he had “not signed anything with Wagner.” “In the Central African Republic, we have companies that were established in accordance with the law and operate on liberalized markets,” he explained.

Nothing has been decided on Wagner, it is repeated in Bamako. According to the military, the selection of foreign “partners” is a matter of Mali’s “sovereignty.” They regard these “rumors” as an attempt to “discredit the country.” The Malian junta is under siege, not only from jihadists but also from the international community. The latter is calling for elections to be held in February to return power to civilians, as stipulated in the military-agreed transition charter. Electoral reform must come before the election. However, Colonel Assimi Gota, the transitional president, has shown little interest in preparing for these elections. The Malian junta may also be hoping that Russia’s partners will be less stringent on democratic requirements.

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Google Drives Deeper into Africa

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As the African Continental Free Trade Area (AfCFTA), the new initiative that places emphasis on intra-African trade – including free movement of goods, capital  and people – foreign players have accordingly raising eyes on using the new opportunity to expand their operations in Africa.

Foreign enterprises are gearing up to localize production in industrial hubs and distribute their products across the borderless territory considered as a single market in Africa. Thus, by its description, Africa’s estimated population of 1.3 billion presents itself a huge market – from baby products through automobiles and to anything consumable.

Google LLC, the U.S. Global Technology Gaint, has primarily set its eyes on business, with a comprehensive plan to expand its operations into Africa. Google made known its plans to commit US$1 billion over the next five years in tech-led initiatives in Africa. It is investing this US$ 1 billion in Nigeria and African countries to support and transform the digital market over the next five years.

In its media release, it said the investment would include landing a subsea cable into the continent to enable faster internet speeds, low-interest loans for small businesses, equity investments into African startups, skills training and many more directions determined in future.

This is in a bid to enable fast, affordable internet access for more Africans, building helpful products, supporting entrepreneurship and small business, and helping nonprofits to improve lives across Africa.

The Chief Executive Officer (CEO) of Google and Alphabet, Sundar Pichai, noted that the company was building global infrastructure to help bring faster internet to more people and lower connectivity costs. Through the Black Founders Fund, Google will invest in Black-led startups in Africa by providing cash awards and hands-on support.

The developing world represents the best chance of growth for large internet companies, and today, one of the very biggest set out its strategy for how it plans to tackle that.

“We’ve made huge strides together over the past decade – but there’s more work to do to make the internet accessible, affordable and useful for every African. Today, I’m excited to reaffirm our commitment to the continent through an investment of US$1 billion over five years to support Africa’s digital transformation, to cover a range of initiatives from improved connectivity to investment in startups,” said Pichai.

According to him, this is in addition to Google’s existing support through the Google for Startups Accelerator Africa, which has helped more than 80 African startups with equity-free finance, working space and access to expert advisors over the last three years. The subsea cable is set to cut across South Africa, Namibia, Nigeria and St Helena, connecting Africa and Europe.

According to Managing Director for Google in Africa, Nitin Gajria, it will provide approximately 20 times more network capacity than the last cable built to serve Africa. It is projected to create about 1.7 million jobs in Nigeria and South Africa by 2025 as the digital economy grows.

Google further announced the launch of the Africa Investment Fund, where it will invest US$50 million in start-ups across the continent providing them with access to Google’s employees, network, and technologies to help them build meaningful products for their communities.

It will additionally disburse US$10 million in low-interest loans to small businesses in Nigeria, Ghana, Kenya and South Africa in order to alleviate hardships brought about by the Covid pandemic.

Google is bringing venture capital into the continent. The fund might work in a similar fashion as the Google for Startups Accelerator programme.

Although Africa has a Big Four (Nigeria, Kenya, South Africa and Egypt) in terms of startup and venture capital activity on the continent, the accelerator has made sure to accept applications from startups in less-funded and overlooked regions. These countries include Algeria, Botswana, Cameroon, Ivory Coast, Ethiopia, Ghana, Morocco, Rwanda, Senegal, Tanzania, Tunisia, Uganda and Zimbabwe.

Founded in September 1998 by Larry Page and Sergey Brin, Google is considered as one of the Big Five information technology companies alongside Amazon, Apple, Facebook and Microsoft. Google specializes in internet cloud services, software and hardware as well as online advertising technologies.

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