In some quarters on the African continent, there is excitement now that Brexit is happening.
The assumption is that when Britain leaves the European Union, giving it legroom to negotiate independently, it will seek trading partners elsewhere with the virgin economies of the African continent being the most favourable for trade and investment. There is logic on paper for this exhilaration.
If Britain is walking away from the advantages of unrestricted travel, preferential tariffs, freedom of movement of labour, and extensive cooperation in the realm of defence and security, then it might probably consider extending these as sweeteners to the new partners it is seeking. It looks good already. The UK Africa Investment Summit happened in January.
Prime Minister Boris Johnson patted almost every African leader present, on the back, and said something nice about their country. For Uganda, he said something about cattle, meat and milk.
Without intending to rain on the parade of the optimists what is on the ground tells a different story and history is there for us to learn from. It starts in the year 2000.
“The African Growth and Opportunity Act (Agoa) was signed into law by President Bill Clinton in May 2000 with the objective of expanding US trade and investment with sub-Saharan Africa, to stimulate economic growth, to encourage economic integration, and to facilitate sub-Saharan Africa’s integration into the global economy.” (Office of the United States Trade Representative)
“Agoa extends the US Generalised System of Preferences (GSP) to sub-Saharan African (SSA) countries and allow them to export around 7,000 products to the US with no duties or customs.” (Agoa info)
Agoa is now in its 20th year (with five more to go ). We are in position to determine whether it has achieved its lofty goals of “stimulating economic growth in sub-Saharan Africa.” It is this that will inform us if the latest opportunity presented by Britain is something we should look forward to.
In an article titled ‘The African Growth and Opportunity Act, a US trade failure’ (thehill.com,) Rick Helfenbei gives a comprehensive, but dismal report. It lists many of the bottlenecks that are a bane to the whole good intention of preferential trade opportunities to the African continent.
It gives statistics that are quite educative and relevant to his argument of the failure of Agoa. For instance, between 2011 and 2014, there was a huge decline in Agoa exports in billions of dollars (2011 - $68.2, 2012 - $43.1, 2013 -$34.8, and 2014 - $23.2).
By 2015, he continues “…except for apparel and auto manufacturing (from South Africa), very few sectors have actually benefited from the treaty.
To make matters worse, close to 80 per cent of all the Agoa exports come from just four of the 40 countries (Nigeria, Angola, Chad and South Africa). If we look at the non-energy sector, just four of the countries (South Africa, Kenya, Lesotho and Mauritius) cover 90 per cent of the exports…”
The major challenge for Africa is that it is almost where it was at the turn of the 19th Century in as far as serious technology is concerned. We have hardly made headway in the field of manufacturing.
We are basically producer of primary products and most of what passes for manufactured products is value addition that comes in the shape of minimal assembly of imported goods, that come in a semi or total knocked down state.
But even in the sphere of primary products, especially in agriculture, our advantage is seriously undercut by the reluctance to adopt the latest agro-technology, which we associate (quite justifiably) with genetically modified organisms (GMOs.) Because all this is not new knowledge, one can only speculate on what the motives of Britain are in this ‘rapprochement’ with Africa, which the former British prime minister Tony Blair once described as being a scar on the conscience of the world.
The world is taking huge lessons from China. Africa for now is a bottomless pit of mineral wealth. It is also the home of a people who don’t seem to value this wealth and will trade it for a trinkets and whiskey just like the chiefs of old. For global dominance, the future belongs to those who lay their hands on them earliest before others wake up and follow suit.
It is the new colonisation. What is happening is the use of mainly economic power to legally lay claim to these resources. The China model works well. China provides funding for huge infrastructural projects like railways, dams, bridges, roads and housing.
Most of the funding is acquired at exorbitant interest rates with the full knowledge and approval of those in power who line their pockets in these deals.
That is why one finds that in countries that have dams that are producing excess and unutilised power, there are still those who sell proposals to build more dams, even when the new dams destroy the environment and tourism opportunities.
The African as a debtor will have no justification to start “clamouring for Independence” from exploiters like it happened in the 60s. Africa might provide the long dead British Empire a new lease of life after Brexit. Colonialists sleep, they never die.
Mr Sengoba is a commentator on political and social issues.