|Wednesday, 11 November 2015 14:14|
Russia: Attempting a Bridge to Africa
By Kester Kenn Klomegah*
MOSCOW, November 11, 2015 (Buziness Africa) -- While Russia's interest in the sub-Saharan Africa is nothing new, Russian authorities have realized that it’s time to move back primarily to reclaim its economic footprints and to find old Soviet-era allies, but that step comes with new challenges especially from other foreign players and the changing internal political and economic conditions in Africa.
For the past few years, Russia authorities have taken steady and strategic steps at the possibility of pushing huge investments in lucrative sectors as ways to strengthen bilateral relations and expand economic cooperation in a number of African countries.
That show of corporate investment and business interests have been sealed into various agreements, for instance, were the results from high-powered state delegations that frequently visited both regions, Russia and Africa, last year and during the first half of 2015.
Keir Giles, an associate fellow of the Royal Institute of International Affairs (Chatham House) in London explained to me in an email interview that "Russia's approach to Africa is all about making up for lost time. The Soviet Union's intense involvement in African nations came to an abrupt halt in the early 1990s, and for a long time Moscow simply didn't have the diplomatic and economic resources to pay attention to Africa while Russia was consumed with internal problems."
According to Giles "that changed in the last decade, thanks to two things: the arrival of President Vladimir Putin with a new foreign policy focus, and the massive influx of cash on the back of increased oil prices, which transformed Russian state finances. Russia is interested both in economic opportunities and in rebuilding political relationships that had in some ways been on hold for over a decade."
In order to raise Russia's economic influence and profile in Africa, in June 2009, the Coordinating Committee on Economic Cooperation with Sub-Saharan Africa, popularly referred to as AfroCom, was created on the initiative of the Russian Federation Chamber of Commerce and Industry and Vnesheconombank to help promote and facilitate Russian business in Africa. Since its creation, it has had full-fledged support from the Russian Government, the Federation Council and State Duma, the Ministry of Foreign Affairs and the African diplomatic community.
The vice-president of the Chamber of Commerce and Industry of the Russian Federation, Georgi Petrov, noted at the AfroCom's annual executive meeting held in April 2015 that "in view of the current geopolitical situation in the world and the economic situation in Russia Russian businesses have to look for new markets. In this regard, of particular interest is the African continent, which today is one of the fastest growing regions in the world with an annual GDP growth - 5%. In addition, opportunities for projects in Africa are opened with the accession of South Africa to the BRICS bloc." Brazil, Russia, India and China are members of BRICS.
Reports also showed that Russia has started strengthening its economic cooperation by opening trade missions with the responsibility of providing sustainable business services and plans to facilitate import-export trade in a number of African countries.
But, these Russian trade centers must necessarily embark on "Doing Business in Africa" campaign to encourage Russian businesses to take advantage of growing trade and investment opportunities, to promote trade fairs and business-to-business matchmaking in key spheres in Africa.
Maxim Matusevich, an associate professor and director, Russian and East European Studies Program at the Seton Hall University, told me in an interview discussion that "in the past decade there was some revival of economic ties between Africa and Russia - mostly limited to arms trade and oil/gas exploration and extraction. Russia's presence in Africa and within African markets continues to be marginal and I think that Russia has often failed to capitalize on the historical connection between Moscow and those African elites who had been educated in the Soviet Union."
"It is possible that the ongoing crisis in the relations between Russia and the West will stimulate Russia's leadership to look for new markets for new sources of agricultural produce. Many African nations possess abundant natural resources and have little interest in Russia's gas and oil. As it was during the Soviet times, Russia can only offer few manufactured goods that would successfully compete with Western-made products. African nations will probably continue to acquire Russian-made arms, but otherwise, I see only few prospects for a diversification of cooperation in the near future," added Maxim Matusevich.
As Buziness Africa gathered in May 2015, Russian Foreign Minister Sergei Lavrov has held talks during the first quarter of this year with a number of state delegations at various levels and that included Foreign Ministers from Burundi, Tanzania, Algeria, Gabon, Guinea, Madagascar, Libya and Zambia.
And also at the start of this year, the high-ranking Russian delegation headed by special presidential representative for the Middle East and Africa, Mikhail Bogdanov, participated in the 24th Ordinary Session of the Assembly of Heads of States and Governments of the African Union and on the sidelines held series of diplomatic discussions with representatives from some African countries in Addis Ababa, Ethiopia.
"On the sidelines of the forum, Mikhail Bogdanov had meetings and talks with President of the Republic of the Congo Denis Sassou Nguesso, President of Mauritania, Mohamed Abdel Aziz, President of Madagascar Hery Rajaonarimampianina, President of Equatorial Guinea Obiang Nguema Mbasogo, President of Gabon Ali Bongo, Vice President of Angola Manuel Vicente, Deputy Secretary General of the Arab League Ahmed Ben Helli."
"The parties discussed current bilateral and regional agendas, further improvement of diverse cooperation between Russia and Africa, including cooperation with sub-regional organizations of the continent," according to the transcript posted to the official website of the Foreign Ministry.
Further to that, Lavrov held a meeting on the sidelines of the 69th session of the United Nations General Assembly in New York. The meeting was attended on the SADC side by representatives of Zimbabwe (the SADC presiding country), Angola, Zambia, Namibia, Mauritius, Malawi, Mozambique, Seychelles, Tanzania, the Republic of South Africa, as well as SADC Executive Secretary.
Without doubts, Russia's strategic return to Africa has sparked academic discussions at various levels where academic researchers openly admitted that political consultations are on track, arms exports has significantly increased, but other export products are extremely low. Russia's involvement in infrastructure development has also been low for the past decades on the continent.
In an interview, Themba Mhlongo, Head of Programmes at the Southern Africa Trust, thinks that Africa should not expect higher trade flows with Russia simply because Africa has not engaged Russia.
Mhlongo told Buziness Africa media that "there is still low Africa-Russia Dialogue or mechanism for dialoguing with Russia, and on the otherhand, Russia has not been as aggressive as China in pursuing opportunities in Africa because Russia has natural resources and markets in Eastern Europe, South West Asia. Russian exports to Africa might be dominated by machinery and military equipment which serves their interest well."
He suggested that Africa must engage all BRICS members equally including Brazil and Russia in order to build alliances and open trade opportunities including finance and investment opportunities. Also African countries must not seem to show preferences in their foreign policy in favour of Western Europe if they want to benefit from trade relations with Russia. They must learn to be neutral!
Mhlongo suspects that Africa still holds an old view about Russia being a communist state and less technologically developed or unsophisticated compared to Western Europe. But, Russia never colonized Africa and therefore there are no colonial ties between the two.
"If you look at African trade flows to Europe they reflect colonial ties most of the time. However, modern Russia is now one of the important emerging market countries and a member of BRICS. The Russian society is also closed and orientation is towards Western Europe in particular the United States (probably as a result of the period of bi-polar global power system that existed before). Although Russia exports to Africa but rarely sets up businesses. The language (or culture in general) could be one of the barriers to the development of trade relations with Russia," he pointed out.
He further proposed that both Africa and Russia can initiate a dialogue in the form of Africa-Russian business summit to explore economic opportunities between them. However, there are other avenues to engage each other through the BRICS bloc or through bilateral diplomatic channels. Russia has embassies in Africa and African countries have diplomatic representations in Russia. Africa may have to pay special attention to cultural issues and try to understand Russia in this ever changing environment and find an entry point to engage Russia.
On her part, Alexandra Arkhangelskaya, a senior researcher at the Institute of African Studies under the Russian Academy of Sciences and a staff lecturer at the Moscow High School of Economics told Buziness Africa in an interview that Russia and Africa needed each other – “Russia is a vast market not only for African minerals, but for various other goods and products produced by African countries.”
The signs for Russian-African relations are impressive - declarations of intentions have been made, important bilateral agreements signed - now it remains to be seen how these intentions and agreements will be implemented in practice, she pointed out in the interview.
The revival of Russia-Africa relations should be enhanced in all fields: political, economic, trade, scientific, technological, and cultural. Obstacles to the broadening of Russian-Africa relations should be addressed. These include in particular the lack of knowledge in Russia about the situation in Africa, and vice versa, suggested Arkhangelskaya.
"As we witness rapid deterioration of relations between Russia and the West unfold, Russia's decision to ban the import of some agricultural products from countries that have imposed sanctions against Moscow offers great opportunities for the expansion of trade of such products from Africa," the academic professor observed in her discussion.
Experts, who have researched Russia's foreign policy in Africa, at the Russian Academy of Sciences' Institute for African Studies, have reiterated that Russia's exports to Africa can be possible only after the country's industrial based experiences a more qualitative change and introducing tariff preferences for trade with African partners. As a reputable institute during the Soviet era, it has played a considerable part in the development of African studies in the Russian Federation.
"The situation in Russian-African foreign trade will change for the better, if Russian industry undergoes technological modernization, the state provides Russian businessmen systematic and meaningful support, and small and medium businesses receive wider access to foreign economic cooperation with Africa," according the views of Professor Aleksei Vasiliev, the director of the RAS Institute for African Studies and full member of the Russian Academy of Sciences, and Evgeny Korendyasov, an expert at the RAS Institute for African Studies.
Statistics on Africa's trade with foreign countries vary largely. For example, the total U.S. two-way trade in Africa has actually fallen off in recent years, to about $60 billion in 2013, far eclipsed by the European Union with over $200 billion and China, whose more than $200 billion is a huge increase from $10 billion in 2000, according to a recent "Africa in Focus " website post by the Brookings Institution. According to the Chamber of Commerce and Industry of the Russian Federation, Russia's trade with Africa, south of the Sahara, is only $3.2 billion.
In one of his speeches posted to the official website, Russian Foreign Minister Sergei Lavrov noted frankly in remarks: "it is evident that the significant potential of our economic cooperation is far from being exhausted and much remains to be done so that Russian and African partners know more about each other's capacities and needs. The creation of a mechanism for the provision of public support to business interaction between Russian companies and the African continent is on the agenda."
*Kester Kenn Klomegah is a research writer and a policy consultant on African affairs in the Russian Federation and Eurasian Union. He has won media awards for highlighting Russia’s economic diplomacy with African countries in the region.