Sunday

15th Dec 2019

Feature

Promises and doubts: Africa's free-trade adventure

  • Concrete skeletons of new buildings have mushroomed across Addis Ababa (Photo: EUobserver)

The remains of a three million-year old Australopithecus afarensis, also more commonly known as "Lucy", can be found in the dusty basement of Ethiopia's national museum in Addis Ababa.

Discovered in the eastern Afar region, Lucy is an insight into the origins of humankind. But behind the scratched glass case, one of the world's greatest wonders appears utterly neglected.

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  • The African Union building was built by the Chinese (Photo: EUobserver)

Throughout the capital, tall grey concrete shells of buildings - held up by a patchwork of wooden scaffolding - have mushroomed. The more modern glass-like structures are being erected by the Chinese.

The building boom could not have gone unnoticed by the some thousand delegates from around 95 countries that gathered last week for the World Export Development Forum in Ethiopia's capital city and seat of the African Union.

"The plan to start integrating the African continent starts now," announced Arancha Gonzalez at the event.

Gonzalez is the assistant secretary-general of the United Nations and the executive director of the International Trade Centre, a joint agency of the United Nations and the World Trade Organization.

"There were many big ideas and many big declarations before," she said.

But the signatures last year, by African heads of state and government, on the African continent free trade agreement marks a turning point, she said.

Amid the promises, the reality of an intra-continental wide trade agreement is also rife with doubt. Can it create tens of millions of jobs and turn Africa into the world's largest market?

Only three months after signing the pact, Africa's largest economy, Nigeria, slapped a ban on the movement of all goods from neighbouring countries Benin, Niger, and Cameroon.

Rahel Heruy, a 40-year old native of Addis Ababa who runs a spice and essential oil farm in the plush rain forests of the south-western Kaffa region, remains hopeful.

"The plan is not just the African market. Any country can buy from us," she told this website.

A pharmacist by trade and educated in cosmetics, Heruy has had to grapple with the daily realities of overcoming numerous difficulties in a business she launched some five years ago.

"Clean water is a problem, the livelihoods of people are of course a problem. When you get there you can see all these problems," she said, pointing out that some farmers are cut off by rivers, simply due to a lack of bridges.

Heruy says breaking down trade barriers for people like herself means she will be able to expand in the hope that one day she can source oils from other African countries to produce unique blends.

Profit: the new incentive behind development

To help get past such obstacles, the EU is using a narrative of equal partnership, as it drums up notions of shared values sometimes thought of as European.

The EU is Africa's largest donor, closest neighbour, and biggest trading partner.

It also sees private investment as a means to close the $2.5tn [€2.27tn] per year funding gap needed to reach the UN's Sustainable Development Goals by 2030.

But the EU's renewed interest in Africa also stems from a continent partly destabilised by conflict, and a projected population rise that may end with more unwanted migrant boat arrivals on European shores.

Aside from the injection of EU donor aid money, which according to one study largely fails to reach the world's poorest countries, a trend has emerged where development aid is directly linked to turning a profit.

"Our support is not just about development aid, it's about an investment in our partners, in return we gain stability, peace and prosperity and market opportunities for European companies," said Neven Mimica, the European commissioner for development, in a policy paper last year.

So far, the EU has cut preferential trade deals with some 14 African states where tariffs are either sharply reduced or non-existent.

It is also true that Africa is home to great talent, opportunities and an eagerness among a youth fighting against a deeply embedded status quo.

But unless something is done, some of those changes, like gender parity among sub-Saharan countries, will take an estimated 136 years. Pakistan and Iran, for comparison, would take another 500 years at their current pace.

Western companies extracting raw materials while avoiding tax payouts into African national coffers have only compounded the misery.

The tariff busters

The seat of those promises to lift millions out of crushing poverty is within the Chinese-built Nelson Mandela Hall of the Africa Union HQ.

It is here where the agreement aims to remove 90 percent of trade tariffs among the 54 out of the 55 African countries that have so far publicly supported the pact.

The proposal also seeks to reap the benefits of value chains, where services and materials for products are not only sourced at site but also made and then sold abroad.

In October, for instance, Rwanda inaugurated a smartphone factory owned by a Dubai-based entrepreneur with a capacity to produce two million handsets a year.

The EU's foreign policy chief Frederica Mogerhini earlier this week told ambassadors in Brussels that mobilising public and private investment for development serves to reinforce the role of the European Union in a world confronted by global competition.

"It is a development and economic diplomacy tool on which it is development ministers who should guide the way ahead," she said.

For the EU, the pact presents an opportunity to tap into a three-trillion euro market and gain further influence in a land balkanised by Europe's colonial past.

That past left Africa with over a dozen land-locked countries and 107 land borders. It also helped create a legacy of exploitation whose system of clientelism continues to play out today in various forms, including the aforementioned tax-avoiding mining firms.

Belgium, where the EU is seated in Brussels, is only now starting to have a conversation on the millions of murdered and enslaved Congolese that served to enrich the royalty under King Leopold's reign some 120 years ago.

Meanwhile, its newly-refurbished and vast Africa museum on the outskirts of Brussels has partly consigned that sordid episode to a drawer of pictures in a filing cabinet.

So it comes as little surprise that a handful of African reporters at the world development trade forum laughed, when asked by this website whether they buy into the idea of European values and shared partnership on equal footing with Africa.

"They have all the money, so we have to keep quiet," said one.

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Feature

Promises and doubts: Africa's free-trade adventure

The EU is hoping that a continent-wide free trade agreement in Africa will help lift millions out of poverty and help solve issues of security and migration. But its message of values and equal partnership do not resonate with everyone.

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