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29th May 2022

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Scepticism in Africa about the EU's green connectivity plan

  • The EU's much-heralded Global Gateway connectivity initiative is not universally welcomed in Africa
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With great fanfare, a Youssou N'Dour concert in Brussels, and talk of a "partnership of equals" Europe tried to rekindle relations with African leaders at the sixth European Union-African Union summit in February.

The EU's big offer at the two-day summit was Global Gateway Africa — a €150bn connectivity initiative that, among other goals, aims to connect Africa's mineral wealth to the global market, and invest in the continent's electrification, preferably using clean energy.

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  • Senegal's most well-known singer, Youssou N'Dour, was in Brussels for the launch of the EU's Global Gateway (Photo: Wikimedia)

Africa needs roughly €150bn a year for infrastructure investment, so if the EU can deliver on its financial promises, the European scheme could end up becoming a real rival to China's Belt-and-Road Africa investment plan — launched in 2013, with major financial promises, but recently revised down to €40bn.

Many African nations are sceptical, however, of Europe's push to promote green energy. Nigeria, Mozambique and Senegal (which hold huge natural gas reserves) have lobbied hard for a continuation of European financial support for new gas projects in Africa.

Nigerian vice-president, Yemi Osinbajo, has gone on record to lambast wealthy nations from the Global North for banning or restricting public investment in fossil fuels, after "decades of profiting from oil and gas" themselves.

Europeans are not ready to say yes to such support, and no commitments were made at the summit. However, it will be difficult to deny African countries access to funding, and potential oil and gas revenues.

European leaders cannot hope to achieve their clean energy goals without African goodwill and African resources. After all, Africa has the richest solar resources of any continent, and countries such as Kenya and Morocco are already significant generators of cleaner energy.

Africa also has 85-95 percent of global chromium and platinum metal reserves; more than 50 percent of cobalt reserves and a third of world bauxite reserves. (Cobalt is a metal used to reduce overheating in electric cars, which is abundant in Congo, but has already been dubbed "the blood diamond of batteries" because of the appalling work conditions and incidents of child labour associated with mining the material.)

Both these metals are essential for the production of solar panels and the batteries needed to store wind energy.

African nations stand to gain from new investments in green energy but some also fear that this will lead to more exploitation of Africans.

"If you look at the history of infrastructure investment in Africa, it has not led to improvements in the situation on the continent," says architect, environmentalist and poet Nnimmo Bassey.

Bassey, as head of the Health Of Mother Earth Foundation, has fought against injustice and ecological destruction as a result of mining and fossil-fuel extraction for decades. And he has three words to describe foreign investment in Africa: "exploitation, domination, colonialism."

He warns: "A transition to renewables does not automatically mean a just transition."

Mines and harbours

Western and Chinese-built roads and train tracks largely connect mines with harbours — they are not meant to help people, but to speed up the export of mineral wealth. [1] Investment schemes such as the EU's Global Gateway will fail to address exploitation because local people remain excluded from decision-making, he warns. "There is a real drive to scrape the bottom of the barrel from all sides."

And it is not just Europeans and the Chinese who are at fault. National African leaders like Senegalese president Macky Sall and Nigeria's Osinbajo, wittingly or unwittingly, are allowing exploitation to continue by promoting new fossil-fuel projects.

"They hope fossil fuels will give them the revenues they need to transform the country," Bassey said.

"But if you look back at 60 years of oil and gas investments, none of the goals that were set out have been achieved. Instead, all we have to show for it is ecocide, extreme destruction and exploitation of local peoples."

The UN has estimated that African countries lose €80bn a year in illicit cash transfers to the Global North, with at least half of that related to the export of extractive commodities.

The EU insists on good governance and has presented Global Gateway as a watershed moment that will change all this. But there are many other ways wealth continues to flow out of Africa.

New borrowing, fresh debt?

The EU Global Gateway states that Africa will receive €150bn worth of grants and loans to spur further private investment. And while this may increase access to much-needed funding for the energy transition in Africa, new borrowing also means more debt.

Private investors often charge high-interest rates because they perceive African countries as risky investments, resulting in many African countries having to pay a large amount of their budget to debt-servicing — a problem now made worse by the Covid-19 pandemic.

At the end of 2021, more than 20 low-income African countries were in debt distress, according to the International Monetary Fund. In the first five months of 2021, 98 percent of the Nigerian budget was spent on debt-servicing. Between 2011 and 2020, Ghana used 74-percent of its petroleum revenue to pay off debt.

"Nigeria can't transition away from fossil fuels because it depends on oil and gas revenues to pay back investors," says David McNair, who heads the One Campaign, a non-profit organisation against extreme poverty.

The new funding projected by Global Gateway is undoubtedly substantial. But its emphasis on private investors that charge high-interest rates may deepen Africa's debt problems, leading to more loss of wealth, which in turn could tempt African governments to invest in new fossil-fuel projects.

This article first appeared in EUobserver's magazine, War, Peace and the Green Economy, which you can now read in full online.
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