A Brookings Institution African Growth Initiative Report “Foresight Africa: Top Priorities for the Continent in 2015” highlights the overarching importance of poverty relief, food security, job creation, infrastructure, governance, peace and security in fulfilling the new UN Sustainable Development Goals.
Download Brookings 2015 Africa Foresight Report
Download UN Sustainable Development Goals
This takes into account the reality that at current growth rates, by 2025, three-fifths of sub-Sahara African countries are becoming middle-class, driven by resource boom, services (such as telecommunications, transportation and tourism), agriculture, private-sector investments, and export. Yet Africa remains home to the bulk of the world’s poor, rising from 41% to 81% in a business-as-usual scenario, let alone trapped in youth unemployment, social divide, environmental degradation, inadequate sanitation and healthcare, as well as armed conflicts threatening long-term stability and development.
China has become Africa’s largest trading partner and a major investor. The coming 6th Forum for China-Africa Cooperation (FOCAC) in Johannesburg from 4-5 December is said to focus on support for Africa’s industrialization, healthcare and regional peace and stability. China has promised to devote over half of foreign aid to Africa, helping to build high-speed trains, expressways and regional aviation. Click here China will also increase credit lines to Africa by US$10 billion and will boost the China-Africa Development Fund by US$2 billion, bringing the latter to a total of US$5 billion. Click here
However, following the collapse of commodity prices worldwide, China’s investments in green-field and expansion projects in Africa have since dwindled by 84%, according to a report in the Financial Times on 21 October, 2015. Instead, investments in resources have doubled.
As in the case of China earlier, India is entering into a stage of rapid industrialization, possibly becoming dependent on oil imports by as much as 90% by 2040. Click here
Additionally, India is rivaling China for global influence including in Africa, a vast continent with a cornucopia of resources including oil needed for India’s rapid economic trajectory. Moreover, India cherishes the aim of gathering enough support in the United Nations for inclusion as a Permanent Member of the Security Council. It’s therefore no surprise that the Modi government has dramatically expanded its African footprint.
Reminiscent of China’s FOCAC, the 3rd India-Africa Forum Summit in New Delhi in October attracted 40 heads of state from 54 African countries. Similar, albeit not yet surpassing China’s African endeavors, India has pledged to double its Line of Credit to $10 billion, the establishment of nearly 100 Indian Africa Training Institutes across the continent, as well as the provision of 50,000 scholarships.
Although India-Africa trade has not met its 2015 target of $90 billion, it has multiplied 16 times in the past 15 years. However, petroleum crude accounted for a significant 67 percent of India’s total imports from Africa during 2014-15. Other major items imported from Africa include gold, inorganic chemicals, metal ores and metal scrap and cashew nuts.
Hence, India’s African ventures are, like China’s, largely resources-driven.
The BRICS countries account for 25% of Africa’s Foreign Direct Investment (FDI), about two thirds going to resource extraction. It goes without saying that the lion share accrues to China and India.
The African Union has flagged up the imperative for “structural transformation for inclusive and people-centred development”. In the light of unsatisfactory experiences after the 2002 Monterrey Consensus on “Finance for Development”, the July 2015 Addis Ababa Conference focused on financing with positive outcomes, including implementation and accountability.
Africa’s Post-2015 sustainable development goals will continue to challenge China and India on how their African initiatives will deliver agricultural productivity, food security, technological upgrading, corporate social responsibility, and improvement in governance through such institutions as the Extractive Industries Transparency Initiative (EITI). They will continue to beg the question whether China and India would be able to harness a broader range of local and international non-state actors, including non-governmental organisations (NGOs), to bring about real advances towards the UN Sustainable Goals.
Specifically, where foreign investments are resources-centred, the question will remain whether the host African countries have the political will and bargaining power to ensure that economic benefits are shared by their peoples inclusively and that there are strategic social, economic and institutional "linkages" in place to develop broader skills and economic infrastructure required to hone uniquely-competitive and sustainable local economies. Click here
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