China’s Belt & Road New Paradigm for Development: United States Should Join

April 18, 2019

Belt and Road Creates New Asian Paradigm for Global Economic Integration and Inclusiveness

That is the headline on an April 15 {Global Times} op-ed by Toumert Al, the director of Education, International Bachelor Program at the International School under the China Foreign Affairs University. The article provides a tour d’horizon of BRI achievements to date in infrastructure projects on various continents.

“In South Asia, the Belt and Road Initiative is seen as a main driver for infrastructure construction in a region that must bridge the ever-growing gap between its economic potential and the realities of its insufficient infrastructure. According to the World Bank, South Asia requires about 2 trillion dollars of investment in infrastructure construction from 2011 to 2020 if the region wants to be part of the new economic order shaping the future.” The article then discusses a couple of key projects, such as the Padma bridge in Bangladesh and Gwadar port in Pakistan.

Nigeria’s Mambilla Hydro-Electric Dam-3,000 megawatts (courtesy nigerianmuse.com)

“True to its global status and inclusive nature, the BRI is not merely a regional initiative. Africa can be considered a major beneficiary of  China’s economic drive to support the continent’s development and to help its infrastructure and economy achieve targeted growth plans. The year 2018 could be considered the turning point for the BRI in Africa as the signing of the MOU of cooperation between China and 37 African countries and the African Union raised the initiative to a new level. Infrastructure financing provided by China to Africa averaged $11.5 billion between 2012 and 2016.” Examples cited include the $5.8 billion Mambila Hydropower Plant in Nigeria, the Addis Ababa-Djibouti railway, the $11 billion port in Bagamoyo, Tanzania now under construction, and the Nairobi-Mombasa railway project. “Another project that is moving forward and may have the same implications as CPEC (China Pakistan Economic Corridor) has in South Asia is the Suez Canal corridor in Egypt,” the Toumert wrote. In short, the BRI “is a truly new paradigm in international cooperation.”

The Belt and Road Initiative Keeps Growing

China is now engaged in heavy organizing in the countdown to the April 26-27 Second Belt and Road Forum in Beijing, which will bring together representatives of over 100 countries and 29 international organizations. Just how powerful a draw the BRI is to nations across the planet, was shown earlier this week when the tiny Caribbean nation of Jamaica announced that they had signed an MOU with China on the BRI –notwithstanding the withering pressure that Washington and London have brought to bear. A similar, if strategically weightier example of this process was Italy’s signing an MOU with visiting Chinese President Xi Jinping last month.

Foreign Ministry spokesman Lu Kang yesterday discussed China’s approach to the upcoming Forum: “While the BRI was proposed by China, it has grown into an international public good. The success of the first BRF together with the bumper practical outcomes speaks volumes. The fact that more countries and international organizations are taking an active part in the second forum is further proof to its success.”

Asked about media accounts that India would not be sending a delegation–as they hadn’t to the First Belt and Road Forum–because they view the BRI’s China Pakistan Economic Corridor (CPEC) as infringing on Indian sovereignty, Lu responded:

“I would like to reiterate that the BRI is an open and inclusive initiative for economic cooperation. It never concerns territorial disputes. In pursuing BRI cooperation, China and partner countries are committed to equality, openness and transparency, to business operations centered around enterprises and to market rules and international norms. For those with inaccurate judgment on the BRI based on misunderstandings due to lack of knowledge of the real situation, I would like to reassure them that China is sincerely and resolutely committed to the principle of consultation and cooperation for shared benefit, equality and mutual benefit. Since its initiation, the Belt and Road cooperation has been inclusive and open to all countries that are interested in joining and working for win-win cooperation. It excludes no one. If the relevant country would like to take some time to see, we can wait.”

Meanwhile, Xinhua interviewed Cambodia’s Information Minister Khieu Kanharith who said that “the BRI forum will also further promote cooperation between China and ASEAN and between China and Cambodia…. For Cambodia, with Chinese assistance, we can build mega-infrastructure projects, and those projects are crucial to boosting economic growth and making communication easier and faster…. Our first priority is to boost economic growth and to make everybody have a fair share of the economic growth, The BRI can help us through sup-porting infrastructure projects and human resources development.”

He continued: “China has assisted us on equal footing, meaning that although China is a big country and Cambodia is a small country, China always treats us equally. With Chinese support, Cambodia has gained confidence in ourselves and our people are proud and confident in rebuilding the country.”

Chinese Insist the U.S. Should Join the Belt and Road

Asian Infrastructure Investment Bank President Jin Liqun told last weekend’s Harvard China Forum that the “infrastructure bottlenecks are the sewage problems of development. I would say that that’s also a problem for the United States”–a statement Americans can agree with. He presented the Belt and Road Initiative as “a platform for all participating countries to work together, including on connectivity,” which he called a matter not only of regional development, but also of “world peace and prosperity.”

When a discussion arose on how China had gone from being a debtor nation dependent on foreign development assistance, to one of the largest contributors to the World Bank’s International Development Assistance facility today, Jin pointedly commented that how much money a country has is not the issue.

“Accumulated wealth cannot buy you respect unless you help do good things for the rest of the world. So China has been trying to invest and help other countries through its own experience,” Jin stated.

At a Center for China and Globalization conference in Beijing over the same weekend, Jin Xin, director of the China Center for Contemporary World Studies of the Communist Party’s International Liaison Department, took on the arguments of former U.S. Ambassador Terry Miller (from the G.W. Bush days), who asserted the U.S. had no interest in participating in the Belt and Road Initiative, which is viewed as “a Chinese show” that “doesn’t have much to do with us.” Jin Xin countered that the U.S. should work with China in third-country markets under the BRI. If it decides not to do so, the U.S. will again find itself “excluded,” just as it excluded itself from the AIIB, in which more than 90 countries are now members, Jin said.

Nigeria to Expand Manufacturing; UN Praises China’s Belt and Road

APRIL 11, 2019

Nigeria plans special economic zones to double manufacturing by 2025

(courtesy thisdaylive.com)

Nigeria is Africa’s biggest economy but it lacks a strong manufacturing base, which contributes less than 10 percent to its total gross domestic product (GDP). The country has maintained a strong currency to ensure it can keep imports pouring in, with a growing proportion coming from China.

 

“Project MINE’s (Made in Nigeria for Export) strategic objectives are to increase (the) manufacturing sector’s contribution to GDP to 20 percent … and generate over $30 billion annually by 2025,” the ministry of industry, trade and investment said in a statement.

The government has set up Nigeria SEZ Investment Company, which will finance industrial parks in special economic zones in the commercial capital of Lagos, southeastern state of Abia and northern state of Katsina.

The government is currently raising capital of $250 million for Nigeria SEZ Investment Company. It plans to double its equity to $500 million over four years, the ministry said.

The West African country’s manufacturing and agricultural sectors have been neglected since the 1970s oil boom, when Nigeria began making easy money from crude oil sales.

Nigeria, where the vast majority of the population lives on less than $2 a day, recently emerged from a recession but growth is fragile and the government is trying to diversify its revenue away from its reliance on oil.

President Muhammadu Buhari, who is due to start a second four-year term next month, has pledged to revive the economy and is focused on building roads and expanding the railway network to lower production costs…

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UN Africa Official Vera Songwe Calls BRI ‘Probably One of the Biggest Growth and Development Initiatives in the World’

In an interview with the Xinhua that appeared on April 10, Vera Songwe, executive secretary of the UN Economic Commission for Africa (UNECA), hailed the role that the China-proposed Belt and Road Initiative (BRI) would play in addressing Africa’s problems in infrastructure and job creation. She told Xinhua that the BRI will positively affect hundreds of millions of people in different countries, while it helps Africa develop infrastructure connectivity of varied types and creates job opportunities that are pressing issues on the continent.

“This (BRI) is probably one of the biggest growth and development initiatives that we have in the world,” the UN official said, adding that the BRI is essential to the continent. She believes that the initiative, in which many African countries “infrastructure today is one of the necessary requirements for Africa’s growth,” Xinhua reported.

Trump Administration Wrong Not Sending High Level Officials to Belt and Road Forum

President Trump did not attend the first Belt and road Forum-(BRF) in May of 2017, only sending a sub ministerial delegation. According to the US State d\Department, no US delegation will be attending this month’s second BRF. If true, this would represent a serious error by the Trump administration in its future relations with China. Beyond China, the decision not to participate in this historic conference will undermine US commitment to collaborate with more than half the world’s population that has joined China’s Belt and Road Initiative (BRI). Thus far, the only G-7 nation that has the wisdom to join the BRI is Italy. A minimum of 40 heads of state will be attending the second BRF. For the US to abstain, from this conference on the Belt and Road, which has already transformed the planet, would be strategic blunder in US policy. A more enlightened US foreign policy would view China as a partner in development not as a competitor, as China as been described by the Trump administration.

(courtesy huffingtonpost.com)

April 4, 2019

State Department Says U.S. Will Not Attend the Belt and Road Forum

According to an unnamed spokesperson for the U.S. State Department yesterday, the United States will not send high-level officials to attend China’s second Belt and Road Forum for International Cooperation in Beijing later this month, Reuters reported. In 2017, when the first Belt and Road Forum took place, the U.S. was represented by Matt Pottinger, the senior White House official for Asia. There are no such plans this year, Reuters stated.

Answering a question from Reuters, the unnamed State Department spokesperson said: “We will not send high-level officials from the United States…. We will continue to raise concerns about opaque financing practices, poor governance and disregard for internationally accepted norms and standards, which undermine many of the standards and principles that we rely upon to promote sustainable, inclusive development and to maintain stability and a rules-based order. We have repeatedly called on China to address these concerns.”

On March 29, speaking to the ruling Communist Party’s official mouthpiece, {People’s Daily}, Political Bureau member Yang Jiechi, who runs the party’s foreign affairs committee, said he found that critics of the Belt and Road Initiative “obviously show a lack of objectivity and fair understanding of the Belt and Road initiative. It is a misunderstanding, misjudgment and is even prejudiced,” stated Yang. Yang also confirmed that “about 40” foreign leaders would take part in the second summit.

Italy, China, and Africa Busting Apart Old Geo-Political Regime

March 23, 2019

Italy and China Sign Groundbreaking MOU on Belt and Road Initiative

 

 

Italy and China have signed the famous Memorandum of Understanding on Belt and Road cooperation today, together with 10 economic agreements and 18 institutional agreements (19 with the BRI MOU). The MOU is a milestone and is said to already be being studied by other countries that want to follow Italy.

The MOU says at the outset that “The Parties will work together within the Belt and Road Initiative (BRI) to translate mutual complementary strengths into advantages for practical cooperation and sustainable growth, supporting synergies between the Belt and Road Initiative and priorities identified in the Investment Plan for Europe and the Trans-European Networks, bearing in mind discussions in the EU China Connectivity Platform.”

With the MOU, Italy is the first large industrial economy to join the Belt and Road, as Chinese media proudly stress. The signature of the MOU occurred in spite of trans-Atlantic pressures and open hostility by Italy’s “partners” in the EU. Italian Minister for Economic Development Luigi Di Maio, who signed the MOU together with his counterpart He Lifeng, chairman of the National Development and Reform Commission, stated that “today is for us a very important day, in which the Made in Italy is winning, Italian firms are winning. We made a step to help our economy to grow. Italy came first with China.”

The economic agreements include: a strategic partnership between the Italian Cassa Depositi e Prestiti and the Bank of China to finance Italian firms in China; a MOU between the Italian oil company ENI and the Bank of China for explorations in China; Ansaldo Energia signed two agreements, one to develop gas turbines with UGTC and another one for the supply of a turbine to Shanghai Electric and Benxi Steel; the Port Authorities of Trieste and Genoa signed an agreement with the construction giant CCCC. Cassa Depositi and the natural gas utility Snam signed a deal with the Silk Road Fund for investments along the Silk Road; the Institute for Foreign Trade signed a deal with Suning to create a platform to promote Italian lifestyle in China; and the Danieli group signed a contract with China Camc Engineering for the construction of a steel plant in Azerbaijan.

The institutional agreements, besides the MOU on the BRI cooperation, include cooperation on innovative startups and electronic trade, as well as cooperation between the two space agencies, agriculture and culture, health and media.

Read article

Italian Finance Minister Tria on Italy-China-Africa Cooperation

In an op-ed in {China Daily}, entitled “As Belt and Road Opens New Doors Across Globe, Italy To Play A Key Role,” Italian Finance minister Giovanni Tria emphasized Sino-Italian cooperation to develop Africa.

After praising the BRI as a way to relaunch global economic integration, Tria recalled that “In September, the Italian government signed a memorandum of understanding with China’s National Development and Reform Commission for joint cooperation in third countries. This way, Italy and China are committed to collaborating in important geographical areas such as Africa, which in the near future will be a top actor for demographic reasons and due to its prospects for economic growth.

“Playing a role in building and restoring large infrastructure is an invaluable opportunity for Italian companies. There is an astonishing variety of areas of expertise where Italy can provide a competitive, paramount contribution. Beyond those more strictly linked to the physical construction of infrastructure (machiner), logistics and plant construction), Italy has strong capabilities in the provision of high-quality technical services such as consulting, feasibility studies, design, engineering services, security, finance and insurance.

“Italy believes in the prospective cooperative development of the BRI. This process will help to identify the paths of action and the main projects. Italy also enjoys a strategic geographical position along the current and future frames of commercial relations between the East, the West and Africa. Located on the Mediterranean Sea, Italy is the second-largest manufacturing country in Europe, leading in technological innovation and equipped with high-quality ports and road and rail networks. These features make Italy the ideal southern gateway to continental Europe and for the trade routes between Europe and China.

“By opening new connections and intensifying trade relations, the BRI will help improve the competitiveness of Italian and Chinese companies operating in each other’s markets and together toward third markets, leaving the respective governments with the task of providing adequate support to foster a business-friendly climate that can enhance their expertise, strengths and innovative approaches.

“I believe that developing physical connections, while enlarging and strengthening cooperation networks and partnerships, represents a valuable opportunity to face the challenge of sustainable growth and to avoid backtracking toward protectionism and nationalism. Commercial synergies and relationships of trust represent the path we want to take to counter international tensions and to favor wider and more widespread global well-being.”

 

China Friend or Foe? Published in AU’s “Invest in Africa” magazine

Below is my article on China: Friend or Foe?-January 2019, that was published (abridged) in the African Union magazine: “Invest in Africa“-2019 vol 1. You can find it on page 65 (85 on the link to the magazine). There are many worth while articles to read in this volume of the AU magazine  

By Lawrence Freeman

January 1, 2019

          The short answer is a China is friend and contributor to Africa’s progress. Ignore all the propaganda, ignorance and outright lies claiming that China is the new colonizer of Africa. There is absolutely no truth in the contorted comparison between China’s involvement in Africa today, and 500 years of slavery and colonialism by Western nations.

          Following the successful September 3-4, Forum on China Africa Cooperation (FOCAC) summit in Beijing, we have witnessed an escalated disinformation campaign alleging that China is attempting to snare African nations in a new “debt-trap.” New vicious rumors have emerged that China is taking over ownership of key infrastructure projects in Africa. Every African Head of State who has spoken out, has refuted these allegations and praised their cooperative relationship with China.  

According to a report by the British based Jubilee Debt Campaign, “Africa’s growing debt crisis: Who is the debt owed to?” China is owed a minority of external debt. Their figures compiled from the World Bank and the China Africa Research Institute show that 20% of African government external debt is owed to China in contrast 32% to private lenders, and 35% to multilateral institutions such as the World Bank.

Of these 14 countries that have they examined: 11 owe less than 18% of their debt to China (Burundi, Cape Verde, Central African Republic, Chad, Gambia, Ghana, Mauritania, Mozambique, Sao Tome and Principe, South Sudan, Sudan and Zimbabwe); and three owe more than 24% -Djibouti (68%), Zambia (30%) and Cameroon (29%).

The proponents of the “debt-trap” accusation conspicuously, egregiously omit from their chronicle the history of the financial imprisonment of the then newly independent African nations by the IMF, World Bank, Paris Club, and their kith and kin in the City of London and Wall Street. Through manipulation of terms of trade, controlling prices, and forcing currency deviations, African nations found themselves shackled in several hundred billion dollars of new debt to the West shortly after African nations achieved liberation from imperialist colonial masters. Western debt replaced slavery and colonialism as the new method of looting Africa of its wealth, reinforced by the ill-fated Structural Adjustment Programs-SAPs, otherwise known as the “Washington Consensus.”

So, who is kidding whom about a “debt-trap?”

Debt for Infrastructure is Necessary

Railroads from the colonial period versus railroads of the future. The East-West and North-South railroads are long overdue

Credits issued for hard infrastructure; energy, railroads, ports, roads, bridges, and soft infrastructure in well equipped; schools, libraries, universities, and hospitals will always result in an increase in productivity i.e. the economic power of the society. By employing advanced technologies embedded in new capital equipment, including infrastructure, farmers and workers can produce more efficiently. Simply providing abundant energy, high-speed railroads, and water inputs to an African nation would lead to a jump in economic output.

All nations that have experienced real economic growth and raised the living standard of their citizens have created credit i.e. public-sector debt or borrowed debt at non-usurious interest rates for targeted physical economic growth.

China is the single largest nation contributing to financing and constructing of infrastructure projects in Africa according, to Deloitte’s 2017 edition of Africa Constructive Trends. The report examines 303 infrastructure projects begun in the first half of 2017 that costs over $50 million. Appropriately, energy& power, and transport comprise 167 of these projects-over 55% of the total. While African governments fund 27.1 % of the funding, China accounts for 15.5% of the funding and 28.1% of the construction for these projects. The US accounts for 3% and 3.3% respectively. Both Italy and France are larger than  the US percentage in building infrastructure in Africa. 

African Development Bank President, Akinwumi Adesina, speaking on November 28, 2016 accurately linked the deadly migrant crisis to deficiencies in Africa’s economic development and infrastructure.

“I believe that Africa development deserves significant support, even in the midst of these challenges. We must not forget that the reason several thousands of Africans have been (illegally) migrating to Europe, is because of the lack of jobs and shrinking economic opportunities at home. Our result must not be to reduce support, but to increase support to help build greater resilience, boost its economies, address its structural challenge, such as closing its huge infrastructure gap, strengthening intra-related trade, and creating jobs for its teeming youths.”

A study done by the AidData Research Lab at William and Mary College in Virginia that analyzed China’s investments in the developing sector between 2000 and 2014, concluded:

“We find that Chinese development projects in general, and Chinese transportation projects in particular, reduce economic inequality within and between sub-national localities,” and “produce positive economic spillover that leads to a more equal distribution of economic activity.”

China has come to know, what the US has forgotten, that infrastructure is the sine qua non to drive economic growth. 

Africa’s huge infrastructure deficit is the causal factor for widespread poverty, and insecurity across the continent, precisely that which China has begun to address over the last decade. The Western financial system that dominated Africa from 1960-2000 contributed almost nothing to help African nations industrialize and failed to help create vibrant agro-manufacturing sectors. China with its Belt and Road Initiative has presented the world with a new paradigm to guide political-economic relations among nations; Africa is the beneficiary.

Lawrence Freeman is a Political-Economic Analyst for Africa, and Vice Chairman of the International Scientific Advisory Committee to the Lake Chad Basin Commission

President Trump’s Non-African Strategy: Published in AU’s “Invest in Africa” magazine

Below is my article on President Trump’s Non-African Strategy, January 1, 2019, that was published (abridged) in the African Union magazine: “Invest in Africa“-2019 vol 1. You can find it on page 109 (129 on the link to the magazine). There are many worth while articles to read in this volume of the AU magazine  

 

 

Lawrence Freeman

January 1, 2019

After waiting almost two years for President Trump to articulate his policy for Africa, last month he unveiled his US-African Strategy, through the mouth of National Security Adviser John Bolton.  It should be called the Non-Africa Strategy because it has little if anything to do with the continent of Africa itself. Rather, it is essentially a geo-political tactic aimed primarily at China and to a lesser extent Russia. President Trump has put his stamp of approval on the age-old British inspired geo-political ideology that views foreign policy as a “global zero-sum game”-a world with only winners and losers among the super-powers. All other (lesser) nations are treated simply as movable pieces in their fantasy game. In other words, in this administration’s policy, Africa is a pawn on their geo-political chess board. Sadly, this so-called African stratagem shows no concern for well-being of the African people, doing nothing to improve the conditions of life on the continent, nor does it enhance US security.

Bolton explicitly attacks China’s new paradigm in foreign policy-the Belt and Road Initiative-while threatening African nations who do not support the US position on China and Russia. Blinded by their geo-political world view, the Trump administration displays disdain for the fruitful collaboration of China (primarily) with Africa nations in building vitally needed infrastructure across the African continent. In many cases constructing new railroads for the first time since the days of imperialist-colonial domination.

The Trump/Bolton policy has already failed from the start. It is too late to stop Africa’s momentum for economic development with its allies. However, if the Trump administration were more thoughtful, it would formulate a strategy to assist African nations in reducing their massive deficits in crucial categories of infrastructure.

Return to a Real American Strategy for Africa

The promotion of human life should (must) be the most important goal of all foreign policy. Human beings uniquely possess the cognitive-creative mental capacity to transform the physical universe. Only through new scientific discoveries by a sovereign human mind, can we ensure the continued material-biological propagation of our human race. Thus, the promotion of physical (not financial) economic growth, which sustains human progress, is the core of any competent “good neighbor” foreign policy.

Presidents John Kennedy and Kwame Nkrumah, Washington DC, March 1963

President John Kennedy was our last president who identified with and supported the development of the newly liberated African nations. His unique friendship with Ghanaian President, Kwame Nkrumah resulted in securing the funding for the Akosombo Dam on the Volta River which provided hydro-power for aluminum smelting and electricity for the people. This project stands as a monument today in Ghana (and Africa) in contradistinction to the El Mina slave dungeon, and other “slave castles” along Ghana’s coast.  We should remember that it was the African liberator, President Nkrumah, who was the very first Head of State invited by President Kennedy to Washington DC on March 8, 1961.  Four months later, the pro-African President invited Tafawa Balewa, the Prime Minister of the newly independent Republic of Nigeria to the White House.

Not one of the ten US Presidents following the death of Kennedy have emulated in practice his genuine concern for the advancement of the African people. However, President Kennedy was not original in his vision for Africa.

President Franklin Roosevelt famously scolded British Prime Minister Winston Churchill, during their war-time conferences, for Britain’s imperialist exploitation of Africa. He drove Churchill into an apoplectic fit, when he threatened to do away with British Imperialism and its eighteenth-century methods, after the war was won.

President Roosevelt expressed his vision for Africa’s development when told his son Elliott, that with the re-creation of a lake in the depressed flats in North Africa, “The Sahara would bloom for hundreds of miles.” He also reminded his son of the rivers which arise in Atlas Mountains and disappear under the Desert. “Divert this water flow for irrigation purposes?  It’d make the Imperial Valley in California look like a cabbage patch!”

This is the way US leaders true to our American System of economic progress used to think.

Africa’s Future

Africa’s population is projected to expand to 2.5 billion people in 2050- a generation and a half generation from now. The continent is well situated to become the center of world commerce, with its expanding population, vast tracts of arable land, and its abundance of natural resources. To secure this future, Africa needs trillions of dollars invested in infrastructure. There is no “zero sum” competition. Africa’s friends should cooperate in promoting the limitless number of infrastructure projects that Africa desperately needs. If, Africa and its allies fail to fully develop its enormous potential, and African nations are unable to productively employ and instill hope for a better future to the continent’s projected 2050 population of a billion young people, then we should anticipate perilously new levels instability and insecurity.

It should be obvious to all, including President Trump and his advisers that there will be no security without economic development.

It would be best for both the US and Africa, for President Trump to jettison this terribly flawed policy and advance a real American vision for the continent.  This should include collaboration with China on building transformative infrastructure such as the Transaqua inter-basin water transfer project to refurbish the shrinking Lake Chad.

Lawrence Freeman is a Political-Economic Analyst for Africa, and Vice Chairman of the International Scientific Advisory Committee to the Lake Chad Basin Commission

 

China is NOT Exploiting Africa, But Investing in its Future: The Case of Nigeria

The article below, “Nigeria’s balanced and diverse relationship with China is key to sustainability,” provides a useful examination of the healthy bilateral relationship that China has developed with Nigeria, especially during the administration of President Buhari.  It is also important to note that Nigeria has officially joined China’s Belt and Road Initiative in January of this year. (excerpts below followed by a link to complete article)

1)    Infrastructure

Nigeria has one of the largest infrastructure deficits in the world; two thirds of the population still does not have access to safe water and over half of the population has no access to reliable electricity. Logistics costs are also extremely high; it costs more to transport a good from Lagos in Nigeria’s South to Kano in the North (1000km), than it does to ship a good from Shanghai to Lagos (over 12,000 km).

Nigeria’s government is investing in infrastructure, but external funding is needed. As cited in the National Integrated Infrastructure Master-plan (NIIMP) developed by Nigeria’s Ministry for Planning in 2015, it is estimated that the country requires $3 trillion over the next 30 years, with $500 billion required in the first 10 years. This estimate, which has wide sectoral scope, is reached by comparing Nigeria’s core infrastructure stock of around 20-25% GDP to international benchmarks of around 70%. Yet, even as the government increased its budget allocation for capital expenditure to 30% in 2017, this remains at least 80% short of the annual amount prescribed by NIIMP.

Alongside self-funding new infrastructure, Nigeria has also looked to the World Bank, European Commission and African Development Bank as sources of infrastructure capital. Yet while they might have the risk tolerance and investment horizons, their capital remains diluted over a number of countries. In its 60 years of operation in Nigeria, the World Bank has invested on average $100 million on infrastructure a year – significant but still a drop in the ocean versus Nigeria’s needs…

3)    Manufacturing    

While Nigeria is the richest economy in Africa, with the largest population and one of the better educated work forces, 4 in every 10 people still remain unemployed. Nigeria needs more inclusive industrialization that creates jobs for all, as opposed to focusing solely on sectors such as oil. Opportunities lie in the manufacturing sector, which creates more jobs through stronger forward and backwards economic linkages than any other sector.

Nigeria is again leveraging its relationship with China here. Some Chinese manufacturers have started relocating production to Nigeria, partly in response to rising wages in China and to take full advantage of the size of Nigeria’s domestic market. Sun Ceramics is one such example; they produce ceramics the size of 10 football fields every day, employ over 1,000 locals and also source all their raw materials from Nigeria. If it weren’t for Nigeria’s difficult business environment, Chinese firms claim they would commit greater amounts of investment.

Stronger ties to stand the test of time.

Nigeria, however, has managed to…build a balanced and more diverse relationship with China. Nigeria’s relationship with China extends beyond resources and infrastructure to security, financial planning and sharing of best-practice in manufacturing, to name a few areas of cooperation. Particularly in the realms of security cooperation; the Chinese have found an area that helps win them local support on the ground in Nigeria given a near-universal desire to eliminate insurgent forces. Nigeria also recognizes that the size of its domestic market offers the largest opportunity in Africa for Chinese companies; and that has helped to improve the balance in the relationship.

It is this combination of balance and diversification that is key to a sustainable relationship with China.

 

Read: Nigeria’s Balanced and Diverse Relationship with China

Italy and Buhari Keep Transaqua on the Agenda to Save the Shrinking Lake Chad

Jan. 18, 2019

Italian Prime Minister Conte Discusses Development with Presidents of Chad and Niger

Giuseppe Conte made a two-day visit to Niger and Chad, two countries members of the Lake Chad Basin Commission, to discuss short and long-term measures to fight terrorism, migration, and their causes on Jan. 15-16. In both countries he discussed development perspectives with national leaders.

At the joint press conference in Ndjamena with Chad President Idriss Déby, Conte referred to the Transaqua project for the revitalization of Lake Chad as an example of development programs.

European countries, Conte said, “cannot remain insensible to the drying up of Lake Chad. If it goes on, there will be increased misery and thus increased emigration and terrorist threat,” Conte remarked. “If we don’t have a vision on those issues, we will be overwhelmed. I reminded President Déby that the possibly oldest project to tackle the drying out of Lake Chad has been made by Italian experts. There is a project of dams and canals to provide irrigation.

This means laying the basis for the development of those territories and therefore better controlling migration flows.”

Both in Niger and Chad, Conte said that Italy will be “the ambassador” of the Sahel region at the EU, to promote a larger effort to finance development. The EU Trust Fund for Africa must be enlarged, Conte said.

At the joint press conference in Niamey, Niger President Mahamadou Issofou thanked Italy for the support of the Sahel-5 Multinational Force to fight terrorism, but repeatedly stressed that “the solution is developing Africa, industrializing Africa.” This goes for defeating terrorism as well as for controlling immigration flows.

Conte thanked Issofou for its support to Italy in the stabilization plan for Libya. Although this was the first visit ever of an Italian Prime Minister to Niger (and Chad as well), Conte remarked that this was his third meeting with Issofou, following meetings in Rome and Palermo, the latter at the International Libya conference. Stabilizing Libya is key to defeat terrorism, Conte remarked.

Nigerian President Buhari Reiterates His Commitment To Refilling Lake Chad

Nigerian President Muhammadu Buhari called for more commitment from the international community on redirecting water to Lake Chad on Jan. 14, warning that the 40 million people who rely on the lake in the region would pose adverse migration and security challenges to the world.

The Transaqua project to refill Lake Chad was approved at the Feb. 26-28, 2018 International Conference on Lake Chad in Abuja and soon the feasibility study financed by the Italian government should start. The cost of the entire 2400 km system of dams and canals will be in the order of several dozen billion dollars.

Receiving Letters of Credence from the High Commissioner of Canada to Nigeria Philip Baker at the Presidential Villa, President Buhari said the tragedy of the shrinking Lake Chad would continue to fuel more illegal migrations, banditry and provide willing hands for terrorism since majority of the people have lost their means of livelihood.

A statement by the special adviser to the President on media and publicity Femi Adesina said that Buhari warned that “the about 40 million population in the region will pose adverse migration and security challenges to the world” if the lake should dry up completely. The President pointed out that banditry, illegal migration and terrorism would worsen if the lake were not rescued. He said: “An academic rightly predicted that unless there was a redirection of water to Lake Chad, it would dry up. Now, whenever I go for any global meeting or visit a country, I will always draw the world’s attention to the adverse effect of climate change on the lake, and the resulting negative effects.”

 

 

Nation State vs Ethnicity in Africa

Mahmood Mamdani raises proactive questions on the role ethnicity in Africa and Ethiopia in particular. (See excerpts and article below).

Africa has been plagued to this day by two legacies from colonialism (British): 1) the intentional failure to build infrastructure; 2) the deliberate fostering of ethnicity. Historical literature is replete with evidence of the British creation of ethnic and/or native administrative units as a central feature of their divide and rule colonial policy. Lord Frederick Lugard, who authored the infamous “indirect rule” stratagem, implemented his scheme in Nigeria when he became the Govern General Nigeria in 1914, and ruled the North and South differently. Similarly, the British cultivated the North versus South conflict in Sudan with their separate Southern policy exemplified by their 1922 Passport and Ordinance Act. There are more examples available.

Accentuating ethnic, tribal, religious, and geographical distinctions is used as a means to thwart the creation of sovereign Nation States, particularly in Africa. A functioning Nation State is not founded on a collection of minorities, or even a majority. Instead, it is created on principles that define its responsibilities to provide for the general welfare of its citizens and their posterity, which must include nurturing the creative potential of each child. Nation States transcend differences within their populations by uniting all their people in a common mission, not only to develop their nation, but to contribute to the future of mankind as well.     

Ethiopia uniquely evaded colonization with its 1896 military victory against the Italian army in Adwa, led by Menelik II. Yet as Mamdani points out, Ethiopian Federalism accommodates ethnicity, which is divisive today, and is being used to undermine the central-federal government. By following the core economic thesis of Meles Zenawi’s “Developmental State” Ethiopia has embarked on a bold campaign to transform their country through government directed investment in infrastructure, while protecting their economy from being invaded by foreign financial predators. As a result of Ethiopia’s relative success among African nations in performing this necessary Nation State function, it has become the “enemy” to those forces-internal and external-that oppose development of African nations. Not surprisingly in the last six months there have been renewed efforts to liberalize-deregulate Ethiopia’s financial system in an attempt to weaken its commitment to the “Developmental State” model. 

Therefore, the suggestion of a new kind of non-ethnic federalism is a conception that could lead to strengthening the institution of the Nation State in Africa.   

The new Tram in Adds Ababa typifies Ethiopia’s approach to infrastructure.

“Ethiopians used to think of themselves as Africans of a special kind, who were not colonized, but the country today resembles a quintessential African system, marked by ethnic mobilization for ethnic gains.

In most of Africa, ethnicity was politicized when the British turned the ethnic group into a unit of local administration, which they termed “indirect rule.” Every bit of the colony came to be defined as an ethnic homeland, where an ethnic authority enforced an ethnically defined customary law that conferred privileges on those deemed indigenous at the expense of non-indigenous minorities.

An interesting book worth reading by Mahmood Mamdani is: “Saviors and survivors.” It about Sudan and Darfur, but also discusses the creation of ethnic groups.

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Pres. Trump’s Non-Africa Strategy

The so-called US African strategy articulated by National Security Adviser John Bolton, with the approval of President Trump has little, if anything to do with Africa. It is essentially a geo-political strategy aimed primarily at China and to a lesser extent Russia. The true believers of the bankrupt geo-political ideology live in a “global zero-sum game”-a world with only winners and losers among the super-powers. All other (lesser) nations are treated as movable pieces in their fantasy game. In other words, in this administration’s policy, Africa is a pawn on their geo-political chess board. Sadly, this so called African strategy does nothing to improve the conditions of life for the African people, and nothing to enhance US security. Bolton’s explicit attack on China’s successful Belt and Road policy, which for the first time since the days of imperialist/colonial domination of Africa, is providing vitally needed infrastructure across the African continent, demonstrates how little the Trump administration actually cares about the economic welfare of African people. The Trump/Bolton policy has already failed from the start. It is too late to stop China’s on-going collaboration with African nations. However, if the Trump administration was more thoughtful about Africa, they would join with China and Russia to assist in developing the continent, which is still suffering from massive deficits in vital categories of infrastructure. There is still time for the US to reverse course, but this would require jettisoning their adherence to the age old British geo-political world view.

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The US Lacks A Development Strategy for Africa

Read Bolton’s Non-Africa Strategy