“Here comes Africa,” the Financial Times newspaper breathlessly proclaimed. Barack Obama seems to agree, visiting the continent more than any other US president.
But the US focus on Africa started under his predecessor. George W Bush introduced a high-profile programme to combat Aids. Under his presidency the Pentagon established a unified combat command—Africom—to deal with sub-Saharan Africa. This reflects the spreading inkblot represented by disastrous US wars in the Islamic world.
Kenya and Ethiopia, the two countries Obama is visiting, both happen to have sent troops into Somalia to fight the Islamist Al-Shabaab movement.
This caused serious terrorist blowback in Kenya.
But Obama has economic as well as strategic motivations in mind. He’s taken hundreds of business executives with him. Bush introduced a trade pact, the African Growth and Opportunity Act, which has just been extended for another ten years. Celebrating the renewal last week, Obama said Africa has the “potential to be the next centre of global economic growth”.
Certainly sub-Saharan Africa experienced a significant increase in trade and investment inflows during the 2000s. More than anything else this reflected the booming Chinese economy’s appetite for African energy and raw materials.
China is now Africa’s biggest trading partner. Total trade rose from £6.45 billion in 2000 to £129 billion in 2013.
These changes need, however, to be kept in perspective. Foreign direct investment (FDI) inflows into the whole of Africa, including Egypt and the Maghreb, totalled £35 billion in 2014. That compares to £300 billion to developing Asia, £186 billion to Europe, £103 billion to Latin America, and £94 billion to North America.
Moreover, the major investors in Africa are still from Western states such as the US and the old colonial powers, Britain and France. The biggest newer players are India and South Africa, whose companies and supermarket chains have penetrated deep into the rest of Africa since the end of apartheid. Chinese FDI lags behind.
A fascinating study by Ching Kwan Lee in the New Left Review journal compares the three mining companies that dominate the Zambian Copperbelt.
Two are subsidiaries of “Western” companies—Glencore and Vedanta. They are based respectively in Switzerland and India, but both well integrated in the London-centered global mining industry.
The third is state-owned enterprise China Nonferrous Metal Mining Company (CNMC).
The Western mineowners are quick to lay off workers and have pushed through casualisation. By contrast, CNMC offers its miners long-term contracts, but at lower wages. Lee speculated that the difference reflects “a state-capital logic of accumulation, in contrast to the profit-maximising logic of private capital” in the case of Glencore and Vedanta.
He said this “encompassing accumulation gives CNMC an important role in China’s economic diplomacy, currently focused on Asia and Africa, with emphasis on the resource commodities that are in short supply in the PRC [People’s Republic of China]: oil, copper, aluminium and iron.
“The Chinese Academy of Social Sciences, a key government think-tank, has identified resource security as the top priority for China–Africa economic strategy over the next ten years.”
This suggests that China as well as the US is in Africa for strategic as well economic reasons.
Overall, Chinese firms operate in Africa in an economic and political environment that’s still very much dominated by Western imperialism. But relationships are shifting.
After a euphoric phase that ended with the 2008 financial crash, Western multinationals have cut back their investments in Africa. Lee’s analysis underlines that Chinese companies are there for the long term.
US policy-makers are no doubt worrying about this.
But whoever’s on top, Africa’s primary interest for outside powers remains what it has been since colonial times—the natural resources that can be extracted from it.
Despite the hype, Africa remains on the bottom rung of the global division of labour.
Crises are on the horizon