Maverick Citizen

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Brexit opens new trade doors for Africa

British Prime Minister Boris Johnson. (Photo: EPA-EFE / Andy Rain)

Contrary to the prophets of doom, the exit of the UK from the European Union could end up being a boon for African nations, especially if British Prime Minister Boris Johnson follows up his initial expressions of interest with concrete negotiations and treaties.

This article is in response to the Emma Ruiters oped.

Since securing a more solid domestic political position in the December 2019 election, British Prime Minister Boris Johnson has shown a commendable interest in UK-Africa relations. However, many on the continent and in the commentariat have treated Johnson’s interest with suspicion, like Emma Ruiters, (“Africa, beware of Boris Johnson”, Maverick Citizen, 2 February 2020). Although they accuse the UK’s Prime Minister of being stuck in the past, it is often these commentators who are blinded by history.

The UK is currently facing a challenge that few nations have faced before. For just short of half a century it has fallen under the umbrella of the EU. Under the EU agreement, and its predecessor organisations, the UK progressively ceded part of its diplomatic operations and virtually all of its trade negotiations to the multilateral body. Now, the UK needs to figure out how it will make its own way in the world. As a result, the next few years will see the country redefine its foreign relations as it drifts away from the EU and seeks new partnerships on the world stage.

It should be self-evident, but apparently it does in fact need stating, that British foreign policy is conducted with the best interests of Britain in mind. In this way, the UK is the same as the United States, the EU, China, all African nations, and in fact pretty much every country on earth. It is a generally accepted tenet in international relations that countries carry out the policies, and pursue the relationships, that they think will benefit themselves the most.

It is slightly perplexing to warn African countries of this widely understood fact, and then proceed to reference China in the next line, in the same week that Daily Maverick carried a story about China’s attempts to strong-arm Eswatini into dropping its recognition of Taiwan. African leaders will be well aware of the fact that the UK will approach any negotiations looking to improve their current position, and will likewise be doing the exact same to improve the benefits their own country can obtain from bilateral relations.

When the UK considers its future allies and trade partners, Africa will have to come into the equation. The continent is showing impressive rates of economic growth, and in the past decade it has produced a few impressive success stories. The continent also boasts a young and growing population, with projections that it will overtake Asia in working-age population by the end of the century.

However, as much as one cannot understate the importance of Africa in the modern world, one should be careful not to overstate it either. The UK is facing a year (potentially years) of gruelling negotiations with the EU over its future trading arrangement. According to the World Bank’s 2018 figures, the combined GDP of the EU (excluding the UK) is around $16-trillion, while in contrast the figure for sub-Saharan Africa is $1.7-trillion. By way of illustration, this puts the size of the entire combined economies of sub-Saharan Africa (all 48 of them) between that of Spain ($1.4-trillion) and Italy ($2-trillion), the fourth and third-largest economies in the EU respectively.

The clear gulf in size between the EU and sub-Saharan Africa hides another factor that needs to be considered by any country deciding to prioritise foreign relationships. The EU is a partially centralised superstate that negotiates trade agreements as one bloc. Sub-Saharan Africa is a mish-mash of independent countries, regional entities with overlapping memberships, and half-completed mega-regional agreements. Negotiations with African countries will often need to be done one-on-one, greatly increasing the complexity of a focus on Africa.

If you look at African countries independently, their importance declines even more. Nigeria, the largest economy on the continent, has roughly the same GDP as Ireland or Denmark, far less than the rising powers of the BRICS nations or other leading developing nations such as Indonesia or Mexico. Africa undoubtedly has an important place in the world, but failure to acknowledge just how far African economies currently lag behind much of the rest of the world is a recipe for outside expectations and policy failure.

The Commonwealth has long drawn the ire of many on the continent who believe that it is the last hangover of the Old Empire, a relic that is long past its sell-by-date and never justifiable in any way. The imperial history of the Commonwealth is obvious, glaring, and jarring to many, so it is understandable that it is viewed with suspicion. However, the reality is that the modern Commonwealth is just like the Queen’s leadership of the organisation; entirely ceremonial. There is no serious attempt to turn the Commonwealth into anything more than its current status as an excuse for world leaders to jet off to some desirable location to sip champagne and rub shoulders with the great and powerful.

Few outside the tiny United Kingdom Independence Party, UKIP (which received 0.1% of all votes in the most recent parliamentary election), and perhaps the more hardline Brexiteers in the Conservative Party, believe that the Commonwealth has the potential to become an economic federation to rival the EU. Those that profess to believe this claim are usually just flailing around for any post-Brexit trade and economic strategy that doesn’t include the EU, no matter how outlandish it may be.

All told, it is unlikely that the Commonwealth will be the centrepiece of UK foreign policy in the next decade, and those decrying the return of Empire that such a focus would entail are as stuck in the past as those advocating for a new Imperial dawn.

This is not to say that Commonwealth countries will be ignored altogether in the post-Brexit era. It would be foolish to ignore the benefits of long-lasting economic ties and a shared (business) language. However, the focus is likely to be on the more developed economies of Australia and Canada, which present opportunities in the services industry and in high-tech value chains, and India, which has an economy and population roughly the same size as all of the other developing Commonwealth countries combined. It is far more likely that the UK will pursue relations with these three countries on an individual basis than try and herd all 50-plus proverbial cats of the Commonwealth in one direction.

Africa has been given an opportunity from the chaos of Brexit. The world’s fifth-largest economy is seeking to re-evaluate its existing relationships, and create new ones, and there is a possibility that African nations could be significant benefactors from this. Britain is not a superpower like the US or China; however, it is still a major economy and an important trade partner of many nations on the African continent. The $46-billion in two-way trade conducted between the UK and Africa may amount to less than a quarter of the continent’s two-way trade with China, but this figure still represents an amount equal to the entire economy of the Democratic Republic of Congo (a country of 90 million people and the second-largest African country by geographic size).

Boris Johnson has indicated a willingness to improve his country’s ties with Africa, and has backed this up with swift action. Opening more embassies on the continent, improving access to UK universities for African students, and increasing the importance of UK-Africa relations under his government, are promising steps that hint to a better-shared future for all parties.

African countries would do well to take advantage of any potential “pivot to Africa”. Some, such as South Africa and the rest of the SACU nations (plus Mozambique), have already taken advantage of Britain’s exit from the EU to secure their future trade relations with the country, concluding the SACUM-UK EPA in 2019 that will cover trade between the two once the UK’s transition period with the EU concludes.

South Africa was able to take advantage of the UK’s willingness to negotiate by securing improved market access for 13 agricultural product lines (including wine and sugar), which will put South African farmers in a better position once the UK officially leaves the EU. Given that the UK will no longer have to consider the interests of 27 other EU members when negotiating future trade agreements, it is likely that this type of concession will not be unique to South Africa, and other African nations could be able to secure similar benefits for their agricultural (and other) industries.

Furthermore, the UK is one of the largest financial centres in the world, with billions of dollars of capital flowing in and out of London every year. Many investment-starved African nations would rightly welcome inflows of foreign direct investment redirected to their shores by treaties negotiated with the Johnson administration, and there are plenty of unfunded projects across Africa that could flourish under a mutually beneficial partnership.

For all these reasons and more, the exit of the UK from the European Union could end up being a boon for African nations, especially if Johnson follows up his initial expressions of interest with concrete negotiations and treaties. Access to markets, finance, educational institutions, and other benefits could be available to African countries willing to work with the UK as it re-enters the world for the first time in decades.

To stir up fears based on long gone (if admittedly horrendous and exploitative) policies, the ramblings of a defunct political party with no seats in parliament, and anecdotal tales of bumbling Brexiteers while ignoring the tangible benefits of the hand being extended by the British Prime Minister seems, at best, incredibly short-sighted.

By no means should Johnson be treated as a magnanimous benefactor; he is not, and never will be. However, it would be foolish to ignore the hand of partnership that the PM is offering in the hope that both the UK and Africa can benefit going forward.

The fact remains that Africa is not a united political entity, and there will be some countries on the continent who seek to make the most of this new opportunity. Perhaps their success will show those dwelling in the past that a new future is already happening around them. MC

Jay Grunder works in the Western Cape Department of Economic Development. He has a masters degree from UCT in international trade law and has conducted extensive research on both Brexit (his Masters thesis topic) and post-Brexit UK-Africa relations. He writes in his personal capacity.

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