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The recent host of oil and gas finds across east Africa have led to a new scramble for resources. It’s no surprise that the Americans have formed their own African taskforce in 2007, Africom, “to promote a stable and secure African environment in support of U.S. foreign policy” mainly based in Germany. On the flipside there is the Chinese invasion, with1-2million estimated to be on the ground, no wonder the second stop off, after Russia, for the new Chinese President, Xi JinPing, turns out to be Tanzania, then South Africa, and a pally commie chat with Zuma – Chomsky is having a field day, but he dislikes anything anyone does.
General Regional Issues
China has often been accused of implementing neo-colonialism in its policy to Africa, enriching the rich and securing resources whilst exporting unemployment and ignoring human rights, but it’s turning out not to be such a monopolistic venture of control, as the state enterprises are entering in conjunction with Western firms, especially in terms of oil and gas. Alongside, the African Governments are taking a more rigid free market approach to their tender processes and imparting harsh penalties where terms are not met (instead of the usual suitcase of brimming full of cash). A form of triangular cooperation and free trade between Africa, the East and the West, seems to be appearing where there is mutual benefit of new markets to enter, resources to export and a dire need of infrastructure to be built in exchange.
Ultimately China is Africa’s largest trading partner at roughly $160bn, with $45bn being exported in the form of minerals, and imports of transportation, machinery and chemicals reaching a total of $35bn. Even though China has a large chunk of the pie, India is moving quickly with its solid links in the East African community.
In general there has been a more stringent approach from African countries towards foreigners. For example, Algeria has suspended negotiations with two Chinese firms on corruption of bribery and Uganda pulled one of Tullow’s licences last year for not fulfilling their obligations -and the expulsion of two rogue Chinese commodity traders from the Congolese Kivu region. Although the trend to free trade isn’t always the case as there are increasingly protectionist stances enacted by Tanzania, Zambia, Malawi and Uganda to insulate some domestic industries from outside competition – you can’t blame them.
Odinga, Kenya’s old PM, was quoted as saying:
“We import a lot of manufactured equipment like tractors, ploughs and harvesters. I feel that we should by now be having a tractor manufacturing plant here in Kenya. There is no reason why we should be importing tractors from China year in year out. These are some of the things we want to engage the Chinese on.”
But the tit for tat of minerals for machinery and infrastructure with loans comes in many forms, for example, the Chinese built Brazzaville Dam, fertiliser plants, roads, rail, T&D, and power plants – all the initial backbone capital assets for a dramatic shift in economic potential – although most of it comes with strings attached such as the Dar Mtwara pipeline.
The Dar Mtwara gas pipeline is financed from the Chinese Export Bank for $1.2bn, on the proviso that equipment was sourced from China. Along with that are similar deals with similar ties in interest to be paid and where the capital is to be spent.
A recent Gallup poll scored Tanzania poorly on local perception of security. In fact manifestations of this have been seen with student riots last year blaming the police for not taking time to investigate stealing in their accommodation. There have also been riots at Gold Mines, Islamic riots and a protest about the Mtwara to Dar pipeline where 4 have been killed. There is a general unease with the Tanzanians seeing foreign exploitation everywhere, especially by Chinese. This became a populist voting movement in Zambia where Sata, on coming to power in 2011, made an abrupt u-turn on his anti-Chinese policy when he realised he needed them badly, and demoted his labour minister for continuing the polemics in 2012.
However this surge of resource dominance has led to local state on state posturing as well as throwing up the localised tribal issues and elements of xenophobia. Tanzania is in a spat with Malawi on re-drawing the boundaries around Lake Nyasa, as the potential for opening the rift valley plays seen to the north with Africa oil and Tullow, are expected to be extended next after Ethiopia. Also, Southern Tanzanians are feeling increasingly ostracised in relation to the northern Dodoma dictation regarding gas near the Rovuma delta. Then there is the uneasy relationship between Tanzania and Zanzibar.
A further risk has been the spread of piracy south from the Puntland as high naval concentrations have moved the threat south. In fact the drill ship Poseidon (Chariots old flame) was targeted in 2011, one of six serious incidents and 20 attempts in the last four years of the coast of Tanzania.
Conclusion
Although there are elements of bullying tactics by the Chinese and Westerners, the general trend is to a more open and less opaque market, with African countries realising they need to provide flawless disclosure, institutional frameworks and the rule of law to break the cycle of revolution/counter-revolution and lack of delivery. This has mainly come due to the competitive position of their resources and their gradual realisation that they are no longer a geopolitical backwater. And with Xi JinPing, making his second official trip outside of China into Tanzania proclaiming his friendly intentions there is confirmation of this point – and you can’t help but feel the region has something he wants that he can’t get his hands on in the old manner – and it looks like it’s the offshore gas, potential coastal oil and rift valley petroleum systems.
It is a detailed research that that has assisted me in my assignment on GEOPOLITICS OF EAST AFRICA.
It is a detailed research that has assisted me in my assignment on GEOPOLITICS OF EAST AFRICA.