macroafricaintel | America cannot stop China’s advance

By Rafiq Raji, PhD
Twitter: @DrRafiqRaji

“The United States hasn’t had a trade surplus with China in 40 years. They must end unfair trade, take down barriers and charge only reciprocal tariffs. The US is losing $500 billion a year, and has been losing billions of dollars for decades. Cannot continue!” This was American president Donald Trump venting about China in a recent tweet. At the ongoing Boao Forum for Asia (BFA) in Hainan, China, today (started on 8 April), Chinese president Xi Jinping would finally get an opportunity to make remarks in public about the trade spat between his country and the United States. His officials have been the ones responding to President Trump’s rhetoric since America fired the first salvo in February by announcing tariffs on aluminium and steel imports. Mr Trump escalated trade tensions further in March by announcing tariffs on goods more directly punitive to Chinese interests. (China is a fringe exporter of aluminium and steel to America.) The Asian nation has announced retaliatory tariff measures of its own. Even so, Mr Xi is likely to be conciliatory in expected remarks on the issue at the BFA on 10 April; that is, even as he would likely make sure to echo China’s capacity to beat Mr Trump at his own game.

Already ahead
America has also filed a complaint against China at the World Trade Organisation (WTO), claiming it has been stealing American companies’ intellectual property; on the back of its compulsory technology sharing policy for foreign companies operating on its soil which must enter into partnerships with local ones. As the slow-winding process of the WTO is not likely to the taste of the restless American president (“The WTO is unfair to U.S.” goes one recent tweet), the complaint is probably just a formality. Mr Trump wants results now. Of course, this is wishful thinking. Even if he were a magician, he would find conjuring up a trade surplus with China to be an arduous task indeed. In any case, China’s advance could hardly be stopped now. What its engineers and scientists do not already know is not likely known to any of their contemporaries in America or elsewhere either. America can only slow China’s advance a little bit by creating a few difficulties here and there. But such an approach could hurt America more than it does China over time. With China so integral to global supply chains, there are limits to the punitive trade and investment actions the Americans can undertake. Besides Mr Trump does not have the capacity to play the long game like his Chinese counterpart could. Unsurprisingly, Mr Trump has left the door of negotiations open; even as he maintains his stern anti-China rhetoric.

China is currently well-positioned to be the leading innovator of the next century. With some clairvoyance, the Asian nation not only aggressively invested and built enviable capacity in new technologies like electric vehicles, solar power, robotics and so on, it has more or less locked in the primary resources that would be needed to power them. Mr Trump’s irritation is understandable. Still, it is probably too late for America or any other country to do anything about it. Most of the goods China produces and sells to the world, it is able to manufacture more cheaply. Those that it cannot do less dearly, its neighbours are taking up; with some bound for African countries like Ethiopia. And for the high-end manufactures it is now focused on, it is increasingly attaining cost leadership. And if Mr Trump’s protectionist measures make China jettison its hitherto feigned posture of obeying global trade rules, it is market-driven economies like America’s that would probably suffer in the long run. Mr Trump is undeterred: “Trump Defiant as U.S. Adds Trade Penalties, Will End Barriers And Massive I.P. Theft.”

Be alert
Should African economies be worried about the Sino-American trade squabble? My views on this are published in the current April 2018 issue of Forbes Africa magazine (“Will Trump’s trade war hurt Africa?”). I argue that as Africa’s trade with America is quite meagre and is infact declining, there is probably no cause for signficant concern. Considering Mr Trump’s volatile nature, however, I suggest the continent’s leaders should not be complacent. Soon enough, after going to press, Mr Trump announced plans to suspend duty-free treatment of clothing from Rwanda under the African Growth and Opportunity Act (AGOA). The move was a potential retaliatory measure to Rwandan restrictions on American used apparel and footwear in the event that it did not reverse them 60 days from the date of the announcement in late March. Tanzania and Uganda were similarly warned for the same measures but were allowed their AGOA benefits after corrective actions. Still, the Rwandan example brings to light how even small economies might find themselves in Mr Trump’ firing line.

Also published in my BusinessDay Nigeria newspaper column (Tuesdays). See link viz. http://www.businessdayonline.com/america-cannot-stop-chinas-advance/

macroafricaintel | Tillerson in Africa

By Rafiq Raji, PhD
Twitter: @DrRafiqRaji

Hours before American secretary of state Rex Tillerson was scheduled to land in Nairobi, the Kenyan capital, President Uhuru Kenyatta and his main political rival, Raila Odinga, held a press conference in which they vowed to mend fences and work together. This was the first time they would meet since a bitter election dispute that started almost 7 months ago. Hitherto, Mr Tillerson’s 5-nation Africa trip, which started this week, was written off as one focused on security and not necessarily concerned with other cogent issues germane to helping Africa move ahead. The five countries Mr Tillerson is visiting, Ethiopia, Djibouti, Kenya, Chad and Nigeria, have been grappling with one security issue or the other. Even so, African countries would also be interested in knowing whether they need worry about a negative surprise from the Donald Trump administration in regard of American trade policy; in light of its recent import tariffs on aluminium and steel. How much of a factor Mr Tillerson’s imminent arrival in Kenya was in getting President Kenyatta and Mr Odinga together remains to be seen. But after their public reconciliation today, all the negative headlines about Kenya, most of which were related to their caustic political standoff, have become largely irrelevant. They said the right words. And their body language suggested they were being sincere. Needless to say, it is a very positive development. Of course, there remains the issue of the worrying indebtedness of the Kenyan fiscal authorities and so on.

Look beyond security
Mr Tillerson’s visit is also opportune for Ethiopia, currently in transition and under a suspect state of emergency, as prime minister Hailemariam Desalegn takes a bow. The American foreign minister did not pull his punches upon arrival there, asserting that what Ethiopia needed at this time was a freer society. How much of an impact his words would have also remains to be seen. But judging from recent political developments, the ruling Tigray elite have little choice but to allow for a more representative government. And considering Ethiopia is still largely aid-dependent, Mr Tillerson’s remarks could be differential. The American foreign minister is also expected in Abuja in a few days. It would be the most high profile visit by an American official to Nigeria in recent times. Nigerians, who were more than a tad disappointed that former American president Barack Obama did not deem it fit to stop by, would nonetheless be looking forward to Mr Tillerson’s visit. Incidentally, he would be arriving at a time when the recent abduction of more than hundred school girls in Dapchi, northeastern Nigeria, is still fresh in their memories. I suppose they would want to ask him if America made an offer of assistance to the Muhammadu Buhari adminstration like it did the Goodluck Jonathan government for the Chibok girls. Other African countries would love to get a sense of American policy on their issues as well. South Africans have been a little taken aback for not being on Mr Tillerson’s itinerary, for instance. The American view of the new Cyril Ramaphosa administration’s land expropriation without compensation policy is one some nervous market participants would be interested in. When asked about the matter at a conference call ahead of Mr Tillerson’s trip, acting assistant secretary of state for African affairs Donald Yamamoto did not give a definite view.

Competing for influence
In light of the foregoing, there is a risk of overestimating the influence of the Americans in Africa. They are not as important as they once were. Mr Tillerson has certainly shown a realism in this regard. In fact, the focus of his first speech in Addis Ababa was preponderantly focused on China’s now enviable hold on the continent. He mentions the growing indebtedness of African countries to China, in particular; cautioning them not to sell their sovereignty away. Coming from the Americans, who through the International Monetary Fund (IMF), were once similarly overbearing on African politics and policy, and perhaps still are, it seemed a little uncanny. But it speaks to the concern of the Americans about the Chinese. Already, the Americans plan to clarify from China in a meeting scheduled for the spring what their operational military goals in Africa are. That meeting, if it holds, would likely be dominated by Chinese military activities in Djibouti. In February, Djibouti terminated its contract with Dubai’s DP World for the management of Doraleh Container Terminal at the Djibouti port. American intelligence has it on good standing that the Chinese, who already have a military base in the country, would likely be gifted the port; with potentially “significant” consequences for American military operations in the country. Incidentally, Mr Tillerson’s Africa trip coincided with a similar one by Russian foreign minister Sergey Lavrov. While in Ethiopia, Mr Lavrov and Mr Tillerson stayed in the same hotel but did not meet. Before arriving in Addis Ababa, Mr Lavrov was in Harare to meet President Emmerson Mnangagwa to agree military and mineral deals. The Americans have more than the Chinese to worry about, it seems.

macroafricaintel | Flattered Trump achieves little in Asia

By Rafiq Raji, PhD

Donald Trump, the American president, concludes his 5-country Asian trip in The Philippines today (14 November). Heralding his arrival in Beijing a week earlier – his third stop after earlier ones in Japan and South Korea – was a reminder of China’s trade surplus with America, data for which came out at US$26.6 billion for October; about US$223 billion thus far this year. And if he thought his trip would make China buy at least as much American goods and services as go the other way, he was a tad disappointed. Of course, there was much pomp about the US$253.4 billion in deals signed between the two delegations. But much of these were not substantive. And some were actually just old deals. The extent of the divergence in the views of the Chinese president, Xi Jinping, and President Trump, would become writ large in Da Nang, Vietnam, at the Asia-Pacific Economic Cooperation (APEC) summit, where they both headed afterwards. They provided sharply contrasting visions on trade in their speeches to the gathering of Asian-Pacific leaders. While President Xi espoused multilateralism, openness, and globalisation, Mr Trump was unapologetically insular in his views. Brief incidental interactions with Russian president, Vladimir Putin, at the APEC summit, in place of a much anticipated formal meeting, did not yield much either. Because even though the Kremlin published a joint statement on the crisis in Syria, there was not much there that was new; a missed opportunity. It did not help of course that the controversy over alleged Russian meddling in the 2016 American presidential elections would not just go away; no doubt made worse by Mr Trump’s equivocation on the matter. In fact, what little progress that was made during his time in Asia was actually on matters antithetical to his agenda. A deal was reached by the 11 countries remaining in the Trans-Pacific Partnership (TPP) trade agreement he ditched, for instance; albeit there were a few hiccups here and there before that came about.

Playground rhetoric
Mr Trump came out a little bruised on the North Korean matter as well. After initially striking a somewhat conciliatory tone towards the communist regime, urging it to do a deal over its nuclear weapons programme, he adopted an aggressive posture shortly afterwards in his address to the South Korean legislature; defiantly telling the volatile man up north not to test America’s might. Unsurprisingly, the North Korean regime replied with insults, calling Mr Trump an ‘old lunatic’, ‘warmonger’ and ‘dotard.’ Not one to take such expletives lying down, the American president threw back a few of his own, suggestively referring to Kim Jong-un, the North Korean leader, as ‘short’ and ‘fat’. Even so, if there is a slight chance of some deal with the communist regime, Mr Trump’s unusual style probably makes him best-placed to make it happen. China remains crucial to any potential progress, however. Unfortunately, they did not offer more than they already had on the matter.

Flatter to naught
The Japanese were more gracious at least; they imposed additional unilateral sanctions on North Korea. Not that this could necessarily be attributed to Mr Trump’s powers of persuasion: North Korea fired missiles over Japan in mid-September. And this was despite Mr Trump’s taunts at prime minister Shinzo Abe: He went on unabashedly about how the Japanese were inferior to Americans and wondered aloud why the Japanese did not shoot down the North Korean missile, suggesting how if they had American-made weapons, they would have been able to do so easily. (The Japanese are officially pacifist but have a military for self-defense purposes.) Little wonder then his Japanese trip turned out to be a failure somewhat. He did not get much from them on trade; a major issue for him. (Like China, Japan also maintains trade surpluses with America; albeit at 9 percent of the total American trade deficit, it pales in comparison to China’s 47 percent.) As if to buttress the point, the Japanese ruled out a potential Free Trade agreement (FTA) with the Americans, Mr Trump’s preferred route to dealing with trade imbalances. Instead, Japan led the effort to ensure a deal was reached on the so-called TPP-11. The Asians were all smiles but gave him little.

Also published in my BusinessDay Nigeria newspaper column (Tuesdays). See link viz. http://www.businessdayonline.com/flattered-trump-achieves-little-asia/

macroafricaintel | What is the point of Trump’s Asian trip?

By Rafiq Raji, PhD

Donald Trump, the American president, arrived Beijing today (8 Nov), the third stop on his 5-country Asian trip, after earlier stops in Japan and penultimately, South Korea. Heralding his arrival was a reminder about China’s trade surplus with America, which came out at US$26.6 billion for October; making it a total of US$223 billion thus far this year. President Trump would like the reverse to be the case. Unfortunately, it would continue to be a source of frustration for him, and in fact any other American leader who desires that China buy at least as much (if not more) American goods and services as go the other way. Incidentally, China is already making headway in the sophisticated industries that America may have once relied upon to stay ahead; which often are in partnership with American companies in China itself. And even as Mr Trump tries to bring back American companies back home from places like China, with jobs in tandem, the economics still favours them staying abroad; albeit not necessarily in China but in cheaper Southeast Asian countries. Turns out, Mr Trump is scheduled to address the 2017 ASEAN summit on 14 November in The Philippines, where bashful and often uncouth president Rodrigo Duterte may be just the ideal host for his similarly mannered American counterpart. And such is the importance the Americans attach to it that Mr Trump’s itinerary was extended by a day to accommodate the ASEAN speech. He would not be leaving China empty-handed, though. At least US$9 billion in deals are expected to be made between chief executives of American companies on Mr Trump’s entourage and their Chinese counterparts, commerce secretary Wilbur Ross is reported by CNBC to have said. (Another official is reported to put potential deals to be signed at US$250 billion.)*

Rocket man
With a belligerent leadership at the helm and reckoning by the Russians that in two to three years, it could have missiles able to hit America, North Korea remains a thorny issue. On his first day in Seoul (7 November), Mr Trump struck a somewhat calm tone on the great matter; urging the North Korean regime to come to the negotiating table and do a deal. Next day, while addressing the South Korean legislature, it was the reverse; defiantly telling the communist regime up north not to test America’s might. These are all very well; but fact is, Mr Trump achieved nothing there. And the elements came up against him en route to the demilitarized zone between the two Koreas, as his chopper could not risk an unanticipated fog. The Japanese, who he visited (5-7 November) before the Korean leg, tried to be gracious at least; they imposed additional unilateral sanctions on North Korea. Not that this could be attributed to Mr Trump’s persuasive powers: North Korea fired a missile over Japan in a show of strenght recently. Of course, Mr Trump could not stop himself from taunting prime minister Shinzo Abe on why the Japanese did not shoot down the missile. Ever the salesman, he did not forget to make a pitch for how American weapons would be able to easily do just that, though. (The Japanese are officially pacifist but maintain a handful of troops, supposedly for self-defense purposes.)

Emperor’s new clothes
Of course, Mr Trump did not see how ill-fitting it was to boast about American might to the face of Mr Abe; going on unabashedly about how the Japanese were still second fiddle to Americans. Little wonder then his Japanese trip turned out to be a failure somewhat. He did not get much from them on trade; a major issue for him. Like China, Japan also maintains trade surpluses with America; albeit at 9 percent of the total American trade deficit, it pales in comparison to China’s 47 percent. As if to buttress the point, the Japanese ruled out a Free Trade agreement (FTA) with the Americans, Mr Trump’s preferred route to dealing with trade imbalances; as opposed to the now 11-country Trans-Pacific Partnership (TPP) trade agreement that he ditched but which the Japanese are keen on, for instance. An FTA with the Japanese would have been hailed by Mr Trump as a victory. A highly likely meeting with Russian president, Vladimir Putin, on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit in Vietnam, his next stop from China, would no doubt be overshadowed by ongoing investigations back home into Russian links of Mr Trump’s associates during his presidential campaign. In the meantime, he should enjoy some relief at his current stop: the Chinese reportedly plan to treat him like an emperor. That is not usually a compliment.

*Trump & Xi announced US$253.4B in deals on 9 Nov 2017; albeit a significant portion is not substantive, as they are simply MoUs and so on.

Also published in my Premium Times Nigeria column. See link viz. https://opinion.premiumtimesng.com/2017/11/12/what-is-the-point-of-trumps-asian-trip-by-rafiq-raji/

macroafricaintel | What about the 2017 BRICS summit?

By Rafiq Raji, PhD

The BRICS group of five emerging economies (Brazil, Russia, India, China and South Africa) held its 9th summit in the Chinese city of Xiamen this year (3-5 September). Originally just an idea by former Goldman Sachs (an investment bank) executive Jim O’Neill in a 2001 publication dubbed “Building Better Global Economic BRICs”, BRICS countries today constitute almost a quarter of global output. They have not proved to be as inspiring since those heady days, though. Since its first substantive summit in June 2009, only China (GDP: US$11.2 trillion) and India (GDP: US$2.3 trillion) have proved to be consistent good performers, albeit China has since 2015 adjusted to a new normal of below 7 percent growth. India is forecast by the IMF to continue powering on above 7 percent, though; over the next two years, at least, after a 7.1 percent headline in 2016. But that is where the good story ends. Brazil (GDP: $1.8 trillion) only emerged from a 2-year recession (the longest in its history) in the first quarter of 2017. And South Africa (GDP: $0.3 trillion) exited a relatively short-lived one in the quarter afterwards.

Mostly about China
The 2017 meeting was somewhat overshadowed by coincidental negative global geopolitical happenings; top among them being the firing in late August 2017 of an intercontinental ballistic missile (ICBM) over Japan by the communist North Korean regime of Kim Jong-un. China, which consititutes more than 60 percent of BRICS output, was called on by world powers to reign in the North Korean regime, which depends a great deal on it for sustenance. Naturally, the key headline from the final communique was related to the crisis. In any case, BRICS has become a veritable platform for China to project power and influence, as it seeks to have more say in international affairs. (As the second largest economy in the world, China would like the IMF to be more representative of the new global economic order, for instance.) And judging from the paltry US$80 million funding commitment ($76 million for an economic and technological cooperation plan and $4 million for projects by the group’s development bank) China made at this most recent BRICS summit, the group probably serves no greater purpose than that; especially when you consider its US$124 billion funding commitment in May 2017 to its ambitious Belt and Road initiative or so-called new Silk Road plan. (It did pledge $500 million for a South-South cooperation fund, though.) As a counterweight to recent American insularity, China used the occasion to once again make the case for globalisation and climate change; two major global issues the Americans have been reluctant to show leadership on under its current president, Donald Trump. Specifically, Chinese president Xi Jinping posited the group “should push for an open world economy, promote trade liberalization and facilitation, jointly create a new global value chain, and realize a global economic rebalancing”.

BRICS plus
The 2017 summit had one major distinction though. It was its largest gathering yet, with non-BRICS countries like Guinea, Mexico, Egypt, Thailand, and Tajikistan in attendance as observers. Their presence was informed by a so-called “BRICS-plus” initiative proposed by China, which could see the current 5-member group include more countries, although this was not formalized at the summit. Of course, it is not too difficult to see why Mexico might be interested in more global outreach, as it faces an imminent dissolution of the North American Free Trade Agreement (NAFTA), which if successful would see it lose lucrative market access to America. Considering it is a major campaign promise of President Trump, it is probably only a matter of time before this happens. Mr Trump desires that America get more from NAFTA, which he believes is currently lopsided in favour of neighbours like Mexico. In any case, China indicated it was interested in entering into a free trade agreement with Mexico; in line with a trend where it now increasingly fills the gap left behind by a less-ambitious America. One of the observer African countries, Guinea, got something as well: it secured a US$20 billion loan over about a 20-year period from China in exchange for mining concessions on its bauxite deposits. Structurally, it did not seem like a bad deal, as revenues from projects the loan would fund would be used to service it. They include a planned alumina refinery and two bauxite mine projects. Roads, a power transmission line and a university are other projects earmarked. Still, considering how shrewd the Chinese are, it is not likely the Guineans got the better side of the deal; especially as the Chinese would get to keep any potential gains down the line, often beyond that which could be reasonably valued at the early stages. Like its other international trade and foreign policy initiatives, the ulimate beneficiary of BRICS is China itself.

Also published in my Premium Times Nigeria column. See link viz. http://opinion.premiumtimesng.com/2017/09/08/what-about-the-2017-brics-summit-by-rafiq-raji/

macroafricaintel | Why are most African airlines floundering?

By Rafiq Raji, PhD

The state-owned airline of Africa’s most advanced economy, South African Airways, is about to be bailed out by the state with about US$1 billion. Again. In July, not only did the state provide cash support to the almost bankrupt airline after an international bank insisted that its loan be serviced, it had to provide about 20 billion rand in guarantees. It would probably not be the last time. Even more saddening is the proposal that the pension fund of public workers may be used to pay almost half of the proposed US$1 billion bailout. Almost everytime credit rating agencies issue a review on the sovereign now, the deplorable state of the airline’s finances is mentioned. Only breath of fresh air is perhaps, finally, it has new management that probably knows its onions. Time will tell. Up north to the east, Kenyan Airways, another state-owned airline (partially though, as the Kenyan government only has a 29.8 percent stake), which incidentally has an international airline of repute, Air France KLM, as a shareholder (26.73 percent stake), would restructure its finances imminently, after failing to recover from a souring of the Kenyan tourism sector by terrorist attacks some five years ago. The restructuring plan seeks primarily to convert the debt it owes 11 local banks into equity via a special purpose vehicle, which would make them the largest shareholder afterwards (according to Reuters).

Bright spot
Some African countries have simply given up on the idea of a national airline, after earlier initiatives either went bankrupt or simply collapsed out of sheer incompetence. But there is a bright spot. Ethiopian Airlines made more money (US$273m net profit) than all African airlines combined (US$800m net loss) in 2016; a point happily made by African Business, a prestigious African publication, and BBC, the premier British broadcaster, in recent features. It begs the question, though: what makes it possible for Ethiopian Airlines to do so well at the same time that its supposed contemporaries are floundering? Tewolde Gebremariam, chief executive of the Ethiopian national carrier puts it rather well in a recent BBC interview: lack of government interference, private sector expertise and cost management. They seem simple, not so? Not really. Even when private sector experts are allowed to run a state-owned enterprise, African governments loathe being ignored.

The discipline of the Ethiopian government provides many lessons. It does not fund its airline in anyway. Ethiopian Airlines is completely run from its own finances. It does get support from where it matters though: America. The US Exim Bank guarantees most of its aircraft purchases, Mr Gebremariam tells the BBC. With that kind of backing, top global banks like JP Morgan Chase, Citi, Barclays and HSBC are all too eager to offer it accommodative financing. Today, a lot of Africans increasingly do not mind a stop at Bole International Airport in Addis Ababa en route their final international destinations and indeed on the return journey back home. Mr Gebremariam made sure to point out to the BBC that at least 2,000 Chinese pass through Bole en route various African countries in the morning and vice versa in the evenings, every blessed day. And anyone who has travelled on the airline would attest to their efficiency. The quality is mid-range, though.

Hands off
Amidst the many floundering African airlines, Nigerian authorities desire to establish a national carrier. The motivation is nostalgic, in part. National pride is also a factor. Many agree that unless the motive is profit, it would suffer the unflattering fate of its predecessors. Thankfully, the authorities plan for it to be private-sector driven. The government has also appointed Lufthansa, a highly-regarded German airline, to advise it. But would the authorities be able to hands off like the Ethiopians seem to be able to do rather well? History suggests this is doubtful. It certainly does not help that Nigeria has a bad reputation when it comes to contracts. The experience of Richard Branson’s Virgin Group in the mid- to late-2000s with its Nigerian airline venture, Virgin Nigeria, in which it had a 49 percent stake, is instructive. Mr Branson was left dumbfounded when a new administration began to question the validity of Virgin’s contracts with the preceding one. What was the gripe? The authorities did not think it was appropriate for Virgin Nigeria to operate from the international terminal of the country’s main airport. To Mr Branson’s dismay, “heavies” were sent to “smash up” his airline’s lounge “with sledgehammers” to ensure compliance. The African aviation sector is not for the faint-hearted.

Also published in my BusinessDay Nigeria newspaper column (Tuesdays). See link viz. http://www.businessdayonline.com/african-airlines-floundering/

macroafricaintel | What is Japan’s African game?

By Rafiq Raji, PhD

The 6th Tokyo International Conference on African Development Summit (TICADVI), held on 27-28 August in Nairobi, Kenya, has come and gone. But what did it achieve? Some US$30 billion in aid and investments over the next three years were promised, half of what China pledged late last year at its similarly themed get-together, the Forum on China-Africa Cooperation (FOCAC); also its sixth meeting then. Some 73 memoranda of understanding were also signed, a lot of which were related to infrastructure, power generation especially. Others were in the health, education and expectedly, oil and gas sectors. A friend who attended the summit was particularly excited about some of the products on display at the exhibition along the sidelines of the event, like pay-as-you-go solar power, supplements for maize porridge, and so on.

Like China, Japan is involved in quite a few infrastructure projects in various African countries, albeit to a lesser degree. And Japanese companies already do quite a great deal of business in most of these. Chinese companies increasingly so as well. In sum though, China’s engagement with the continent is more intense and widespread. The Japanese make up for this in other ways. Japanese brands evoke feelings of quality, brilliance and efficiency. From electronics to cars, they are quite ubiquitous across the continent. Despite China’s growing closeness, similar sentiments are barely associated with its brands, if at all. Chinese goods are still considered inferior. Surprisingly, their cheapness barely appeals commensurately. Even so, China’s experience and relatively ample resources may be more germane to African needs. No matter. Both are willing. Sand in the wheels? Both are staunch rivals, albeit they feign some level of maturity in front of their African ‘friends’ – an official Chinese delegation attended TICADVI.

They all want the same thing
When there are numerous suitors for a potential bride, it is often ironic that blessings do not always follow. The one being sought after might overestimate her value, dither, or hope for better opportunities that may never come. Africa is one of many frontiers of interest to these world powers. So for Japan and China, longstanding rivals, whose volatile relationship is writ large by a territorial dispute over eight islands in the East China Sea, Africa provides a vast field for them to spar. Even so, they both really want the same thing: influence. Like China, Japan is also interested in the continent’s mineral resources. Resource-poor Japan seeks fuel for its energy needs, as its nuclear-dominated system have been mostly shut down since the 2011 Fukushima mishap. Both are also counting on African countries to pursue varied agendas at the United Nations and other multilateral institutions. Like the Europeans and Americans before them, Japan and China are also building military bases on the continent. Simply put, they are pursuing their own interests. Knowing this could be a blessing for African countries, whose negotiating positions are enhanced as a result. The temptation to pitch one against the other should be resisted, however. Instead, African countries should articulate what their development needs are and then go with the partner that best ensures their fulfilment. Japan is not offering as much money as China is. But it has one advantage over the latter. It is more technologically advanced. Its projects are executed with the highest standards and are delivered on time. And they last. China, on the other hand, knows only too well how steep the road to development can be. It is likely a better teacher on how to traverse that road than Japan could ever be at the moment. There need not be a dilemma in any case. Both can help.

Accept only the help that liberates you
As the Japanese prime minister, Shinzo Abe, was engaged in his charm offensive – the TICAD conference was being held on African soil for the first time – Chinese officials were quick to deride his efforts. It was almost the same way the Americans were all too quick to point out how the Chinese then newfound interest in Africa was going to be similarly or more exploitative. Truth is, these supposed development partners go into these relationships often because they already see more advantages for themselves. Or at least, they see the costs and benefits as evenly balanced – not in the African case: whether the partner is China, Japan, America or Europe, the advantages are tilted towards the other side. And the toast is always the same: we want to help. That is all very well. What African countries need the most, in addition to infrastructure, is technology and skills transfer. In doing this though, the situation can no longer be as it is currently, whereby these so-called partners set up businesses on the continent, bring their own staff, integrate little and barely mask their disdain. The scorecards cannot continue to be about how many billions of dollars our partners’ supposed benevolence allowed for each time. Thankfully, more energy at these summits is now being devoted towards changing this lopsided paradigm.

Also published in my BusinessDay Nigeria newspaper back-page column (Tuesdays). See link viz. http://www.businessdayonline.com/en/what-is-japans-african-game/