Report: Why Africa's ties with China, Asian tigers will matter in 2022

Photo credit: File | Xhinhua

Africa’s rising ties with top Asian economies could be useful for the continent’s recovery from the Covid-19 pandemic, a new report suggests.

And researchers who prepared Foresight Africa 2022 say access to adequate vaccines, critical financing of economies and a balance of trade will be important aspects to ensure the continent’s economies rise from Covid-induced slumber.

Despite historical ties to the West, Africa has recently raised its connections with the Far East countries such as China, Japan, Vietnam and Malaysia through trade, financial aid or logistical connections.

And having emerged from colonialism and poverty, Southeast Asia is routinely given as an example at Africa’s economic forums to encourage good policy.

Don't repeat mistakes

The report, launched on Monday, says there are dangers in copying everything, and warns African leaders not to repeat the mistakes of entrenching authoritarianism, focusing on commodity exports, mistaking trade for development, accepting infrastructure financing without backup logistical packages, and ignoring the environmental impact of projects and the growing population.

“The critical aspect in Africa’s developing relationship with Southeast Asia is to find the means to build stronger ties, a relationship that goes beyond a burgeoning loan book for African infrastructure, to a regime that expedites freer trade and seeks fresh investment in African industrial and services sectors,” argues the report.

“For their part, Asian countries should seek a more equitable and thus sustainable relationship with Africa; and for theirs, African governments should seek to put business, not government, at the centre of economic development.”

Foresight Africa is an annual series published by US think tank Brookings Institution. This year, the report has cited five key areas the continent must work on, including enhancing healthcare and especially vaccine equity, supporting environmental conservation, technological innovation, gender equity and better leadership as critical for the recovery of Africa’s economies. 

At least half of the world’s population has been fully vaccinated against Covid-19, but only 10 percent of Africa’s 1.2 billion people.

But health, researchers argue, will bank on the public policies of these countries, especially on how foreign aid or loans are utilised.

Greg Mills, director at the Brenthurst Foundation, and Marie-Noelle Nwokolo, a researcher at the same entity, are the authors of a chapter on Africa’s external relations. They say the continent should learn from Far East countries on how they utilised debt and aid to invest in areas that created jobs.

“Whereas some Asian countries enjoyed especially large aid flows (South Korea and Taiwan, for example) and continue to do so (such as Vietnam), they did not allow themselves to become dependent on this single source of income. Most Asian countries have put aid to good use, in part because of firmer local ownership of projects,” they said.

Some commentators have argued that those countries grew by developing a political system that did not encourage opposition.

“Rather, a lot of East Asia’s success has been down to leadership, policy style, and governance substance.”

Aided by spending on education and a responsive public bureaucracy, private players also helped these Asian countries grow after authorities decentralised control on investments.

In Africa, a number of countries are now heavily indebted to bilateral lenders like China. They include Kenya, Angola, Ethiopia, Zambia and Nigeria. Zambian President Hichilema Hakainde admitted in the report that debt owed by his country had made it difficult to invest in key areas of the economy as the budget had to be cut for repayments. Zambia was at some point negotiating to reschedule its debt repayments.

“Over the last decade, we have witnessed the erosion of our economy and the corruption of our politics. As a consequence, our debt has risen to unsustainable levels, reducing the country’s capacity to invest in productive areas of our economy and its ability to address the gaps in health care, education, and other social services,” he observed in a commentary on the report.

“We will pay special attention to lowering the fiscal deficit, reducing public debt, and restoring social and market confidence. We will also promote national unity and good governance by strictly adhering to the rule of the law and democratic accountability.”

As the continent recovers from the effects of Covid-19, the report says governments must give the private sector a greater role, while reducing regulatory arms and improving the business environment.