Wednesday, June 2, 2010

France Eyes New Tack To Profit In Africa

(The neo-colonial scramble for Africa is neither identical nor less oppressive. Now France is putting on a new face).

June 01, 2010

By DON MELVIN, Associated Press Writer

NICE, France (AP) China’s investment in Africa has increased so much in recent years that some Africans fear a new form of colonialism.

Now, France, one of the continent’s old colonial masters, is looking to Africa with outstretched hands, working to imitate China and step up its own investment there.

To send that message, French President Nicolas Sarkozy opened this week’s 25th Africa-France summit for the first time to captains of industry as part of his bid to get “made in France” labels on bridges, roads and other infrastructure now made by China and to increase Europe’s influence in Africa once again.

Africa “is not the only place where Europe’s influence is on the wane, and we should accept it,” Andris Piebalgs, the European Union’s development minister told The Associated Press at the summit Tuesday. He said Europe needed “to learn from the positive Chinese experience.”

The tables have turned on the French in Africa, once at the heart of its colonial empire.

Paris is now leading a European bid to complement hefty aid with increased trade by private companies in Africa where French and other European languages are still a second tongue in many countries but where one increasingly hears Chinese. The summit coincided with the 50th anniversary of independence for 14 former French colonies.

Hard figures on investment are difficult to come by. China does not issue reports on all its investments, nor do many African countries. But the dramatic increase in economic ties can be seen in trade figures.

Between 2006 and 2008, Chinese exports to Africa increased from $26.7 billion to $49.8 billion, according to a report to be released this week by Chatham House, a London-based policy group. And Chinese imports during the same period more than doubled, from $28.8 billion to $56.8 billion.

French trade during the same period increased, but not as dramatically exports rose from $26.3 billion to $38.5 billion, and imports rose from $24.8 billion to $38.8 billion.

What is indisputable is that Chinese investment on the continent is shooting up and as a result Europe’s influence there is in decline.

No deals were announced as a result of the summit, which ended Tuesday; the occasion provided an opportunity for networking as much as for signing contracts.

But among the business people Sarkozy invited to this city on the Riviera were representatives of some of France’s most prominent companies: Total S.A., Alstom, the power generation and rail infrastructure company; Compagnie Generale des Etablissments Michelin, the tire-maker; Arianespace, which launches satellites; PSA Peugot Citroen S.A., the car manufacturer; France Telecom and a host of others.

It’s not just France that wants a share of the action. So do other European powers and that is in keeping with a rising theory that private investment is a more efficient engine for change than development aid. But the issue is complex.

Critics argue that no-strings investment like China’s can enrich repressive regimes and subject African workers to difficult conditions. But proponents say that investment, rather than aid, fosters growth rather than dependence.

“The ball is very much in the African countries’ court,” said Matthews McDonald, a research analyst at the Centre for Chinese Studies at Stellenbosch University in South Africa. China, he said, “is not an external investor seeking to modernize Africa. But Africa has a chance to modernize.”

Sarkozy is trying to have it both ways and has insisted that aid must not be abandoned in favor of free enterprise.

Businesses present at the summit laid out a charter of good behavior in a bid to safeguard against corruption, dispel memories of shady practices prevalent for decades after colonial rule and win over African hearts and minds. However, Reed Brody, a spokesman for Human Rights Watch, told the AP that voluntary codes of conduct have been shown not to work.

Adama Gaye, a Senegalese journalist who specializes in China-Africa relations, said from Paris that France must not abandon its ideals while private firms are taking part in a feeding frenzy in Africa.

“By dropping soft power and trying to compete with China on its own terms, France will not be able to keep up,” he said. “China’s colors are very clear: it is not a multiparty democracy. You have to take it as it is.” Meanwhile, the Europeans “come to Africa with a flag of democracy. You have to be true to your flag.”

China is not the only outsider interested in Africa. India, Turkey, Iran and South American countries are signing contracts.

That is precisely why more European investment in Africa is needed, said Thomas Cargill, the assistant head of the Africa Program at Chatham House.

“A lot of the time, that does come without any strings attached, without concern for democracy and rule of law,” Cargill said by telephone. He said that western investment can be linked to respect for democracy.

And he argued that private investment because it is a transaction between equals, a willing buyer and a willing seller is more respectful of African dignity than aid.

Africa offers investors rich agricultural possibilities, 1 billion consumers and 40 percent of the world’s mineral resources, he said.

China is challenging traditional Western dominance in oil investing, for example, in Nigeria’s corruption-plagued oil industry. In May, Nigeria signed a $23 billion agreement with China to construct three gasoline refineries. The deal is expected to add 750,000 barrels a day to Nigeria’s refining capability, reducing the oil-rich nation’s dependence on imports of refined fuel.

The EU development commissioner said that Europe is not about to cut back in aid to the developing world. He noted the commitment by rich nations to one of the U.N. millennium goals is for countries to contribute 0.7 percent of GNP to development assistance by 2015.
But, “We need an additional driver,” Piebalgs said, referring to free enterprise. “Until now, the driver was government-to-government relations.”
Sarah DiLorenzo in Dakar contributed to this report.

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