“The health crisis has wreaked havoc in Africa, but it has also made it possible to win debates”

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Bissau-Guinean economist Carlos Lopes, in Berlin, in May 2017.

In Africa, the Covid-19 pandemic has caused more economic damage than health damage. After a recession in 2020 – unheard of for a quarter of a century – the resumption of growth was more modest on the continent than on the rest of the planet. The crisis reversed years of economic and social progress, and heightened fears about the sustainability of public finances and indebtedness. For the coming year, the outlook is mixed.

The Bissau-Guinean economist Carlos Lopes, professor at the University of Cape Town (South Africa), severely judges the support given by the international community to the African continent. He is delighted all the same that this period allowed “Move the lines” on certain subjects, such as the need to develop a manufacturing industry in Africa.

“The support given to Africa has been very modest, despite the promises of the international community”

After the health crisis, African economies were severely shaken. Can we afford to be optimistic about 2022?

For me, rather, there are reasons to be pessimistic. After two years of crisis, governments no longer have any fiscal leeway to take protective measures vis-à-vis businesses and households. The limited resources of the families have been exhausted and the social damage is very important. Capital flows to the continent have declined, as have migrant remittances. Second, the support given to Africa has been very modest, despite promises from the international community. Official development assistance even declined in 2021.

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There is still some positive news, such as the upturn in global economic activity. Commodity prices are rising, which is important for the many African countries that depend on their export. And as there is excess capital in the markets, Africa is once again becoming attractive to institutional investors looking for yield. But there are also worrying signals, such as the positioning of China, which is in the process of downgrading its African policy.

During the Forum on Sino-African Cooperation in Dakar at the end of November, Beijing indeed seemed more in the background than in the past on the aspect of investments and financing. Will this have an impact on African economies?

China’s huge investments in Africa scared its “competitors”, which gave Africans some bargaining power. This will be less the case now. In addition, China played a major role in building infrastructure on the mainland. A slowdown in this area would make the logistical situation even more complex, even as the world faces a crisis in supply chains.

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Chinese decisions are certainly considered and considered. The country seems to have carried out a reassessment of the risks and one should not expect another change of foot in the short term. This could pose a big problem for Africa, which already suffers from a significant infrastructure and funding deficit. It will be difficult to find alternatives quickly. I do not think that the Western countries, which demonstrate in speeches a renewed interest in Africa, can compensate – at least within the necessary time frame – the decline in Chinese interest.

“I fear that the summit between the EU and Africa will above all be the occasion for major declarations of intent”

A summit between the European Union (EU) and Africa is to be held in February under the aegis of France. What role do you think Europe should play to support the recovery?

I fear that this summit will above all be the occasion for major declarations of intent, on the part of the European Commission, of the French President [Emmanuel Macron] and even the president [sénégalais] Macky Sall, who will then be the current president of the African Union. There will be announcement effects but not concrete things that herald a profound change in the relationship. Look at what happened during the pandemic: in aid, the European Commission has contented itself with reprogramming funds that were already planned for the continent. She didn’t add a dime. And the EU did not want to encourage the lifting of patents [sur les vaccins] demanded by Africans.

But the EU ended up supporting this solution as well …

A l’OMC [Organisation mondiale du commerce], where negotiations on the subject take place, it is the EU that displays the most conservative positions. The French president has evolved on this issue, but at the beginning he said that he was against the lifting of patents, then that it was not the priority, then that it was necessary to find intermediate mechanisms, etc.

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There is all the same a rather important gap between the speech and the reality. The President of the European Council, Charles Michel, talks about a paradigm shift with Africa. But what is a paradigm shift? Let Africa stop being dependent on its exports of raw materials. If this is what we really want, we must do everything to encourage a structural transformation of the continent. For example by helping to develop a pharmaceutical industry or by considerably increasing funding for infrastructure or logistics.

There are also trade issues. In this area, the Europeans must take into account the direction taken by the Africans with the establishment of the CFTA. [Zone de libre-échange continentale, aussi appelée Zlecaf], instead of relying on old trade patterns.

“But even if European money flows freely, we Africans must be more united to defend our own interests”

In public, however, Europe is very enthusiastic about the ZLEC, which it is moreover largely financing the establishment of …

Yes, but his argument is always to say that we are not ready and that we cannot therefore negotiate from continent to continent. So we end up with thirteen types of trade arrangements, one with Morocco, one with South Africa, etc. For each of these agreements, Europe firmly defends its interests. I am not saying that there is some kind of conspiracy. But even if European money flows freely to finance the CFTA or the African Union, we Africans must also be more united to defend our own interests.

You were a great promoter of the ZLEC. Why is this project not progressing as quickly as hoped?

Indeed, after a lot of excitement, there is a certain stagnation. Of course, the pandemic has slowed the process down a lot. The general secretariat of the ZLEC was launched during this period, which made recruiting and logistical implementation of this rather complex machine more difficult. And the concerns related to the health crisis were such that this issue was somewhat put aside.

In the absence of political mobilization, the negotiations get bogged down around two subjects: that of intellectual property and the question of rules of origin. [les critères permettant de déterminer le territoire d’origine d’un produit]. These are important issues, but we could absolutely find solutions and move forward.

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A crucial aspect now is also to be able to demonstrate our ability to negotiate within the framework of this free trade area. This is why what is at stake with Europe, our number one trading partner, is so important. This will serve as a reference for future negotiations with other partners such as China or the United States.

“The whole world may crumble in debt, Africans are blacklisted as if they were the only ones with a problem”

Why do you judge so harshly the responses provided by the international community to help Africa overcome the crisis?

Take the example of SDRs [droits de tirage spéciaux, l’actif de réserve du Fonds monétaire international]. It has been said that the issue of 650 billion dollars in SDRs by the IMF would be a solution for developing countries, especially if, as the French president demanded, the rich countries redistribute their share. But finally, when we look at the figures, we see that so far, only 5% of this amount has gone to Africa. It’s a crumb.

For me, the international financing system is going through a great moral crisis. The whole world may be drowning in debt, Africans are blacklisted as if they were the only ones having a problem with it. However, Africa’s problem is much more that of access to finance. When African countries want to borrow, they have to pay very high rates, while Germany can raise money at negative rates. Under these conditions, is it not she who benefits from an “aid plan” and concessional funds, rather than the Africans?

Today, everyone agrees that Africa must produce its own vaccines. Can this crisis also generate progress?

This crisis has done a lot of damage in Africa, but it has also enabled it to win a lot of debate. In particular that on patents and the need to develop a manufacturing industry. I hope that we are also in the process of moving the lines on the debt, as the unequal treatment of Africa on this subject has become obvious to everyone. Moreover, African leaders now dare to speak out on this issue and make proposals themselves. Overall, we can rejoice that subjects debated in a very theoretical way for decades are beginning to translate into concrete expression.

Africa in 2022