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'The Big View', March 2012 (Part 2)

Europe and the Changing Global Order: Implications for the EU-Africa Relations

Mzukisi Qobo and Mills Soko

Introduction

When the Lisbon Treaty came into force over two years ago nobody could have predicted that it would soon be followed by the outbreak of the Eurozone crisis. As the new Treaty was given life a new era for deeper integration in Europe beckoned. In recent times, at least since the onset of the Eurozone debt crisis towards the end of 2009, serious questions have been raised about the viability of the European Union (EU) project.

This brief will not discuss the debt crisis as this has been widely dissected in the media and various other policy notes. It is rather concerned with the implications of the Lisbon Treaty, in particular the role of the revamped external relations mechanism, for the EU’s relations with Africa. The discussion is situated within the context of the EU’s place in a changing global order and the main observation being made is that Europe’s fiscal travails, and their potential impact on the EU’s relations with Africa, have coincided with a gradual shift in Africa’s foreign policy away from Europe towards emerging economies and China in particular. This raises questions about the scope of future engagement between the EU and Africa, and more importantly about the need to structure a new agenda that defines relations between the two. Given the still evolving nature of the issues under discussion, most of the reflections here are tentative and prognostic.

The European Union and the Changing World Order

The EU has been one of the vital catalysts of globalization alongside the US and Japan, driving global output and trade on the strength of its expanding internal market. Since the early 1990s this picture started to change: the locus of global economic power has gradually shifted away from traditional powers to emerging powers such as Brazil, China and India.

The EU appears to be uneasy with the rise into prominence of Asia’s emerging powers and, in particular, the growing confidence of China. Europe’s apprehensions about its decreasing influence on matters of global governance were expressed by Britain’s former Secretary of State for Business, Peter Mandelson, who remarked that, ‘As Asia and Latin America have risen, the proportional influence of even the largest European states has shrunk. As if to make a point, the American president marked the anniversary of the fall of the Berlin Wall by going to…China.’

There is also a sense that the EU is too focused on its internal divisions to be able to construct a fluent narrative about an emerging global governance system and project an influential voice in decision-making processes. Part of this reflects a growing crisis of confidence and identity within the regional body. It is against this backdrop that EU-Africa relations have been evolving in recent years.

The Lisbon Treaty and EU-Africa Relations

Europe’s integration has, hitherto, moved in tandem with increased engagement with former African colonies, especially since the 1970s. It is common knowledge that these relations have not always been easy and, in fact, in the last few years they have become strained owing to the difficulties around the negotiation of Economic Partnership Agreements. Within this context, the Lisbon Treaty has attracted a great deal of attention amongst African countries that for the most part have been advocating for a fair and equitable engagement with Europe as an important development partner. The shifting priorities of the EU, the impact of the global financial crisis on the EU member countries, the challenge posed by Asia’s emerging powers, and the greater financial demands resulting from climate change exigencies could lead to a re-examination of the EU-Africa relations, with the development partnership likely to be redefined.

At the heart of the evolution of the EU project has been to put Europe’s house in order and to reposition the EU on more advantageous terms in the global system, vis-à-vis the United States and Asia’s emerging powers, in particular China. Internally, the EU has directed efforts towards achieving greater institutional coherence, simplifying EU’s complex decision-making procedures, and knitting a common foreign strategy that will set out EU’s strategy on the global stage. There has not been much progress on this score given other challenges that have come to dominate the EU in recent times, in particular, as it has had to battle the storm of the Eurozone debt crisis and direct energies towards cobbling a new fiscal stability measures for the area.

With the Lisbon Treaty in force it cannot be taken for granted that it will business as usual in EU-Africa relations. While there is no clarity on what will change and how, discussions on the future of this relationship are ongoing in Brussels. Since the advent of the Lisbon Treaty, the routine of meetings between the EU and African countries have continued. It is possible that the development assistance template will be reviewed.

Given the competing priorities that the EU will be pursuing in the years to come, Africa could find itself struggling to get as much attention as it used to in the past. There is no hint that the EU will entirely shift its focus away from Africa, but its strategy towards Africa could be recalibrated, with the aid component toned down. A more commercially oriented approach in the EU-Africa relationship, appealing to decades of financial support by the EU, is likely to be pre-eminent. This will be made all the more urgent given the accelerated economic engagement between Asian countries and African countries.

The EU will also be keen to accelerate the implementation of some of the aspirations it set out in its 2007 Joint Africa-EU Strategy, notably, the need to rationalize the fragmented nature of its relationship with Africa on trade cooperation and economic development cooperation.

The major weakness in the developmental partnership between the EU and Africa is poor coordination of development assistance, which is often dispensed under conflicting programmes. Parts of the existing developmental assistance pool could be shifted to areas connected to climate change, which is shaping up to become a key priority area for the EU. Recently the EU pledged US$10bn towards climate change efforts in developing countries for the next few years. Even in its Africa Strategy 2007, the EU underscored the importance of climate change adaptation. But where this new financing for climate change will come from is unclear.

It bears mentioning that also within the EU there is a debate going on about reforming its Euro140bn annual budget. The EU disburses aid internally, targeted mainly to poor states and most needy regions within them. There is no doubt that the envisaged budgetary allocations for the 2014-2020 cycle will not be unrelated to the external responsibility that the EU will be playing in the future, in particular in Africa

A key challenge that confronts the EU is that of emerging powers that are increasing the intensity of their engagement in Africa. Countries such as India and China are increasing their aid to African countries on the back of commercial and political relationships. China has been especially adept at this game.

The aid activism that is being pursued by emerging powers is in direct competition with that of established powers such as the EU. This reality will not be lost to the EU in rethinking its development and trade partnership with African countries. This could act as a boon for African elites as it might militate against significant reductions in EU’s developmental assistance to Africa.

Africa’s Engagement with ‘’New” External Partners 

Europe’s fiscal troubles have coincided with a gradual shift in Africa’s foreign policy away from Europe towards emerging economies and China in particular. Increasingly, Africa’s elites are focusing their attention on emerging economies such as Brazil, China and India. They view Africa’s growth prospects as being tied to deeper engagement with these economies. This signifies a break with the historical pattern of reliance on northern partners in the US and Europe.

While much of the relationship between Africa and Europe in particular centred on trade preferences and aid towards the social sector, the new emerging country partners have been funneling significant volumes of investments towards infrastructure, commodities, and the productive sector. There is certainly a change in the terms of engagement between Africa and these external partners, and a reorientation towards commerce rather than the social sector.

In his autobiography, The Journey, Tony Blair (2011) observes that the obsession of Western countries has in the past been largely with assuaging their guilty conscience rather than perceiving opportunities in Africa. As Blair puts it, “[for Western countries] giving money was a moral imperative, but there was little real belief in it delivering the outcome, which in turn led to ‘donor fatigue’.” In other words, Western countries saw Africa as an outlet for charitable work or an extension of their domestic welfare programmes. This was also self-serving for the West as it played into the dynamic of unequal power relations and perpetuated Africa’s dependence on the West. Africa’s elites milked this for all it was worth, and to the detriment of the continent’s future prosperity.

On the upside, China’s continued growth and its demand for Africa’s resources provide much needed foreign exchange earnings, which could be deployed towards diversifying the production structure in African countries. Importantly, China has shown a strong commitment to invest in Africa’s infrastructure and to the creation of special economic zones in a number of African countries.

According to a 2010 UNCTAD report, China’s growing economic activism in Africa has unsettled Western European states, which traditionally viewed African countries as their client states. China-Africa trade grew from US$8bn in 2000 to US$90bn in 2008. China’s official sources have suggested that the value of trade has grown to US$114bn.

Concessional loans and grants, support for infrastructure, generous debt relief and the opening up of markets to Africa’s goods and products, are some of the forms of development engagement characterizing China’s approach to Africa. These represent a significant departure from how developed countries in general, and Europe in particular, have engaged with Africa in the past, and could change the patterns of national development and subsequently that of the African continent.

The positive dimension of this Chinese engagement lies in its comprehensive approach: building trading relations, deploying infrastructure support, loans, and social support. The decisive factor is how African countries utilize this support and their approach to maximizing this positive force for domestic economic development and regional integration processes that generate developmental dividends.

The growth of trade between China and Africa exerts pressure for increased infrastructure development, which can be a catalyst for growth of Africa’s economies and for strengthening intra-regional trade links. Further, China is in the process of establishing economic trade and cooperation zones in Zambia, Mauritius, Nigeria, Egypt and Ethiopia, with a total infrastructure investment reaching US$250 million in 2010. The value of China’s trade and economic cooperation zones lies in their bolstering of industrialisation and employment.

Conclusion 

The changing nature of the relationship between the EU and Africa in the context of the post-Lisbon Treaty era, and of the growing ascendancy of emerging powers (notably China) in Africa raises questions about the scope of future engagement between the EU and Africa. Notwithstanding the challenge from emerging powers, Europe remains Africa’s major trade, investment and development partner. Yet Europe cannot afford to be complacent about its role in Africa. It is imperative that the EU and Africa work together to construct a new cooperation agenda, taking into account the fundamental policy, institutional and contextual shifts that have taken place in recent years.




[1] Dr Mzukisi Qobo is Senior Lecturer in the Department of Political Sciences at the University of Pretoria, and Visiting Lecturer at the University of Cape Town’s Graduate School of Business (UCT GSB). Dr Mills Soko is Associate Professor at the UCT GSB. The original draft version of this brief was published as a Diplomatic Pouch by the South African Institute of International Affairs.