Britain and the new scramble for Africa
I must confess that I have always been partial towards Britain. I spent some of my formative years as a student in France. I love Paris and its boulevards, elegant cafés and sheer style. But I knew I would always be the outsider. I was always desperately homesick in winter; only comforted by the words of the novelist Albert Camus, “in the midst of winter, I suddenly learned that there was, within me, an invincible summer”.
England, by contrast, felt like home. The Cotswolds, Tintern Abbey, Christchurch Meadow and the Lake District felt exactly as I had read about them as a schoolboy in Mada Hills, in the backwoods of the ancient savannah of my birth in the Middle Belt of Nigeria. To echo the poet Rupert Brooke, there is a part of me that will forever be England.
All the other places I was privileged to foray into in the course of a privileged career – Boston, Washington DC, Tokyo, Singapore, Helsinki, Uppsala, Stockholm, Bergen, Copenhagen, Budapest, Warsaw, Vienna and Ottawa, with all their attractions pale behind the immortal dreaming spires of Oxford.
The whirlwind African safari by British Prime Minister Theresa May last week has come and gone. Britain, as my gentle readers already know, is about to leave the European Union in a matter of months. The Brexit negotiations do not look particularly promising. It is not in the interest of the Europeans to give the Brits a soft landing, just in case it serves as an incentive to others who might consider leaving the union. Britain, if truth be told, stumbled into Brexit without the vaguest clue as to what they would have in replacement.
The entire project was bankrolled by irresponsible public school boys like Nigel Farage, former leader of the UK Independence Party (UKIP) and former foreign secretary and accident-prone Boris Johnson. It came across as a playground prank that suddenly went wrong. They had absolutely no plans for the future of their country outside Europe and were quite surprised that they actually did win. They have been in hiding ever since.
I have always been a student of British political history since Magna Carta 1215. I know that giants once governed Britain – from William Wilberforce and the two Pitts to Gladstone, Churchill, Macmillan and Margaret Thatcher. Today, the state is riddled with wimpy little Old Etonians. The great statesmen are no more. In their place we have mere political jobbers who are in government merely to have a go at something that will give them a reasonably cushy pension later in life, so they can go with the lads to the pubs in the evening of their days. John Major and Tony Blair typify that type. I feel sorry for Britain.
Theresa May’s lugubrious dance-steps with some giggling school girls in South Africa last week did not impress me. The visit to Abuja seemed somewhat more dignified. The question is: Why Africa, and why now?
Britain is rediscovering Africa and the Commonwealth because she needs new trade and business partners to replace the gaping hole that will inevitably emerge with Brexit — borne of desperation. Be that as it may, the new rapprochement with Africa comes at an opportune moment.
Britain is the oldest democracy in the world. The Brits take pride in the fact that their parliament – the Mother of all Parliaments – has never stopped sitting, be it in war or peace, for the last 300 years. Today’s Britain is a prosperous middle industrial power with a population of 66 million, a GDP of US$2.64 trillion and a per capita income of US$39,734.
As my gentle readers who did history at school would know, the industrial revolution first began in Britain in the middle of the nineteenth century, before spreading to France, Germany and the United States. Britain was the first factory of the world, aided by the supremacy of the pound sterling, mastery of the high seas and imperial hegemony over North America, Africa and India.
Britain held sway over Africa for more than a century, until the 1960s when Harold Macmillan’s “wind of change” swept through our glorious continent. Post-independence relations have waxed and waned over the succeeding decades. By the 1980s Britain had retreated from much of Commonwealth Africa, with the exception of Apartheid South Africa. Three reasons accounted for this.
First, British accession to the European Economic Community, as it then was, required that she gave up her trade and financial links with her former colonial dependencies. The Commonwealth trade preferences were discontinued. They also withdrew the pound sterling as the principal anchor for the currencies of the African English-speaking countries. A process of trade diversion occurred in favour of Europe as against the former African colonies.
Second, the rising wave of economic nationalism in the developing world made the British to look more inwards within Europe for trade and investment opportunities. The Indigenisation Decrees of the seventies in Nigeria, for example, compelled several British companies to disinvest from our country. The nationalisation of British Petroleum and of Barclays Bank by the Obasanjo military administration to punish Britain for her implicit support for the ignoble Apartheid regime in South Africa probably did help to mount additional pressures that ultimately led to the unravelling of the fascists in Pretoria. But it was a ghastly mistake for our economy.
Third, we have the grim reality of de-industrialisation in Britain towards the last quarter of the twentieth century. When I was a child, any object that had “Made in England” appended to it was the seal of quality and international standard. Sadly, these days, such an item with the same label would be considered suspect. The main culprits are Baroness Thatcher and her neoliberal Argonauts who hated the labour unions so much that they were ready to close down the coal mines and the factories in order to call their bluff. They preferred to transfer much of the capital resources to the money-changers in the City of London. Britain gradually lost her place as one of the great manufacturing powerhouses in the world.
Lest I’m misunderstood, it must be said, though, that Britain has made a success of the money-changing business. The City of London has become the global centre of international finance. Every year, trading in currencies such as the dollar, yen and the euro is in the staggering amount of US$869 trillion. This is more than in all the Eurozone countries combined. London is home to the largest number of banks in the world, ahead of New York, Chicago, Paris and Frankfurt. It is also hosts the largest insurance market in the world, valued at over US$6.8 trillion. London also dominates Europe’s US$5.2 trillion investment banking business. French nuclear reactor agencies, German automakers and Dutch pensioners all invest in London insurance and other financial services. Britain also hosts the largest foreign exchange market and the biggest derivatives industry in the world, controlling a whopping 4 percent of the world dealings in those sectors.
These exploits have raked in humungous amounts of dosh and influence. But British leaders do not realise that their island homeland is not a little country like Monaco or Luxembourg; it’s a populous nation of nearly 70 million. The rise of the finance capital and the demise of industry in Britain has brought with it industrial blight across much of the North, particularly in places such as Manchester and Yorkshire. Everybody is moving to London, making it a crampy, overcrowded and expensive place in which to live and do business. Unemployment remains a major challenge, particularly in the former industrial heartlands. Given the kind of noises we are hearing from Brussels, Paris and Berlin, the Europeans are determined to take with them a large chunk of currency and banking business away from London. That can be expected to compound Britain’s economic challenges post-Brexit. But all of that, of course, is in the future.
Africa accounts for a mere 3 percent of Britain’s global trade as contrasted with 54% with Europe. Until the late nineties Britain accounted for 7% of Africa’s imports, but that volume has gone down to a mere 2 percent. This lacklustre performance, according one leading international trade expert, is on account of the “lack of competitive exports from Africa and the rise of other competitive economies”.
Today, the total volume of Britain-Africa trade stands at over US$28 billion. The total stock of British investments in our continent is currently valued at over UK£43 billion, second only to China. Theresa May’s priority, as we understand, has been South Africa and Nigeria, whose combined trade with the UK stands at over US$8 billion.
With the British Premier’s visit, more trade and investment opportunities will open up for both Britain and Africa. She announced during her visit that London will host the 2019 Africa Investment Conference. British companies have already struck some good deals with African countries in the infrastructure and mining sectors. In Ghana British companies are building one of the most modern rail networks on the continent. The multi-billion dollar deal also involves building of telecoms and power distribution installations. In Angola a British company is investing some UK£800 million to resuscitate an iron ore mine; a project that will entail extension of an existing railway, expanding a port and construction of a power plant to generate additional 600 megawatts of electricity.
Britain and Nigeria have had long-standing trade and diplomatic relations. The downside of this long-standing relationship is akin to what happens to long-married couples: they tend to take each other too much for granted. This, of course, has a tendency to sully relationships. The Anglo-Dutch oil company, Shell, has been in Nigeria for more than 60 years. Several British firms have invested in our country and they are doing good business. According to Britain’s Minister for Africa Harriet Baldwin, Anglo-Nigerian trade is currently valued at more than US$4.5 billion annually. Much of the trade balance has historically been in favour of Nigeria. Since 2015, however, we have had a trade deficit with Britain, owing to dwindling oil revenues and the recent economic recession, amounting to over N280 billion. The British government recently created a UK£750 million fund to aid British companies seeking to invest in our country.
Among the important outcomes of Premier Theresa May’s visit is the signing of defence and security agreement and an economic cooperation compact. It was also announced that the British aid agency DFID is committed to providing annual funding of UK£200 million for humanitarian action in the North East over the next four years.
With its market size and enormous growth potentials, Nigeria should be the ultimate destination for Britain on our continent. There are considerable opportunities for trade and investments in such sectors as transport and infrastructures, machinery and transport equipment, manufactured goods, chemicals and pharmaceuticals, mining, technology, telecoms and information services, retail and consumer products and business and financial services.
Britain and Nigeria are partners of destiny. Some 1.1 million Nigerians reside in the United Kingdom. An estimated 18,000 Nigerian students enrol in British higher educational institutions annually, the third largest after India and China. For many of our compatriots, Britain is like home from home.
For us to build stronger economic ties in future, some of the binding constraints must be loosened. It is imperative that we in Nigeria keep our home in order. We need to build an eco-system that is attractive to foreign investors – a safe, peaceful environment with stable electricity, world-class infrastructures and a highly skilled populace. I see Lagos twinning with London to boost our commercial capital’s ambitions to become the financial capital of our continent. I see our leaders working together to strengthen the ties between our two nations for mutual prosperity of our people. I see Nigeria working with Britain as a prosperous democracy and a moderating voice in international relations.
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