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Volume 50 Number 4, February 1, 2020 ARCHIVE HOME JBCENTRE SUBSCRIBE

UK-Africa Investment Summit

Increasing Britain's Exploitation of the Wealth of Africa

On January 20, Prime Minister Boris Johnson opened the UK-Africa Investment Summit, which, according to the government, will lay "the foundations for new partnerships between the UK and African nations based on trade, investment, shared values and mutual interest". Twenty-one African countries attended, including sixteen heads of government. Although much was made of the alleged aim to "support African countries in their ambition to transform their economies", and efforts to "enable Africa's clean energy potential", the summit was being held in the context of Brexit, the continued aim to make Britain "great" again, and the requirements of the big monopolies and financial institutions to contend with their rivals, China, Russia, the US and others, to control the resources and wealth created in Africa. Emphasis was placed on enhancing the role of the City of London's control over African financial sector and institutions. It was also announced at the summit that the government had already signed trade agreements with eleven African countries and expects to sign such agreements with seven others.

The summit in London followed in the wake of similar summits held by Britain's main economic rivals. China, which conducted $208 billion worth of trade with Africa last year, holds annual summits with African countries. Last year China provided $60 billion in trade investment. Russia has also just held its first such summit. It is reported to have brokered trade deals worth $12 billion and to have already agreed another $14 billion in arms sales to Africa, around a third of its total armaments sales. Germany has just held its third investment summit with African countries, at which rivalry with Britain and France was a key theme.

The British government now aims that "Global Britain" should become Africa's "obvious partner of choice", following on from former Prime Minister Theresa May's aim of Britain's becoming the leading source of direct foreign investment in the continent by 2022. However unrealisable, it is evident that the government has committed itself to the scramble for economic as well geopolitical influence in Africa, which it recognises will have half of the world's fastest growing economies and by 2050 will provide a market of 25% of the world's consumers.

The summit itself resulted in major trade deals worth a total of £6.5 billion for the big monopolies such as Rolls Royce, Bombardier, Diageo, GlaxoSmithKline and Tullow. Despite government claims at the summit that it was committed to clean energy, 90% of the energy deals that were announced were in fossil fuels, the most significant being the £1.2 billion investment by Tullow in oil production in Kenya. Although the government attempts to show that such deals are leading to development for the people of Africa, facts show the reverse. The World Bank estimates that if current trends continue, 87% of the world's extreme poor will live in Africa by 2030. At present, 431 million people, 41% of Africa's population, live on less than $2 a day. Four of the world's most unequal countries are in Africa, including the continent's two largest economies, Nigeria and South Africa. In short, the "free market" and neo-liberal globalisation have failed to "develop" Africa for the majority of its people. The privatisation of key sectors such as education, which has been encouraged and financed by British governments, has exacerbated existing problems.

Even before the summit, the government had announced that so-called "aid" to Africa amounting to some £320 million would immediately be more closely linked to the requirements of the major financial institutions and the City of London, with another £2 billion made available over the next two years. It was announced that measures would be taken to facilitate more direct investment into Africa's economies, by using government funds to underwrite private sector capital. Social wealth created by the working people is being taken out of the economy, in the interests of the financial oligarchs, to facilitate the extraction of social wealth created throughout the African continent. These announcements by the government coincided with the announcement of similar measures taken by the World Bank. As the president of the World Bank put it, "strong actions from countries to improve rule of law and take on vested interests could create the right incentives to spur investment by strengthening financial systems, building confidence in financial markets, and enabling more productive private-sector activity".

The aim of the government is evidently to tie Africa's financial markets and banking systems more closely to Britain, while at the same time linking aid in African "development" projects more closely to the investment needs of the major financial institutions.

It was noteworthy that the investment summit was not only attended by the Prime Minister but also by four cabinet ministers, including the Foreign Secretary, underlining the importance attached to increasing Britain's trade and financial connections with Africa. Despite various attempts to present such connections as good for Africa's "development", what stood out at the summit was, as the International Development Secretary Alok Sharma put it, that the government wants "investors to seize the exciting opportunities that Africa offers".

The British government is using the conditions created by Brexit to attempt to strengthen the neo-colonial relationship that already exists with Africa and in the interests of the big monopolies and financial institutions. It is doing so in the context of the what is being called the new scramble for Africa's wealth and resources between all the big powers and blocs and especially in opposition to China and Russia. This course is not only a recipe for the continued impoverishment of the majority of people in Africa, but brings Britain into ever more dangerous contention with its rivals.

As part of the independent programme of the working class post-Brexit, it is essential that working people in Britain oppose this direction that the government is taking its trade deals which are aimed to favour the oligarchs and which will not solve the economic crises for the African peoples nor for Britain. Trade on an equal basis and for mutual benefit is what is called for, and which working people must strive for in their struggle to affirm their rights.


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