Obama in Africa is right to emphasise trade over aid

Published by CapX (28th July, 2015)

It is always easy to snipe at a state leader’s foreign tour, and Barack Obama’s trip to Africa was no exception. He was criticised for visiting a Kenyan president who only recently – and questionably – evaded the International Criminal Court for inciting political violence, then was condemned for claiming a despotic regime in Ethiopia to be a democracy. Given his host government’s recent clean sweep in elections and record of grotesque human rights abuses, this rather undermined the president’s promotion of liberal freedoms.

In many ways Obama has been a disappointment to his father’s continent. During his first term in office he stepped on African soil for less than 24 hours to deliver a speech in Ghana. His second stint in the White House has been slightly better, but he has still done less for Africa than his much-maligned predecessor George W Bush. Yet despite this he deserves credit for his strong focus on trade, even having the courage to reduce official assistance and resisting pressure to reimpose tariffs on many goods.

The president rammed home this message during his short tour. First he hung out with entrepreneurs in Nairobi. Then in Addis Ababa he called on the world to recognise the continent’s extraordinary progress when he became the first US leader to address the African Union. ‘It is long past time to put aside old stereotypes of an Africa forever mired in poverty and conflict,’ he said rightly. In his usual eloquent style, Obama declared Africans were telling him they wanted trade to fuel their progress and to determine their own futures, rather than relying on outmoded handouts of aid and the ‘indignity of dependence.’

This is a message I have long heard across Africa: a sense of pride in people’s own achievements amid rapid change, combined with smouldering resentment at the salvation fantasies of so many Westerners (and, it should be added, often anger at their own thieving and thuggish leaders). Sadly, however, this message of self-reliance seems slow to permeate through to British political and business leaders – and as the continent takes off economically, this will be to our detriment.

The statistics about Africa are becoming well-worn: a continent of 1.1bn people expanding more than any other last year, home to five of the world’s ten fastest-growing economies and with consumer spending per capita already matching China and India. Its very young, increasingly well-educated population is entrepreneurial – often by necessity – and driving technological innovation, frequently to circumvent failures of the state. Indeed, that speech was given in a symbol of modern Africa: the AU’s glitzy new $200m headquarters, funded by China.

Yet the dominant images in Britain remain conflict, disease and gut-wrenching hardship, driven by a government obsessed with aid in harness with self-serving charities and struggling media going along for an easy ride. This deters businesses from joining the rush to invest in Africa. ‘They are trapped by the past, thinking of poverty and roadblocks rather than mobile phones and traffic jams,’ said one City adviser. Bosses of entertainment and technology firms that I have encouraged to investigate African markets have told me they are scared even to visit wonderful cities such as Accra or Nairobi.

This is pathetic. Surveys show investors in Africa to be highly positive, but firms without a presence there filled with pessimism about the continent. And the consequences of this anachronistic mindset are worsened by the arrogance of British visa policies, which assume we have a right to visit any place on the planet but put barriers in the way of Africans seeking to visit our country. These official attitudes, costs and hurdles make it harder for businesspeople from fast-growing nations to trade here, put off free-spending tourists and undermine successful British sectors such as arts and education.

Britain has a host of advantages when trading in Africa: history, language, time zone, diaspora links, even soft power strengths such as music and football. Yet as countries from Brazil to Turkey chase China into African markets, our nation is losing out. A Renaissance Capital study found UK share of trade with sub-Saharan Africa fell from 26 per cent in 1960 to just three per cent by 2011 – a far-sharper fall than France, the other former colonial titan. Latest figures indicate British exports still declining despite the ferocious growth of many African economies and emerging middle class. Meanwhile we ramp up aid, despite its obvious failures, and our politicians pose as saviours of the poor.

Obama also condemned the corruption that curses Africa during his speech. So it was good to hear this echoed by David Cameron during his own foreign visit to Singapore with a pledge to tackle the tide of illegal money flooding into British property. All too often, the West has complained about theft in developing countries while ignoring how the dirty cash is cleaned up by our dodgy banks, estate agents and law firms. Now Britain needs to take on board the rest of Obama’s message and abandon the rest of our patronising approach to Africa; otherwise, we will be the only losers.

Categorised in: Africa, Aid & development, Ethiopia, home page, Kenya