Background
Times ahead will be radically different. Africa faces headwinds and gigantic stakes on the economic front. This short article presents some of the major economic, political, and geopolitical issues and challenges that lie ahead for the African continent in 2024 and beyond. The world is entering a new economic order, a dangerous phase of global economic leadership at every level. Indeed, a drastic shift of this nature could completely redefine the parameters of the world’s economic, political, geopolitical, and geostrategic order. It appears that everything is in place to take the redefinition of the global governance cards to the next level.
Failure of Multilateralism in Africa
Multilateralism has failed Africa in many ways. After the Second World War and Cold War ended, there was a huge amount of hope about the promises of liberal international order and multilateralism in Africa. That hope was reflected in world-renowned distinguished John Ikenberry’s groundbreaking book, After Victory, a work that celebrated the tremendous victory of the liberal international order. The birth of the United Nations was welcomed as a savior in a world divided by decades of global power struggle. As prescribed in Article 1 of the Charter, the mission of the UN is to “maintain international peace and security, and to that end: to take effective collective measures for the prevention and removal of threats to the peace and for the suppression of acts of aggression or other breaches of the peace”. In this gigantic enterprise, equal international cooperation, win-partnerships, collaboration, unity, and solidarity have left the train. Experts like John Mearsheimer, the R. Wendell Harrison Distinguished Service Professor in the Political Science Department at the University of Chicago, indicate that such an enterprise was doomed to fail from the beginning.
Conversely, this huge optimism has turned into an abject pessimism in Africa. The United Nations, African Union, ECOWAS, and many multinational institutions have become a total embarrassment for African nations. Established under liberal principles and values, these institutions are becoming less powerful year in and year out. The notion of self-interest now governs the functioning and operations of these institutions. The resurgence of widespread instability in West Africa continues to raise questions about Africa’s position in the global system. According to William Ruto, President of Kenya, ‘’Multilateralism has become an empty word and concept in international relations, and it has failed to deliver results in terms of its founding aspirations as well as its present agenda.’’ The UN charter, for the most part, has resulted in severe violations of nations’ rights globally, especially in African countries. The lack of democratic governance in leading institutions such as the United Nations has irreparable consequences in several parts of the world.
This current volatile international context means that African nations must count on their strengths, capabilities, and resources to resolve their problems.
Rise of the Global Debt Crisis
The emergence of government debts across Africa signals systematic shockwaves that could affect multiple nations immediately. Under these circumstances, no African country is in isolation from the consequences when they arrive. The United Nations News reports that debt service demands and rising debt burdens combined with rising borrowing costs are putting enormous pressure on public budgets around the world.
History tells us that debt crises are just an eternal repetition. They happened in the past and are susceptible to happening again in the future. As the saying goes, ‘’Like causes produce like effects’’. When debt costs rise, nations are forced to adopt drastic measures and make difficult and existential that go from pronouncing bankruptcy, and economic restructuring to leaving certain existing forces. Again, one needs to look back to understand that the global economy has entered a challenging phase. The 1980, 1990, and 2008 debt crises are real evidence that governments were on the brink of total collapse, causing riots, and demise of political governments worldwide.
Debt in Africa will continue to rise significantly over the next couple of years, creating a more complex economic development and capital investment environment for local companies. The cost of borrowing remains very high compared to developed and emerging economies. The high price for servicing the debt will continue to create development challenges and vulnerabilities. The rapid pace of underdevelopment under global financial institutions such as the International Monetary Fund and the World Bank is a big indicator of change in terms of actors and rule-making institutions in Africa.
A Growing Risk of Increased Geopolitical Tensions in Africa
There is already a growing geopolitical adversity across the continent, creating political and economic blocks with different worldviews, cultures, traditions, economic theories, and political ideologies. Four major powers are engaged in a more ferocious battle for control of the region and its natural resources, which is the most important reserve in the whole world. For African governments, such confrontations are devastating, causing serious socioeconomic consequences for their countries. The African region could become the chief spark plug to an increasing world great power competition. Most experts have identified the main antagonists in this saga to be France, the United States, China, and Russia, with important public and private capital investments leading to an important regional engagement and cooperation. This has the potential to exacerbate tensions between these world powers fighting for their survival in Africa as each party protects its economic interests. In the face of such a complex situation, prudence is the best form of reaction. In other words, it clearly appears that African nations cannot count on multilateral institutions to solve their problems. Therefore, learning the basics to survive alone remains the only option at this time.
African Continental Free Trade Area, Its Funding, Ideology, and Leadership
The AfCFTA entered into force on May 30, 2019, after 24 Member States deposited their Instruments of Ratification following a series of continuous continental engagements spanning since 2012. It was launched at the 12th Extraordinary Session of the AU Assembly of Heads of State and Government in Niamey – Niger, in July 2019. As the world’s largest free trade zone gathering 55 nations and eight Regional Economic Communities, the AfCFTA is expected to build a single African market generating multiple trillions of dollars for African economies.
- AfCFTA Political Theory in International Relations
What is the international political and economic theory behind the African Continental Free Trade Area? A theory in international relations helps competing actors understand how the world (political and systems) functions and the direction that economies should follow regarding their economic development goals. All free trade agreements since the end of WWII have been rooted in the liberal international economic order principles and rules. The liberal international order pursues three main goals. First, it wants to spread democracy globally. Countries that join the liberal market openness automatically abide by the rules. Second, it promotes the openness of an international economy and brings every state into the market openness. Third, it creates a lot of economic interdependence among countries in the order. AfCFTA has been credited with expanding free trade, driving capital investment, and creating huge economic opportunities for African businesses. More specifically, it will entail continental cooperation through multilateral institutions such as the African Union and eight Regional Economic Communities (RECs).
- AfCFTA Funding
One of the biggest challenges facing the AfCFTA implementation is a lack of financial resources to build trade routes, power the continental supply chain, finance entrepreneurs, consolidate existing resources, and project trade relations against illegal competition. To succeed in this huge enterprise, governments must fund the projects for the most part. This will give them total control over the agenda, governance, and maintenance of the agreement. AfCFTA’s economic independence is crucial because it will allow leadership to make independent decisions that benefit its African economies without being dictated by external players. Finance and economic conditions always inform economic development policies, including free trade agreements. Specifically in the history of free trade zone development, the funding sources exert a large amount of influence on economic growth, the creation of new business entities, and the success of financial markets.
- AfCFTA Leadership
A strong leadership is needed to drive the agreement to success. The African Continental Free Trade Area (AfCFTA) is a beacon of hope, offering significant opportunities for businesses across the continent. There are some non-negotiable principles that leadership needs to abide by to realize this project. These include transparency, accountability, and openness. We need to know who funds the free trade agreement, what ideology drives it, and how people are chosen in governance. Wamkele Mene, Secretary-General has the difficult to build the mindset, skills, structure and culture to transform the African Continental Free Trade Area (AfCFTA) and turn it into an economic powerhouse. Leadership should prioritize excellence over familiarity when it comes to placing the right people to do the job. Whatever the challenges, leadership should understand how to choose integrity over anything else. With this, we will avoid having a club of friends out there.
How Can Africa Shape Its Future and Competitiveness Globally
Africa is becoming the center of gravity of the World. Africa is taking an important driving seat in international relations. In the 17th century, Cardinal Richelieu from the Republic of France modernized international relations. Cardinal Richelieu’s approach to global affairs, which is nation-focused, focused on realizing national interests. Cardinal Richelieu could be considered a defensive realist. Great Britain, in the 18th century, introduced the concept of balance of power to the international system. This concept championed diplomacy on the European continent for over two centuries. In the 19th century, Metternish’s Austria built the Concert of Europe, and Bismark’s Germany dismantled it, reshaping European diplomacy into a cold-blooded game of power politics. In the 21st century, America has dominated international relations diplomatically, economically, politically, commercially, and militarily. In the coming decades, Africa will shape the future of international relations in several ways possible.
To keep this part of the paper short and to the point, I will focus on two opportunities: the advancement of the African private sector and the modernization of the agriculture sector.
- Advance private sector competitiveness
Advancing private sector competitiveness is critical to building strong African economies. The private sector is the lung of every powerful economy. The best policy is therefore to increase its performance. When given the place that it deserves, the private sector can play a vital role in the African economic development sector. The point is that Africans have a unique opportunity to place their continent at the center of the world.
On a continental scale, advanced industries for agricultural products are mainly concentrated in countries such as Egypt, Rwanda, Kenya, Ghana, Tunisia, Morocco, South Africa, etc. In terms of national scale, they are still concentrated in urban regions, making it even harder for product development.
The food engineering and processing sector needs to be revolutionized the way it is been in North America, Western Europe, Russia, Japan, China, South Korea, South Africa, and beyond.
- Modern agriculture needs a revolution.
Agriculture is a vast domain that provides a large part of the world’s food and fabrics. Cocoa, Cotton, leather, Cassava, Yam. Are all agricultural products. In this part, I will focus on food processing and engineering. The main income streams in most African countries come from the agriculture sector. Several portions of the people depend on farming and related work. Agriculture is the backbone of most of the continent’s economy. Advancements in agriculture have driven important economic growth and performance in developed countries for centuries. In Africa, there is a huge need for the development or adoption of advanced technologies in the agricultural and food engineering areas.
As the world shifts to adopt the Fourth Industrial Revolution objectives, the agricultural sector in Africa must not remain in isolation from the rest of the world. The World Economic Forum talks about Agriculture 4.0. Agriculture 4.0, in analogy to Industry 4.0, stands for the integrated internal and external networking of farming operations. This indicates that digital form data is present in agriculture processes like suppliers’ communications with end customers performed electronically. Again, African nations should align this with expectations and objectives in the long run.
On a continental scale, advanced industries for agricultural products are mainly concentrated in countries such as Egypt, Rwanda, Kenya, Ghana, Tunisia, Morocco, South Africa, etc. In terms of national scale, they are still concentrated in urban regions, making it even harder for product development.
The food engineering and processing sector needs to be revolutionized the way it is been in North America, Western Europe, Russia, Japan, China, South Korea, South Africa, and beyond.
Moving Forward
Times ahead will be radically different. There is a very real risk of change in the economic and geopolitical order in Africa. We now see new agendas of collective issues, new interests, and policies being put forward by a coalition of countries, economic clusters, and groups of individual economic agents across all 54 countries on the continent, increasing the already existing prospects of divisions in the political and economic classes in Africa. Multinational corporations are becoming more powerful than governments across Africa, questioning Africa’s overall competitiveness and presence on the world stage, economically and politically.
Africa has a competitive advantage. The prospect of a new world reconfiguration provides the African continent with a unique opportunity to position itself to be the center of gravity of the world. Africa has everything the global community needs to survive in the 21st century: natural resources, clever minds, talent youth workforce on the way to becoming the most important in the world by 2050 (United Nations). Several African countries can now ask for a permanent seat at the United Nations Security Council: this is where great power competition takes form and transports to the continent.
Final thoughts
Times ahead will be radically different. The world is rewriting terms and concepts of a new economic world order that will directly shape the future of nations in the developing world, including African ones. Africa has already become the playground of great power competition whose sole interests remain economic. As the world seeks to make the most of its future capital (economic) and political investments in Africa, governments must continue to play a critical role in turning these resources into economic gains for private-sector companies across crucial future-oriented development sectors.
This is a unique opportunity for African leaders to write a new chapter in the history of their presence in international relations since the independence era in the 1960s for the most part. Realizing the tremendous potential for growth and prosperity in a world dominated by a one-way discourse, all 54 countries must understand that they possess the future of the world in their hands. This future should be designed to meet their needs and realities rather than those elsewhere in the world. Every African nation will need to accept a business environment that favors youth entrepreneurship, youth technology innovation, public-private partnership, and geopolitical intelligence culture building.
After the severity of the storm always comes the light.
Author The Author
Jean Narcisse Djaha, PhD is the Founding President and Chairman of the African Council on Foreign Relations. He is guided by Romans 8:30” And those he predestined, he also called; those he called, he also justified; those he justified, he also glorified”.
