Africa’s bumpy road to regional economic cooperation (4)

CENTRAL AFRICA AS A REGION is showing up as both an asset and a liability to the rest of Africa for a number of reasons. As an asset, a bulk of mineral resources from Africa could be found there. Angola, for example, has become one of the largest exporters of petroleum in sub-Saharan Africa, and production has nearly tripled since independence, nearly overtaking Nigeria now. That is a good story. The Angolan economy  –  the fifth largest in sub-Saharan Africa  –  is dominated by the oil and gas industry, which accounts for about 49 percent of its GDP and is the primary source of revenue for the country. In Angola, over 70 percent of government revenue and 90 percent of exports are derived from oil transactions. Gabon has a wealth of raw materials, including oil, minerals and timber, but is especially dependent on oil, which provides more than 75 per cent of all export earnings, 60 percent of government revenue and about 40 percent of current GDP. In the Republic of the Congo petroleum has supplanted forestry as the mainstay of the economy, providing a major share of government revenues and exports. Petroleum extraction, cement, lumber, brewing, sugar, palm oil, soap, form the main industries.

For the DR Congo, the country’s main economic resource is its mineral deposits in which mining produces almost 90 percent of total exports. The DR Congo is reputed for having about 70 percent of the world’s cobalt deposit. On demographics, DR Congo will likely become a country with the largest city within Africa. Kinshasa – the capital and Africa’s greatest megacity with 17.1 million inhabitants – may soon burgeon into the world’s largest city with a whopping 35 million inhabitants by 2050, rising to 58 million by 2075 and 83 million by 2100, except the unexpected happens. The city is likely to benefit from the massive copper and cobalt boom under way in the country. For Burundi, agriculture accounts for over 40 percent of GDP and employs more than 90 percent of the population. Burundi’s primary exports are coffee and tea, which account for more than half of foreign exchange earnings. The Central African Republic relies heavily on its exports, of which the most important are timber, diamonds, cotton, and coffee. The DR Congo still remains the country with the largest swathe of pristine forest resources in Africa. Next to the Amazon in Brazil in landmass, the forest in DR Congo is regarded by environmentalists as one of the biggest carbon sinks remaining, and relied upon for reducing global warming.  Cameroon, by contrast,  relies heavily on customs duties and direct taxes as sources of government revenue.

Oil and agriculture drive Chad’s economy. Oil constitutes the bulk of export earnings and government revenues. Gold, gum arabic, sesame, cattle, and cotton are Chad’s primary non-oil exports. A majority of Chad’s population relies on subsistence farming and livestock rearing. Petroleum now accounts for the vast majority of Equatorial Guinea’s exports and contributes more than four-fifths of its gross domestic product (GDP). Rwanda’s economy is almost exclusively agriculturally based, with more than 90 per cent of the population making its livelihood by producing food crops and other industrial activities. Rwanda is reputed for its tea. The Central African country has made some progress in digital transformation and looks set to keep the peace for some time.

Optimism about African regional integration is good. In reality, however, centrifugal forces pulling countries apart seem stronger than those centripetal forces seeking to bring them nearer. Those national differences highlighted still stand in the way of the region’s progress today. It will also hamper its participation on a continental scale, particularly in AfCFTA. For instance, of the 11 member countries making up ECCAS, including Angola, Burundi, Cameroon, Central African Republic, Chad, Congo, DR Congo, Equatorial Guinea, Gabon, Rwanda as well as Sâo Tomé & Principé, six independent states are in Central African CFA franc zone. The Central African CFA franc (known in French as franc CFA or simply franc; and in ISO code as XAF; usually abbreviated as F.CFA) is the currency of those six  states, namely: Cameroon, Central African Republic, Chad, Republic of the Congo, Equatorial Guinea and Gabon. These six countries have a combined population of 55.2 million people (as of 2020), and a combined GDP of $113.322 billion (as of 2020). The six countries are members of the Central African Currency Union, also known as the Economic and Monetary Union or Community) of Central Africa, known in French as Communauté Économique et Monétaire de l’Afrique Centrale (CEMAC). Their common currency, the CFA could also stand for Coopération Financière en Afrique Centrale (“Financial Cooperation in Central African”) notwithstanding the fact that the abbreviation CFA is also used in UEMOA in West Africa. It is issued by the Bank of Central African States or Banque des États de l’Afrique Centrale (BEAC), the central bank common to the six states, headquartered in Yaoundé, Cameroon, where it manages monetary policy and foreign reserves for the members of the CEMAC.

 Like its West African counterpart, BEAC is a central bank with the sole right of note issued to the member states of the monetary union, the  CEMAC. While it could be considered a good thing that the values of West and Central African CFA appear roughly at par in several West African states in which the Central African CFA franc is in circulation, of greater concern is the fact many countries that are under the same economic bloc are at daggers drawn against each other. It does not appear as if France is able to stabilise or propel the Central African community tethered to it economically, much less politically. Notwithstanding the May 2021 diplomatic shuttle of French President Emmanuel Macron to Kigali intended to further strengthen bilateral relations and cooperation between Rwanda and France, a subsequent bigger event a year later seems to have made the effects of Macron’s visit pale into insignificance. Could these be what spurred Paul Kagame into piloting away from the francophone Central African neighbours? Since the end of the Rwandan genocide and the ascension of Kagame as the political leader, Rwanda has officially switched to English language, turned to its English-speaking East African neighbours, including Uganda, Kenya and Tanzania, and has attempted to strengthen  ties with them as it does much of its trade with them. What was it about French-African relationships that was considered undesirable as Rwanda has also drawn closer to the US and Britain over these years. What could be the implications of the UK now as the single largest donor to Rwanda, providing nearly 50 per cent of its foreign aid? And what are the likely motivations for Rwanda in applying to join the Commonwealth, even though the country was never a British colony? What else could be Rwanda’s end goal in hosting the June 2022 Commonwealth Heads of Government Meeting (CHOGM) in Kigali and the visit of the heir apparent to the British monarchical throne, now King Charles, to Kigali during that Commonwealth conference?

There could be some things that are undesirable but diplomatically suppressed about the relationship of France with Africa. Maybe the coming of Russia to supplant France in the latter’s troubled colonies of West and Central Africa, and France’s traditional dependents, will begin to open up some profound but hidden issues. The areas in which Central African countries are a liability to the continent are many. Corruption, drugs, crime, terrorism and illicit financial flows are areas that need to be dealt seriously with. How effective has the AU’s programme, commenced in 2017, in which people are encouraged and allowed to voluntarily hand over illegally held small arms, every September, under the conditions of anonymity and immunity from legal prosecution?

How well have the Central African Republic, the DR Congo and Cameroon performed in this to date? How far have the UN and the AU been able to achieve the lofty, though highly desirable, goal of “silencing the guns”?

Are they seriously looking at the protracted hostilities and regional insecurity in the context of global commodity market economics? Research findings seem to confirm that illegal mining has been reported to fuel violent conflicts, environmental crime, trafficking in human beings and financial crime. Strong evidence has linked the mining of minerals to local conflict in several African countries, especially in Liberia and Sierra Leone. This is because minerals are prized by rebel groups and are a source of their financing. Examples include the “blood diamonds” that were used to finance armed groups in those two West African countries. A study on local conflict in eastern DR Congo between 2004 and 2015 looked at how changes in world prices of minerals and a surge in industrial mining affected peace and security. In the study, artisanal miners reportedly experienced more battles between armed groups over the mines when mineral prices rose while the expansion of industrial mines triggered riots and also increased violence against civilians. The trends are similar in other countries. In the Central African Republic, for instance, the peace deal signed between 14 armed groups and the government in 2019 does not seem to be effective as the armed groups reportedly still control the country.

Political leaders and policymakers all over Africa can direct interventions towards reducing these conflicts and creating an enabling environment for social and commercial activities to thrive. They need to do more on these aberrations that are almost becoming entrenched and Institutionalised. The African Union (AU), in particular, needs to wake up to its responsibility and wade into the lingering crisis in ECCAS  and find lasting solutions if the region in particular, and Africa in general, would make headway.

• business a.m. commits to publishing a diversity of views, opinions and comments. It, therefore, welcomes your reaction to this and any of our articles via email: comment@businessamlive.com