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Analytical digest
24.03.2020

ROSCONGRESS INSIDER. Special issue on the outcomes of the Russia–Africa Economic Forum

Outcomes of the first Russia—Africa Economic Forum

The motto of the Russia—Africa Summit and Economic Forum in 2019 was «For Peace, Security and Development». The event was attended by more than 6,000 participants and media representatives from Russia and 104 foreign countries and territories. Among the participants were leaders of all 54 African states, members of official Russian and foreign delegations, and representatives of Russian and international business community.

President of the Russian Federation Vladimir Putin and President of the Arab Republic of Egypt Abdelfattah Al-Sisi spoke as co-chairs of the Russia—Africa Summit. The Summit concluded with the adoption of a declaration. The document outlines a set of goals and objectives for further development of Russian—African cooperation in politics, security, economy, science, technology, culture, and humanitarian affairs. Also, the declaration establishes a new mechanism for dialogue — the Russian-African Partnership Forum.

The development of collaboration between Russia, the EAEU, and the African Union

Russia’s relations with the African Union show a positive trend. Russia has repeatedly voiced its willingness to intensify cooperation with this organization on a wide range of international issues. Also, Russia, in its capacity as a permanent member of the United Nations Security Council, has expressed its readiness to facilitate interaction between the UN Security Council and the African Union Peace and Security Council regarding conflict resolution on the African continent.

The main focus of attention is on diversifying Russia’s relations with the African Union where Russia has observer status since 2006. Both parties are interested in expanding their collaboration in the sphere of international relations generally, and in economic relations in particular. In the context of strengthening the cooperation between Russia and the African Union, both parties are working towards expanding the links between the Eurasian Economic Commission and the African Union Commission.

A free trade agreement is viewed as potentially beneficial for the development of trade relations between Russia and Africa because it would make it possible to reduce export duties for the participating countries. In view of the problems currently existing on the African continent, such an agreement could definitely have a certain positive effect on the growth of trade turnover between the EAEU and the African Union.

The development of the Russian-African cooperation in finance

A high level of activity of Russian financial organizations is currently observed on the African track. One of the incentives for Russian organizations to come to the African continent are tax benefits offered by many African states to attract foreign investors. However, the main reason for the expansion of Russian banks to Africa is the necessity of providing financial support for Russian businesses.

VTB Bank has subsidiaries in Angola and Namibia. Renaissance Capital operates in Kenya, Nigeria, and the RSA. Gazprombank has subsidiaries in the RSA as well.

An agreement is in force between Vnesheconombank and two African financial institutions — The Industrial Development Corporation of South Africa Limited and Nedbank Limited. These three organizations are meant to facilitate strategic partnership between Russia and the RSA in export promotion and banking support for investment projects in a variety of industry sectors.

Since 2018, Russia, represented by the Russian Export Center, is a shareholder of the African Export—Import Bank (Afreximbank). Afreximbank is expected to back a number of projects currently under development which are located in various regions of Africa.

The development of the Russian-African cooperation in energy and mining

Africa possesses over 30% of the world’s natural resources. In 2018, the cumulative amount of foreign direct investments (FDIs) in mineral extraction on the territory of Africa was USD 16.8 bn (22.4% of all FDIs in the African states). However, Africa accounts for as little as 1.5% of Russia’s foreign investments. The greatest share of these investments is channelled into exploration and production of oil, gas, uranium, bauxite, iron ore, and other minerals.

30 Russian companies operate in this sector, including ALROSA, Vi Holding, Gazprom, Gazprom Neft, Zarubezhneft, Lukoil, GPB Global Resources, NOVATEK, Nornickel, Renova, Rosgeologia, Rosneft, RosSpetsSplav — MidUral Group, UC RUSAL, Severstal, etc.

On this track of cooperation, the African states of greatest interest to Russian companies are Algeria, Angola, Burkina Faso, Cameroon, Chad, Democratic Republic of the Congo, Egypt, Equatorial Guinea, Ethiopia, Gabon, Ghana, Guinea, Liberia, Mali, Mauritania, Mozambique, Namibia, Nigeria, Republic of the Congo, Rwanda, Sierra Leone, South Africa, South Sudan, Sudan, Tanzania, Zambia, and Zimbabwe.

The development of the Russian-African cooperation in science and education

The African states are having difficulties increasing the number of people with primary and higher education. However, they are raising expenditure on education and science every year. This is why education and science is one of the key areas where Russia can fulfil its strategic potential.

The topic of education and human capital was widely discussed at the Forum. The participants put forward a number of proposals for expanding cooperation in science and education, including the following:

• create permanent representative offices of the Russian Academy of Sciences on the African Continent;

• ensure that African specialists with academic qualifications, as well as young researchers, are enrolled in Russian research institutes;

• create a database of research initiatives, which will make it possible to select the most promising areas and redouble the efforts to develop them.

The development of the Russian-African cooperation in culture and the humanitarian sector

Cultural links between Russia and Africa have been left out of the focus of attention over the last few decades. However, the outcomes of the Forum suggest that positive changes can be expected in this sphere. Eight representative offices of Rossotrudnichestvo (Russian Centers for Science and Culture) have been carrying out a humanitarian mission on the territory of Africa for thirty years. The activities of the Pushkin Institute and the Russkiy Mir Foundation deserve a special mention too.

The Centers teach Russian as a foreign language, enroll African students in Russian universities, and offer art classes, supplementary education for children, and sports groups. The premises of the Russian Centers for Science and Culture regularly serve as venues for exhibitions, lectures, movie shows, seminars, and meetings of the Russian Club.

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