Category: Commentary

Africa: The Good News

By Giacomo Valentini

The press is filled with dire news coming from Africa: in July, riots broke out in South Africa following the arrest of former President Jacob Zuma. In Ethiopia, amidst bloody battles and thousands of deaths, fighters from the rebel region of Tigray are overwhelming the national army and threatening to take the capital Mogadishu. All over the continent, COVID-19 causes deaths amid a chronic shortage of vaccines and concern among the medical community that allowing the disease to advance unchecked could give rise to new variants of the disease. The list of bad stories from Africa could continue.

But while this news is undoubtedly concerning, some important but less headline-grabbing developments offer a much more positive vision of where the continent is heading.

Towards better governance

The riots that caused so much damage in South Africa are actually the result of an unexpected resolve by the government of Cyril Ramaposa to fight back against the corruption that pervaded the country during the Zuma years. The fact that Zuma is actually serving time in jail – limited as it might be compared to the misdeeds he is accused of committing – is remarkable. It will hopefully mark a transition in the country away from tribal-based rule to the building of a modern rule-based state.

In Ethiopia, the hope is that the current tragic civil conflict surrounding the Tigray region will not disrupt other, positive developments in the region. One such development concerns the recent launch of the first major blockchain deal in Africa, whereby 5 million Ethiopian students will be given blockchain-based digital IDs, which by improving the credibility of their credentials, will give them better access to business opportunities and financial assets. 

Another country experiencing dramatic developments is Sudan, where following a popular insurrection in 2019 that deposed the Islamist despot Omar al-Bashir, an unlikely triumvirate of an urban civilian, a military leader and a warlord is ruling the country, gradually moving it towards a more liberal, business-friendly legal system. Over the past two years the government has lifted many restrictions on public speech, banned female genital mutilations, and repealed various Islam-based laws, including lifting dress obligations for women, decriminalising apostasy, ending public flogging, and partially lifting a ban on the consumption of alcohol. 

Clean African energy

On the energy front, the most important development in the Nile basin is the progress in construction of the “Grand Ethiopian Renaissance Dam” (GERD), which will create a gigantic new reservoir along the river Nile, close to the border with Sudan. In July this year, the second stage of the filling of the dam was successfully completed, triggering a new round of complaints from Egypt and Sudan, the down-river countries that are most impacted by the reduced water flow that the reservoir filling is causing. Egypt has issued veiled threats that it was ready to resort to military means should it feel that Ethiopia is damaging its interests with the dam. 

Egypt’s rumblings have a broader geopolitical dimension, given the size of the project. With a planned installed capacity of 6.45 gigawatts, the dam will be the largest hydroelectric power plant in Africa when completed, as well as the seventh largest in the world. It would greatly expand Ethiopia’s role in the region, to the detriment of Egypt, which is currently seen as the regional superpower.

Another aspect of the issue concerns Ethiopia’s decision to finance the dam by internal fund raising through bond selling and persuading employees to contribute a portion of their incomes. This decision came because of Egypt’s efforts to undermine the project by denying it traditional sources of international funding such as through the World Bank. The result is a fully domestic funding scheme, no doubt a source of additional pride to Ethiopians. Ethiopia will be able to use the electricity generated for its domestic uses, but also to export it to nearby countries, boosting the regional economy and meeting many of the “green” goals that the international community is pursuing in the fight against climate change. There are, therefore, many reasons to hope that the current troubles in the region will be resolved soon.

Reducing dependence on imported vaccines

On the COVID-19 front, the situation in Africa remains dire, as vaccination levels remain low and developed countries are reluctant to contribute significant amounts of vaccine doses before their own populations are deemed to be sufficiently protected. Even the limited supplies promised under the UN-backed COVAX scheme have largely failed to materialise. But in the longer term, some important developments are underway, which portends to a much more positive scenario for future pandemics. 

In July, the government of Senegal announced the construction of a vaccine facility in the country, with the financial and technical support of the EU and the World Bank. A former French colony, the country is host to the Institut Pasteur de Dakar, part of the international Pasteur Institute network. The plant is scheduled to begin production by the end of 2022. Further good news on the vaccine front comes from  Cape Town, South Africa, where the Biovac institute announced that in 2022 it will start production of Pfizer’s COVID-19 vaccine, using large batch ingredients from Europe which it will blend and put in vials for distribution in Africa. These will be the first African locations to have vaccine production capacity, a very important step in raising living standards in the continent.

Africa to the stars

One further area of African progress comes from the aerospace sector. In July this year, Uganda became the latest African country to prepare to launch a satellite. It is one of 10 countries on the continent with such plans, while another 13 have already put satellites into orbit. For 2021, African countries are spending over half a billion dollars on their space programmes, roughly double the amount spent in 2018. Many African countries are located at latitudes that are favourable for rocket launches, with increasing interest among international investors in new and existing launch sites on the continent. 

Conclusion

The geopolitical consequences of an African renaissance are to be carefully taken into account. China’s close involvement in many investment projects in Africa should be a warning to western countries that they need to step up their own actions there, to encourage the emergence of modern, pluralistic societies and open economies.

Impact of Populism on European Policy Making

Relaunching the blog

This article relaunches IPM’s blog after over a year of silence. We hope to provide more frequent, timely updates on issues that are of interest to our clients and friends.

Giacomo Valentini

 

THE IMPACT OF POPULISM ON EUROPEAN POLICY MAKING

In recent years, a majority of European countries have experienced a rise in populist movements, a trend which is affecting national politics and even brought populist leaders to occupy important government positions.

In Hungary, on 8 April the nationalist and populist Fidesz party won a two-thirds parliamentary majority, reconfirming Viktor Orban as prime minister. Orban based his election campaign on fighting alleged foreign meddling in Hungarian politics, in particular by financier George Soros, and on preventing refugees and migrants from entering the country.

Since 2015, Poland has been ruled by the populist PiS Party, adopting policies that tend to reject international cooperation, set limits on freedom of expression, and focus on domestic issues.

In Greece, the current government is a coalition between anti-establishment parties. It adopts positions that are often at odds with those of the country’s EU partners.

In Austria, following a general election in 2017, the country is ruled by a coalition between the mainstream conservative ÖVP Party and the right-wing populist FPÖ party, with an anti-immigrant agenda. In the Netherlands, the mainstream conservative VVD Party of Prime Minister Mark Rutte heads a coalition designed to keep the right-wing party of Geert Wilders out of power. To win the election, Rutte adopted some of the anti-immigrant rhetoric of his right-wing opponents. Populist parties have appeared elsewhere in Europe, from Spain, to Finland, Norway and Sweden.

Not to be undone in this competition, Italy has spawned not one but two populist parties. The election of 4 March saw big gains for both the Five Star Movement and of the League, while the two main traditional parties lost badly. The two parties are discussing a possible coalition government, which might focus on adopting measures against immigrants, promoting greater government spending, and challenging EU authority in economic matters. While the United Kingdom does not currently feature a prominent populist party, the recently deceased UK Independence Party (UKIP) fitted that definition during the years leading up to the 2016 referendum which resulted in the UK announcing its withdrawal from the EU.

The last bastions of European stability and continuity appear to be Germany and France. However, in both countries populist movements have emerged. In France, the elections of 2017 saw the defeat of the country’s two main traditional parties, Republicans and Socialists, and the rise to prominence of two outsiders, the centrist Emmanuel Macron – who eventually won the presidency – and right-wing populist leader Marine Le Pen. In Germany, the right-wing anti-establishment AfD party made significant gains at the 2017 general election, with 12.6% of the vote and 94 members in the 600-seat parliament.

The populist parties that have emerged in Europe in recent years can be divided into two broad categories:

  • Parties that defend the “ordinary citizen” against the power of the “elites” – an umbrella name which covers supposedly corrupt politicians, multinationals, and unspecified occult powers.
  • Nationalist parties which claim their country is under attack from foreign threats – including immigrants, supranational organisations such as the EU, the UN, or the IMF.

These two categories often overlap, and most populist parties include both elements. Both these groups of parties tend to be inward-looking, in the sense of being relatively uninterested in international issues. Many of the populist parties in power in Europe adopt inward-looking policies, and try to divert government expenditure towards measures to help vulnerable groups – in particular the unemployed and retirees.

Implications for European politics and policy making

Election results in recent years suggest that in most of Europe, traditional parties are struggling to maintain their popular support. Many factors might be cited to explain this decline – including the financial and economic downturns of the past decade, increased automation on the factory floor and outsourcing of production to countries with cheaper labour costs, the long-term political and ideological consequences of the end of the cold war in the 1990s, the rise of social media, the refugee crisis that followed the civil war in Syria, and hypothetical Russian disinformation campaigns.

The changes in government are already having an impact on EU politics. However, the impact on policy making has so far been much more muted. This is because EU institutions are somewhat shielded from political swings. The civil service plays a central role, and top civil servants are career officials, thereby relatively immune from changes in the political mood.

This means that sudden swings in policy are unlikely as a result of political shifts in government. Nonetheless, over time the political changes will make their way into EU policy making.

Policy outlook

It is quite possible that over time, the rise of populist parties could result in subtle changes in the EU’s policy focus. Populist parties tend to be suspicious or outright sceptical of policies that would require them to spend money on international issues, or on issues which appear to be removed from the concerns of the ordinary citizen. On climate change, some populist parties are openly climate-sceptic. This is, for instance, the case of Poland.

For instance, in energy policy currently the EU concentrates its efforts on market deregulation and coordination of national energy policies. A rise in populist parties might result in more attention being paid to electricity prices. On climate change, populist parties are likely to assign a low priority to climate-related policies, if these involve major costs or budgetary expenditures.

Similarly, on policies such as innovation, transport, or industrial policy, populism is likely to promote diversion of expenditure towards meeting the concerns of the ordinary citizen, away from more lofty or long-term goals.

Giacomo Valentini