US Africa summit reinforces Zim’s isolation

By The Standard | Aug. 10, 2014

The economic picture remains gloomy for Zimbabwe due to the strained relations with the West and the leadership’s choice to look East.

By JOHN MOKWETSI/ SILENCE CHARUMBIRA

This became clearer last week at the US Africa Leaders’ summit where US President Barack Obama pledged US$33 billion in investment money to about 50 heads of State and government who converged in Washington DC.

Zimbabwe, which was excluded from the summit due to President Robert Mugabe’s bad relations with the West, missed a chance to benefit from Obama’s charm offensive to do business with Africa. Washington did not invite Mugabe who is subject to US travel and financial sanctions because of his poor human rights record and history of alleged election rigging.

With him on this list of absentees were Sudan’s Omar al-Bashir, Eritrea’s Isaias Afwerki and Central African Republic’s Catherine Samba-Panza.

Economist Godfrey Kanyenze said Zimbabwe would continue to suffer from its pariah state status because there has not been any re-engagement with the West.

He said the Look East policy that has been touted by the Zimbabwean government was not of strategic importance. “We cannot continue looking in one direction,” said Kanyenze. “Even China gets raw materials from Africa but they do business with the West. There is need for a holistic approach and to look in all directions including the West and the East”.

Kanyenze said the future remained bleak until realistic strategies were put in place. Among many other deals that impressed and excited African leaders was the provision of funding for investment in electricity generation under the Power Africa initiative that is also supported by the World Bank. Electricity shortages is seen as a major impediment to development in the continent.

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President Obama pledged US$300 million in assistance per year to expand the reach of Power Africa in pursuit of a new, aggregate goal of 30 000 MW. He said Power Africa has now mobilised more than US$26 billion and would be looking at making electricity available to rural areas.

Zimbabwe has a serious electricity deficit and has resorted to load-shedding that economists say was crippling an already fragile industry. Zimbabwe has not benefitted from this programme despite the World Bank providing a trickle for the rehabilitation of Kariba dam.

Speaking to The Standard in Washington, World Bank Vice-President for Africa Makhtar Diop said although Zimbabwe was in arrears in terms of debts repayment, the international financial institution was financing the repairs of Kariba dam and other projects. Zimbabwe owes the World Bank over US$1 billion.

“There are certain procedures that we need to go through to work with a government that is in arrears but we have provided a special fund of US$40 million for other actions because we could not lend to a country that is in arrears hence the special fund,” Diop said.

This is a drop in the ocean when one considers that the World Bank Group last Tuesday announced during the US Africa Business Forum that it had committed US$5 billion in new technical and financial support for energy projects in six African countries — Ethiopia, Ghana, Kenya, Liberia, Nigeria and Tanzania—which have partnered with President Obama’s Power Africa initiative.

African leaders agreed on the importance of increasing US investment in Africa and welcomed the announcements made at the US-Africa Business Forum, including over US$14 billion in new private sector deals. President Obama announced US$7 billion in new financing under the Doing Business in Africa Campaign that would support US trade with, and investment in Africa over the next two years.

Presidents like South Africa’s Jacob Zuma, Jakaya Kikwete of Tanzania and those of Gambia and Senegal asked for equal benefit in the investments.

Obama addressed the request by promising: “The United States is determined to be a partner in Africa’s success — a good partner, an equal partner and a partner for the long term.”