What do Brexit, Brics and the rise of the Indian Ocean rim economy mean for Africa?
There is a nexus in the Indian Ocean, which, if not contrived, is very strong, and there is a wealth of unexploited opportunities in Africa. This is according to Dr John Maré, international public affairs and diplomacy consultant and the keynote speaker at the University of Johannesburg and Mail & Guardian dialogue on the Africa economic outlook, Brexit, Brics and the rise of the Indian Ocean rim economy, held at the University of Johannesburg’s (UJ) campus on August 25, 2016.
Introduced by Dr Taurai Imbayarwo, UJ’s director: Corporate Services Division of Internationalisation, Maré went on to say: “In one way, Brexit, Brics and the Indian Ocean appear disparate, but they actually do synergise. We think we know a lot about Brics, but even leaders of the Economic Union (EU) know little about the Indian Ocean and how the Brics countries could benefit.
“Brexit and Brics are both very important international issues with clear interaction between them — on their own and then, if transposed into the Indian Ocean ‘room’, it becomes clear that this is one of the most strategic and promising platforms for potential.”
Maré explained that Brexit did not mean the United Kingdom (UK) had “pressed the button to start their exit, but they are now talking about the beginning of next year.
“However, the longer there are uncertainties, the worse they for business. Britain, the EU and Africa share special relationships and uncertainty impacts on investment. Voices inside Britain are suggesting waiting to take action until after the French and German elections, which would be stupid, as whoever comes along then will be far more inflexible.”
Brics is the acronym for the association of five major emerging economies: Brazil, Russia, India, China and South Africa. These are all leading developing or newly-industrialised countries, all G-20 members and demonstrating large, sometimes fast-growing economies and significant influence on regional affairs.
“South Africa was tagged on in 2010 as a gateway into Africa,” explains Maré. “Yes, there are political agendas, but Brics is important, even though perhaps South Africa has not seen enough action, but with the new development bank, there is potential for the country and continent going forward.”
Maré believes that in terms of Brexit, even without the UK, the EU represents a significant bloc and that Africa also cannot afford to ignore the US, which has the biggest GDP, and China, with the second largest. He also highlighted the significance of relationships with Japan and Germany.
Blue and blue water economies
The third largest of the world’s oceans, the Indian Ocean is bounded by Asia to the north, on the west by Africa, to the east by Australia and down south, Antartica. Major sea routes in the Indian Ocean connect the Middle East, Africa and Asia with Europe and the Americas.
“Japan is showing more interest in the Indian Ocean through its interests in Africa. This year it held its sixth Tokyo International Conference on African Development summit, in Nairobi, Kenya, at the end of August 2016. Two key areas received real attention: piracy and security, both topics being of critical importance,” said Maré.
A very important dimension to future growth in the ocean is the “blue economy” or “blue growth”. There is a growing awareness of the heavy damage wrought on ocean ecosystems by the impact of climate change, habitat destruction, overfishing and pollution. Many new national ocean strategies and policies have factored this in, particularly where progressive governments demonstrate the intention to promote a more sustainable balance between economic growth and healthy oceans.
The blue water economy regards the oceans more as development spaces where useage integrates conservation, sustainability, responsible oil and mineral extraction, bio-prospecting, sustainable energy production and marine transportation. It revolves around creating a framework for developing countries that enables them to share the benefits of marine resources. It also creates scope for investment in human capital to improve well-being through marine-orientated activities, such as ship building and tourism, while preserving environments and scarce resources.
“Revisiting the history of trade in the Indian Ocean could be a major factor in building an ocean economy,” Maré concluded, quoting Mauritian Prime Minister, Dr Navinchandra Ramgoolam: “The next frontier for the global economy is the ocean. When it happens, Mauritius must stand ready to seize the opportunities. We cannot wait passively for that rising tide to lift our boat. We must be proactive.”
Underlining the importance of Japanese dealings with Africa was Isamu Yamaguchi, head of economic development for the Embassy of Japan in South Africa. He stressed how Japan adheres strictly to international regulations on environmental impact and also respects the agency of Africa.
“Commodity prices are declining and Africa needs to diversify its industries,” said Yamaguchi. “We are also concerned about the spread of infectious diseases, especially Ebola, as well as terrorism, particularly in Western Africa.
“There needs to be security of our seas, especially the Indian Ocean and in response to requests from our international friends, we are showing our footprint on the ground and not just through financial support, but by despatching our Safe Defence Force to places like Somalia. [Maintaining] the law of the seas is another message we are trying to dispatch.
“Africa is now a recipient of aid, when it should be an investment destination. We regard Africa as an equal import and export opportunity partner, and we see many ways in which we can make a contribution, including to infrastructure,” he concluded.