How to boost EU business with Africa

Earlier this week, I attended the EU-Africa business forum as a representative of the Kenyan private sector.

The forum dubbed “Africa and Europe: on the road to win-win partnerships” provided an excellent opportunity for us in the private sector to play an important role in improving the existing relationship between Europe and Africa in favour of more symbiotic ties.

Of course there have been concerns that this relationship is not as beneficial to Africa as it has been to Europe.  For example, while Europe’s imports have multiplied substantially over the course of the last couple of Economic Partnership Agreements (EPAs), Africa’s exports to Europe have increased by a relatively lesser percentage. 

Both sides have had compelling arguments as to why there exists an inequity in this trade area.  Africa has often cited protectionist practices and lack of access to financing as some of the main hindrances to trade.  The EU on the other hand has often cited issues of poor governance, unfavourable local business environments and sub-standard goods which cannot conform to international markets.  

In my opinion, and in recognition of the existing challenges, there is much more we could be doing to enhance free trade as a country.

We must begin from the point when we are invited to negotiate for EPAs.  Often, we have been negligent and not paid meticulous attention to the composition and ability of our delegations to negotiate.  Whereas our partners come to the table armed to the teeth, we on the other hand have often put up a weak defense.  For this reason, we have been unable from the starting point to negotiate for more favorable terms for our country and continent.
Secondly, I continue to lobby for full integration in the East African community and beyond.  Our synergies as regional trading partners can be exploited to make us a force to reckon with at the negotiation table.  Obviously, that would call for the member states of any integrated community to resolve the differences pertaining to the disparity in socio-economic eminence and consequently, the fear of exploitation. 

But there is one other area which I advocated for during the forum and which I will state here for my readers. 

The European Commission has always channeled the majority of their resources through government entities.  Although I recognize that business may not optimally exist outside of government structures, I feel that the success of these trade partnerships is hugely dependent upon greater private sector involvement.  Firstly, for the simple reason that the private sector is more responsive to market demands and world trends.  Secondly, because it has more vested economic interests to ensure that the partnerships are beneficial to them.  My suggestion therefore, is that the commission considers channeling a greater percentage of those resources directly through the private sector.

There are other notable suggestions and recommendations that emerged during the forum which I will bring to your attention.

The Gold award goes to the Secretary General of United Nations Industrial Development Organisation (UNIDO) Dr Yumkella Kandeh, who called for a paradigm shift in donor assistance.  He stated that donors should move away from giving aid based on a poverty alleviation mind frame.  Instead, they should focus on wealth creation which demands that aid be directed towards growth of the local economies.  When aid is directed towards growth, there is no doubt a higher probability of enhancing sustainability of funded projects and consequently the local economy. 

My second award goes to the Head of the European Commission delegation to Kenya, Eric van der Linden, who made a powerful suggestion with regard to improving access to financing for Africans.  Traditionally, every donor has very rigorous processes and procedures that must be followed to the letter while applying for financing.  This often means that start-ups which cannot afford to hire a consultant, who is conversant with these processes, often have no chance whatsoever to access these funds.  He stated that ideally, all donor partners could have a simpler and standardised application process, cutting across the board.  This would improve the probability of getting financed and having sustainable projects being implemented.
These ideas are very progressive and indicative of the willingness of EU to partner with Africa on a win-win basis.  I hope that they are not just ideas.  I hope that we can begin to see this ideology and goodwill translating into tangible action that benefits Kenya and Africa as a whole.

To this end, I am honoured to have been a part of these discussions because I am hopeful that they will be instrumental towards enhancing our own regional integration and our competitiveness on a global scale.

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