| 00:06 | Africa is a continent caught in the middle. |
| 00:09 | We have the United States to the west, China to the east. |
| 00:13 | Both are vital to Africa's development. |
| 00:16 | And while we count Europe as a key trade partner, we also work closely with Russia and with our partners in the Middle East. |
| 00:23 | As East and West draw their battle lines on trade and geopolitics, where does Africa fit into the new global dynamic? |
| 00:31 | Let's find out today in the Blue Space. |
| 00:42 | Hello, I'm Joanne Joseph, and you're in the Blue Space, presented by Standard Bank Corporate and Investment Banking. |
| 00:49 | Africa is not a country, but with the African Union as a political body and the African Continental Free Trade Area as an economic alliance, Africa is an increasingly formidable block on the global stage. |
| 01:02 | But where does it stand relative to the rest of the world, and where should it position itself? |
| 01:07 | Joining me to discuss this are Standard Bank's Chief Economist, Gulan Balan. |
| 01:11 | And Michael Power, consultant at Asset Management Group 91. |
| 01:15 | Gulan, Michael, welcome to the Blue Space. |
| 01:17 | Lovely to have you with us today. |
| 01:19 | So, Michael, just to give us an overview, the most significant global economic trends impacting Africa, in your opinion? |
| 01:27 | Probably the same as the ones that are impacting the world. |
| 01:29 | Demographics, debt, tech, the rise of Asia and climate change. |
| 01:35 | Is it more or less the same for you, would you say, Gulan? |
| 01:37 | Deep resonance with Michael's remarks. |
| 01:40 | We are now also entering a new geopolitical era, from the moderate multilateralism of the last 30 years to a more contentious one. |
| 01:52 | We embrace the geopolitical and political dynamism of the world and recognize that the channels through which it transmits is through trade and financial flows. |
| 02:03 | Huge opportunities in terms of renewable energy for Africa, wouldn't you say, Michael? |
| 02:07 | Well... |
| 02:08 | The sun shines in Africa. |
| 02:09 | I mean, Afrique means without cold in its origin. |
| 02:13 | So yes, there's huge opportunities, and not just in solar. |
| 02:17 | The Rift Valley gives us all sorts of thermal. |
| 02:20 | That's where Kenya and Ethiopia get a lot of their renewable energy from today. |
| 02:24 | There's a lot of wind opportunity in Africa, and who knows where the likes of hydrogen will fit in. |
| 02:29 | But yes, Africa is well positioned to exploit its renewable assets. |
| 02:35 | Gulen, which for you are becoming... |
| 02:37 | the most significant players in terms of trade with Africa? |
| 02:43 | Africa has quite vast trading relationships, of course, some of them defined by the colonial history. |
| 02:50 | But over the last 30 years, the tilt to the east has become manifestly more stark, and of course, welcomingly so. |
| 02:58 | I suspect that the global south, in terms of both trade courts and financial flows, will continue to grow in terms of an economic platform for increased trading opportunities in the ensuing years. |
| 03:15 | What about trade on the continent, intra-African trade, Michael? |
| 03:20 | How much hope do you have in this new agreement that will encourage African countries to lower tariffs, will do away with them, trade with each other? |
| 03:29 | I think it'll be, in the first instance, more regional than pan-Afric. |
| 03:33 | So there will be, broadly speaking, a southern Africa and eastern Africa, a western Africa sort of block. |
| 03:41 | But these pieces of the jigsaw puzzle will then find ways of connecting. |
| 03:46 | And in due course, we will see a lot more trade happening from east to west and north to south. |
| 03:51 | What will it take to really give the African trade agreement the shot in the arm it needs to make it an actively beneficial agreement for the continent? |
| 04:02 | Probably the recognition by outsiders that something is happening. |
| 04:07 | And I think it is happening. |
| 04:09 | And one of the outsiders that really has recognized it has been China. |
| 04:15 | One of the interesting things about their priorities within Africa is that they've generally speaking, but they've looked at Eastern Africa as their primary area of engagement. |
| 04:25 | And what they've done is they found one particular country through which they can actively engage all the other adjacent countries. |
| 04:33 | The idea, I think, for many foreigners is to find one place to start in Africa and then look at which doors that it has through something like the African free trade area. |
| 04:44 | And that then allows them to access adjacent countries usually because there's usually a regional trade pattern. |
| 04:52 | And that basically allows slowly but surely you to integrate an actually quite large area, if you're a foreign country, into your trade network. |
| 05:01 | With the expansion of BRICS coming, what sort of opportunities or additional opportunities does that create for trade between our continent and all the countries outside of the continent that will be a part of BRICS in the future? |
| 05:14 | So, Joanne, perhaps it's helpful to recognize that the world is more from its early 90s unipolarity to multipolarity. |
| 05:24 | So there's many more voices in the world. |
| 05:27 | And in a sense, you could argue BRICS and BRICS Plus is simply a subset and recognition of this morph to multipolarity, geopolitically, geoeconomically, across trade and across finances. |
| 05:43 | One region that we haven't really spoken about is the Middle East, the Gulf Cooperation Council, some interesting movement there, Gulam, seems to become a major investor in Africa and vice versa in recent years. |
| 05:58 | Joanne, the Middle Kingdom does appear to be asserting itself on many levels far more vigorously, and you are correct. |
| 06:05 | Trade associations between several Middle East and broader GCC countries have strengthened phenomenally. |
| 06:12 | over the last decade. |
| 06:14 | If we just look at the city-state of Dubai, and I do say city-state deliberately, and you consider that Dubai is probably going to become the world's greatest people and goods carrier. |
| 06:27 | What do I mean by that? |
| 06:29 | Emirates Airlines and its phenomenal reach with Dubai as a transient hub is just simply significant. |
| 06:36 | And then Dubai Ports World initiatives in terms of acquiring... |
| 06:41 | Port infrastructure around the world effectively mean that they become the shipper for global trade. |
| 06:50 | And so that speaks to the vision of Dubai. |
| 06:53 | More belatedly, Saudi Arabia also is flexing its petrodollar muscle, incredibly ambitious. |
| 07:02 | And I have no doubt, Ronaldo adds a very significant halo to the Middle Eastern and particularly Saudi Arabian. |
| 07:09 | ambition. |
| 07:10 | So they're formidable partners. |
| 07:12 | If I can add, history also suggests that there are very, very deep links between that part of the world and Africa, especially down the East African coast. |
| 07:23 | Swahili is the language of East Africa. |
| 07:25 | It comes from the Arabic word swahili meaning coastal. |
| 07:29 | It is essentially a fusion between Arabic and Bantu languages. |
| 07:34 | And the connection is deep. |
| 07:36 | along the East African coast all the way down to bottom of Mozambique is essentially linked with that part of the world for nearly 2000 years. |
| 07:48 | So in this era of heightened multilateralism and admittedly a contentious one, historic colonial partners of course provide for bedrock opportunity and hopefully for more mutually beneficial trade, but markets such as Brazil, Turkey, Of course, the Indian subcontinent, which is likely to grow quicker than China in the ensuing decade, and bearing in mind, for example, that India has a very significant diaspora plastered across the continent, it basically says, yes, there are opportunities for new markets, new relationships, but I would quickly then suggest that should not be at the exclusion of historical partner. |
| 08:31 | A global approach to trade and commerce would be fruitful. |
| 08:36 | In terms of economic leadership, the leaders that stand out for you on the continent and are most likely to be able to attract investment because of their policies and outlook, Michael? |
| 08:47 | Gosh, I think it, again, for whatever reason, Kenya has been blessed by leaders who understand the needs of business. |
| 09:01 | The extraordinary thing at the last election was that... |
| 09:04 | While it was a very hard-fought election and the opposition essentially won, the new guys came in and basically said, we ain't going to change anything to do with the way in which we prioritize the economy. |
| 09:18 | There may be other policies that we'll have a look at and change, but broadly speaking, business is business. |
| 09:25 | And this phrase, business is business, as I think Gollum knows, I apply to as a sort of test phrase to every country I look at now. |
| 09:34 | because I want to see their pragmatism, to see can they deal with multiple partners, be they from the West or from the East or both, and keep them all happy. |
| 09:47 | Adagoa is a classic example of being able to do this. |
| 09:51 | And if they can somehow do that, that pragmatism counts for a lot. |
| 09:56 | And it does sort of signify a prioritization which foreign investors are generally speaking going to. |
| 10:03 | Michael, thank you so much. |
| 10:04 | Gulan, lovely speaking to you as well. |
| 10:07 | Plenty more to talk about, but that's all we have time for today. |
| 10:11 | Gulan Balam, Chief Economist at Standard Bank, and Michael Power, Strategist at 91. |
| 10:16 | Thank you so much for your insights. |
| 10:17 | Really lovely speaking to the both of you. |
| 10:20 | To you, our audience, thank you for joining us. |
| 10:22 | From me, Joanne Joseph, it's goodbye until our next conversation here in the Blue Space. |
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