First it was President Obama who delighted his audience when he undertook a whistle-stop tour. Now Secretary of State Hillary Clinton is embarking on a seven-country tour of Africa. Why is she going? It couldn’t be so crude to be about crude could it?
The answer is yes. The visit could be construed as the latest play in the power struggle between Asia and America over Africa’s resources.
It is the latest twist in the last scramble for Africa. Where once America led the race, Clinton’s visit cannot conceal the fact that America is currently now coming second. China has overtaken the United States as Africa’s top trading partner. US trade with sub-Saharan Africa was $104 billion in 2008 compared to China with $107 billion.
Now not of all of this is oil, but it does reflect the growing influence of China and other Asian nations on the continent. Although the officials deny it, in part Clinton’s visit is meant to be schmoozing the two key oil countries on the continent and her visit reflects this: Clinton visits the top two oil producers: Nigeria and Angola as well as Kenya, South Africa, Congo, Liberia and Cape Verde.
Whereas Clinton will also preach human rights (something the Chinese conveniently forget) a new report published by Chatham House will make it harder for the Americans to portray counties such as Nigeria and Angola as weak African states being ruthlessly exploited by resource-hungry Asian tigers.
The report, published today, looks at the Asian involvement in the oil industry in Nigeria and Angola. But what will please the Americans and their oil industry friends is that it concludes that “In spite of fears expressed in Western capitals about an Asian takeover in the Nigerian and Angolan oil sector, the reality is different. These fears were highly exaggerated.”
It looks in part at the Chinese infrastructure for oil deals orchestrated by President Obasanjo, which have been so badly managed that $20 billion of investment is at risk. “We salivated in anticipation of what could be off the shores of Nigeria,’ India’s former Minister of Petroleum admitted.
But the Asian companies that gained a foothold in the Nigerian oil sector failed to understand the political context of Nigeria. “The scale of the corruption, mismanagement and non-execution of projects in the Obasanjo years has sent shockwaves through Nigeria,” the report said.
So despite the Asian influx, in Nigeria at least, the international oil majors such as Shell, Chevron and Exxon do not see their Asian rivals as much of a threat. Moreover, an Ad Hoc Committee of Nigeria’s House of Representatives has now recommended that all oil blocks so awarded to Asian companies should be cancelled.
Things are different in Angola. In contrast with the chaos of Nigeria, Chatham House argues that the stability of the Angolan regime of President Jose Eduardo Dos Santos’ 30-year tenure had helped Angola emerge as the second-largest supplier of oil to China last year and helped the African country secure at least $13 billion in oil-backed loans from Beijing.
“While Nigeria was playing politics with its Asian partners, Angola was driven by economic necessity to quickly access funds to finance its reconstruction,” the report said. But even here, the international oil companies remain the leading players.
But the power axis is changing. “Obama has had some sort of effect, but that’s waning pretty quickly,” said Martyn Davies of Johannesburg-based regional investment consultancy Frontier Advisory.
“Reality is heading back in and the reality is that the crisis is accelerating the geo-economic shift of Africa toward Asia, centred largely around China,” he said.
And it is this that Clinton is trying to counteract, no matter what her officials tell you. Johnnie Carson, the US Assistant Secretary of State for African affairs, has said that the concept that Clinton’s visit is motivated by Asian competition for Nigerian and Angolan oil were a “cold war paradigm”.