African leaders - including President Hage Geingob - made their way to India, a country with a strong resemblance to most of the emerging economies in Africa, to map a way forward in cementing a South- South business engagement for the future.
South-South Cooperation is an issue which has been high on the agenda for the past decade, and is viewed by most emerging economies as the best way to create a state of equilibrium in world economics.
Africa sent a highpowered delegation there, including African Union chairperson Nkosazana Dlamini-Zuma. We need not mention that the composition of the African delegation to India symbolises a continual look for solace in trade and a new beginning.
Of course, the proponents of the South-South engagement believe that there has been an unnecessarily long dominance by the European bloc and her allies.
In fact, they do not like the way the Anglo- Saxons push for business engagements with the raw material- producing countries which make up the bulk of the African continent.
Perhaps to get closer to reality, there has never been a time when trade engagements between the dominant European bloc and the Americans have come in a form which favours the Africans.
Namibia is a good example to show for it because the country is struggling a lot to create a level ground on reciprocal trade.
Namibia recorded a trade deficit of –N$10 480 000 (Approximately N$106 million). The country exports mostly diamonds (25% of total exports), uranium, lead, zinc, tin, silver, tungsten, food, live animals and manufactured products.
Namibia’s main export partners are South Africa (27% of total), United Kingdom (17%), USA, Angola, The Netherlands and Spain.
The country imports food products; petroleum products and fuel, machinery and equipment as well as chemicals. South Africa is Namibia’s major import partner (66% of total imports), followed by The Netherlands, the United Kingdom and China.
The question though is: since the engagement of Africa and India and the subsequent respect given to the Asian giant by Africans, will Africans manage to make inroads into the diversified market in the future?
Coining a new future Indian Prime Minister Narendra Modi believes Africa is the bright future which India can prosper with.
He was quoted in the media last week as saying “this is not a new journey, nor a new beginning, but it is a new promise of a great future for an ancient relationship.”
If one is to dig deep into the sentiments of the Indian Prime Minister, there seems to be genuine chemistry between Africa and India which can be exploited to beneficial levels.
He said his country will also offer grant assistance of US$600 million (N$ 8billion) to Africa. This includes US$100 million for a development fund, US$10 million for an India-Africa health fund and the cost of 50 000 scholarships in India over the next five years.
The avenues which India is opening up are beneficial because they are deliberately targeting key focus areas which African countries need to beef up.
It is not a secret that most African countries have a dire skills’ shortage in important fields like science and innovation, and also in accounting.
India, as a rising economic power, could easily be one of the countries which Namibia as a developing country can use to sharpen its skills.
There is also the obvious benefit that India can assist Namibia to grow. This opportunity lies in the robust and growing Indian automobile industry, which obviously needs raw steel supplies.
Writing about the coined relationship, Sherelle Jacobs described it as a mutually-beneficial engagement which emanates from the early days of Africa’s quest for independence.
“In more modern times, Africa’s trade with Europe and the United States dominated the trading patterns until the gradual swing to the East, principally led by China, gained increasing momentum.
Indian companies were fairly quick off the mark too, re-establishing contacts with the continent and expanding the volume of trade exponentially.
For example, bilateral trade was worth $1 billion in 1995. By 2008, that figure had hit $36 billion, according to the African Development Bank Group, and in 2011 it had risen to $45 billion. By 2014, bilateral trade is anticipated to climb to more than $75 billion,” she stated.
She added that these trade trends can be clearly traced on national as well as continental levels. “Economic relations between South Africa and India, for example, have grown manifold since diplomatic relations between the two countries were first properly established in 1993.
Bilateral trade between 2003-04 and 2008-09 alone increased threefold from $2.5 billion to $7.5 billion.
In January 2011, following a visit by India’s Commerce and Industry minister to South Africa, an unprecedented new bilateral trade target of $15 billion by 2014 was agreed upon,” she noted.
At present, Africa enjoys a positive trade balance with the subcontinent. India’s imports from Africa reached $18.8 billion in 2009, while exports from India to Africa were $13.2 billion in the same year, according to the African Development Bank.
Exports from Africa are typically raw materials, including oil and minerals, while exports from India tend to be manufactured and finished goods, including transport equipment, industrial machinery and pharmaceuticals.
Nigeria, South Africa, Kenya and Tanzania are the most important destinations for Indian products in sub-Saharan Africa at present.