By: Eugenia Boateng
Over the course of the last week, leaders from over a dozen African nations assembled in Germany for the G20 Compact with Africa Summit. The aim of this summit was to support private investment in the world’s poorest, yet rapidly developing, continent.
The member countries of the G20 Compact include Morocco, Tunisia, Egypt, Senegal, Guinea, Ivory Coast, Ghana, Togo, Benin, Burkina Faso, Rwanda, Democratic Republic of Congo and Ethiopia.
Early in the year German government authorities revealed that German Chancellor Olaf Scholz would be hosting the conference in Berlin. Other notable European diplomates in attendance include French President Emmanuel Macron, Dutch Prime Minister Mark Rutte, and President of the European Commission Ursula von der Leyen, all of whom demonstrate fresh interest in Africa.
Among these is Africa’s capacity to produce renewable energy, especially green hydrogen, which might facilitate its northern neighbor’s economic shift to carbon neutrality. Reducing illegal migration is also regarded to be contingent on the stability and economy of the continent.
Under the German G20 presidency, the Compact with Africa was established in 2017 with the goal of bringing together bilateral partners, international organizations, and reform-minded African nations to examine investment prospects and coordinate development objectives.
The message that the Compact with Africa conference seeks to convey is that Germany is a reliable partner.
The joint EU-African Initiative for Green Energy would receive the 4 billion euros. It was previously stated that the European Union would provide grants totaling 3.4 billion euros.
African nations have long lamented that, despite Europe’s promise of investment, China really delivers funding without passing judgment on morality. Nonetheless, European interest is growing while Chinese funding to Africa is declining.
Indeed, the West is increasingly competing with China and Russia across the continent for geopolitical influence, crucial minerals, and new economic prospects.
“The global order is shifting, and Europe and Germany cannot just sit on the sidelines,” Finance Minister Christian Lindner said after meeting with peers from various African countries at the conference.
The G20 Compact with Africa summit on Monday was the sixth since its inception in 2017 under the German G20 chair, and it brought together the leaders of more than a dozen African countries.
Last year, Germany’s commerce with Africa was 60 billion euros ($65.4 billion), a fraction of its trade with Asia but growing 21.7% from 2021.
According to German government officials, Africa can help Germany better diversify its supply chains, secure skilled labor, reduce illegal migration, and achieve its green transition.
African countries have long complained that while Europe talks about investment, China actually provides funding without moral equivalence. Nonetheless, Chinese lending in Africa is declining, while European interest is increasing as the continent seeks to diversify its supply chains.
Last year, Germany’s trade with Africa totaled 60 billion euros ($65.4 billion), a fraction of its trade with Asia but up 21.7% from 2021.
According to a study conducted by KPMG and the German-African Business Association, nearly two-thirds of German companies want to expand their operations in Africa.
