Japan offers billions at Africa investment conference

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Tokyo Onkod Radio) — Japanese Prime Minister Fumio Kishida, speaking over live video from Tokyo after testing positive for Covid-19 days earlier, said that “Japan will invest both public and private funds worth $30 billion over the next three years across Africa. To improve the lives of Africans, we will provide up to $5 billion in co-financing with the African Development Bank.
Japan’s initiative “includes up to $1 billion in a new special quota to be established by Japan to promote debt consolidation reforms” in Africa, the Japanese premier said. He also pledged $300 million in co-financing with the African Development Bank to boost food production, vowing to help African countries weather grain shortages caused by the war in Ukraine, a major wheat producer.
Kishida announced that Japan would appoint a special envoy to the Horn of Africa, where a long and devastating drought in parts of Ethiopia, Kenya and Somalia has prompted the UN’s weather agency to warn this week of an unprecedented humanitarian catastrophe.
In West Africa, Kishida said Japan would pump $8.3 million into the troubled but gold-rich Liptako-Gourma tri-border area between Mali, Niger and Burkina Faso that has been ravaged by jihadist attacks in recent years. The aid will aim to “develop good cooperation between residents and local authorities” and help improve administrative services for the area’s five million residents.
It wants to create an environment where African people can live in peace and security so they can develop. Japan would use its place on the United Nations Security Council next year to push for a permanent African seat on the world body.
The pledge come as China cements its influence on the continent with its “Belt and Road” infrastructure initiative, and as experts express concern about the long-term sustainability of some African nations’ borrowing from Beijing.
The summit held at a time when the African Continental Free Trade Area (AfCFTA) has chosen eight countries to start implementing the idea of a shared market without trade barriers, an opportunity for Japan to be the first foreign power to access the continent as a single free market.
This, Japan hopes, will help it catch up with China, the EU, and the US who have been active in the continent in the recent past, deepening business relations. The US-Africa Business Summit in Morocco in July attracted 450 US companies, 17 government agencies, and 213 business deals were signed. FDI from the US to Africa stood at $44.8 billion in 2021.
FDI as the model for engagement with Africa. While there have been concerns over the reduction of China’s financial commitments in Africa from $60 billion in 2018 to $40 billion in 2021, China’s move this past week of waiving debt from 17 African countries weighs favorably for the Asian giant.
There is growing interest to invest in Africa, with FDI to African countries doubling last year to hit a record $83 billion, though investment flows to the continent accounted for only 5.2% of global FDI, up from 4.1% in 2020. Last February, however, the EU committed to invest $170 billion in Africa, positioning itself as the most valuable business partner for the continent.
Tokyo could also take advantage of its 2019 Partnership on Sustainable Connectivity and Quality Infrastructure with the EU, with trilateral business initiatives being actively discussed as cooperative schemes through which to facilitate joint Japan-EU-African private investment.
The African Development Bank said in its report that Japan’s $5 billion financial cooperation is under the fifth phase of the Enhanced Private Sector Assistance for Africa initiative (EPSA) from 2023 to 2025.
The funds consist of $4 billion under the existing window, and an additional up to $1 billion that will be provided under a new Special Window. Japan will establish this Special Window to support countries that are making progress in the enhancement of debt transparency and sustainability, and other reforms, thereby making steady and significant improvement in their debt situations.
Given the importance of food security, Japan and the African Development Bank will add agriculture and nutrition as a priority area under EPSA 5. As a result, EPSA 5 will cover 1) electricity, 2) connectivity 3) health, 4) agriculture and nutrition as priority areas in order to address key challenges in Africa.
Japan and the African Development Bank will join forces to support countries that address enormous challenges, including food security, climate change, health, digitalization, and debt issues. These initiatives help to mobilize the private sector, create job opportunities and positively impact on millions of lives across Africa.
The eighth Tokyo International Conference on African Development (TICAD8) took place amid a “complex” international environment caused by the coronavirus pandemic and the war in Ukraine, the Japanese foreign ministry said. Since their inception in 1993, the TICAD conferences, co-sponsored by the United Nations, World Bank and African Union, have generated 26 development projects in 20 African countries, largely funded by the Japan International Cooperation Agency (JICA).
Host country Tunisia is among the countries bearing the brunt of global supply chain disruptions and price spikes unleashed by these two factors, since it is heavily import dependent and is not an energy player. A slick promotional video said the conference aims to promote “African development led by African people” during the summit.
In his opening speech, Tunisian President Kais Saied urged delegates to “search together for ways for African peoples to achieve the hopes and dreams of the first generation after independence.” Praising Japan’s strong track record of development and “preserving” its culture, he said that “the world cannot continue as it was. With all its wealth and assets, Africa cannot watch its people live through poverty.”
Senegalese President Macky Sall, the current chairman of the 55-member African Union, paid tribute to Africa’s “partnership” with Japan, praising “concrete results in the agriculture, health, education and water” sectors. He also urged a suspension of interest on debt owed to G20 countries, calling for a seat for the continent at the next G20 summit. “Without security there can be no development,” Sall said and called for a greater role for African peacekeepers in resolving conflicts.
In a final statement, the conference participants voiced “deep concern (over) the negative socio-economic impact” of the Ukraine crisis, saying it had created food insecurity in Africa. “(We) reiterate the repeated calls for the resumption of the export of cereals, grains and agricultural products as well as fertilisers to global markets in order to relieve the African population,” the declaration read.
The Japan-Africa summit was held in Tunis, capital of Tunisia. The Tokyo International Conference on African Development (TICAD) is held every three years either in Japan or an African country. The Japanese delegation was headed by Foreign Minister Yoshimasa Hayashi, with about 5,000 participants in attendance. There were 48 representatives of African countries, including at least 20 Heads of State or Government, according to Tunisian diplomatic sources. *This article was facilitated by Kelvin Dewey in Tokyo, Japan and with news agency reports.

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