Africa: Globalisation hurting continent

African nations participating in last weekend's Asia-Africa Summit in Jakarta railed against the effects of globalisation on their continent and the imbalance in the global distribution of power and wealth.

    Globalisation is causing poverty and unemployment in Africa

    Leaders such as South Africa's Thabo Mbeki criticised how globalisation was leaving Africa in a state of abject poverty and underdevelopment.

    "Every day the process of globalisation emphasises the gross imbalance in the global distribution of power, making it imperative that we use our collective strength urgently to achieve the restructuring and democratisation of the United Nations and other multi-lateral organisations," Mbeki said.

    "We continue to face the daunting challenge to eradicate poverty and underdevelopment that afflict millions of our peoples," he added.

    Asian-African trade

    President Olusegun Obasanjo of Nigeria, too, used the summit to highlight the strain of globalisation on Africa.

    Obasanjo (L) used the summit to
    highlight strains of globalisation

    "The new globalisation has little or no regard for culture, history, values and the dreams of the weak," he said. 

    "Its god is money and profit at the expense of almost all else.  There is hardly an attempt to relate products and institutions to local specifications, hence it generates resistance and rejection, rather than acceptance."

    Obasanjo suggested that Africa and Asia could enhance trade and economic cooperation in order to bypass the worst effects of globalisation.

    "Partnership between Asian and African private sector operatives should be an obvious alternative to total dependence on the developed countries," he said.

    Alternative system

    Indonesia has been optimistic that such diplomatic, economic and trade deals could provide an alternative economic system.

    "It's not just a dream, it's a realistic view in every Asian and African nation that they can reap the benefits together," said economist Pande Rajah Silalahi, from the Centre for International and Strategic Studies (CISS) in Jakarta.

    Indonesia is likely to follow China
    and Japan and invest in Africa

    Muhammad Hidayat, chairman of Indonesia's business council, which organised a parallel Asia-Africa business summit, said he hoped the summit would provide the opportunity for direct trade links between Indonesia and Africa, and that Indonesia would follow the example of other Asian countries such as China and Japan and begin investing in Africa.

    "At the moment, our trade with African countries has to go through third parties in Europe and Australia.This event, maybe, can be used to consider opening a pathway for direct trade," Hidayat said.

    But other analysts were not so optimistic.

    "Can the summit counter the West and globalisation? It's not possible," said Philip Jusario Fermonte, an international relations analyst at CISS.

    "We need the help of the West and the World Bank to deal with poverty, aids and internal conflicts - they have the expertise and money we need," he added.

    Fermonte said rather than criticise globalisation as a source of poverty and unequal wealth, they should focus on more domestic issues.

    "One thing both Africa and Asia need is democracy and good governance," he said.

    Intra-regional trade

    "You can't force intra-regional trade''

    Pande Rajah Silalahi,
    Indonesian economist

    Analysts say the bottom line is that trade between the two continents is unlikely to be significant in the short term.

    They quote the example of the Association of South East Asian Nations (Asean), which talks of economic cooperation and establishing a trading bloc, and how the intra-Asian trade is yet minimal.

    "You can't force intra-regional trade, and to some extent, some of these countries, such as in Asia, are more competitive than cooperative partners," admitted Pande Rajah Silalahi.

    Silalahi pointed out that since most of the participants in the summit were bound by the rules of the World Trade Organisation, any such trade deal had to abide by the WTO rules.

    With conference participants issuing a very generally worded statement about economic cooperation, it could be another 50 years before the Asia-Africa Strategic Partnership emerged as a trading bloc, said Silalahi.

    However, the weekend meeting had set the stage for increased diplomatic and economic cooperation, which could make this alliance, representing some of the poorest countries in the world, a force to reckon with.

    China's role

    "If they all vote together in international forums, then they have the power to force first world countries to take note - like the Africans did, forcing Japan to provide debt forgiveness, or by rejecting WTO proposals. Such cooperation can be strengthened in a place like this," said Silalahi.

    The summit became a showcase
    of China's economic prowess 

    But perhaps the most important development emerging from the summit was that it was a diplomatic forum for China to take a leading role in the two regions.

    "Because China, as the emerging power, is taking this seriously, it sets the stage for other plans and sparks interest there," said David Chang, a financial analyst with Paramitra Alfa Securities.

    China's interest in the Asia-Africa summit meant that many other developing and developed nations, such as Malaysia, Singapore and India, were also keen to be involved, said Chang.

    Since China's trade between Asia and Africa is worth $463 billion in 2004, or 40% of its foreign trade, attracting Chinese investment is a major aim for countries from both the continents. Much of China's interest in such a forum was in gaining access to cheap natural resources from Indonesia to Africa to feed its voracious economy, said Chang.

    SOURCE: Aljazeera


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