Africa is blessed with an abundance of natural resources. If its mineral resources are managed effectively, Africa has the answers to not only its electricity crisis, but also continental food security and rising fuel costs.
Africa’s largest natural gas exporter, Algeria, has recorded the largest natural gas production as at 2020, reaching an output of about 85 billion standard cubic metres. The Global Times reports that positive signals from this global energy powerhouse, Algeria wanting to join BRICS, is not only a game changer for the continent.
On a side note, we’re seeing more co-operation between African countries, for example, Botswana offering to sell South Africa its excess electricity. Algeria’s interest in joining BRICS demonstrates that more countries have faith in the group and its ability to offset the negative influence of certain countries’ rising unilateralism and protectionism, according to experts.
In addition to Iran and Argentina, which have officially applied to join BRICS, Saudi Arabia, Turkey, and Egypt are also signalling an interest. Algerian President Abdelmadjid Tebboune’s comment comes after Russian President Vladimir Putin called on BRICS leaders in June to move towards “formation of a truly multi-polar system of intergovernment relations”.
Russia is being hit by some of the harshest Western sanctions over its Ukraine invasion, which has seen international markets buckle thanks to skyrocketing petrol and gas prices. Intra-regional trade has remained low in Africa relative to its trade with Asia and Europe, accounting for less than 17% of total trade volumes compared to 59% for intra-Asian trade and 68% for intra-European trade, according to Nabil Frik, managing director for Africa and the Middle East at British Arab Commercial Bank.
Following the biggest policy shift in the region fostering integration – the African Continental Free Trade Area Agreement (AfCFTA) – African economies are turning their attention inwards and seeking to build resilience through intra-continental trade ties, says Frik.
The AfCFTA agreement will be the biggest trade deal in the world, in terms of the number of participating countries, since the establishment of the World Trade Organisation in 1994.
According to the African Centre for Economic Transformation, the AfCFTA agreement is made up of 54 African countries merging into a single market of 1.3 billion people. This resource could create an economic bloc with a combined GDP of $3.4 trillion, according to analysts.
Intra-African trade is expected to grow by 33%, and Africa’s total trade deficit is expected to be cut in half. In addition, the AfCFTA could generate combined consumer and business spending of $6.7 trillion by 2030, according to the Mo Ibrahim Foundation.
BRICS also includes the major emerging economies of Brazil, India and South Africa. What we are seeing is a new play for Africa. Everyone wants a piece of what the continent has to offer. In April, Putin had a conversation with the Algerian president in which the two leaders “reaffirmed their intention to continue bilateral co-ordination within the Opec+ format and the Gas Exporting Countries Forum in the interests of ensuring stability on global energy markets”, said the Russian presidency.
In conclusion, Africa is set to benefit immensely from the investment that it is receiving now and in the coming months from major role players who are aligning their Africa strategy to become a mutually beneficial partnership between Africa and bigger economies.
* Williams is a multi-media journalist.