At the fourth EU-Africa Summit held earlier this month under the banner, “Investing in People, Prosperity and Peace,” Heads of State from the two continents reaffirmed their commitment to objectives set forth in the  Joint Africa- EU Strategy (JAES), including moving away from a traditional relationship to forge a real partnership characterised by equality and the pursuit of common objectives.

From an observer’s perspective, little new ground was broken during the formal Summit or embodied in the resulting declaration. However, there was a tangible emphasis on a need to focus on trade and investment rather than aid and, at the margins of the Summit, the EU- Africa Business Forum demonstrated encouraging innovation and growth in private sector involvement.

Focus on Trade and Investment Rather Than Aid

The shift away from the traditional donor-recipient model towards a relationship based on equality, was a theme which permeated discussions; an acknowledgment that “it is time for a fundamental shift from aid to trade and investment as agents of growth, jobs and poverty reduction” (Declaration).

Interestingly, “Africa’s Pulse”, the World Bank’s bi-annual report on Africa, release of which coincided with the conclusion of the Summit, indicated that the region’s countries have made substantial progress in diversifying their trading partners in recent years. Africa is no longer heavily dependent on EU support. Over the last decade, exports to emerging markets such as BRICs (Brazil, Russia, India and China) have grown dramatically. In 2000, the BRICs received 9% of Sub-Saharan Africa’s exports, but by 2010, received 34% of exports. By 2010, total exports to BRICs surpassed the region’s exports to the EU market and by 2012, the region’s exports to the BRICs had reached $145 billion.

A realisation seems to have dawned; Africa’s presence on the international platform is becoming ever-more powerful, and its trade relationships with non-EU regions continue to develop at a rapid pace. In his address, the President of the Council of Europe acknowledged that the “Partnership of equals has come of age.” Against a backdrop of Africa’s rapid growth and diversification of trading partners, such an acknowledgment is not merely desirable, but necessary. The traditional EU-Africa model must be allowed to evolve if the EU is to keep up.

In the formal summit proceedings, there was little discussion of the Economic Partnership Agreements (EPAs) currently under negotiation between the EU and various African blocs, which are to replace the longstanding Contonou Agreement, which gave ACP countries duty-free access to European markets. Many of these negotiations have proven difficult (read about the ECOWAS negotiations here). With the scheduled 1st October deadline looming, it will be interesting to see whether the substance of the final agreements embody a shift towards equality between the two continents which was recognisable at the Summit.

The EU-Africa Business Forum: Encouragement for Private Sector Investment

The EU-Africa Business Forum, taking place in the days preceding the central Summit, focused on engaging the private sector in sustainable and inclusive growth and providing an opportunity for businesses and states to network and exchange views and ideas on EU-Africa business and investment relations. Jose Barroso, current President of the EU Commission, recognised that the private sector is a “powerful engine of progress.”

For the first time, the Forum involved “investment pitches”, where several African states were allotted 15 minutes to communicate “excitement, metrics and aspirations” to potential investors, with the aim of linking up governments, project developers and investors with similar visions. Another particularly encouraging aspect of the Forum was the “success stories” workshop, during which the successes of various African SMEs and their policies and strategies were showcased.

The Forum was supported by the International Trade Centre and attended by business leaders of multi-nationals, large corporations, SMEs, business confederations and regional institutions, including more than 500 high level participants from the EU and African private sector. For businesses looking to diversify and invest in Africa, attendance at such forums could prove to be invaluable in future.

Hannah Edmonds is a trainee associate in Covington’s London office.  She studied law at St Catharine’s College, Cambridge, the LLM in International Law at Bristol University and the LPC at BPP Law School.