AU reform plan will unlock Africa’s immense potential

When the President Paul Kagame-led team – one seeking to restructure and streamline the operations of our African Union-suggests a measly trade goods tax on imports, an incandescent American-led camp wags its finger at the AU.

Friday, September 22, 2017
Delegates at the AU reforms consultative meeting in Kigali recently. / Village Urugwiro

Editor,

RE: "Time for Africa to revisit its trade systems, not just monetary policy” (The New Times, September 22).

Talk of unbridled hypocrisy. When the President Paul Kagame-led team – one seeking to restructure and streamline the operations of our African Union—suggests a measly trade goods tax on imports, an incandescent American-led camp wags its finger at the AU; "You are contravening WTO trade rules with your suggested tariff imposition on our exports to Africa. And we shall not tolerate any of this maneuvering. For it disadvantages our export trading position. So it’s a big no, no, no! We forthright forbid you to proceed as suggested!”

But what purpose does the EU single market serve in principle? Nothing else other than a closed trading bloc, with a tight ring fence around partner states who have assented to a customs union and pretty much no tariff trade barriers for goods, services, capital and labour.

It is essentially a "private members club only”; a cartel, for want of a better word. An economic-cum-political cabal. A trading protectionist zone. And you won’t get any more protectionist trade-wise than the EU – they simply whip around cheap capital within their own outer ring fenced borders...raising the bar whenever poor little African tradesmen come knocking for a piece of their frothy pie. 

Little wonder CFA franc worshiping West Africa has been taken to the cleaners by France for donkey years; all the while timidly kowtowing to their Paris-based masters who control the strings to their treasury purse in exchange for "cover” – be it military or economic/financial. After all the CFA franc is pegged to the euro by design; a currency-cum-inflation hedge if one looks closely enough.

So we see why the West isn’t particularly and overly keen on Africa industrialising any time soon. Africa’s underdeveloped energy capacity has put paid to the "industrialised Africa” fairy tale, at least for the time being. But only Lord knows how much nuclear power capacity our yellow cake crust in Karamoja (Northern Uganda), and elsewhere in the region, holds.

An energy surplus can be generated once our yellow cake is tapped and well developed by the likes of Mitsubishi or the ever inspirational Chinese. Then the likes of Cadbury-cum-Mondelez will have nowhere else to hide all that sweet and mellow West African cocoa bean bounty in their hordes other than setting up shop in a sufficient power capacity neighborhood in Musanze, or even Pubungu for good measure.

But in the meantime, Africa needs to remind Europe to play by WTO’s trade rule book: open free trade, not protectionist tendencies. And the likes of USAID and Comic Relief can take their "Red Nose Day” alms and collections in the form of so-called "aid” elsewhere.

Ggwanga Mujje