Asia humbling Europe and the USA’s economic arrogance

Since the end of colonialism, most African countries thought of Europe and the US as the main economic powers that would turn around their economies.

Since the end of colonialism, most African countries thought of Europe and the US as the main economic powers that would turn around their economies.

African leadership looked forward to foreign aid to help them stop wars and suffering, fight poverty, disease and hunger.

Today, there’s a new wave of change among most developing countries especially in Africa. Gone are the days when citizens would be more keen on how a leader will stop war.

It is now “how will the leader bring about economic prosperity by bringing in more investments to create jobs.”

Most economies in Africa are now striving to reduce the European and American aid....aid that ever comes with lots of stringent conditionalities.

However, getting rid of such aid completely will take time, as some selfish past regimes signed treaties that still keep African countries tied to aid. 

The interesting news for Africa and other developing countries is that Asian countries’ interests in Africa are growing steadily.

Asian countries like South Korea, Malysia, Singapore, India, China United Arab Emirates, Iran and the likes are keeping the EU and the US on their toes.

Yes, EU have also opened theirs through the Everything But Arms (EBA) arrangement and the US through the AGOA (Africa Growth Opportunity Act), but the question is: how easy is it for the beneficiaries (Africans) to sell in these markets?

The reality on ground is that, much as these markets are lucrative, supplying and satisfying them has proven quite hard. The notion; “International Standards” has beaten off many Africa exporters. 

AGOA and EU reports however indicate exports growth into these markets. Such exports are concentrated in a few exporting firms who labour to meet required “International Standards”.

As pundits say, the strictness of the EU and the US on standards is not largely good intentioned to protect Americans and Europeans’ lives but rather to control volumes from the flooded African markets.

Who cares if say a pineapple or mango is not of a given kilograms or size as long as it is juicy and fresh from the garden. Is a below size or kilograms pineapple or mango infectious? Of course not!

Anyhow, on the other hand, Asians are wisely exploiting this kind of European and American rigidity. They are engaged in almost every sector; but quite strategic to where they’ll reap sustainably.

A quick browse through some of the giant Asian entries in the region: Sudan is exporting most of its oil to China.

Dubai World, an investment company that manages and supervises a portfolio of businesses and projects for the Dubai Government across a wide range of industrial segments and projects that promote Dubai as a hub for commerce and trading, is committed to investing over $230million in Rwanda, investing mainly in the tourism sector.

Looking at Foreign Direct Investments (FDI) in the region (EAC), every member state is wooing Dubai World to pump oil money into their economies.

Dubai World was established by His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of UAE and Ruler of Dubai.

On July 2, 2006 it was launched as a holding company, now with more than 50,000 employees in over 100 cities around the globe.

Dubai World, Abu Dhabi and the likes are, interestingly, beating the US and UK at their own game. For instance, Dubai World has extensive real estate investments in the US, the UK.

Dubai World made headlines in March 2008 after its chairman, Sultan Ahmed bin Sulayem, threatened to take the fund’s money out of Europe if the EU tried to regulate its activities.

Dubai World’s threats came shortly after the EU attempted to lay out “a set of principles for transparency, predictability and accountability” for Sovereign Wealth Funds.

The boss of Dubai World, the powerful sovereign wealth fund, issued a thinly veiled warning to critics of the $2.5trn (£1.25trn) sector. 

In his own words, Sultan Ahmed bin Sulayem, Dubai World’s chairman said: “If somebody comes with regulations that make it difficult for someone from certain geographical locations to invest in Europe or the West, people will take their investment somewhere else,” “I think it’s dangerous when this money and liquidity is so badly needed – we are investors and we are free to go wherever we want. If you squeeze us, we will go elsewhere.”

The EU was brought down to its knees and succumbed, for had it refused, economies in the bloc would then suffer a record slump. 

Statistics indicate that in most UK and the US institutes of higher learning, foreign students especially Asians now excel more than Americans or Europeans. And, as a result, most white color jobs there are now occupied by foreigners.

Europeans are now so worried of the impact this is already causing, as the amounts of euros being repatriated to Asia and Africa are enormous.

Soccer fans have recently witnessed how oil money exchange hands in the English Premier League, influencing things like never before.

A few days back, Manchester City was sold off to the Arabs. Arabs have shares in Manchester United, the biggest club in the UK.

Arabs have a standing relationship with Arsenal FC--owning their grounds called Emirates Stadium, Arabs are also in Liverpool and Chelsea.

They have disorganised the English transfers by buying players at crazy monies. For instance, following the buying of Manchester City, they signed the Brazilian star Robinho from Real Madrid, in a space of just hours, at a crazy price ($62million) that surprised many.

During the recent visit of the British Premier Gordon Brown to Arabian countries, he called for a new approach to doing business; partnership...proposing joint ventures in alternative sources of energy and of course oil--a win-win game indeed. This idea is of course contrary to what America is doing in Iraq and Afaghanstan.

Until the US realises that its foreign policy is outdated; of colonial times, its economy will continue to decline as Asian countries propser. Hopefully, Presidential hopeful Barack Obama will bring “Change” to the US as he promises, and Europe will follow Gordon’s joint venture proposals with Arabs.

Contact: mansurk@rpsf.org.rw

 

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