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RUSSIA: Outpaced by China in Africa

Kester Kenn Klomegah

MOSCOW, Feb 26 2010 (IPS) - Russian efforts to acquire oil and gas fields in Africa and prospect for minerals on the resource-rich continent have yielded little success over the past decade due to lack of a coherent national strategy, experts say.

Questions are being asked as to how China has scored in Africa with its resource exploration policy, infrastructure projects and three international summits on the continent since the turn of the 21st century.

Andrei Petrov, chairman of the ‘New Africa Initiative’ non-profit organisation, told IPS that Russia lags critically behind China, India and some countries in Western Europe in promoting its interests in Africa.

Petrov said there appeared to be a lack of coordination among Russian ministries, agencies and private companies when it comes to dealing with Africa.

“As competitive advantages over other countries have been effectively foregone, other players, notably China and India, have secured strong positions of dominance in the region by pursuing their long-term economic policy on the continent consistently. Such policies have primarily targeted the strategic sectors of the economies in the African countries, notably transport, power, natural resources and telecommunications,” Petrov explained.

Russian leader Vladimir Putin spearheaded a powerful economic delegation to select resource-rich African countries in 2006, but it was followed up by President Dmitry Medvedev only June.

Medvedev has admitted to tardiness in returning to Africa to pursue agreements on exploring natural resources.

Prof. Tom Wheeler, a research associate at the South African Institute of International Affairs in Johannesburg, believes that Russian involvement in the exploitation of resources would bring balance to the current control of African oil and gas by Western, Chinese and Indian oil companies.

“Russia, one of the world’s largest sources of oil and gas, has sought to strengthen ties with two of Africa’s largest oil producers, Nigeria and Angola, the current chair of OPEC. If this delegation succeeded in creating a strong link with Nigeria’s parastatal, that will give Russia another lever in its aim of controlling access to the gas that heats western and central Europe,” Wheeler told IPS.

“Is all this attention to Africa and the rivalry between countries outside of the continent in the interest of Africans? That is for each country to decide. It is important that governance structures and legislation be put in place which will enable African governments to judge whether proffered cooperation and contracts are truly to the benefit of their countries and their populations,” he asserted.

According to Wheeler, Africans must control their own destinies and their leaders must ensure that the poor and hungry also enjoy the advantages that can flow from the exploitation of the natural resources their countries have been endowed with.

Unlike China, Russia currently has little need of African resources but is desirous to sell Russian nuclear technology and possibly armaments to African countries, he explained. He added that Russia’s objective seems to be to control the access that other countries have to Africa’s resources by forming cartels with African oil and gas producers.

‘’Given its own financial problems, Russia has not been able to contribute much financially to Africa’s development,’’ said Wheeler. ‘’This contrasts with China’s insatiable appetite for Africa’s resources and its provision of infrastructure of various types without conditionalities.”

China’s role in Africa, however, has not been uncontroversial. China has been heavily investing in Sudanese oil developments, ignoring human rights issues there.

For their part, Africans tend to look at Russia and India as “a third force” to counterbalance Western and Chinese investment, Ivetta Gerasimchuk, director of the Trade and Investment Programme at World Wildlife Fund-Russia and author of the book ‘Rethink Russia’s Investment Policy in Southern Africa’, told IPS in an interview.

‘’China is hungry for virtually all raw materials, offering a guaranteed market and financial pledges for importing the African oil and gas, therefore its expansion in Africa covers almost every extractive industry,’’ said Gerasimchuk. ‘’In contrast, Russia itself is an important oil and gas producer and exporter.’’

“An explanation of Russia’s investment efforts in Africa could be the fact that our country has to a considerable extent depleted its deposits of ferrous and non-ferrous metals, diamonds, and uranium. Therefore, Russia’s interest in the African resource base has been primarily focused on these sectors,” she added.

Russia is strongly interested in Africa’s growing demand for manufactured goods, although the focus has been mainly on arms sales. “Importantly, the financial crisis has also changed the rules of the game as China is one of the few countries in the world that continues its economic growth and has enough financial resources to support its expansion,” Gerasimchuk observed.

Basically, China has better access to financial resources, which is backed by the state and also influenced through an effective Africa policy determined through the Forum on China-Africa Cooperation (FOCAC) process, Sanusha Naidu, research director at China/Emerging Powers in Africa Programme, FAHAMU – Cape Town (South Africa), told IPS.

Perhaps, through the BRIC [Brazil, Russia, India and China] bloc, Russia could carve out better relationships through joint ventures and other investment relationships to get into the mineral sector in Africa, Naidu suggests.

The Washington-based Centre for International Strategic Studies has projected that Africa would provide up to 45 percent of China’s oil by 2010 and China is determined to outspend Russia and the other foreign players in Africa to raise its stature on the world stage.