Africa

Brexit is an opportunity for Africa

Cityscape of Johannesburg in South Africa, a venue of the 2010 World Cup, February 18, 2010. The 2010 World Cup soccer finals will take place in South Africa from June 11 - July 11. WORLD CUP 2010 PREVIEW

How Africa's trade and global position could benefit from the results of Brexit. Image:  REUTERS/Euroluftbild.de (SOUTH AFRICA

Calestous Juma
Director, Science Technology and Globalization, Belfer Center for Science and International Affairs, Harvard Kennedy School of Government
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Africa

The entire world felt the shock waves from the decision by voters in the United Kingdom to leave the European Union, and Africa was no exception, especially given its close historical ties with many EU member states. African pundits and public officials were quick to lament the new cloud of economic uncertainty and the potential for catastrophe in the near future.

Namibia has been alone in downplaying the Brexit fallout, most likely because its exports to the EU have declined significantly in recent years. But the rest of Africa is right to be taking it seriously, at least with respect to the short-term outlook.

 A common market spanning half of Africa
Image: UNCTAD

However, from a long-term perspective, Africa should be optimistic. Most of the post-Brexit handwringing reflects traditional thinking that ignores the economic goals of both African countries and the UK. Dire warnings about Africa’s position as an exporter of raw materials to the UK and Europe assume that the full extent of cooperation between the two continents will forever be limited to commodities trading.

Africa aspires to much more than this. As Africa’s youthful population continues to come of age, it will push for more innovation and less reliance on commodity exports. In fact, Africa’s Agenda 2063 framework, adopted by the African Union in 2013, aims to establish the continent as a collection of “learning economies”: diversified, education- and innovation-driven, with a higher position in global production chains than extraction of raw materials.

In 2014, the AU adopted the Science, Technology, and Innovation Strategy for Africa (STISA) – a roadmap that calls for national and regional governing bodies to increase investment in research infrastructure, education, and other necessary conditions for technological innovation and entrepreneurship. Beyond those baseline investments, the plan also establishes a framework for engagement between Africa and its northern neighbors.

The STISA scheme places scientific cooperation above national politics. Though the Brexit vote is generally regarded as a symptom of rising nationalist sentiment in the UK, it doesn’t follow that the UK – or individual remaining EU member states, for that matter – will stop viewing science and technology as drivers of economic growth. In fact, scientists in the UK have already come together to demand that EU funding for research at British institutions not be compromised in any exit negotiation. Whatever the outcome, the possibilities remain strong for Africa to enter into future partnerships with the UK and the EU to advance its own innovation agenda.

In the future, national and supranational issues will, one hopes, matter less for innovation. But the new competition between EU member states and a non-member UK could lead to renewed investments in science and technology within those countries. This will take place in traditional innovation hubs – in cities with research universities, existing tech and science sectors, and few regulatory hurdles for entrepreneurs.

Like Silicon Valley, these hubs will become subnational ecosystems with a global presence. So, whether innovations come from the UK, the EU, or elsewhere, there will be opportunities in the international marketplace for African countries that have prepared for them.

This will require adjustments in Africa’s economic diplomacy. Rwanda, Ethiopia, and Kenya have already modified their foreign policies, particularly their placement and selection of ambassadors, to focus on global economic and trade issues.

Moreover, Africa’s position on the global economic stage will improve significantly when the Continental Free Trade Area negotiations conclude in 2017. The CFTA will comprise a market of more than a billion people with an initial GDP above $3 trillion. It will remove trade barriers and boost investment in infrastructure so that African countries have the industrial capacity to compete globally. All told, the CFTA is a grand opportunity for Africa to reshape its relations with the UK and the rest of the world.

Post-Brexit forecasts of doom and gloom for Africa’s export-driven economies miss a fundamental fact: these economies will soon be relying far less on commodity exports. When Africa’s potential for innovation and entrepreneurship is taken into account, a long-term perspective indicates a much brighter future.

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