Daily Times

Major Powers’ contestations in Africa involve a complex interplay of geopolitical, economic, and strategic interests. The US and France, for instance, have a military presence in Africa, often justified by the need to combat terrorism and provide security assistance. Russia and China are also increasing their military engagement through arms sales and training. Post-colonial legacies continue to influence these relationships, with many African countries navigating a path between the lingering impact of past colonial rule and their aspirations for greater autonomy and regional integration. The African Union (AU), a continental body consisting of 55 member states, plays a pivotal role in fostering political cooperation and addressing collective challenges such as conflict resolution, human rights issues, and democratic governance.

China is the most prominent player, heavily involved in mining and investment in Africa’s mineral sector, which has worried the United States about securing supply chains for critical minerals. EU and Russia are also showing interest in securing critical supplies. India and Japan to a lesser extent, are also focusing on securing supplies for their high-tech industries. These countries engage through direct investments in mining, development of infrastructure, bilateral agreements, and in some cases, through state-owned enterprises. Thus, in recent years major global powers such as China, the United States, the European Union, India, and Russia have shifted their strategic focus to the region to expand their influence through trade, investment, and diplomatic partnerships. China through initiatives like the Belt and Road Initiative, has significantly increased its geopolitical and economic influence on the continent. It has also established its first-ever Military outpost in Djibouti which signifies the strategic importance China attaches to the African continent.

The negative connotations of disaster-stricken and home-to-unstable institutions associated with Africa are giving way to a picture of a prospering and stable Africa.

Africa is also endowed with a significant number of natural resources such as rare earth metals and minerals, which are critical for various high-tech applications. For example, the Democratic Republic of Congo (DRC) holds over half of the world’s cobalt reserves, which is an essential element for electric vehicle batteries and electronics. Platinum, Palladium, gold, Diamond, Uranium, Colton, Copper and Rare Earth Mineral are some of the other minerals found in abundance. The scramble for securing supplies of these critical natural resources is also one of the reasons for the US, China and India’s increasing contestation in the region. These resources are vital for the global economy.

In Africa, there is also a contest among major powers in the realms of culture, education, and media. Scholarships, cultural exchanges, and media presence are tools used by great powers to enhance their soft power in Africa. Western countries also provide significant development aid and investment, often tied to governance and human rights conditions. The spread of digital technology, including the involvement of Chinese tech giants in developing Africa’s telecommunications infrastructure, is another arena of competition.

The negative connotations of disaster-stricken and home-to-unstable institutions associated with Africa are giving way to a picture of a prospering and stable Africa. Rapidly growing middle class and increasing GDP in African countries have become focal points for global investors, leading to a new wave of market engagement and competition. According to the African Dialogue Series 2023, Africa’s middle class is estimated at around 350 million people or approximately 34 percent of the total population presenting a host of economic opportunities for investors. This substantial demographic reality is fuelling the expansion of consumer markets across various sectors, including retail, consumer goods, and telecommunications, while also driving demand in real estate for quality residential and commercial spaces. The burgeoning middle class is also catalysing growth in financial services, not just in traditional banking but also in innovative fintech solutions. Moreover, their increasing focus on quality of life translates into significant investment opportunities in the education and healthcare sectors. Additionally, their tech-savviness and growing digital connectivity open avenues in e-commerce and mobile-based services, showcasing the diverse and dynamic nature of investment opportunities linked to the African middle class.

The technological savvy and growing consumer market of Africa’s middle class are driving major investments in fintech, e-commerce, and mobile technology, while also catalysing innovations in the financial sector with digital banking and mobile money platforms. They are also driving demand for enhanced infrastructure, including transportation, energy, and utilities, attracting international investment in large-scale projects, especially from China, Europe, and the US. This demographic shift is also boosting the real estate market and transforming the agricultural sector, as evolving dietary preferences open new opportunities in food production and distribution. However, according to William Attwell, the sales and profits for many Multinational corporations (MNCs) have not lived up to expectations because the disposable income available to the middle class is much less and their spending pattern are more focused on helping their extended family and saving for the unforeseen emergencies. Nevertheless, the overarching theme is that of optimism, with the African market’s long-term growth potential anchored in its rising middle class and economic progression.

(Concluded)

Areeba Matloob is a student. Saud Bin Ahsen works at a public policy think tank.