Next week, the UK will welcome 21 African heads of state to London for an investment summit hosted by the Prime Minister, Boris Johnson. Organisers say the UK-Africa Investment Summit will provide an opportunity for delegates to finalise post-Brexit trade deals between the UK and African states.
Organised by the UK’s Department for International Development (DFID), in partnership with Department of Trade (DIT), the Foreign and Commonwealth Office, (FCO) and the Department for Business, Energy and Industrial Strategy (BEIS), the one-day summit and side events are designed to seal UK-African business deals as the UK prepares to formally leave the European Union (EU) on 31 January.
The event will also be a platform for African countries and companies to court investment.
Who will attend?
The UK did not invite Zimbabwe to the summit, prompting a bitter post from presidency spokesperson George Charamba: “Let’s see what happens in the United Kingdom and to those invited. Methinks the UK uses false diplomacy to steady home nerves arising from Brexit. The UK is no longer an investing global power; long ceased to be thus!”
What will happen?
On the side-lines of the summit, the UK’s DIT will seek to roll over some of its outstanding trade agreements with African states and economic blocs, Britain’s trade commissioner for Africa, Emma Wade-Smith says.
Over the last three years, the UK has been locked in long negotiations to copy the EU’s generalised scheme of preferences, which guarantees tariff-free market access to 36 African countries on all goods and services except arms.
“We’ve passed legislation here in the UK already which allows for the transition of those into a UK generalised scheme of preferences, which will replicate what we have currently at the EU level. That legislation is already in place.”
Once agreed, the new deals kick-in on January 1, 2021, at the end of the implementation phase of the UK’s exit from the EU, Wade-Smith confirmed.
The largest of these trade deals, SACU + 1 (Southern African Customs Union + Mozambique) – which accounted for £9.7bn ($12.6bn) worth of trade last year – is a done deal. Another deal between the UK and Eastern and Southern Africa, including Mauritius, Seychelles, Zimbabwe, and Madagascar, has also been struck, she says.
“We’ve also transitioned the association agreements in Morocco and Tunisia, and we’re working really hard on the remaining network of agreements and hope that some of the political conversations we’ll be able to have at the summit will enable us to make a bit more progress on that.”
Negotiations with Egypt, Ghana, Cote D’Ivoire, Cameroon, Kenya and the East African community are still ongoing.
The UK currently has £78.8bn worth of trade with countries throughout the continent, roughly evenly balanced between imports and exports in machinery, oil and gas, tourism and professional services.
Africa’s trade commissioner hinted that there could be a breakthrough in Angola’s bid to join the SACU + 1 trade pact with Britain:
“Angola for example wants to join SACU + Mozambique, so there are a number of options on the table which we’re actively looking at, and maybe we’ll have some announcements relating to that at the summit next week,” she said.
British FDI in Africa reached £42.7bn in 2016, ahead of France with £38bn and China with £31bn, but just behind the United States on £44.3bn.
Since 2018, DfID’s focus in Africa has switched from short-term poverty relief to long term economic development and promoting security. Over the last year, the UK has stepped up its personnel on the continent by 15% in an attempt to boost trade and investment, Wade-Smith said.
UK investment into Africa, currently at £36bn, has grown over the last 12 months, while trade has increased around 7.5% over the last 12 months. At the same time investment increased 14.5% over the last 12 months, she said.