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    BusinessJapan showing more purpose in Africa

    Japan showing more purpose in Africa

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    Finally the dust has settled in the Kenyan capital Nairobi. The streets have resumed their normal activities. The situation today stands in stark contrast to the one a week ago, when 10,000 visitors from the Far eastern nation, Japan, and from the rest of Africa descended on Nairobi. Now, as the economic delegates partaking in the Tokyo International Conference on African Development (TICAD) go back to their respective countries, what is left is a 33 billion dollars assistance package for the continent which will be disbursed over the coming three years.

    This is not the first time for Japan to devote billions of dollars to Africa. Three years ago, Japan pledged 32 billion dollars in assistance to be invested in the period  of five years. So far, with two years remaining until it phases out, close to 67 percent of this investment has materialized.

    In many ways, the sixth TICAD submmit had mouth-watering proposals for African heads of state and government. As witnessed during the three-day summit in a Nairobi’s Kenyatta International Convention Center (KICC), some come out to be winners while a few other countries struggle to capitalize on what Japan has to offer.

    One thing that became clear at the summit was that the Japanese demand high reward for their investment. For instance, the Japanese want to see huge chunk of the total 33 billion dollars, around one-third or some 10 billion dollars of it, invested in what they called high quality infrastructure over the coming three years. Although what constitutes best quality infrastructure will be a topic of discussion for other platforms, clearly Japan would not have it any other way. Apart from infrastructure, another two billion dollars of the total assistance package is reserved for trade facilitations; while some 1.8 billion dollars will be set aside to serve the climate change agenda and assist African nations take natural disaster counter-measures. It is also hoped that not less than half a billion dollars will go to the food security sectors; and another half a billion for peace and stability activities. The assistance package also incorporates some 330 million dollars of Small and Medium Enterprises (Funding) funding.

    At the end of the day, the Japanese wish to see the continent’s electricity generating capacity growing by 2,000MW. In that, geothermal energy takes centre-stage. According to the investment plan, geothermal energy sources will be exploited further to benefit some three million households. On the human resources side, the African Business Education (ABE) initiative will see 1,500 Africans trained in Japan to become plant managers, foremen and the like in the three-year period. Furthermore, 30,000 more will receive training that will enable them to strengthen the industry sectors.

    But things are not that straightforward in terms of generating the needed financial resources to live up to the 33 billion dollars pledge that the Japanese have just made to Africa. Prime Minister Shinzo Abe was quite honest in this regard. He pointed out that his government has already decided to put up the ten billion dollars needed to realize the assistance package while expressing his belief that the remaining balance will be accounted for by the contribution of the Japanese private sector. Nevertheless, this was not an empty sentiment since the PM brought along some 70 top-notch executives representing major Japanese multinational companies with him.

    Countries like Kenya, the host nation, are sure to benefit from the new assistance package. According to reports, Kenya’s take will be in the tune of 10 billion shillings or 100 million dollars. Furthermore, it is Kenya that is chosen to showcase the Universal Health Coverage (UHC) assistance program that Japan wants to pilot in Africa. “In order to press ahead with the UHC, we will select countries to serve as models and provide assistance intensively to those model countries, and then use them as a doorway to further efforts,” Prime Minister Abe told the summit. Hence, in three years, at least two million people will receive the UHC services in the continent with Kenya and a handful of others countries playing a central role.

    Countries such as South Africa, Angola, and Mozambique are the most likely to benefit more out of the TICAD VI. More or less, Ethiopia included, Cameroon, Congo, Cote d’Ivoire, DRC, Egypt, Ghana, Kenya, Madagascar, Morocco, Namibia, Nigeria, Rwanda, Seychelles, Tanzania, Uganda and Zambia have inked 73 Memorandum of Understandings (MoUs) with 22 Japanese companies and with six regional and international institutions on the sidelines at TICAD VI summit.

    By comparison, Ethiopia was lightly represented at the summit and would probably be the least to conquer Japanese business attentions, to say the least. Compared with other African leaders and how busy they were meeting with Japanese business, Ethiopia garnered limited interest from the Japanese business delegates. But still, six major companies have requested and were waiting for a one-on-one with Prime Minister Hailemariam Dessalegn, who was not able the attend to summit. Hailemariam was in fact confirmed to show up in Nairobi but canceled at the last minutes as he was heavily invested in resolving the political unrest going on in Ethiopia for past month or so.

    Regardless, Toyota Tsusho Corporation (TTC) has managed to ink two MoUs with Ethiopian officials on the sideline of TICAD IV. It is to be recalled that earlier in September, Toshiba Corporation had shown similar interest in the Ethiopian market. Nevertheless, the move is considered to be a serious step to seeing big Japanese multinational investing in Ethiopia.

    Commentators argue that the move is linked to the Japan External Trade Organization (JETRO) which has established shop in the country recently. This state-run organization is known for sniffing around for opportunities on which Japanese firms can capitalize.

    Earlier TICADs

    The Japan-Africa relationship has seen many twists and turns over the years. Certainly, this relationship has evolved this time. The pioneer TICAD summit has paved the way for many forums which came after it and tried to convince African states in their quest for economic growth and development. But, the continent had a menu of countries wanting to strengthen their ties both in the political and economic arena. 

    Forum on China and Africa Cooperation (FOCAC), which China initiated some time back, is one that clearly indicates the race to win the minds and hearts of Africans. It goes on as India, USA and respective political and economic powers in the contemporary world try to preserve a place for the so-called ‘Africa show’. For the most part, Africa is seen benefiting out of this competition. For instance, China is well remembered to have pledged some 60 billion dollars for Africa via the FOCAC platform in South Africa a year ago.  With current developments in TICAD, it has now become clear that the continent is becoming a battle ground for competing economic powerhouses coming from the Asian region. Both Japan and China are currently waging criticisms across one-another due to the political tensions across the Indian-Pacific region. The case of South China Sea, most importantly that of the Senkaku Islands, have been creating tension between the two nations. Even at the Nairobi TICAD summit, at some point, both Prime Minister Abe and the Japanese media looked highly absorbed in over the situation in the region.

    In the broader sense, TICAD was originally crafted to fill the gap that was created by the western powers in Africa. The west seemingly left Africa in a vacuum after the end of colonization and later after conclusion of the cold war. That was the time when the far easterners moved to provide a helping hand to the run-down and forgotten continent. According to accounts of Africa-Japan relations, the Asian giant devised a way to gather the African states and face their previous donors who have abandoned them. That time was referred to as a time of “Afro-Pessimism”. More or less, that’s how the current highly advocated TICAD was first conceived in 1993.

    Since then, TICAD has evolved. It has evolved to its form in 2016 where the first African nation hosted thousands of Japanese high-level politicians, business executives and government officials led by Prime Minister Abe. In fact, last week’s TICAD saw some 4,000 Japanese delegation meeting their African counterparts. They conferred and agreed to have paced development, reduce outbreak of deadly diseases, and about erecting training and education facilitated across Africa.

    TICAD VI, in general, emphasized three major objectives: Economic transformation, resilient health system creation and promoting social stability by assisting the fights against radicalization, terrorism and ensuring food security. The previous summit, TICAD V, was focused on emerging challenges of the continent: the declining trends of global commodity prices, the outbreak of EBOLA and the rise and growth of radicalism, terrorism and the likes.  

    As per the requests of the African states to host such meetings, which were held exclusively in Japan, TICAD VI traveled to the continent that it seeks to support for the first time. Both the first and the second TICAD summits were arguably less effective to win back former allies, mostly seen as back turners in times of need, as TICAD defines it. 

    In the aftermath of the 2003 TICAD-III summit, the first to be held outside Tokyo in Yokohama, defying the name bestowed on it, had attracted a good number of members of the international communities.  Held in 2008, TICAD IV was another important summit which is said to have catered to the needs of African states with a pledge of 6.5 billion dollars assistance package. Out of this figure, the four billion dollars was disbursed in terms of loans and the remaining 2.5 billion was promised to be extended as a grant. Five years later, in TICAD V, Africa is announced to have hit a jackpot with a 32 billion dollars Japanese assistance pledged solely for the continent. The amount was allocated to run through 2017, beginning from 2013. According to Abe’s spokesperson, Yasuhisa Kamamura, 67 percent of the 32 billion dollars have so far been released.

    Since last year, Kamamura claims, TICAD V has seen a steady implementation of the assistance package. According to him, until last year, 21.5 billion dollars out of the 32 billion have been disbursed. Some of the activities that the fund has been invested in include the 700 million dollars non-sovereign loans provided for private sector development in Africa. Some five billion dollars devoted for infrastructure development, 430 million for health related assistances and the like are some of the few sectors which have actually seen the Yen trickle through.

    Future TICAD will not be alien to Africa countries no more, according to organizers of the summit. From now on, TICAD will be held in rotation between a chosen African nation and Japan evey three years.   

    President Uhuru Kenyatta, as in many instances, referred to the summit, TICAD VI, as a success story partly since it was held in Africa for the first time. Uhuru was most certainly the happiest of all the 54 African leaders present at the summit, who have seen him buzzing around the entire week of the TICAD summit. These days, he seems to be having more of that sort of meetings routinely. Just weeks ago, seven thousand people gathered for the United Nations Conference on Trade and Development (UNCTAD) in the Kenyan capital. Media reports suggest that Kenyan tourism has been able to generate billions of Shillings from these series of conferences, while hotels and taxis were at lower end of this food-chain yet gaining great from the meetings, mainly of TICAD. 

    After six years it will be the turn of another appealing African leader and an African nation to host the prestigious TICAD summit. As to which country it is going to be, one has to wait and see.

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