Obama’s Re-election: Implications for Africa

When the NBC first called in the election and pronounce President Barack Obama reelected for second term in office, the new America was born. When he rose to the podium to deliver his victory speech – you realized here was a man who ought to have been politically crumbled due to “superficial” figures of job creation and humongous debt, yet he was audaciously hopeful of success at the polls. As I was listening to his speech, I could not but wonder how much effect his second term will have on Africa.

Obama, though has the African blood flowing through his veins, is much broad minded to be too concerned with Africa really. He can really be said to be race-neutral, and of course not a bigot. By the way, he only made one hasty trip to sub-saharan Africa throughout his first term and that’s to Ghana. The other one being Egypt. However, we are talking about American elections here; Americans might have decided but the effect is felt worldwide.

His race neutrality nevertheless, he appreciates the opportunity the American spirit gave him to climb to his current status, and thus abhors policies and governance that would rather shunt the possibility of sustainable human development, equal opportunity, transparency, education and innovation – much of what many African governments represent.

His views and objectives, expressed in the policy document of June, 2012: U.S Strategy Toward Sub-Saharan Africa, are to: (1) strengthen democratic institutions; (2) spur economic growth, trade, and investment; (3) advance peace and security; and (4) promote opportunity and development.

Obama’s government will be attempting to consolidate on the four-pronged approach in partnering with ‘responsible’ governments and actors in Africa to promote strong and credible democratic norms and processes, facilitating with U.S companies to trade with and invest in Africa, addressing constraints to growth and promoting poverty reduction, and increasing opportunities for women and youth. And much more…..

It is of course expected that the American government intensifies its effort in the area of trade and investment in Africa since China has been romancing and actually becoming established as a worthy partner in trade and investment. China’s strategy, in relations with African countries, is easily understood though as it needs to obtain energy resources to support and sustain economic development. Obama, however, will be seeking to improve Africa’s trade competitiveness by encouraging diversification of the continent’s exports beyond natural resources, or extractive industries, and ensuring the benefits from the growth are broad-based.

Most of these functions would be undertaken using the ‘usual’ aid through the USAID. There has however been serious shouts as to the effectiveness of the US foreign aid to Africa both from concerned Africans and US Congress. The President himself is really concerned as to the utter dependency of African governments on foreign aid, and for which has steeped further in corruption. In the words Professor Ayittey, much of the aid has gone into the accounts of African dictators as most African leaders are more interested in lining their pockets than encouraging entrepreneurship. That’s especially unfortunate, because before Africa – now the begging bowl – was colonized it had a culture of markets and entrepreneurship, a spirit still in evidence in small African towns.

Regardless of China’s continuing influence, and in consonance with Obama’s views of public service responsibility, the American government may remove or reduce aid going to some African countries, for example, previously small allocations of existing Development Assistance funds would be eliminated in at least eight countries (Benin, Cameroon, Chad, Madagascar, Mauritania, Mauritius, Niger, and Togo) and would be cut by over half in several others (including Burundi, Djibouti, and Guinea). Some would however receive significant boost e.g Kenya – fast turning to Africa’s technological go to hub, Ethiopia, Ghana and Nigeria (largely because of the strategic partnership between the 2 countries more than anything). To this end, Africa foreign operations budget for FY2012, as made available and analysed by the Congressional Research Service, showed a total $7.8bn planned for the continent (a figure slightly lower than what was actually spent in FY2010 – $8.1bn). The figure is as such not just because the country is still normalizing from the Great Recession, but because of the renewed sense of real monitoring and expected responsibility from recipients.

It is also noteworthy to the African countries fully dependent on crude oil for their sustenance that the Obama administration’s long term energy policy see more of clean and renewable energy than fossil based. Machineries, policies, and strategies are already in place to achieve his pledge of cutting America’s daily 11 million barrels of oil imports by a third by the end of his presidency. It is true that every president since Richard Nixon has called for America’s independence from oil, but Washington gridlock has prevented that again and again, but don’t underestimate Obama. The same way universal health care bill was sought by many presidents, but Barack got the Act, Obamacare is now a reality. Countries need to start thinking of diversification.

On a final note, during this second term, Africa may see significant increase in remittances from the US and elsewhere. it has been noticed that African Americans (and by extension African migrants) do well during Democratic party’s presidency, and as such more inflow of money is expected into the continent. Today’s African Diaspora consists of approximately 20 to 30 million adults, who send about $40 billion annually to their families and local communities back home. For the region as a whole, this represents 50 percent more than net official development assistance (ODA) from all sources, and, for most countries, the amount also exceeds foreign direct investment (FDI). According to a World Bank study, Nigeria is by far the top remittance recipient in Africa, accounting for $10 billion in 2010, a slight increase over the previous year ($9.6 billion). Other top recipients include Sudan ($3.2 billion), Kenya ($1.8 billion), Senegal($1.2 billion), and South Africa ($1.0 billion). Hopefully this inflows will be allowed to do that which they are meant for: development.

Obama’s re-election is therefore a mixed blessing for Africa, and of course, the effects are going to be felt in varying degrees around the continent. For many countries, with not much exportable commodities, balance of trade may tilt much out of their favor; some (e.g Kenya and Ghana) may become more stronger because of their better democratic institutions and entrepreneurial opportunities. For many, especially the youths, the Obama figure alone is enough a psychological boost telling them that hope is not lost; with education, endurance and opportunity spotting, the world can be at their feet.

Share your thoughts on this issue by dropping your comments below.

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