The good news is: Germany starts to consider Africa as the G20 Africa Summit in Berlin proves. The bad news: German investors are still too slow and too hesitant.
The German government invited for two days on June 12 and 13 in the event centre Gasometer in Berlin for a G20 Africa Summit opened by German chancellor Angela Merkel herself.
It is good news that Germany starts to consider the opportunities that the economic upswing of the African continent creates for international trade and investment. When I published in 2014 my book “Africa is the next Asia”, I had to face a wave of scepticism in Germany. Africa is too poor for doing business, Africa is too corrupt for ethical investments, Africans are undereducated, undertrained and underqualified – these were just some of the objections I was confronted to in many discussions, round tables and key notes.
Today, the look Germans have on Africa is starting to change. Africa has become an issue that does not interest anymore just the Minister for Cooperation, but also the Minister of Foreign Affairs, the Economic Minister, the Finance Minister and even the Chancellor herself. There seems to be some competition around the best concept for approaching Africa – and competition has never been a bad thing.
Published too early?
Before I published my book on Africa in 2014, I travelled a lot on the continent for investigating of what is really changing there. By that time, few newspapers were interested in publishing stories about successful African entrepreneurs or about ground-breaking innovations such as the mobile payment system M-Pesa in Kenya. Africa was by these days just a topic for the political staff when a new hunger crisis broke out, an epidemic or some guerrilla conflicts. Africa was not a topic for the business pages. Today, this starts to change, the daily Frankfurter Allgemeine Zeitung has even created a series called “Transitions in Africa” (“Afrika im Umbruch”).
The new German interest in Africa is a good thing, but Germany remains a late comer on the continent. Not only the former colonizers, Great Britain and France, as well as China have discovered the new opportunities earlier. Also, entrepreneurs from the whole world, from India, Malaysia, the Philippines, Brazil, Turkey, Israel, the Gulf and Saudi Arabia are realising much more business and investment projects and building good business relationships in Africa.
Lack of flagship investments
Even if Germans change their way to consider Africa, what still misses are flagship projects. The German carmaker Volkswagen started in 1984 to produce cars in China, at the very beginning of the country’s opening to a more liberal market economy. At that time, Volkswagen was a real pioneer blamed by the whole German business world for doing business with the communists. The Chinese attracted foreign investments in a very clever way: Under the far-seeing leader Deng Xiaoping the government imposed to Volkswagen to create not just an assembly line, but a whole factory. This forced many German suppliers to go with Volkswagen to China for maintaining their relationship with the powerful carmaker.
And this is what the German involvement in the African upswing needs most: flagship investments that push the German industry to produce in Africa. Too often, Germans tend to consider Africa just as a new sales market. But the continent is much more: Africa offers the solution to most structural deficiencies of the German economy, the increasing lack of workforce for instance as German society is getting older and older.
German entrepreneurs complain a lack of purchasing power of African consumers. This is true and not true in the same time. But what is undoubted is that German companies have to strengthen the purchasing power of Africans by creating jobs for their future customers. This is the real challenge for the German economy in Africa.