No one can ignore Africa anymore. Mauritius’s intention to position itself as a hub for Africa is manifest. But it’s high time to move from ambition to execution in a coherent way. And it should be recognised that the Mauritian government has not done enough good diplomacy until now. Mauritians, from the public and private sector, should understand the important aspects of the African culture and learn to see in African people more than “zulus”. In an interview to Aufait, Amédée Darga, Managing Director at Straconsult ABDS (Africa Business Development Service), tells us more of his vast experience on the African continent.
Is Africa the last frontier for investment?
Africa is certainly an unavoidable and inescapable frontier for the coming decades for fueling the economic development in the world, and especially, the economic development of those countries who want to do business with the continent. Just now, the United Kingdom, who is now engaged in Brexit, has decided to make Africa, an important partner in its business, both in trade and investment.
No one can ignore Africa for a number of reasons. First, the huge population, 1 billion, which puts it at par with China and India. Second, an extremely young population. That means dynamism. That means consumption. That means an able and productive labor force, with a growing consumption and middle class, and also as a major supplier of resources, like mineral resources.
It can be potentially, I say potentially because it is not yet there, a major supplier of food for the World. Food for other countries which have less capacity in terms of arable land than the African continent. So, yes, Africa is already poised to be a player in the world economy. But essentially, Africa is a vast zone of untapped business opportunities for those who want to play on the continent.
“Mauritius should be in a position to be an important manufacturing base”
For several years now, Mauritius has positioned itself as a hub for Africa, is it ultimately the case today?
Not quite. The intention is manifest. The intention is repeated through various government programs and various projects. But we are still in a situation where we have been quite timid. We have been quite hesitant. We have not managed to get all our acts in proper order. We have not managed to be very coherent in the way we approach the continent.
I have no doubt that Mauritius can and should be, for the future development and future growth, a hub. I would say, similar to Singapore for Asia. Similar to Dubai for the Middle East and similar to Malta today for the Mediterranean countries, Mauritius can play a major role, and can benefit tremendously in being the hub for a number of things for the African continent. But we are not there yet.
In fact, we should speed up what we have already pronounced as intentions. We can be and we should be the trading hub for the whole region. What does that mean? That means, first, that the port of Port-Louis should be the port where most goods coming between Asia and Africa are traded.
Secondly, Mauritius should be in a position to be an important manufacturing base, through his freeport, to produce for what is being important in Africa, taking into consideration that we already have preferential access to the COMESA and SADC markets. I will not mention the AFCFTA but COMESA and SADC by themselves provide us preferential access, provided we set the rules of origin and we get the level of value addition.
But the actions that have been taken, up to now, are incoherent. So in short, yes, we can be the hub.
Yes, we should have the ambition. But we should move from ambition to execution, and we should be coherent. We should have a number of things done now, before it’s too late. The continent is not going to wait for us. Other countries are moving fast. In fact, Mauritius has already been overtaken in some fields, like Information Technology, where Kenya is far ahead of Mauritius. So, we should act fast, and we can be that hub, provided we get our acts clear.
“SADC, COMESA, AFCFTA… and preferential agreements“
What about the Mauritian government’s strategy / blueprint for Africa?
Well, there is no blueprint as such. There’s a number of things said and done. A number of good things have been done. The most important thing that has been done to the benefit of Mauritius, is the time taken to negotiate the island’s position in the regional trade agreements in SADC, in COMESA, and today, through the tripartite, the AFCFTA. Another good thing is that we have now opened visas for most African countries.
The third good thing that we have done, but which we have not used properly, is the fact that Mauritius is giving scholarships to about 50 African students. We know that in most countries when they give scholarships, it is a way to carry favor with this or that country. Unfortunately, we don’t do it properly. We just scatter around these scholarships, instead of using it, targeted on some countries which are more supportive to Mauritius.
The country has also negotiated a number of double taxation avoidance agreements. It has negotiated a number of investment protection agreements. So, all these are very good things that the Mauritian government has done. However, what is needed is the real business. Now, the real business is on a number of things which have not yet taken off as it should have taken off or, in some cases, not yet started.
One is, as I said, being the trading hub for Eastern and Southern Africa. The port cannot do it right now. There is a project for the island’s port. This project is too slow. And the way they are approaching it is wrong. So, developing the port into “The Port” for that region, is one important project which is not yet done.
The second is, in terms of manufacturing in the Freeport. We have preferential agreement with a number of African countries. We have a preferential agreement with India (almost done). We have a preferential agreement with Turkey. These countries do not have preferential agreements with most African countries. So we can be that gateway, where things are produced here, to be sold into Africa, under preferential access.
Thirdly, we have spoken about the education hub. Fine! There are a number of African students now studying in Mauritius, however we are far from the initial target, which I think was 5000 students. We are far from that. What are we lacking?
We’re lacking marketing. We are lacking also, to a certain extent, some dynamism from the private sector. So, it should be the government and the private sector working hand in hand in a coherent manner, to develop our penetration of that region, whether in terms of trade, services or investment. It’s possible. But we are far from it yet and time is not in our favor because others are also moving.
“There are no more risks in Africa than there would be in India…“
Many local companies have invested on the African continent with different levels of success. What are the prerequisites to invest in Africa?
First, understanding that Africa is not a country. It is a continent of 54 different countries, and from east to west and north to south, all african countries are not the same. All African countries do not have the same culture. Second, understanding that, it’s not only in Africa but it’s also in India, the way of doing business is not the way that you know in Mauritius. It’s about first defining what is your objective.
Once you define your objective, then you need to understand the context in which you’re going to operate. You need to understand that you have to evaluate the risk, and factor in the risk. There are risks, but there are no more risks there than there would be in India or there would be in some other countries. Understanding that some practices are different, and understanding that you need to be able to work in a way that ensures that you get to your objective, while having the flexibility to adapt, the flexibility in terms of how you do business.
Let me give you some success cases. Alteo is one of the success cases in Africa. Alteo has invested in Tanzania and is highly successful. When they invested in Tanzania, the government wanted a share of the company. Alteo is the majority shareholder but the government is also a shareholder. And that works.
We took State Informatics Limited to Namibia, in 1998, and it became the number one IT service provider in Namibia and then they expanded to Botswana.
Straconsult ABDS took IBL to Namibia, they became the first ground handling service provider at the international airport. So, having good information, investing into people who know the “ how to” and the “who to” to accompany you is extremely important. Don’t be foolhardy and say I can do it by myself and you try to replicate what you’ve done in Mauritius.
It can be done! There are huge opportunities. But you need to be properly accompanied. You need to be able to get advisory service and to be able to identify the risk. Not all the risks are evident! You should be able to shape your strategy with respect to the landscape.
“Most Mauritians cannot properly apprehend the African countries.“
While Mauritius is an African country, not all Mauritians feel/or are proud to be Africans. Why and what is the remedy to that?
Unfortunately so. I must say, however, that this attitude is a prejudice. Even in our Creole language, there are words that translate that prejudice. When somebody looks black, we say “Guet enn zulu”. This is clearly a bias, a prejudice.
The person who is saying it, is not saying it, with a wrong intent. It’s almost unconsciously prejudiced. Although there are some conscious prejudices among some people, including some of our civil servants and equally in the private sector in Mauritius. This has obviously been bred into us since the colonial days, from the kind of education we have received, from our past and from the fact that Africans came here as slaves.
However, I think that this prejudice is on the reduction curve. More and more people look at Africa with less prejudice. Among the young professionals, Africa has become the buzzword. That’s very interesting. Although most do not know. Most cannot properly apprehend the African countries but it has become the buzzword.
A lot of people in business, a lot of people who are professionals, talk about the fact that we need to be in Africa. That’s a good sign. But, don’t rush into it, unless you prepare yourself so that you make your venture a success.
“African countries have a problem on the DTAA applying to companies involved in mineral resources, oil and gas.“
Can you tell us how Mauritius is viewed on the African continent. Does Mauritius have a good reputation on the mainland?
Mauritius and Mauritians have a good reputation. I have traveled and practiced in almost 49 countries out of 54 and I’ve always heard good things from my African friends in general, about their perception of Mauritius.
They perceive Mauritius as a country which has been successful in its development compared to African countries. They perceive Mauritius as being a democratic country and open. They perceive Mauritius as a country where there is ease of doing business. There are a number of Mauritians, who have worked or who work in a number of African countries, they all are welcome and appreciated. Mauritians are not arrogant. They easily mixed with other people, because we ourselves come from a multiracial society. So it’s easy for us to mix with people of different cultures.
That’s the way Mauritians conduct themselves and practice in countries where they are. Some Mauritians are in Zambia, for 15-20 years. You have a number of Mauritians in Botswana, Kenya and a number of other countries.
“The Mauritian government has not done enough good diplomacy.“
There have been some attacks against Mauritius by some governments, namely with respect to the double taxation avoidance agreements. But let me tell you how I view that issue. First, these attacks have been mastered and engineered by an NGO from Europe, not in Africa. Obviously they have their relays in Africa.
I’ve seen, and I was shocked. In Nigeria, I saw a shameful thing. I saw a woman, a white woman from the United States, standing and lining up a group of Nigerians, giving them placards to campaign against illicit flows and this double taxation agreement with Mauritius. They have also managed in certain cases to convince some African countries to relook at their DTAAs with Mauritius. Nonetheless, I don’t think all African countries want to renege on these DTAAs.
But they do have a problem with one thing and we should be open to renegotiating that. They have a problem on the DTAA applying to companies who are involved in mineral resources, oil and gas. They have a reasoning which we can understand, which we should understand. They say, listen, this is in my soil, gold, diamond, gas, oil, or whatever is in my soil. Whether these companies get fiscal facilities or not, they have to come to me to get that resource. So, this is something we need to negotiate.
I also believe that the Mauritian government has not done enough good diplomacy to talk to the respective African countries to explain that we are not doing harm and what benefits we are bringing to the country. Try to find a compromise to maintain the agreement, while giving away certain things that we should give away. I said earlier that we have done a lot of good things, but we are definitely deficient in our diplomacy towards Africa.
“The person to person relationship is very important in the African culture.“
In terms of diplomatic presence, we are up there in Egypt. We are in Addis Ababa, because Addis Ababa is the seat of the African Union. We are down there in South Africa. We are not in Kenya, we are not in West Africa. We are nowhere. That is a shortcoming. We should have a better presence. They’re going to say that we have an embassy in Maputo that looks after countries X,Y and Z, but we should decide who our main partners are.
Can we avoid a country like Kenya? No, we should not be doing that. So we need a stronger diplomatic presence. You know, it’s not just now, it’s always been the case. How many times has the Prime Minister of Mauritius paid a state visit to African countries? This person to person relationship is very important in the African culture. Yet, we don’t practice it enough.
How many foreign affairs ministers have traveled to a number of African countries, apart from going to a conference. I’m talking about traveling to that country to go and talk to that government bilaterally. So that’s missing!
Recently, we’ve heard about a project where the Mauritius Africa Fund is involved, namely, the project for special economic zones in Madagascar, in Congo, in Ivory Coast and Senegal. Up to now nobody understands what exactly these projects are. Up to now nobody has explained to us, what really are the benefits that we’re going to derive for Mauritius.
It was a good idea to set up this fund. I think this fund should have better been used to have partnerships with the private sector. When I say private sector. I mean, the big companies but also medium sized companies that want to go into Africa and to support service providers from Mauritius that are trying to go onto the continent.
I’ll give you an example, one of the IT companies in Mauritius, has been for the last four years, the IT service provider for Ethiopian telecoms. They’ve done it on their own. We can have more. We need the support of the government. We do, at Straconsult ABDS, a lot of work and help companies. But government to government, certainly, can make the road easier for higher penetration of Mauritian companies into the continent.
Marcus Garvey and Patrice Lumumba, amongst others, dreamed of a United States of Africa. Do you see this dream to come true in the future?
Well, you know, great people have dreams and they are right to have dreams. I don’t think that’s an issue that is relevant for now. Because as we are seeing even with Europe, this is the kind of dream that takes a long, long time. It takes decades to materialize. That’s number one.
And even when it materializes like in the case of Europe, there can be problems like Brexit. Secondly, do we really need, what you call, and what they call, a United States of Africa, which is politically integrated. It will be a nightmare.
I think Africa is going in the right direction with the African Continental Free Trade Agreement. Let’s play it on the economic field, and let the existing states have their own political, legal and set up governance systems. Trying to integrate all that, is going to be a nightmare factor.