Development policy: Germany’s pact with Africa – Economy

Without the funding, says Julia Gause, everything would have been difficult. The first investments in the plant, then the setback caused by Corona. But now it’s working well: organic chocolate made in Ghana, produced using solar energy. “In 2019, we shipped two full containers throughout the year,” explains Gause, Europe manager of the Munich-based company. It is now one container per month, filled to the brim with “Fairafric” chocolate. “An insane leap,” she said. And the “Pact with Africa” ​​- a pact with Africa – has helped.

The pact dates back to the G20 summit in Hamburg in 2017. At that time, in the aftermath of the refugee crisis, it was supposed to promote economic development in Africa and thus create new perspectives. Twelve African countries participated, in addition to Ghana, countries such as Ethiopia, Egypt, Tunisia and Rwanda. Even poor Burkina Faso is there. And this Friday, the federal government is inviting conference participants for the fourth time. Because if the presidencies of the G20 change, Germany remains the sponsor of the initiative.

The partnership aims to promote reforms between partners, but even more to promote economic relations. “Africa is always a continent of opportunity,” said Development Minister Gerd Müller (CSU). “As much will be built there in the next ten years as in Europe in the last hundred years.” But only one percent of German foreign investment is currently flowing there. What is needed is a “new spirit of optimism”, says Müller: “On the way to Africa!

A “development investment fund” weighing up to one billion euros is supposed to help. Fairafric has also received loans this way – initially two million euros to start, then another two million to cushion the consequences of the pandemic. 66 people now work in the Amanase factory, a good fifty kilometers north of the capital Accra. Then there are the farmers who provide the raw material for the chocolate. A total of 21 projects have now been funded, ranging from Volkswagen electric tractors to be tested in Rwanda to a system that Ethiopian students can use to take their Abitur exams online, including facial recognition. There is the production of corrugated cardboard in Senegal, but also medical analysis laboratories for Burkina Faso. The federal government claims that nearly 9,000 jobs have been created or secured in this way.

The interest of German companies has increased

“We are heading in the right direction,” says Stefan Liebing, president of the African Association of German Businesses, “but the dimension is not there yet”. With the 20 million new workers entering the workforce each year due to population growth alone, 9,000 jobs are a start at best. But there are still companies that have projects in Africa but cannot find funding. Liebing believes that more venture capital is needed. “The fund is designed in such a way that it has to act too cautiously.” Overall, the African economy weathered the Corona crisis fairly steadily, declining 2% last year.

However, Corona also complicates the assessment of the pact itself, says economist Jann Lay, who works on globalization and development at the GIGA Institute in Hamburg. Overall, however, it helps. “It can be said that the interest of German companies has increased in recent years.” Some of these initiatives also went directly back to the Pact. It is also not a mistake to focus on certain countries: “Your economic development always has an impact on neighboring countries,” says Lay.

In Ghana, Fairafric is already planning an expansion. A new hall is to be built, including new product lines. And no longer just for export. “Demand from Ghana itself,” says Director Gause, “is also growing.”

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