Exportrådet 23 april 2012
Ewa Björling, Handelsminister
Ewa Björlings anförande vid Sub-Saharan Africa Day 2012
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Ladies and gentlemen,
First of all, let me say thank you to the Swedish Trade Council for arranging this important and timely seminar.
I would like to start by sharing a memory from one of my recent trips.
When our plane taxied in at the airport, in late January this year, we came to a stop not more than twenty metres from a bright red fence, stretching out for hundreds of metres around a giant construction project.
When we stepped outside, we were welcomed by red flags flapping in the breeze, beautiful oriental ornaments, and signs in Chinese warning us not to enter the site.
But we hadn't arrived at Shanghai or Beijing, as one might imagine - the humidity and the heat of the midday sun dispelled that illusion.
We were at Maputo international airport in the capital of Mozambique, one of the fastest growing economies in East Africa.
The Chinese presence in Africa is nothing new, but I hadn't seen it quite so tangible as this before.
And even though I'm sure the Chinese didn't erect a huge fence in the middle of Africa to send a message to me, or Sweden, to keep out, I couldn't help seeing it as a challenge.
Swedish companies have been present in Africa for many years, and right now they are doing a fantastic job in a lot of places. But I'm certain that what we've seen so far is just the beginning.
I'm also convinced that if we want to make the most of our long experience of working in Africa, and take full advantage of the impressive growth and development in many countries right now, we have to step up our efforts.
As the red fence in Maputo clearly indicated, competition is growing.
But, as you know, it's not just Sweden and China that are competing. The increasing importance of Africa, both economically and politically, has led to strong efforts from the USA, India, Russia, Brazil, South Korea, Turkey and many other countries that want to increase trade, investment and exchange with the continent.
It is crucial that Sweden rises to this challenge. We really can't afford to ignore this vast continent, with 54 countries and enormous resources and possibilities.
As you know, Sweden is a relatively small export-oriented country. More than half of our GDP can be traced back to our external trade. Our prosperity therefore depends on our ability to compete in the global market, and on our ability to discover and enter new promising markets at an early stage.
Our accumulated exports to Africa have increased by 200 per cent in the past ten years. This may sound good, but Africa still only accounts for around three per cent of our total exports - and there is no doubt in my mind that there is potential to rapidly increase exports further in the years ahead.
Last week, Swedish radio reported that the economic crisis in southern Europe is forcing a lot of people to emigrate to look for work.
In Portugal, for example, the largest wave of migration since the 1960s is taking place right now. The news report said that people are mainly moving to "economies that, in contrast to Portugal, are growing", namely "the former colonies in Africa". The Angolan Embassy in Portugal is now issuing 24 000 visas per year, compared with 156 visas six years ago.
This positive African development can not only be seen in the increasing numbers of people relocating from Europe, but also in the facts concerning trade, investment and economic growth.
You will receive a more thorough presentation of this by the Swedish Trade Council today when it presents its excellent report - "From 'the hopeless continent' to the 'the hopeful continent'". But allow me to point out a few interesting and impressive facts:
- In 2011-12 Africa is expected to grow faster than any other region or country in the world, apart from China and India.
- African GDP has outpaced world growth since the start of the last commodity boom in 2001, reaching 6 per cent in the middle of the decade. In the last decade, GDP tripled across the sub-Saharan region.
- Seven of the ten fastest growing countries in the world can now be found in Africa.
- Angola is the fastest growing country in the world, and Mozambique, Ghana and Zambia are not far behind.
- Sub-Saharan Africa has the largest share of the world's uncultivated land, and thus the potential for large productivity increases.
- Sub-Saharan Africa has a substantial share of the world's metal and mineral reserves, as well as production, and one of the world's largest oil and gas assets.
- Sub-Saharan Africa has the fastest growing ICT sector in the world. Already today, 45 per cent of the population has access to mobile phones, compared with 33 per cent in southern Asia.
There are still huge challenges and tragic problems in some countries in the continent, not the least in the Horn of Africa.
These problems range from high levels of HIV/AIDS, corruption, dependence on foreign aid, war and conflicts, drought and hunger, lack of skilled workers. The business climate leaves a lot to be desired in many countries - weak fiscal and monetary policies are not uncommon, high inflation still a problem in many places, as is inadequate infrastructure, and so forth.
These are things that many of us, tragically enough, have learned to associate with Africa during the last decades. We shouldn't forget about these challenges, ignore them or lessen our efforts to help resolve them. We shouldn't try to make it sound like there aren't any risks associated with doing business in Africa. There are, off course, both economic and socio-political.
Having said that - and I believe this is important to say - the main developments are clearly going in the right direction, as the facts and figures I just referred to clearly indicate.
The explanations can be found in things such as:
- The strengthening of economic and political freedoms,
- The increased level of education and healthcare,
- The fact that there are less conflicts than ever in the region, and
- And a strong increase in consumption, supported by a growing middle class.
It is clearly the case that improved stability and political reforms have resulted in increased prosperity across the region.
The remaining problems can, and this is also important to say, be turned into opportunities in many cases, if handled correctly. Not least by Swedish companies, which excel in many of the areas where the needs are greatest across sub-Saharan Africa.
Take the poor state of infrastructure, for example, something that is very noticeable especially when it comes to electricity and transport. This is one of the biggest obstacles to business. The Economist magazine has stated that Nigeria, a country with a population of 150 million, has the same power capacity as Hungary, which has a population of less than 10 million. Clearly there is room for improvement here. And Swedish businesses such as ABB can play an important part in this work.
Sustainable and innovative solutions in energy, infrastructure, transportation and telecommunications - ICT - are at the core of Sweden's knowledge and expertise, as you know. And stronger involvement from our side would benefit both Sweden and our African partners during this important phase of the continent's development.
But many Swedish companies can contribute to development in ways that go beyond their everyday activities. I'm thinking about one of our extraordinary strengths, our wholehearted commitment to CSR - Corporate Social Responsibility. This commitment is manifest in a wide range of activities, from the extensive training of the local workforce, programmes to combat HIV/AIDS in the workplace and the development of local communities, to a strong ambition to care for the local environment.
Our commitment to CSR, regardless of the exact shape or form it takes, is something that I believe gives us an important comparative advantage over investors from many other parts of the world that often tend to be, shall we say, more short-sighted.
As you can probably tell, I'm very optimistic about future economic relations between Sweden and Africa.
In my capacity as Minister for Trade I have visited some of the fastest growing and most interesting economies in the region:
- Ghana and Nigeria in the west.
- South Africa, Botswana, Angola and Zambia in the south, and
- Uganda, Tanzania and Mozambique in the east.
I have seen first-hand how the wheels are turning faster and faster.
I have spoken to politicians who are working day and night to get their countries better integrated into the world economy. I have met with local businessmen with huge plans to expand internationally. I have sat down and listened to Swedish companies that are trying to grow and improve their operations.
Sure, I have seen the other side as well. I have met ministers with a serious addiction to foreign aid, unable to talk about business and trade without constantly mentioning development cooperation. I have been told terrible stories about corruption and bad practices. And I have even met Swedish representatives defending the lack of reforms in crucial areas such as property rights.
Both the good and the not so good experiences have led me to the same conclusion however: we need to strengthen our efforts to promote trade and investment in sub-Saharan Africa, we need to work harder to get more free trade with Africa, and we need to reinforce our efforts to move from aid to - exactly - trade.
Our embassies are of course key players in strengthening and transforming our relations with Africa.
We have 16 embassies in sub-Saharan Africa right now, and one 'section office'. The Swedish Trade Council has four offices in the region, situated in Botswana, South Africa, Nigeria and Kenya. And I would also like to mention that Swedfund has a regional office in Nairobi.
Based on this, I think that 'official Sweden' is quite well represented in the continent.
Traditionally, as I have mentioned, much of our relations with Africa have been focused on development cooperation. Sadly, this is still true in some places. I have seen some quite depressing figures on how much time some of our embassies put into trade promotion compared with aid-related work.
Having said this however, I have also seen how we, step-by-step, are moving in the right direction. I have seen excellent examples of trade promotion activities carried out by our embassies and the trade council across the African continent.
This is of course something of a balancing act, the shift from aid to trade. We have put a lot - to say the least - of time, money and effort into building relations with many sub-Saharan African countries over the years. It is important not to ruin these relations now by handling them clumsily. However, I believe that this doesn't have to be difficult, because I am certain that the move towards more trade and economic exchange is something that both parts will gain from.
Trade promotion can take a lot of different shapes and forms. One example is this sort of conference - during which I present my positive view of Africa as a start, and the Trade Council presents a more detailed study of where the best business opportunities are to be found.
But seminars are also arranged in Africa. In October last year, for example, the Swedish Embassy in Nigeria arranged a seminar together with the Nigerian Ministry of Environment on sustainable city development. Experts from Hammarby Sjöstad and the University of Borås participated together with Swedish and local businesses.
In January, another seminar was arranged in Abuja, together with the Ministry of Mines and Steel Development, focusing on the extraction industry.
Another activity that I touched upon is trade delegations. I have taken part in a couple of these myself, but the Trade Council and other organisations arrange them in many shapes and sizes. For example, I have been told that the visit to Botswana by His Majesty the King last year was a big success with representatives from the mining industry, the energy sector, transportation and ICT.
Trade promotion also takes place at home, and this sub-Saharan Africa Day is an excellent example of this. But we also have a lot of incoming delegations, and other seminars. For example, the Nigerian Ministry of Energy will visit Sweden later this week (23-25 April) to explore business opportunities in the energy sector, and on Thursday a renewable energy seminar will be arranged by the Trade Council together with the East African Chamber of Commerce.
From the foreign ministry's side, we have increased the resources for trade promotion between 2010 and 2012, and one of the most important ambitions right now is to create better synergies between our development cooperation and our trade promotion.
I could go on talking about strategies, handbooks being produced to help companies, groups being formed to strengthen our trade promotion towards Africa and so forth. There are a lot of things going on right now, and hopefully you will learn more about some of them here today.
In South-East Asia, the so-called Tiger economies have gone from poverty to prosperity in just a couple of decades. Countries such as South Korea have gone from an economic level comparable to that of the poorest African nations to become stable, democratic and prosperous industrial nations exporting cars, computers and other high-end products to the West.
Right now - a number of Africa Lion economies are about to make the same journey. We have every reason to play a part in that endeavour.