By ALEX KOLE
This is the second part of a series of articles on West Africa. Part One can be read here: https://socialistresurgence.org/2020/07/14/french-imperialisms-quagmire-in-africa/ . The author plans to write a third installment, dealing with imperialism’s role in East Africa, in late August.
Given the highly competitive nature of capitalism globally, France’s historically uncontested dominance in its former African colonies is bound to lose ground to its rivals if it lacks the economic and military wherewithal to preserve it. Today, France’s economic influence in West Africa is being contested by several of its imperialist rivals in the European Union (EU), the United States and, most aggressively, by China.
While France remains very relevant to the economies of its former African colonies—it is the second largest exporter of goods to Africa and the financial backer of the region’s currency, the CFA franc—it is rapidly losing ground to its imperialist rivals.
While France’s Ministry of Europe and Foreign Affairs boasts that French foreign direct investment (FDI) in Africa has seen a tenfold increase from 2010 to 2017, Landry Signé, writing for the Brookings Institution’s website in February 2019, writes that China and the U.S. represent Africa’s largest trading partners, followed by the EU. In terms of investment in Africa, he noted, China ranks first and by 2016 invested $38.4 billion in Africa as compared to France’s $7.7 billion. In spite of these setbacks, it would be erroneous to conclude that France’s stake in Africa is negligible.
France enjoys a significant trade surplus with sub-Saharan Africa, with its exports to the region representing 2.4 percent (€11.1 billion) of all French exports in 2017. Its imports from sub-Saharan Africa, which are heavily weighted toward commodities, comprised over 80 percent of France’s $8.5 billion overseas purchases in 2016. The former French colony of Niger provides an illustrative example of the implications of this trade imbalance, which shows that for France, preserving African countries as resource suppliers and markets for its products is a top priority and strategic objective of its foreign policy.
France has long maintained an interest in Niger’s uranium, a key component in its nuclear power infrastructure. A former French state-owned uranium mining conglomerate, Areva (now part of Orano Corp.), which set up mining operations there in the late 1960s and 1970s, has the capacity to extract 4800 tons annually, according to Abhijit Mohanty, writing for the Geopolitical Monitor website, and although “one out of every three light bulbs is lit thanks to Nigerian uranium mining … nearly 90 percent of the population [of Niger] has no access to electricity.” Areva’s neocolonial agreement with Niger’s government preserves an unequal and exploitative relationship with the former French colony. Mohanty points out that for Niger, “uranium represents around 70 percent of the country’s exports but contributes only 5 percent to the national GDP.”
Another important mechanism that France uses to preserve its neocolonial grip on the economies of its former colonies is the CFA franc—the acronym translates as colonies françaises d’Afrique. The currency was established by France during colonial times and was tied to the French franc. France had good reason to pin the currency to the franc, because the latter’s reliable value provided French companies security for their investments. However, as Financial Times reporter David Pilling pointed out in an article on the subject from January of this year, the high-valued CFC franc hindered exports from France’s colonies, hence stunting industrial growth and development.
Although the regional economic union known as the Economic Community of West African States or ECOWAS is considering abandoning the CFC franc in favor of a new currency, the Eco, Pilling notes that such a move would be more symbolic that substantive since France’s central bank would back the new currency and pin its value to the euro. Essentially, the role of the new currency would be to maintain the economic exploitation of West Africa by preserving its role as resource provider to the nations of the developed world without the colonial-era stigma attached to the CFA franc.
China provides a vigorous alternative
China, a rising imperial power in its own right and major player for resources and markets in Africa, has sold itself as an alternative to the neoliberal Western model of development driven by international institutions like the IMF and World Bank, which France has played a major part both creating and administering since they were founded in 1944 by the Bretton Woods Agreement. With a currency of its own, the renminbi, which has become one of the world’s major international currencies, China is also backed by massive state-supported banks and construction companies that are competing with France and other imperialist powers for development projects that would make Africa’s resource extraction projects and import infrastructure more efficient.
Lee Wengraf, in her book “Extracting Profit,” writes that to entice African nations to make deals with Chinese firms for infrastructure projects, China employs offers of “resource-for-infrastructure” swaps and low-interest loans with fewer conditions (compared to those imposed by the IMF and World Bank), which has helped it gain an important foothold in the continent to exploit its resources and gain a foothold in its export markets.
China has been a rising economic power since the Chinese Communist Party under Deng Xiaoping placed China firmly on the road to capitalist restoration in the late 1970s. Initially, China made herself attractive to foreign direct investment (FDI) by creating Special Economic Zones or SEZs, whereby multinational corporations could benefit from low taxes, lax labor and environmental regulation, and most importantly, the exploitation of cheap labor. As China industrialized, she began to grow into a huge consumer of natural resources, and consequently, invested abroad in resource extraction enterprises. As Wengraf points out, “Between the early 1990s and 2010, China’s share of world consumption of refined metals went from 5 to 45 percent, and oil consumption increased fivefold over the same period to a level second only to the United States.”
During these years, and stretching to 2015 when the commodity price bubble collapsed, Africa experienced an explosion in demand for her natural resources driven by the emerging economies of Latin America and Asia, which did not ease even after the 2008 financial crisis triggered a deep recession felt throughout the global economy. In a 2018 article by Bloomberg News on the subject of Chinese investments in France’s former West African colonies, its authors asserted that China posed a direct threat to France’s historical hegemony over the region by greatly outpacing her on the export of capital to her former colonies.
While China has invested all over Africa to satisfy the resource and export requirements of her largest industrial conglomerates, a considerable portion of those investments have targeted countries from what was French West Africa—including Mali, Niger, Togo, Senegal, and Ivory Coast—which is of particular interest. The former French colony provides a glaring example of the aggressiveness with which China is making investments in the region. Wengraf cites data from the China Africa Research Initiative, which found that between 2010 and 2018, loans from China to Ivory Coast “surged in the first five years of this decade by 1,400 percent to a total of $2.5 billion.”
While Chinese firms remain very interested in Africa’s resource wealth, due to overproduction in China, especially after 2008 when the Chinese state attempted to spend its way out of recession, Chinese firms have been particularly interested in investing in infrastructure and energy projects, and a good example of this again comes from Ivory Coast. Bloomberg News reported that thanks to China’s investments, Ivory Coast’s economy expanded at a rate of 8 percent since 2012. In its commercial hub of Abidjan, $191 million was invested to build a bridge, and 10 of the 18 companies that showed the most interest in the project were Chinese firms, with China State Construction Engineering being the one that won the contract.
The China State Construction Engineering Corporation boasts that it is “the largest engineering contractor in the world,” doing business in over 100 countries worldwide. In 2018, it ranked 23rd on the Fortune Global 500 and achieved a new contract value of RMB2.63 trillion that year. The company has many subsidiaries, several of which are holding companies that direct investment in real estate, overseas investments, and myriad other financial endeavors and has received much of its financing from the Chinese state in the form of the Export-Import Bank of China. The China State Construction Engineering Corporation, in addition to the massive Export-Import Bank of China that finances it, are shining examples of what Vladimir Lenin described as “finance capital” in his 1917 pamphlet “Imperialism: The Highest Stage of Capitalism.”
China emerging as important imperialist power
While defining what imperialism is, Lenin argued that what most characterizes imperialism is the dominance of the national economy by monopoly capital. Lenin pointed out that monopoly capital included not only industrial conglomerates but also large banks, which frequently merged with industrial capital to form what he referred to as finance capital. Not only does China boast many companies on Fortune’s Global 500 list, but it is also home to three of the top five largest banks in the world, and these banks finance myriad engineering, construction, transportation, and energy firms that are investing heavily in projects in Africa and elsewhere.
Lenin pointed out that imperialist nations, because of the dominance of finance capital, provided the fundamental impetus for the predominance of capital exports over commodity exports. While we think of China as being a major exporter of goods, and she most certainly is, China’s leading position in global trade, significant investments overseas—in the form of loans and FDI—and expanding military presence globally helps us to understand China’s emerging role as an important imperialist power, and Africa’s role as an arena for the maneuvering of imperialist nations from North America, Europe and Asia.
Despite China’s massive investments in the continent, France has the advantage militarily. Landry Signé notes that President Emmanuel Macron placed Africa at the center of his foreign policy. At the time Operation Barkhane was launched in 2014, France sent 3000 troops into Mali, but that number has expanded to 4500 with Macron pledging 600 more. France has signed defense agreements with several African countries, including former colonies of Central African Republic, Senegal, Gabon, and Ivory Coast and military bases throughout western and eastern Africa. France also has boosted its foreign aid to €20 billion with two of the top five recipients being Morocco and Ivory Coast.
While it is vital for France to project its military power to protect its economic assets in Africa, France today is a second-rate military power that is heavily reliant on the United States and NATO. Ruth Maclean, writing for The New York Times in March of this year, reported that France remains highly dependent on the U.S. for the use of its air bases in the region and its contribution of $1 billion annually for “transportation, air refueling and drones.” The United States, however, has pivoted away from West Africa as it refocuses its attention on East Asia.
France no doubt fears that if its main military backer reduces its troops in the region, protecting its assets would fall more heavily on her, which likely explains Macron’s renewed focus on the region in his foreign policy. The United States has communicated that it expects France to assume a greater role in combating Islamic forces in West Africa, which given the importance of its investments there, certainly needs to protect them against seizure by militants eager to secure funding for their operations.
France also must worry that China’s growing investment in the region will likely be followed by an expanded military presence. Not only has China sent around 2400 troops to participate in UN-sponsored peacekeeping operations in Africa, but in 2017 completed construction of its first overseas military base in the East African country of Djibouti, which would secure its merchant ships traveling through the Suez Canal and allow it to project its military power to protect assets in the Middle East and Africa.
In her analysis of the military dimension of China’s pursuit of resources and markets in Africa, Wengraf writes that, consistent with Marxist theories of imperialism, “the tendency under capitalism [is] for economic competition to spill over into competition between nation states.” We in Socialist Resurgence concur with Wengraf’s prognosis and anticipate an increase in imperialist rivalry and militarism in the years to come. In the international resolution adopted at our 2019 convention, we recognize that China has become a imperial power that emerged “following the culmination of a carefully managed capitalist restoration,” and because of its severe exploitation of the world’s working class, its greed for natural resources and the environmental destruction their extraction breeds, and its increasing militarism abroad, is of great concern to any party in the revolutionary movement.