APPLIED RESEARCH DISSERTATION Nesty Lema Brazil and Africa An equal relationship? MASTER « IBM-E » Dissertation advisor: Mrs. Anna GIFKINS Submitted on: October 28th 1 French Abstract Dans ce mémoire, il sera question de la relation économique et sociale, entre l’Afrique et le Brésil. Connaissant un tant soit peu l’historique de ces deux zones, il est légitime de savoir si elles ont entretenu et entretiennent des relations passives ou actives. Les raisons qui m’ont poussé à choisir ce sujet de recherche sont multiples. Tout d’abord, je voulais me focaliser sur un thème qui concerne mes origines ethniques : étant Afro-Caribéen, je souhaitai faire place à un moment ou à un autre de ma scolarité à l’INSEEC à ces dernières. Deuxièmement, étant donné que ces deux zones respectives obtiennent des taux de croissance élevés en cette période de crise mondiale, il me semblait important de se concentrer sur ces espaces qui semblent ignorer la crise. Troisièmement, ayant un projet de commerce social orienté vers les pays du Sud, je souhaitai à travers ce travail d’investigation obtenir plus de renseignements pour savoir quel serait le créneau porteur pour accéder à ces marchés émergents. 2 English Abstract Throughout the dissertation, the economic and social relationship between Africa and Brazil will be studied in depth. Knowing bits of History, it is legit to ask ourselves if these areas have maintained and/or currently maintain active or passive relations. The reasons for this topic to be dealt with by myself are various. First and foremost, I wanted to put the lime lights on my ethnic origins, which are part African and part West Indian. As a matter of fact, there is a saying expressing this thought: ‘to look where one comes from to see where they may be heading in the future’ and that is exactly what I want to achieve thanks to this piece of work. Secondly, as these two areas obtain impressive growth rates, compared to America’s and Europe’s, it seemed relevant to focus on them as they tend to bypass the economic and financial crisis. Finally, on the long term, I have a social business project centered on the so-called Southern countries: these former still encompass Brazil and most are from Africa. I see the dissertation as an opportunity to look for a better insight of these respective markets. 3 Acknowledgements First of all, I would like to thank both my parents: Mrs. KEMBONZA Maria-Christina and Mr. LEMA Lysis. They have given me the will to carry an extended educational period, mixed origins and a gaze constantly set on the world. These are the people I am indebted for life for their love and their care. The same goes out to the rest of my family and friends. As a logical consequence, I extend my sincere gratitude to Mr. TOURNESAC Yvan. He is in charge of the Master 2 of Event Marketing and PR Strategies; moreover, he is the Head of Admissions Department. Because of him, I got shortlisted to be part of the Master 2 in International Business Management from March 2013. Then, the other INSEEC character I am grateful to is my head teacher in the M2, Mrs. PATOUT Rany. This hard-working person made us discover a part of the intercultural business I never really have taken into account, e.g., the main Asian markets - Chinese, Korean and Japanese. She also had to interest us to Geopolitics and International Relations: these two courses were among the ones I enjoyed the most since I have some background in these two fields, due to my four years at university. To conclude this series of acknowledgements, I am also thankful to the classmates I had during the M2. These people have brought me a better understanding of what diversity is, from a cultural to a behavioral point of view. Furthermore, I enjoy the time we spend together in the classroom and more importantly, outside the classroom. In my opinion, that is where true friends can be met. Here are their names in alphabetical order: CANVIN Luke, COURNOT Devlin, EL KHAWANKY Sara, FENG Bo, GROS Cindy, HERRERA Andreina, KOFFI Jean-Vincent, LAMARI Fella, LEMAIRE Mathilde, MAHJOUB Lobna, PALANIVEL Senthilkumar, PITHWA Neha, REN Jing, SUN Rui, WU Lingling, ZHENG Yichi. 4 TABLE OF CONTENTS Front page Abstracts 1 2-3 Acknowledgements Introduction List of tables/graphs Dissertation summary 4 6-8 9-10 11 Current situation between Brazil and Africa: a seemingly fair relationship 12-57 South-South agenda 12-24 Main points of entry and types of exchanged goods and services between both areas 24-57 Brazilian hidden agenda 58-69 Expanding its international influence thanks to Africa 58-61 Whilst, competing at the same time with three other BRICS on the continent (China, India, South Africa) 61-69 Conclusion 70-71 Glossary 72-75 Annexes 75-86 Bibliography 87-94 5 Introduction As an introduction, the subject of the economic and social relationship between Brazil and Africa was chosen because of the relative lack of information about the trade and social between the two areas, which can be surprising knowing their common past and future trends. The interest was renewed because of some recent events which are to be pinpointed: Brazil, on the one hand, will host the 2014 Soccer World Cup-the most watched sports event worldwide- and, on the other hand, gained a huge momentum in important international forums such as the Food and Agriculture Organization and the World Trade Organization due to its position as one of the fastest-emerging economies. Concerning Africa, since a few years, it is dealt not only as the ‘doomed continent’ but as a continent of opportunities at several levels. First of all, demographically speaking, Africa is growing and, de facto, the middle class is also growing making it an interesting target market for the foreign companies and investors eager to diversify their portfolio. Secondly, in the economic field, following the specialized news or going on websites such as the World Bank’s or the CIA’sFactbook, most countries appear to have growth rates tremendously superior to those of the Western countries due to the aftermath of the 2008 financial crisis but also to economic indicators that improved. As written before, the chosen subject will be the opportunity to put on perspective the cultural, social and economic similarities between Africa and Brazil. In other words, this dissertation will intend to highlight in a few words the common history- from the triangular trade period to the last ten years in which the relations between both zones started anew. The axis of study will be based on this distinction between culture/social compared to economic realities. 6 The final aim of the dissertation will be to illustrate the lack of information of a certain pool of people directly impacted by Brazil and Africa relations and to prove that the renewal of the relations between Brazil and Africa without the Western domination obeys to two principles: a moral obligation from Brazil to Africa because of the slave trade but also to take into account theirtrue whereabouts, e.g., this relationship is not only based on generosity. Some interests are orienting the exchanges between both areas. In order to proceed, there are two categories of data that were used: • Primary data thanks to the creation of a questionnaire answered by fivehouseholds from the middle class and the local ‘bourgeoisie’ with African and/or Brazilian origins. The questionnaire is visible in the appendixes, as the reply charts and graphics. • Secondary data based on a few studies, figures and lectures led by think tanks and international organizations. The data was analyzed according to demonstrate the respective growth and importance that Africa and Brazil respectively to each other for the first part. For the second part, the data was analyzed more from a Brazilian perspective to explicit the African need while also comparing the efforts made in Africa compared to the three main BRICS competitors: China, India and South Africa. The dissertation was divided into two parts because there was a will to put as more weight as possible on the duality on what is written on paper and said by officials and the reality of the facts. The outline encompasses two parts. Each of these parts is divided in two sub-sections as it is detailed below: 7 I. Current situation between Brazil and Africa: a seemingly fair relationship I.1 South-South agenda I.2 Main points of entry and exchanged goods and services II. Brazilian hidden agenda II.1 expanding its international influence thanks to Africa… II.2 whilst, competing at the same time with three other BRICs: China, India and South Africa 8 List of tables/graphs Have you already heard something on Brazil & Africa relationship? Yes 2 40 % No 3 60 % In case you haven't, what do you expect it to be? A non-existing relationship 1 20 % A limited relationship 2 40 % An equal partnership between Southern zones 1 20 % A dominant-dominated relationship 1 20 % In case you heard about such a relationship, what can you briefly tell about it? Nothingmutual benefitsBrazil's hegemony over Africanothing in particularnothing at all What would be the advantages of both zones to entertain a relationship without the intervention from the Western world? More markets, for market profits, equal economy and exchange, more money to Treasuries,mutual benefits andbetter access to resources. Which sectors do you think are most affected by this relationship? 9 Technology 2 15 % Profesional Training 18% Oil and gas 2 15 % Building of better infrastructures 3 23 % Financial Aid 3 23 % Agriculture 2 15 % In your opinion, which is/are Brazil's main touchpoint(s) in Africa? South Africa 3 38 % Portuguese-speaking countries 2 25 % Niger Delta countries 2 25 % Others 1 13 % In your opinion, which are Africa's main touchpoint(s) to reach Brazil? Coastal cities and regions 2 40 % Inner cities and regions 3 60 % 10 Dissertation summary I. Past & current situation between Brazil and Africa: a troubled but seemingly fair relationship nowadays……………………..…………………………….….pp 11-56 I.1) South-South agenda…………………………………………………….pp 11-23 I.2) Main points of entry & types of exchanged goods & services between both areas…………………………………………………………………………pp 23-56 II. The Brazilian hidden agenda…………………………………………….....pp 57-68 II.1) Expanding its international influence thanks to Africa……………....pp 57-60 II.2) whilst competing with three other BRICS on the continent (China, India, South Africa)…………………………..……………………………………….….pp 60-68 11 I. Past and current situation between Brazil and Africa: a troubled but seemingly fair relationship This chapter will be the starting point of our analysis upon the relationship between Brazil and Africa. Our timeline will follow a chronological order between the two areas concerned by the dissertation topic. As a short introduction to this chapter, we will place our gaze upon the past and current relations between Brazil and Africa. In our day and age, the relationship between these different geographic and economic zones is forged through an exchange of goods and services, e.g., through the globalization process. The two areas we are going to tackle have long been excluded from this process due to their relative lack of economic leverage compared to the Western hemisphere one. However, the developing countries have implemented their own dialogue and trade platforms to counter the Western dominance. In which way did they implement this dialogue? And how can itbe translated in economic and financial terms? I.1) South-South As implicitly expressed earlier, Africa and Brazil are part of the Southern hemisphere in a conundrum of countries previously called the Third World. It is still admitted that this zone of the world is the main recipient of development aid from the Western world. The former statement means that funds are being transferred from the West to the South to provide aid for the Southern countries to develop and/or foster the sectors needed to gain full access to the market. 12 The idea of gaps between rich and poor countries dates back from to the mid-nineteenth century with the beginning of the colonial unfolding. However, this traditional model of development has been challenged since the 1960s with the creation of the Group of 77 (G77) during the United Nations Conference on Trade and Development (UNCTAD) in 1964, furthermore, the development agenda wasimproved by an initiative called Technical Cooperation among Developing Countries, which received its conceptual and operating mode of action from the Buenos Aires Plan of Action of 1978. Theevidence was given in the 1990s -Asian and Argentinian crises- that this model failed. Developing countries began searching for alternatives to gain more weight internationally and created arrangements to counterattack the Western influence. On the economic point of view, the Group of 20 (G20) created in December 1999 was implemented to reflect the new role of emerging countries. In 2001, the four biggest growing economies – Brazil, China, India and Russia decided to create a group under the BRIC acronym. South Africa joined 9 years after to complete the group now known as ‘BRICS’. On the political point of view, Brazil, India and South Africa created a Forum for Discussion named as IBSA Dialogue Forum in mid-2003. It is uniting the three emerging multicultural and democratic players1 as a platform to exchange knowledge and give more weight to their common interests on the global scale.In a larger perspective, other groups can be quoted as attempts to pursue this ideal of a new world order such as the Africa and South America Cooperation Forum (ASA), the Common Market of the South (MERCOSUR) and the Southern African Customs Union (SACU). This South-South relationship can exist because over the past decade Africa became a continent of opportunities, with positive economic and demographic trends: Brazilian Foreign 1 As opposed to China and Russia. 13 Direct Investment(FDI) in Africa caught up by 6% in 2010, reaching US$32 billion after a decline of 12.3% in 20092. In 2012, the GDP growth rate in Angola was of 6.8%, of 7.4%in Mozambique and of 2.5 % in South Africa. Sub-Saharan Africa has a population of 841 million people growing at 2.3 percent a year and is expected to attain some 1. 5 billion people by 2050, making it the world’s fastest-growing continent3. Nonetheless, most African countries are still facing tremendous infrastructure and democratic gaps compared to Europe or the United States. According the World Bank’s estimation from 2011, the cost of this infrastructure deficit would be of US$75 billion per year- $37 billion for operations and maintenance and $38 billion, e.g. 12% of Africa’s GDP4. On top of this, they are more vulnerable to climate change and suffer from weak institutional capacity. The mutual interest between Brazil and Africa got much more explicit since the last decade, despite long-time relationships between the two areas, both geographically- Africa and Brazil were joined in a single landmass known as Gondwana millions of years ago- and historically – these two zones have been directly concerned by the triangular slave trade. Brazil–Africa relations can be divided into five distinct periods. The first covers Brazil’s colonial history from the sixteenth to the early nineteenthcentury. Starting with the transatlantic slave trade, links between Brazil and Africa—including trade in goods, economic and social interactions, andexchanges of ideas and skills—expanded during this period. Portuguese historians,such as Oliveira Martins (1880) and Jaime Cortesão (1933), pointed outthat large parts of the Guinea Coast and Angola were directly dependent on Brazil during the eighteenth century. 2 World Bank 2011a. UNDESA 2009. 4 Ibid. 3 14 The second period started in 1822 with Brazil’s independence. It is characterized by a decrease of relations between Brazil and Africa. After Portugal signed the Treaty of Acknowledgment of Brazilian Independence in 1826, the mutual relations were put on hold. With the slave trade endingand the acceleration of Europe’s penetration of Africa, Brazil focused on other areaslike Latin America, Europe, and North America. This pattern continued until the 1950s. The third period included the loss of European influence in Africa, with the end of colonization,and new developments within Brazil. In the late 1950s, the relationship between Brazil and the United States began to create conditions favorable to a renewal of relations between Brazil and Africa. Brazil had to adapt its foreign policy to an international environment that included newly independent African governments. But the Brazilian approach on Portuguese colonialism in the African continent—a type of hesitant support for anti-colonialism, constrained by traditional relations with the former colonizer—continued to block a closer relationship with these newly independent African states. The fourth period was merely starting from January 1961 to the mid-1980s, during which many changes took place in Brazilian foreign policy. This period, except for the years following Brazil’s 1964 military coup, saw an active political and economic rapprochement with Africa. The late 1970s and 1980s were a period with strong flows of capital and goods acrossthe South Atlantic Ocean. From Brazil’s point of view, the South Atlantic became animportant focus of both foreign policy and commerce. Brazil’s recognition as the government of the People’s Movement for the Liberation of Angola (Movimento Popular de Libertação de Angola or MPLA) on November 11, 1975 (this very same day, the Portuguese left Angola and the MPLA declared the country’s independence), ahead of progressive African countries such as Nigeria and Tanzania, was to be a stalemate for Brazil’s relationship with Africa. 15 During the fifth period, which extends into the twenty-first century, Africa has become one of the major fronts of Brazil’s international agenda. Lula Da Silva’s administration revived Brazil’s interest in Africa as a milestone: standing for the oppressed and the outcast but at the same time, giving more weight to Brazil in the global chessboard. To give to this statement more perspective, Lula travelled twelve times in Africa and visited twenty-one countries, something that has never been done by a Brazilian President before.5 Contacts between Brazil and Africa began in the sixteenth century against the background of Portuguese colonization. Under Portuguese rule, the African coastline supplied slaves for colonial Brazil’s sugarcane plantations. The arrival of the first Africans in Brazil dates back to about 1530, but slaves came in mass to Brazil after 1550, when sugarcane plantations became better organized. The demand for African slaves in Brazil was so high that the Portuguese were only focusing on Africa to get the manpower it needed. The Spanish-Americancolonies were relatively spared6 to Brazil (Goulart 1949). Year after year, the annual import of Africans to Brazil increased, ranging from 1,000 a year in the sixteenth century to a record 60,000 in 1848 alone. Smugglers continued to bring slaves into Brazil after the slave trade7was formally forbidden in 1850. Goulart estimates the total number of Africans transported as slaves to Brazil at 3,500,000–3,600,000, while Curtin (1969) has an estimation of at 3,646,800. Brazil’s African slaves had varied origins. Most were transplanted from the western coast of Africa, though some came from as Far East as Mozambique. The zone known as the Slave Coast, which encompasses the coast from Togo to Nigeria, was where Portuguese and Brazilian traders conducted negotiations for slaves not only for 5 See Table 1. Such as Mexico, Peru and Santo Domingo 7 But not slavery… 6 16 sugarcane production, but also for exploitation of mines in the seventeenth century and for work on coffee plantations in the eighteenth and nineteenth centuries. Common items traded for slaves on the African coast included tobacco, gold, sugar, and cachaça8from Brazil. But the history of Afro-Brazilian relations also includes exchanges ofother commodities, such as salt, cloth, and Asian spices. Some Brazilians became administrators in Portuguese colonies in Africa—the governors João Fernandes Vieira, André Vidal de Negreiros, and Baron José de Oliveira Barbosa in Angola were all Brazilian (Rodrigues 1961). Not all Africans traveling to Brazil were slaves. In 1750, King Tegbessou of Dahomey sent a diplomatic mission to Brazil to persuade Brazilian merchants to keep the Luso–Brazilian slave trade concentrated in Whydah rather than in Dahomey—even though Dahomey had conquered the Kingdom of Whydah some years before. Other Dahomean missions to Portugal stopped in Brazil in 1795, 1796, and 1800. Two successive governors-general of Brazil, Dom Fernando José de Portugal and Dom Francisco da Cunha Mendes, welcomed the African ambassadors and discussed with them a proposed monopoly of Brazilian trade on the Slave Coast. At the time, envoys of African rulers were givenfull diplomatic honors in Brazil (Almeida Prado 1955). Relations between Brazil and Africa reached a turning point in 1648, when Portugal took back Angola from the Dutch with a fleet taking off fromfrom Rio de Janeiro. Alongside the Portuguese, the mission included Brazilians who strengthened the ties between Brazil and the parts of Africa underPortuguese rule. Over time, Angolan relations with Portugal diminished while relations with Brazil intensified; by the mid-1800s, the substantial trade out ofCabinda was proceeding directly with Rio de Janeiro, with no intermediation by Portugal. Angola 8 ‘firewater’ or sugarcane alcohol 17 became increasingly dependent on Brazil from the sixteenth century to the beginning of the nineteenth century. During that time, Rio de Janeiro became an important and dynamic warehouse in South America. Salvador Correia de Sá e Benevides, the commanding officer of the expedition that ousted the Dutch, was a member of the dominant aristocracy of Rio de Janeiro and a landowner in the region of Tucumán, near the mines of Potosí, Bolivia, in the Andes. At that time, Rio de Janeiro was the main harbor to the slave-trade corridors extending into the south of Brazil, the River Plate delta, and the mining regions dominated by Spain in South America. Angola in effect became an appendix of Brazil in the eighteenth century. In 1770, Martinho de Melo Castro, Portugal’s foreign minister, wrote that he could not tolerate the fact that Brazil had control over all trade and navigation between the two sides of the Atlantic to the total exclusion of Portugal. In his view, the Brazilians had developed two branches of trade: first, the legal and useful slave trade—and second, the illegal trade of Asian and European goods. Despite the tense context between Brazil and Portugal, the close relations continued into the nineteenth century. FollowingBrazil’s independence in 1822, Benguelan traders were tempted by the idea of a political union between Brazil and Angola. A movement of emancipation was organized in Luanda and Benguela between 1822 and 1826, with the goal of turning Angola into an overseas province of Brazil. The traders requested that the new Brazilian monarchy ensure the continuation of the special relationship they had enjoyed during previous centuries. In 1822, two Angolan members of the Portuguese parliament joined the Brazilian independence movement and moved to Brazil as representatives of Angola, resigning their seats in the Portuguese parliament (Santos 1979). The United Kingdom, which had acted as the mediator between Portugal and Brazil in the negotiations that followed independence, did not appreciate the idea of direct political links 18 between an independent Brazil on the one hand, and Angola, West Africa, and Mozambique on the other. Citing humanitarian and trade reasons, it preferred a free South Atlantic Cone, in order to not harm anybarriers its interests. Brazil thus came under constant pressure from British interests not to accept the union with Angola. The negotiations conditioned Portuguese and British recognition of Brazilian independence on complete stop of political ties between Brazil and Angola. The result is embodiedin the third clause of the treaty signed by Portugal in 18269 acknowledging Brazilian independence: “His Imperial [Brazilian] Majesty promises not to accept proposals by any Portuguese colonies to join the Empire of Brazil” (Saraiva 1996). In the years after Brazil abolished slavery in 1888, few people of African descent penetrated Brazil’s intellectual and political circles. Cultural traits, values, and beliefs of African origin remained alive in popular culture, but interest in the African continent was virtually excluded from what was regarded as high-valueculture. Brazil’s class society inherited the patterns of race relations that had developed under slavery, and the liberated slaves encountered the inequalities they had faced during the time of slavery. A market economy, free labor, and institutional modernization did not erase these structures (Fernandes 1969). Economic and educational disadvantages, combined with the system of alliances, bargaining, and patronage that recruited the political and diplomatic elites, marginalized Brazilians of African descent and deprived them from the benefits of modernity and progress. Such obstacles needed to be removed, rather than deepened, and access to education broadened. The tone of Brazil’s dominant, liberal culture was derived from the contradictions of the ‘bourgeois gentilhomme,’ who lived in Brazil but had Europe as his point of reference. This 9 with British mediation 19 planter class used slaves to produce goods for the international market, keeping one eye on profit and the other on gentility. The same contradiction extended to the precarious alliance between African descendants, among who were the so-called mulatto10intellectuals, with the ruling classes of entrepreneurs, and in the alliance between the rural oligarchies of men of modest origins with the power elite. Some mulatto intellectuals simultaneously criticized and embraced the contradictions of their situation. One of them, Luís Gama—born of a slave mother and a white father, and sold as a slave but later freed—mocked the elite who denied their African roots. Yet this did not prevent him from becoming one of them. Another renowned mulatto writer in the late nineteenth century was Machado de Assis, who depicted with irony the white world to which he belonged. In one of his books, Memórias Póstumas de Brás Cubas, the author presents a funny and tragic picture of a member of the white liberal Brazilian community whose characteristic trait was volubility (Schwarz 1990). The range of intellectual European references in the universal discourse of the book’sprotagonist was a perfect example of the glibness that characterized the elite as a whole. Some scholars explored the survival of African culture in Brazil, including the vestiges of African languages and religions, in the early twentieth century. Raymundo Nina Rodrigues, who based his best-known book, Os africanos no Brasil, on observations and face-to-face interviews with Africans in Brazil, was a pioneer of these Afro-Brazilian studies (Nina Rodrigues 1982). Although a mulatto himself, and despite being one of the few authors to devote attention not only to the presence of African culture in Brazil but also to the African 10 ethnically mixed 20 continent itself, he succumbed to the ‘scientific racism’ thesis. Scholars such as Manuel Raymundo Querino, Arthur Ramos, Evaristo de Moraes, Gilberto Freyre, and Edison Carneiro produced studies about the role of African culture in Brazil. Cultural and social inequality affected Brazil’s relations with African nations. When, in the second half of the twentieth century, Brazil began to revive its interest in Africa, Brazilian society still had not come to terms with its African descendants and the African legacy. Widespread criticism of the culturalhierarchy inherited from slavery led to a rather naïve discourse on rapprochementwith Africa, much of which remained blind to the fact that Brazil, in spite of its historical and cultural links with the continent, was dismally ill-equipped to build a new relationship with it. For instance, when professional diplomats of African descent were needed to enact the new Brazilian foreign policy, none were to be found. And there were virtually no Brazilian experts on the history and cultures of the African continent at Brazilian universities. In recent years, the Brazilian “Black movement” has helped to develop a new set of public policies and norms, including the creation of new federal institutions on racial issues. One initiative, included in the Brazilian law in 2003, stipulates that ‘Afro-Brazilian and African history and culture’ becomesa mandatory subject in public and private schools. The law is a major step forward for the Brazilian Black movement, though it faces constraints in full implementation because of a lack of professionals with the required teaching expertise. Several universities are now responding to the new call by training a new generation of teachers. The Department of History at the Catholic University of Rio de Janeiro, for example, created two new compulsory courses for its undergraduates in 2008: Africa I, covering the Atlantic slave traffic and sixteenth-, seventeenth-, and eighteenth-century Africa; and Africa II, on contemporary Africa. 21 In the past few years, several universities have begun to target admissions efforts toward particular groups, including Afro-descendants. Innovative affirmative-action programs were needed, and the National Council for Scientific and Technological Development11with the Ministry of Foreign Affairs (MFA), created a scholarship for Afro-descendants applying to the Instituto Rio Branco (IRBr), the renowned Brazilian diplomacy school. Instead of granting access under a traditional quota system, the program grants teaching assistance to increase recipients’ chances in the admissions process. Ten months before the exam, the IRBr candidate receives a monthly stipend of US$1,500 from the government to prepare for the exam. After decades of consolidation, it seems that the discourse of South-South cooperation has achieved a certain level of maturity and the minimum financial and human resources needed to advocate significant change. According to UNCTAD’s report, Economic Development in Africa 2010, the spotlight is put on the fact that this new type of cooperation is attractive to African economies due to the existing plights for the delivery of efficient foreign-aid and that it represents a new way to apprehend global economic, financial and trading systems in the African sphere. The report also highlights the major increase in the region’s negotiation power in international negotiations concerning international trade and climate change. South-South arrangements do not seek to replace traditional strategies in international development. They rather represent a complementary channel to reinforce goals set to lift up poor countries from extreme poverty. The second reason why the term ‘South-South’ has been coined is due to the emergence of economies which are getting on track of economic development. So as to say, these 11 Conselho Nacional de Desenvolvimento Científico e Tecnológico or CNPq 22 economies are on track to overcome the traditional big players included in the Group of 7 (G7): USA, Canada, United Kingdom, France, Japan, Italy and Germany. The concept was created in 2001 but the first inter-governmental meeting took place in 2007 in Ekaterinburg, Russia. South Africa was only invited to join the four emerging economies in 2010, modifying the name to BRICS. In the early twenty-first century, several indexes pointed to the emergence of Brazil, Russia, India and China. In 2000, the BRICs had a 23.3% share of the world’s gross domestic product (GDP); their real GDP growth exceeded that of the Group of Seven12. In 2001, Goldman Sachs estimated that in a 10-year time period BRIC countries (especially China) would play a major role in the world economy. Indeed, between 2003 and 2010, trade between these countries rose from US$38 billion to US$220 billion13 and the expectation is that, by 2032, the BRIC economies will account for more than half the world economy14. In spite of the economic performance we just mentioned above, each of these countries is facing serious challenges. According to the chief economist in the World Bank’s Africa Region, ‘each… still has significant pockets of poverty… such as Western China or the Indian states of Bihar and Uttar Pradesh’15. In fact, in these countries, inequality tends to be higher than in the mature countries and that is why the Gross Domestic Product (GDP) per capita remains quite low compared to the former countries. One part of our case study is the exception among the BRICs because its income per capita (per head) grew at an average of 1.8% faster than its GDP between 2003 and 200916. To put in a global perspective, according to the report of FGV, income inequality grows around the 12 Goldman Sachs, 2001. MFA 2011. 14 Beattie 2010. 15 Devarajan 2010. 16 Fundaçao Getulio Vargas, « Os Emergentes dos Emergentes: Reflexoes Globais e Acoes Locais para a Nova Clase Media Brasileira » (http://www.fgv.br/cps/brics/). 13 23 world except for Latin America and Brazil: the former is ranked first among 146 countries when it comes to expectations and optimism for living conditions in 201417. Trade between the original BRIC countries and Africa nearly grew ten-fold between 2000 and 2009, from US$16 billion to US$157 billion while world trade simply tripled from US$13.1 trillion in 2000 to US$32.2 trillion in 200818. Now that a clearer picture has been made about the concept and implementation of the SouthSouth concept, the focus can be put upon the specific areas in which this South-South cooperation is felt by both parties on the field. I.2) Main points of entry and types of exchanged goods and services between both areas As previously told, Africa became one of Brazil’s major fronts in its international agenda due to their common history and geography. Africa is also eager to join the Brazilian effortthirty-seven embassies in Africa from seventeen in 2002- as part of their South-South agreement because of the comparative advantages that Brazil has in technical assistance, cooperation and investment. In Brazil, seventeen African embassies have opened in Brasilia since 2003 over the previously sixteen first ones already there. In other words, the new Africa coincides with a global Brazil19. This is a consequence of a ‘black-oriented’ policy: in the past five or six years, the Brazilian ‘Black movement’ has helped to foster policies, norms, institutions to deal with racial issues, a mandatory study of Afro-Brazilian and African history and culture in schools and universities and incentives to 17 Ibid. Standard Bank 2010. 19 Bridging the Atlantic, Brazil and Sub-Saharan Africa, South-South Partnering for Growth, Executive Summary, p. 3. 18 24 enlarge the number of Afro-descendants attending courses in the Institute Rio Branco, which is Brazil’s most renowned school of diplomacy. As a complement to the historical and cultural links, Brazilian technology seems to be a good match for the majority of African countries due to geographic common features in soil and climate. Sub-Saharan Africa has requested cooperation from Brazil in five key areas:tropical agriculture, tropical medicine, vocational training, energy and social protection. Tropical agriculture The Brazilian Agriculture Research Cooperation or Empresa Brasileira de Pesquisa Agropecuaria (EMBRAPA) with the Brazilian Cooperation Agency or Agência Brasileira de Cooperaçao (ABC) started the implementation of projects alongside local partners in agriculture. The purpose is to duplicate successes in the Brazilian savannah or cerrado and significantly increase agricultural development and agribusiness. Relevant examples include the Cotton Four Project, the project on technical Support to the Development of Agricultural Innovation in Mozambique, and the Rice-Culture Development Project in Senegal. Brazilian agriculture benefits from several geological and climatic advantagesdue to the nation’s large territory, tropical location, and biodiversity. The past ten years of political and macroeconomic stability, along with the elimination of import substitution favoring domestic production, have contributed to agricultural growth. Recent structural reforms have ‘included the privatization of state-owned enterprises, the deregulation of domestic markets, and the establishment of the Mercosur customs union with other South American countries,’while ‘policy changes included deep tariffs cuts and the elimination of non-tariff barriers to trade’20 20 OECD 2005 25 With food exports estimated at US$54 billion a year, the World Trade Organization ranks Brazil as the third-largest food exporter in the world, trailing only the European Union (EU) and the United States (WTO 2009). The increase in Brazil’s farm production during the past 10 years has been substantial. Between 1996 and 2006, the total value of the country’s crop rose by 365 percent from R$23 billion21to R$108 billion22. Its beef exports increased tenfold in the same period,overcoming Australia as the world’s largest exporter. It has the world’s largest cattle herd after India’s. It is also the world’s largest exporter of poultry, sugar cane and ethanol. Since 1990, its soybean output has risen from 15 million tons to over 60 million. Brazil is now the world’s biggest beef exporter. It is also the leading international supplier of sugar, coffee, orange juice, ethanol, tobacco and chicken. It ranks second in soybean exports and fourth in pork and cotton.23 This growth was achieved with little subsidy from the state—just 5.7 percentof total farm income in 2005–07, compared with 12 percent in the UnitedStates, 26 percent across OECD countries, and 29 percent in the EU.24 The agricultural development policies adopted during President Lula da Silva’s term, such as the National System for Food and Nutritional Security, have contributed to the agricultural development and increased food security. It has helped the country to achieve the Millennium Development Goals for poverty and hunger five years ahead of schedule (IPEA 2010b). Innovative policy reforms that boosted agricultural productivity also increased social inclusion and reduced poverty and inequality. These included the creation of networks for citizens’ wider participation in development, the expansion of public markets, and increased support to family-based agriculture25. 21 Approximately US$12.8 billion. Approximately US$6 billion. 23 See Annex 4. 24 Ibid. 25 85 percent of credit operations linked to family-based agriculture is financed by public banks such as Banco do Brasil, Banco Nordeste, and Banco Amazônia 22 26 In contrast to Brazil’s productivity, several African countries import both food and energy. Though about 60 percent of Africa’s population depends on agriculture (ADB 2011), the sector is characterized by low productivity, poor infrastructure, and lack of qualified labor. Therefore, some innovative practices relating to food security and family-based agriculture in Brazil are being adopted by other countries with tropical agriculture. The fact that much of Sub-Saharan Africa has similar geological and climatic conditions to Brazil26makes it an ideal collaborator in the development of joint research and projects. Noting Brazilian successes, many Sub-Saharan countries have requested Brazil’s support in agricultural development. The key governmental institutions responsible for Brazil’s recent agriculturalsuccesses are EMBRAPA and the Ministry for Agrarian Development(Ministério do Desenvolvimento Agrário or MDA). EMBRAPA EMBRAPA was established in 1973 as part of the Ministry of Agriculture, Fisheries, and Food Supply. Its mission is “to provide feasible solutions for the sustainable development of Brazilian agribusiness through knowledge, technology generation and transfer in order to increase productivity and support agriculture in the Brazilian territory.” The institution has created and recommended more than 9,000 technologies for Brazilian agriculture, reduced production costs, and helped Brazil increasing food supply while conserving natural resources and the environment and diminishing Brazil’s dependence on external inputs. With 38 research centers, 13 central divisions, and 3 service centers, EMBRAPA is present in almost every Brazilian state, each with its own ecological conditions. It has 9,248 employees, including 2,215 researchers (74 percent with doctoral degrees, 18 percent with master’s degrees, and 7 percent with postdoctoral degrees). It coordinates the Sistema Nacional de Pesquisa Agrícola (National Agricultural Research System or SNPA), which includes 26 See Annex 5. 27 universities and most public and private entities involved in agricultural research in the country. Its 2010 budget was R$1.8 billion (approx. US$1 billion). EMBRAPA is one of the world’s leading tropical-agricultural research institutions. Its technological innovations initiated the transformation of the Brazilian savannah (cerrado), and it is now focusing on areas such as biotechnology and bioenergy. EMBRAPA has therefore strengthened its international connections—it has 78 technical cooperation agreements with 56 countries and foreign institutions27, as well as 20 multilateral agreements with international organizations. Internationally, it has innovatedvirtual laboratories, placing researchers in well-known agricultural research institutions abroad to contribute to strategic areas for agricultural development. Coordinating activities with the ABC, EMBRAPA has increased its presence in Sub-Saharan Africa in recent years. It opened its African office in Accra, Ghana, in 2006, in order to coordinate all requests from its African partners and contribute to the continent’s agricultural development. In view of increasing demands, EMBRAPA has since set up a coordinating unit in each country with current projects. EMBRAPA’s collaboration with African countries is carried out mainly through three instruments: structuring projects, technical training, and the Africa-Brazil Platform for Agricultural Innovation. Structuring projects Structuring projects are a fundamental means of Brazilian support to Africa. In line with Brazil’s unique approach to bilateral cooperation, such projects are customized to local biome and economic conditions. Much time is invested in identifying local needs, and there are continuous feedbackswith local stakeholders during all phases of a project. According to the ABC, these projects are conceived with a long-term objective and seek to build social 27 Mainly in agricultural research. 28 development in partner countries through capacity-development facilities ranging from experimental farms to vocational training centers, allowing for sustained capacity development of a larger local audience over longer periods of time, with long-lasting effects on specific socioeconomic segments of the population. Added to this, some projects have a regional impact and facilitate South–South experience exchanges. In agricultural projects, for example, the Cotton Four experimental station in Mali has received technicians from Burkina Faso, Benin, and Senegal; the rice station in Senegal will benefit from technicians from Guinea-Bissau, Mali, and Mauritania (Itamaraty 2011a; ABC 2011). These, andthe project on Technical Support to the Development of Agricultural Innovation in Mozambique, are the three main structuring projects carried out withEMBRAPA and supported by the ABC—as now discussed. The Cotton Four Project This project was conceived in 2008 to support the development of the cotton industry in the ‘C-4 countries’—Benin, Burkina Faso, Chad, and Mali—which all face losses arising from subsidies used in the international cotton market (ABC 2010). Based on the underlying principles of South–South cooperation, the project has a strong capacity development component. The objectives of the project, which supports the World Trade Organization’s Cotton Initiative, are: - To provide tools for the four governments to enable them to addressissues of developing an autonomous cotton industry. For example, nine Brazilian cotton varieties developed by EMBRAPA over the past 20 yearsare being tested and adapted in Mali (ABC 2010). - To transplant Brazilian technologies for increased profitability and quality to the C-4 countries, given the similarities in soil and climaticconditions. 29 - To increase the quality of life and food security of farmers. For example,the ABC suggests that farmers can use Brazilian-developed crops thathave been adapted to local conditions “in order to supply consumermarkets with better quality produce” (ABC 2010). Important successes have been achieved in the four countries despite difficulties such as poor communications, high labor turnover, limited and expensive local technology, inappropriate use of chemicals, lack of soil samples for analyses, farming techniques that erode soil fertility, loss of soil potential, and low-quality seeds. Mali built one laboratory for biotechnology in the experimental station, which will be equipped with financial support from the ABC. A second laboratory for biological controlis being built by EMBRAPA, also with financial support from the ABC. These initiatives are helping to integrate plague management into the production process in the four countries. In 2009, cotton yields increased from 1,000 kilogram/hectare (kg/ha) to 3,000 kg/ha, with an additional 10 percent increase achieved in 2010. But a third consecutive year of planting will be required before there are sufficient data to develop technical recommendations to start large-scale production (ABC 2010). If successful, chances for replication are good in other countries with low cotton productivity and similar soil, climatic, and rainfall conditions28 that want to be included in the Cotton Four Project. According to the Brazilian government, the ‘structuring’ nature of this project involves local capacity building and allows for expansion into other areas related to the cotton industry, such as livestock, cereals, and handicraft. Fifty-six researchers from the C-4 countries have participated in technical training on cotton genetic improvement, direct planting, and integrated plague management. 28 Such as Ghana and Uganda. 30 One of the project’s aims is to ‘acquire knowledge to integrate the different components of an agro-ecosystem to promote rational utilization of natural resources, promoting studies on integration with shorter-cycle crops so farmers can have a quicker return for their investment. . . . Its capacity to embody the concepts of South–South cooperation makes it an innovative initiative among other international cooperation efforts in the field of agriculture’ (ABC 2010). Technical Support to the Development of Agricultural Innovation in Mozambique This project is the first structuring project implemented since 2010 through trilateral cooperation among the Agricultural Research Institute of Mozambique, EMBRAPA, and the United States Agency for International Development,which is executed by EMBRAPA’s headquarters, EMBRAPA Solos, EMBRAPA’s monitoring via satellite, EMBRAPA Cerrados, EMBRAPA Hortalicas, and EMBRAPA Institute for Capacity Development on Tropical Agriculture— CECAT, created in 2010. The project has five different components: institutional strengthening of the Agricultural Research Institute of Mozambique, seed systems, territorial management, monitoring, and information and communications. Two other structuring projects are in the design phase. The first is Improving Technical Research and Technology Transfer Capacity for Agricultural Development in the Nacala Corridor Project in central Mozambique, which is being designed by technicians from Brazil, Japan, and Mozambique. This project seeks to improve research capacity and knowledge transfer to support agricultural development of the corridor. The expectation is to replicate the positive transformation of the Brazilian cerrado into a productive agricultural area, to build competitive capacity, and to create a sustainable and environmentally sound solution to local and regional agricultural development. 31 The second is the Technical Support to Food Security and Nutrition Project, aiming at strengthening strategic capacity for horticultural production and distribution in order to support food security projects developed in the context of the Global Initiative for Food Security and Nutrition as well as to consolidate family-based agriculture. The project has three components: production systems, postharvest systems, and processing and socioeconomics. The key pillars of the collaboration are the similarities in Brazil’s and Mozambique’s geological and climatic conditions, jointly identified opportunities for technology sharing and learning, and a common vision of the future with a focus on developing business opportunities. Rice-Culture Development Project EMBRAPA’s third structuring project is in Senegal. Launched in 2010, the US$2.4 million project was jointly developed by the Senegalese Institutefor Agricultural Research and EMBRAPA’s rice-and-beans unit in San Antonio de Goiás, Brazil. The project seeks to support and transfer technology to Senegal as it moves toself-sufficiency in rice production by improving productive systems. Activities include mechanization of production, training, and capacity building of Senegalese technicians, and experimenting with 10 different varieties of rice developed by EMBRAPA’s rice-and beans unit for irrigated cultures at intermediate elevations and highlands. EMBRAPA’s capacity to use its various technical units and expertise developed in Brazil is an important contribution to African countries as they benefit from the know-how developed under similar geological and climatic conditions. The strategic relevance of this project is because rice is the one of the primary food products eatenby the Senegalese: the annual 32 average consumption is 74 kg per person compared with 44 kg in Brazil. Though numbering 800,000, Senegalese rice farmers29do not produce enough to meet local demand. In 2007, 80 percent30of Senegal’s local consumption was imported, and 16 percent of the trade deficit reflected rice imports. In addition to the structuring projects, Brazil has projects throughout Africa that focus on training and agricultural research, run via partnership agreements with Angola, Cape Verde, Republic of Congo, Ghana, Guinea-Bissau, Nigeria, Tanzania, and Togo. Technical training The second instrument used by EMBRAPA to support other countries is technical training through CECAT. It offers four courses: Brazilian agriculture—research in agriculture, forage production and pasture, good practices in agriculture, and livestock production; seed production; production systems for family-based agriculture, community-basedseed production, and water-resources conservation in small properties and farms; and soy production (ABC 2010). In October 2010 alone, 45 technicians and researchers from 20 African countries participated in CECAT trainingevents. Africa-Brazil Platform for Agricultural Innovation The third instrument is the Agricultural Innovation Marketplace, launched in 2010 to establish closer links between EMBRAPA and African researchers. One hundred and twenty-five African specialists from 15 African countries met in Brasília for this initiative in October 2010. Joint projects were designed through a dedicated website to be implemented in Africa. Applicants could seek up to US$80,000 for their projects, which wereshortlisted through a competitive process. The subjects of the projects selected included fostering knowledge sharing for integrated natural-resource management in the agricultural landscapes of southern 29 Mainly small-family units. 820,000 tons. 30 33 Africa31; sweet sorghum varietal adaptation for ethanol production32; rehabilitation of degraded rangeland using planned grazing in arid and semiarid lands33pesticide leaching and loss to groundwater in coastal vegetable cultivation34; cotton varieties and pest management35; ecology and nutritional potential of native food tree species used by local communities36; and a food security and conservation strategy in the context of climate change37. Through this instrument, African and Brazilian researchers promoted South–South collaboration and greater innovation for agricultural development in Africa. The marketplace now has participation of the ABC, the Forum for Agricultural Research in Africa, the International Fund for Agricultural Development, the United Kingdom Fund for Agricultural Development, and the World Bank. Tropical medicine As of 2011, Brazilhas singed fifty-three agreements on health with twenty-two African countries. Brazil’s approach to HIV/AIDS treatment and other prevalent diseases, including malaria and sickle cell anemia, is wellregarded by African peers. The Oswaldo Cruz Foundation or FIOCRUZ, a Brazilian foundation for research and development in the biochemical sector, is leading partnerships with local institutions in Africa. As well as running model projects on tropical medicine, FIOCRUZ is partnering with the Mozambican government to build a pharmaceutical plant to issue generic medicine to treat HIV/AIDS. The plan will give Mozambique a competitive edge in the export of health products compared to its neighboring countries. 31 Mozambique. Kenya 33 Ibid. 34 Togo. 35 Tanzania 36 Burkina Faso and the Brazilian Amazon 37 Burkina Faso 32 34 The right to health access is included in the 1988 Brazilian Constitution, requiring appropriate policies and mechanisms to enforce this right for all Brazilians. One example is the production and free distribution of drugs for HIV/AIDS treatment. Innovative solutions in Brazil’s health sector include successful mass immunizationcampaigns, the development of national milk-bank networks, and advanced research to fight diseases such as sickle-cell anemia and malaria. All 12 of Lula da Silva’s presidential missions to Africa included a health aspect,39 and as of 2011, Brazil has 53 bilateral agreements on health signed with 22 African countries38. Small-scale projects, carried out in specific countries, were at the heart of Brazilian cooperation on health until 2008, when a new approach encouraged the development of structuring projects (Mateos 2011; ABC 2010).. Activities are designed based on a longerterm approach, emphasizing local engagement and capacity development. Two of these projects deserve special attention for their significant impact on the local population. The government of Mozambique, in partnership with Brazil, is building a plant to produce generic drugs for treating HIV/AIDS and other diseases. This is undoubtedly the largest project involving Brazil’s development cooperation, with an investment of about US$23 million39. A regional office of the Oswaldo Cruz Foundation (FIOCRUZ, FundaçãoOswaldo Cruz) was officially installed in Maputo in 2008 to facilitate coordinationon the ground, and is the first field office opened abroad. According to FIOCRUZ, during the first phase, equipment and drugs will be brought from Brazil, packing will be done in Mozambique, and drugs will be distributed in the country free of charge. This phase includes the development of local expertise and labor capacity to run the factory. During a second phase, scheduled for 2012–13, drugs will be produced in the factory. By this 38 39 See Annex 7. See Annex 8. 35 time Mozambique is expected to be able to choose where and how to buy most of the formula components. The current director is Brazilian, but the goal is to transfer authority to the Mozambican government in the near future. The second large health-focused structuring project is with the government of Ghana. A hemophilia and sickle-cell anemia treatment center will be built in Accra. The center will have dedicated space for research and training and will be opened to other countries in the region. The initial phase was carried out in 2009 and focused on training the local workforce and acquiring materials. Construction began in January 2011, and the center is expected to open in 2013–14. The project will benefit not only Ghana, but will also serve as a reference to other countries in the region, such as Benin, Burkina Faso, and Nigeria (ABHH 2010). Vocational training The Brazilian National Service for Industrial Apprenticeship or Serviço Nacional de Aprendizagem Industrial has created vocational centers in Cape Verde, Guinea Bissau, Mozambique and Sao Tomé and Principe and pledged to act in such matter in coordination with Angola, Congo and South Africa. Along with EMBRAPA, SENAI benefited from technical cooperation during the 1970s. It was created in 1942 to support industrial development in Brazil following the adoption of import-substitution policies. Funded through mandatory contributions from about 120,000 private enterprises,SENAI is globally recognized for the quality of its vocational training as well as its approach, which is attuned to Brazil’s industrial requirements. SENAI’s sophisticated structure allows it to provide timely and targeted support as part of the private sector’s long-term vision and the nation’s development objectives, while its sector technical committees encourage industry participation to ensure that the design of its skills development programs, professional curricula, and courses are aligned with industry 36 requirements. The committees include representatives from private industries, factories, union leaders, governmental bodies, academia, and vocational training. SENAI has 471 fixed and 326 mobile training units around the country, and provides services on location at 55 client sites. It is well placed to service industrial needs in remote areas that have a variety of geological, climatic, and geographic conditions, including the Amazon and cerrado. Its integrated approach to developing a labor force—basic education combined with professional training—contributes to ensuring a sustained and consistent response to individual, industrial, and societal requirements. Distance learning is a strong component of SENAI’s programs. In 2010, the distance-learning program—2010 e-Learning Brazil—received national recognition for its contribution to developing Brazilian society. The institution has 14 distance-education centers for vocational training around the country with courses including entrepreneurial development, sustainable environmental protection and security in the workplace, information technology, workers’ legislation, and intellectual property rights. One innovative approach fostering regional development is training40on board a ship, which allows SENAI to reach coastal and riverside communities that do not otherwise have access to educational facilities. The National System for Professional Evaluation evaluates SENAI’s learning products along two lines. The System for Evaluation of Professional and Technical Education (Sistema de Avaliação da Educação Profissional e Tecnológica or SAEP), created in 2010, evaluates the quality of its courses and their impact on the development of the participants, industry, government, and society as a whole. The Evaluation of Students’ Performance (Avaliação do Desempenho de Estudantes or PROADE) aims to evaluate the development of SENAI’s graduates in the labor market, so as to ensure that the right skills are developed. 40 On topics such as river navigation, use of renewable energy, water and residual treatment, and IT. 37 SENAI’s mission has a public service component: it has established partnerships with the government at the federal, state, and municipal levels, with key Brazilian engineering and infrastructure companies such as Odebrecht and Camargo Correa, and the Social Industrial Service (Serviço Social da Indústria or SESI). These partnerships aim to support social projects for the poor through youth training for sexually abused youth groups, among others. Working with the National Justice Council (Conselho Nacional de Justiça), the institution also provides technical training to prisoners to prepare them for reintegration into society. SENAI’s global partnership SENAI is joining other Brazilian institutions as a provider of international technical assistance. It has 48 international partnerships with 25 countries, which have so far led to 29 projects, five of them in Sub-Saharan Africa. The experience that SENAI has acquired from adapting its programs to requirements in Brazil allows it to share its knowledge with other developing countries. It now provides technical advice on strategic planning, structuring, organizing, and running vocational training centers as well as training of trainers, managers, and technical personnel. With the ABC, SENAI has set up 10 vocational training centers globally— five in SubSaharan Africa (Angola, Cape Verde, Mozambique, Guinea-Bissau,and São Tomé and Príncipe). Two others are being opened in South Africa and Angola. The Brazil-Angola Vocational Training Center, in Cazenga, supported national reconstruction through training and rehabilitation of the demobilized labor force as Angola’s 40-year civil war wound down. Between 1999 and 2006, it trained more than 3,000 Angolans in fields such as diesel mechanics, civil construction, apparel making, and IT. The center’s training methods and operational know-how were ultimately transferred to the National Employment and Training Institute of Angola (Instituto Nacional de Emprego e Formação 38 Profissional de Angola), which continues to provide training and to contribute to the social reintegration of the demobilized population. Several other SENAI projects are being carried out in partnership with African countries and with support from the ABC. Mozambique. The National Employment and Vocational Training Institutein Maputo, with SENAI, is establishing a National Vocational Training Center based on the Brazilian model. São Tomé and Príncipe. SENAI is supporting the government to establish a Reference Vocational Training Center offering courses on construction, electricity, sewing, mechanics, and computer skills. This initiative will also support training of trainers for instructors and managers, as in SENAI’s other partner countries in Africa. Guinea-Bissau. SENAI, the ABC, and the Ministry of Public Administration and Labor are running a project to structure and strengthen the nation’s vocational training system and to establish a vocational training center in Bissau, which is now operational and provides courses in civil construction (general construction, roofing, painting, plumbing, tiling, and so on), electrical installations, industrial sewing, electrical appliance repair, cooling system repair,personal computer maintenance and repair, baking, and metalwork. Cape Verde. With the government of Cape Verde, SENAI supported the establishment of the National Vocational Training Center of Praia. The center offers six courses: metalwork, food, electricity, plumbing, civil construction, and IT. Other recently launched SENAI initiatives include establishing the Brazil-Angola-Japan Vocational Training Center (via trilateral cooperation); strengthening civil construction in the Republic of Congo; and establishing the Brazil-South Africa Vocational Training Center. Youth vocational training in Sub-Saharan Africa is required to support economic growth and socioeconomic development. Vocational training centers are also providing youth with the knowledge and skills needed to open small businesses. How this critical mass of skilled labor 39 will contribute to the development of the social and physical infrastructure of Africa remains to be evaluated. But SENAI’s partnerships with African governments have so far resulted in nine new projects in development; eight projects under negotiation; 74 instructors trained in local partner institutions; 173 managers/administrators trained to support the development of vocational training centers in Africa; more than 6,500 enrollments; and more than 420 courses. An additional line of SENAI’s work in Africa involves providing educational and technical services to Brazilian companies. This started in 2007 with SENAI supporting Odebrecht in launching the Integrated Center for Technical Education (CINFOTEC) in Luanda with the government of Angola. After two years of working with SENAI, CINFOTEC is now offering integrated solutions for professional development, technology transfer, consultancy, research, and technical assistance in areas such as meteorology, mechanics of production, electricity, IT, and communications. In 2008, Vale requested SENAI to support the design of a training program to respond to the skilled-labor requirements for its carbon mine in the district of Moatize, province of Téte, Mozambique. Vale identified projects that had been offered in Brazil that could be adapted for local labor skills. The program provides training in mechanical and electrical maintenance, welding, and mining equipment operation. In 2011, Petrobras Tanzania Limited requested SENAI’s services to carry out a training program with the government of Tanzania and local organizations. The Vocational Educational and Training authority of Tanzania is to select 50 professionals to participate in the training-of-trainers’ programs. After training, these professionals will maintain Petrobras Tanzania’s electrical and mechanical installations in the city of Mtwara, where the firm is to start exploring for deep-sea oil. Energy 40 Sustainable energy is another field in which Brazilian expertise has gained momentum and attracted the desires of many African countries. Successes in agriculture arenot enough to reduce poverty. Thus, public policies that promote economic growth and social inclusion are at the heart of Brazil’s sugarcane production— for example, local and family-based farms have been helped to produce energy (ethanol). The Brazilian private sector is also involved with energy issues in Africa. A good example is BIOCOM, a joint venture between the Brazilian firm Odebrecht, the Angolan state company Sonangol, and the Angolan firm Demer. An investment of US$400 million aims at using sugarcane to produce sugar, ethanol, and power. About the time of the first oil shock in 1973, Brazil was dependent on imports for about 80 percent of its oil needs. But investments in both oil and biofuel production41allowed Brazil to declare oil self-sufficiency in 2006. At the end of 2007, Brazil announced the discovery of large oil reserves in the pre-salt layer along the coast, 43 which guaranteed that its natural resources would be more than enough to fulfill domestic needs. Brazil has thus been able to revise its international energy strategy to that of an oil exporter, achieving an average production of 2 million barrels per day in 2009(Petrobras 2009). The rapid growth of global energy consumption, the limited availability of fossil sources, and the geopolitical risks of oil dependence, together with social and environmental concerns, provided a major incentive for Brazil to deepen its search for alternative sources of energy. Biofuels have proven to be of major relevance because they cause less damage to the environment and offer new markets for farmers (New York Times 2011; MME 2011). In fact, only in the past decade, the global production of biofuel increased from 16 billion liters (in 2000)to more than 100 billion (in 2010) (IEA 2011), mainly led by the two largest biofuel producers: the United States42and Brazil43(World Bank 2008; EIA, 2009). 41 42 To reduce oil consumption. 46% of the world’s share. 41 Sugarcane and soybeans are at the heart of the Brazilian biofuel industry, for the production of ethanol and biodiesel, respectively. Favorable geological and climatic conditions, with targeted public policies, have helped Brazil to become the largest sugarcane producer in the world (FAO 2009). The original sugarcane plants were fragile and not all the soil in the country was suitable, but the plants have since been genetically modified by EMBRAPA and the Centro Tecnológico de Piracicaba to be more amenable to cultivation and biofuelproduction. Until the 1990s, the prevailing argument was that poverty reduction would be a consequence of trade liberalization, the growth of agribusinesses, and the decline of agricultural employment rates (World Bank 2008: 38). But success in agriculture was not enough to reduce poverty. From the mid-1990s to the mid-2000s, social policies such as Bolsa Escola (under Fernando Henrique Cardoso’s administration) as well as the Zero Hunger and Bolsa Família (under Lula’s administration) empowered and engaged small producers, stimulating not only economic growth but also social inclusion. It was also recognized thatsugarcane has a peculiar characteristic that helps involve local farmers: it is not easy to export, unlike crops such as soybeans, and so local use and processing were recommended, as without an industry at the community or local level, production was likely to be lost. This fact, together with advancements in biotechnology, justified public policies to strengthen the productivity of family-based agriculture to produce energy. This is one area where Sub-Saharan Africa can eventually benefit from Brazil’s experience. Brazil is the world’s . . . most efficient producer of biofuels, based on its low-cost production of sugarcane. But few other developing countries are likely to be efficient producers with current technologies. . . . Increased public and private investment in research is important to 43 42% of the world’s share. 42 develop more efficient and sustainable production processes based on food stocks other than food staples (World Bank 2008: 17.) Soybean production is a different story. When the world trade of the crop doubled from 1994 to 2004, Argentina and Brazil were the countries that most convenientlyresponded to the new opportunity (World Bank 2008: 62). As of 2011 Brazil is still the second-largest producer of soybeans in the world (FAO 2009). Environmental issues, however, are of concern because deforestation has increased the need for open land to cultivate soybeans (World Bank 2008). There is criticism involving the production of biofuel and the competition for land needed for food production. But the Brazilian government argues that bioenergy has a significant role to play in Brazil and in a continent such as Africa, where many countries depend on imports for food and energy. In this sense, the Brazilian model is adaptable to some African countries, especially those with abundant land near the tropics. Several agreements on energy have been signed by government and private investors (RTS 2008), and joint projects are under way in Sudan and Zimbabwe, where Brazilian ethanol plants have been installed. New plants will also be set up in Angola and Ghana (Itamaraty2011b: 37). A few energy initiatives between Brazil and Sub-Saharan countries stand out like the exchange of oil and gas, the need from electrical plants or hydropower and nuclear plants in Africa. In 2007 the Brazilian government signed a memorandum of understanding on issues related to biofuels with the West African Economic and Monetary Union (Portugal Digital 2011). This memorandum called for feasibility studies to analyze bioenergy production in the countries in this grouping. A study from Senegal (which is facing an energy crisis), finished in early 2011, aimed to decrease the country’s dependence on one single source of energy, and research verified the feasibility not only of sugarcane-based biofuels, but also of fuels based on peanut bark as well as solar and wind. In 2011, EMBRAPA and ABC presented their initial proposals to the government of Senegal; a final decision is awaited. 43 Brazil could also share its experiences in power crisis management, power sector reform, and large power-systems. Other more efficient approaches to rural electrification and energysaving schemes could be jointly developed for areas in Brazil with similar conditions as those in some areas of Sub-Saharan Africa. Petrobras, the Brazilian state-owned oil company, is the eighth-largest publicly traded company in the world, according to Forbes (Petrobras 2011a). It has activities in 28 countries, including Angola, Benin, Gabon, Nigeria, Namibia, Senegal, and Tanzania. In Africa’s west coast, for example, Petrobras’ main goal is to find light oil, reflecting the company’s strategy to seek opportunities in deep and ultra-deep waters in the region (Petrobras 2011b). The company has also invested in biofuels since at least the 1970s, when it started to marketethanol in its service stations in Brazil. It has recently started biodiesel production, as the company’s strategy is to develop technologies that ensure global leadership in that area.48 Cooperation on biofuels started with Angola and Mozambique, and is an area in which other African nations could benefit. The Brazilian private sector has also started to work on energy issues through joint ventures in other Southern countries, including Africa. A goodexample is BIOCOM (Companhia de Bioenergia de Angola), a joint venture between the Brazilian firm Odebrecht, the Angolan state enterprise Sonongol, and the Angolan firm Demer. An investment of US$400 million aims at using sugarcane to produce sugar, ethanol, and power. The impact on the Angolan economy is expected to be large, both because the country imports 80 million tonnes of sugar a year and because the project is already producing 565 megawatts (MW) of energy. The plant was built by Odebrecht with funding from the National Economic and Social Development Bank (Banco Nacional de Desenvolvimento Econômico e Social or BNDES). Another area of energy in which Brazil has advanced knowledge that is highly relevant to Africa is charcoal. Sub-Saharan Africa produces and consumes about 25 million tons of 44 charcoal annually (more than any other region in the world), while Brazil produces and consumes about 9 million tonsannually (more than any other country in the world) (FAO 2009). Although in Africa charcoal is primarily used for cooking in urban households, in Brazil nearly all of it is used for pig-iron and ferroalloy production. But despite that, Brazil’s charcoal lessons may still be valuable to Africa. Over the past 40 years the Brazilian charcoal industry has been developing ways to produce charcoal efficiently and sustainably. For instance, efforts by private companies and public universities have increased the productivity and quality (tree density) of dedicated fuel wood plantations, reducing the dependence on natural forests for charcoal. The estimated annual demand for charcoal in Sub-Saharan Africa will double from 25 million tons in 2009 to nearly 50 million tons by 2030 due to the region’s fast-growing population and urbanization rates, persistent poverty, and price volatility of fossil-based cooking fuels. But African charcoal production is still mainly based on traditional, inefficient, and unsustainable methods, and contributes to deforestation. Cooperation with Brazil on charcoal technology could therefore greatly enhance Africa’s capacity to produce charcoal more efficiently and sustainably. Such modernizationcould transform Africa’s inefficient charcoal sector into a strategic development sector that would see reforestation, higher charcoal productivity, and even cogenerated electricity. Social protection Despite the huge challenges faced by policy makers in a country known for having one of the largest income-inequality gaps in Latin America, a few programs offer social protection. Since 2003, policies aimed at fighting hunger and marginalization have been implemented, one of the most successful being the Zero Hunger initiative, which includes several programs44sponsored through a strong partnership among 12 ministries and agencies. The 44 Like the Bolsa Familia 45 Brazilian experience in social protectionis now being adapted and replicated in other developing countries, including Angola, Kenya, and Senegal, with activities to build conditions for more inclusive growth. Since most projects between Brazil and African countries began fewer than 10 years ago, proper evaluation of the outcomes still falls short. Initial results have, however, often been positive, highlighting the potential for more sustained and longer term engagement. Brazilian policy makers seem to understand that while economic growth may solve some issues related to poverty, it will not necessarily reduce inequality. The 1988 Constitution states that ‘social protection’ is a right. Despite the huge challenges faced by policy makers in a country having one of the largest income-inequality gaps in Latin America, a few programs have been launched to promote social protection rights, especially in the mid-2000s. From 2003, policies aimed at fighting hunger and marginalization were carried out, one of the most successful the Zero Hunger Program. Launched in 2003, it includes several programs sponsored through a strong partnership among 12 ministries and agencies coordinated by the Ministry of Social Development and Fight against Hunger (Ministério de Desenvolvimento Social e Combate à Fome or MDS). The most comprehensive and best-known program under Zero Hunger is Bolsa Família, a conditional cash-transfer program created as an institutionalumbrella for several existing social projects. Bolsa Família follows three basic guidelines: to provide its beneficiaries with immediate relief from poverty through direct cash transfers; to help families overcome the intergenerational cycle of poverty with conditions that involve children and youth in each family that benefits; and to boost families’ progress and development through complementary social projects related to issues such as adult literacy and income generation (MDS 2009). Bolsa Família’s purview is intersectoral, covering education, health, and prevention of child labor. Another characteristic is its decentralization and shared management across agencies 46 and levels of government. Each participating ministry oversees social assistance, health, and education at the state and municipal levels, monitoring conditions in its own fields of expertise. As of 2011, Bolsa Família has registered 19 million families across the country.45 The experience of Zero Hunger and other Brazilian social projects is beingadapted and replicated in other developing countries. The MDS, since its creation in 2004, has had institutional contacts with more than 60 countries, including Angola, Kenya, and Senegal, to build conditions for more inclusive growth. In Angola in 2009, the government turned its focus to protecting and promoting the rights of vulnerable people, fighting poverty and hunger, and reducing regional disparities. In Senegal in 2005, joint projects were started in, for example, food and nutrition security, family-based agriculture, biodiesel, hydropower resources, and the quality of agricultural products. In Kenya, a program was expected to launch in 2011. These similarities in the history, soil and geography lead Brazil to enter the African continent by various touch points, in this case, the touch points are countries which offer Brazil more ease to enter the African market. To make it more explicit to the readers, the paragraphs below will focus on the amount of cash traded through the sectors unveiled in the part focusing on the main points of entry according to the following data: the Foreign Direct Investment or FDImade by Brazilian corporations and Small and Medium Enterprises (SMEs) to Africa, exports and imports between Brazil and Africa. First of all, an explanation about the acronym FDI is needed to orientate the study axis that is going to be unfolding in the following lines. A FDI is when a country or an investing company makes its overseas investment either by creating a subsidiary or associate company in the foreign country, by acquiring shares of an overseas company, or through a merger or joint venture. The accepted threshold for a foreign direct investmentis 10%. In other words, 45 See Annex 9. 47 the foreign investor must own at least 10% or more of the voting stock or ordinary shares of the investee company46. Although the Brazilian government has been prioritizing FDI in Africa47, Africa has not been a major destination for foreign investment from private Brazilian firms over the past decade. Brazilian FDI in Sub-Saharan Africa amounted to only $281 million in 2001 and $124 million in 2009. It is possible that some funds get to Africa through a “triangular diversion” via countries such as the Bahamas and the Cayman Islands, but the data cannot confirm this. Some African countries were named in central bank data in 2001–06. But during 2007–09, few African countries were—most were, instead, relegated to the “other” category. But two of the countries in this category—South Africa and Angola—host the largest concentration of Brazilian FDI in Africa48. According to the UNCTAD Global Investment Trends Monitor (January 2011), although global flows were largely stagnant in 2010, developing countries’ markets allowedforeign investors to increase their profits. FDI inflows to Africa peaked in 2008, alongside a commodities boom, before falling by 14 percent in 2010. The expectation is that as more Brazilian companies do business with Africa, some of them will relocate to the continent, and Brazilian FDI in Africa will become more relevant in the medium and long term. Brazilian corporations 46 http://www.investopedia.com/terms/f/fdi.asp. It increased from about US$69 billion in 2001 to US$214 billion in 2009. 48 Angola was the larger, especially in energy, mining, and infrastructure, given the presence of Petrobras and Vale as well as the construction companies Andrade Gutierrez, Camargo Correa, Odebrecht, and Queiroz Galvão. 47 48 Brazilian private investment in Africa began in the 1980s, and early investorsare the Brazilian corporations with a presence in Africa. Although they are found across the continent, their activity is concentrated in infrastructure, energy, and mining in Sub-Saharan Africa49. These traditional players— the leading Brazilian companies in Africa by investment and sales—are Andrade Gutierrez, Camargo Correa, Odebrecht, Petrobras, Queiroz Galvão, and Vale. Marcopolo also deserves to be mentioned for its approach. The Brazilian presence in Africa stands out because of the way Brazilian corporations do business (Reuters 2011). Their business models tend to hire locals for their projects and develop local capacity, which improve the quality of services and outputs. Brazilian businesspeople from Odebrecht in Angola, for example, confirmed that strategic positions are not only held by Brazilians, but also by locals. The number of Africans hired in Brazilian firms is so high that Odebrecht has become the largest private employer in Angola. Odebrecht is the Brazilian construction company with the largest number of projects in Africa, with a presence in South Africa, Angola, Botswana, the Democratic Republic of Congo, Djibouti, Gabon, Liberia, Libya, and Mozambique. It has partnered with governments and other foreign companies aswell as established consortiums with other Brazilian contractors in Africa. Its diversified activities include projects related to oil and gas exploration, infrastructure, construction of residential condominiums, urban planning, diamond mines, and food distribution. One of its first projects was in Angola, with the 1984 construction of a dam in Capanda, Malange. Since then, the company has undertaken business activities in many countries in the region, including building the Letsibogo dam in Botswana, drilling for oil in the Democratic Republic of Congo, providing oil-well services in Gabon, constructing container and fuel terminals in Djibouti, and constructing a coal mine at Moatize, Mozambique50, including settlements for families forced to move by the new mine. 49 See Annex 10. With Vale. 50 49 Andrade Gutierrez is active largely in construction in Angola, Algeria, Cameroon, the Democratic Republic of Congo, Guinea, Equatorial Guinea, Libya, Mali, Mauritania, and Mozambique. It has been doing business in Africa since 1984, building roads and housing as well as being involved in urban planning. After the construction company Camargo Correa opened offices in Angola in 2006, it was hired as the contractor for many projects. Many of them entailed urban planning and building housing, roads, and power lines. One of the company’s largest projects involved a consortium of foreign and local companies for producing cement. In Mozambique it is involved in constructing the MphandaNkuwa hydroelectric project on the River Zambezi. It is also part of a consortium—headed by Odebrecht—building a coal mine at Moatize, Mozambique. Recently, it was announced that the company would undertake road and drainage infrastructure work in Angola with a credit line from the BNDES. The construction company Queiroz Galvão is engaged in civil construction work in Angola and Libya. It has undertaken projects related mainly to building and rehabilitating roads. Vale has been active in African mining since 2004. The company has officesin Angola, the Democratic Republic of Congo, Gabon, Guinea-Bissau, Mozambique, and South Africa. It announced in October 2010 that it would be investing US$15 billion–US$20 billion in projects in Africa over the following five years, with more than US$2.5 billion already invested (Reuters Africa 2010). The company has acquired mining companies in South Africa and the Democratic Republic of Congo, particularly in copper and cobalt mining (Época Negócios 2008). In Mozambique, Vale has officially begun metallurgical and thermal coalmining activities at Moatize (Verdade 2011). The company has pledged to invest another US$4 billion beyond the US$2 billion it has invested since its purchase of a coal-mining operation in 2004 (Katerere 2011). 50 In Angola, Vale focuses on identifying suitable areas for copper and nickel mining. Through the corporation GeVale Indústria Mineira Ltda and a consortium involving Vale and the Angolan group Genius, the company is active in the Moxico Province that borders Zambia, mining one of the world’s largest copper veins, which, with Katanga in the Democratic Republic of Congo, forms the copper belt. In Guinea (Conakry), Vale has purchased 51 percent of BSG Resources (Guinea) Ltd., which holds iron ore concessions in the country (Reuters Africa 2010). Since April 2008, Petrobras has taken a more assertive posture than in the past. Its activities focus on prospecting for and extracting oil, especially in deep and ultra-deep waters, with operations in Angola, Libya, Nigeria, and Tanzania. The company recently acquired a 50 percent stake in a 7,400 square kilometer block off the Benin coast to search for light crude (Petrobras 2011a). InNamibia, it has acquired a 50 percent stake in a block for exploration in deepand ultra-deep waters (Petrobras 2011b). SMEs in Africa In the context of Africa’s favorable business environment, the Agency for the Promotion of Exports and Investments (APEX) has been fosteringBrazilian SMEs in Africa through various fairs, alongside Brazilian firms51. “Brazil Trade Africa” was an event, held in April 2010 in São Paulo; over 70 Brazilian companies met with entrepreneurs from Africancountries and closed deals amounting to about US$25 million. According toTendências e Mercados 2010, these were in sectors such as food and beverages, clothing and footwear, automotive parts, electronics, housing and construction, and cosmetics. The highest number of Brazilian SMEs is in Angola, where APEX opened a business center in 2010; operations began in January 2011. Since 2009 Angola and Brazil have formalized 51 See Annex 11. 51 their intent to internationalize SMEs through the Angolan National Agency for Private Investment (Agência Nacional para o Investimento Privado or ANIP) and the Brazilian Agency for Industrial Development (Agência Brasileira de Desenvolvimento Industrial or ABDI). Some Brazilian SMEs are already in Africa (table 5.4), and others are interested in working there. With the aim of studying and supporting the development of micro andsmall enterprises, the Tri-Nations Summit Meeting, which brings together South Africa, Brazil, and India, was initiated in 2006 under the IBSA Dialogue Forum. Managers and technicians from the Brazilian Service to Support Micro and Small Enterprises (Serviço Brasileiro de Apoio às Micro e Pequenas Empresas or SEBRAE), the Small Enterprise Development Agency (SEDA) of South Africa, and the National Small Industries Corporation of India have encouraged the Incubation Crusade Program to identify incubators and technology parks that can house entrepreneurs and companies from Brazil, India, and South Africa. This initiative aims to help in internationalizing these companies and their services. APEX signed a cooperation agreement in 2011 with the Angolan National Purchasing Office (Central de Compras de Angola or CENCO), which is responsiblefor the Program for Restructuring the System for Logistics and the Distribution of Essential Goods to the Population (Programa de Reestruturação do Sistema de Logística e de Distribuição de Bens Essenciais à População or PRESILD). This is a public initiative by the Angolan government to bring basic consumer items to the population and to stabilize supply chains. Brazil, through its SMEs, is in an advantageous position in this promising consumer market. A key strategy of the Secretary for Foreign Trade in MDIC is to assist the entry of Brazilian companies into the Angolan market and to foster partnerships with Angolan (and other African) companies. TRADE BETWEEN BRAZIL AND AFRICA 52 Over the past 10 years, the need for market diversification and the favorable international economic environment has reintegrated Africa with its Braziliantrade partners. In 2000, all 53 countries52 on the African continent represented 3.83 percent of Brazilian trade with the world, of which 1.85 percent was with the 47 countries of Sub-Saharan Africa. At that time, Brazil’s main trade partners were the European Union (29.95 percent) followed by the United States (23.81 percent), South America (19.93 percent), and Asia (16.21 percent). China accounted for 2.08 percent, a share greater than for Sub-Saharan Africa. Ten years later, the scenario had changed somewhat. Diversification can be seen in the data for traditional partners such as Europe (down to 25.46 percent), South America (down to 15.74 percent), and the United States (down to 12.18 percent) and for emerging markets such as China (up to 14.70 percent) and Africa (up to 5.32 percent), of which 3.18 percent was accounted for by Sub-Saharan Africa. Despite the growth of trade between Brazil and the world, which went from nearly US$111 billion in 2000 to about US$383 billion in 2010, trade betweenBrazil and Africa has not yet reached 10 percent of that amount: the largest share was 7.08 percent in 2007 (the largest share for Sub-Saharan Africa was also in 2007, at 4.67 percent). In quantitative terms, total trade between Africa and Brazil set a record in 2008, with US$26 billion, of which US$17 billion was for Sub-Saharan Africa (table 5.1). In 2000, the region accounted for 48.31 percent of this trade, having reached 65.96 percent in 2007. From 2008 (65.12 percent) to 2010 (59.74 percent), the share decreased because of political disturbances in countries in North Africa. Africa’s share of bilateral trade with Brazil during the past decade nearly doubled between 2000 and 2009. Even so, there is plenty of room for enhancing this relationship. In 2002, Africa accounted for 4.68 percent of Brazil’s trade with the world. In the first year of 52 South Sudan is not included. 53 President Lula da Silva’s newadministration (2003), growth rose to 5.06 percent. The year 2007 was the best in relative terms, at 7.08 percent, while in absolute terms 2008 was best, with trade of nearly US$26 billion. The African share of Brazil’s trade declined between 2008 and 2010 (6.98 percent to 5.32 percent), stemming from a fall in commodity prices53. Although there was some decline in levels in 2009(to US$17 billion), due to the international financial crisis and the fall in commodityprices, a turnaround took place in 2010 (to US$20 billion). Exports Africa received only 2.44 percent of Brazilian exports in 2000. By 2010, this sharehad almost doubled to 4.54 percent. In percentage terms, the highest share wasreached in 2009, at 5.68 percent, which shows that Africa had become a viablealternative for Brazilian investors, promoting market diversification. Exports increased in the period from 2000 (US$1.3 billion) to 2008 (US$10.1 billion), with a slight decline in 2009 (US$8.6 billion) and a return to growth in 2010 (US$9.1 billion). The decrease in 2009 can be explained by the same factors that caused a simultaneous fall in imports. There was also the consolidation of a greater Chinese presence in Africa, including operations that competed against the Brazilians in several sectors such as infrastructure, mining, and energy. Brazilian exports to Africa between 2000 and 2010 consisted primarily of resource-intensive manufactured goods, technological products, and primary products. Primary goods showed continuous growth of 10 percent over this period, and accounted for almost 30 percent of Brazilian exports to Africa. The share of primary products in Sub-Saharan Africa more than doubled, in relative terms, from almost 10 percent in 2000 to 20 percent in 2010. 53 Growth was seen from 2000 to 2008. 54 The Sub-Saharan countries were accountable for most of Brazil’s exports tothe continent during the past decade. Thus, exports may have been leveraged bySub-Saharan Africa, which, in 2007, had its largest share of exports from Brazil,at 3.7 percent. Since then, the region has begun to lose ground to countries in North Africa. Even within Sub-Saharan Africa, Brazilian exports were concentrated in just five countries, which accounted for 51.36 percent of the total volume for the period of 2000–10; South Africa alone accounted for 18.93 percent.54The main exports were sugar and honey, rice, meat, vegetable oils, refined oil, and vehicles and automotive parts. Imports Africa’s economic growth of the past two decades has spawned an emergingmiddle class with growing demands for products and services. In countries suchas Angola, where the middle class represents 38.1 percent of the population,the depiction and dissemination of the Brazilian way of life (jeitinho brasileiro)through Brazilian soap operas (novelas) has influenced people’s choices (AfDB2011). Flights from Luanda to Rio de Janeiro or São Paulo are booked months in advance, as Angolan tourists visit Brazil and are eager to buy Braziliangoods.55 Africa provided 5.21 percent (US$2.9 billion worth) of Brazilian imports in 2000, which grew to 9.84 percent (US$6.1 billion) in 2004 and 9.10 percent (US$15.7 billion) in 2008—an over fourfold increase. There was a further upward trend in the last two years of the decade (figure 5.7). Sub-Saharan Africa, for its part, accounted for 2.18 percent (US$1.2 billion) of Brazilian imports in 2000. There was continuous growth after 2000, and in 2004 the figure reached 6.08 percent (US$3.8 billion). The fall in 2005 to 4.21 percent (US$3.1 billion) was quickly 54 55 The remaining four countries are Nigeria (15.05%), Angola (12.53%), Ghana (3.26%) and Senegal (1.58%). Interview with the former Angolan Minister of Economic Cooperation, August 2010. 55 readjusted, and in 2006 the figure roseto 5.78 percent, though there was a further period of decline from 2008 (5.72 percent) until 2010 (4.03 percent). Brazilian imports from Africa during the period consisted mainly of primary products, which in 2000 made up 40 percent of the total, rising to about 70 percent in 2010. The share of lowand medium-technology products was lower, together not exceeding 10 percent of imports throughout the entire period. The top five sources in Sub-Saharan Africa provided 59.53 percent of imports. Nigeria alone accounted for 46.81 percent—its main products beingcrude and refined oil as well as natural and manufactured gas.56 Imports fromSub-Saharan Africa followed the same pattern as for the rest of the continent. Sub-Saharan Africa also managed to increase its share of Brazilian imports, especially in 2004, when it almost tripled the share compared with 2000. Given that Brazil’s imports from the whole of Africa (as well as from other regions) declined over that period, this increase is noteworthy. Brazil is still facing constraints to trade and investment in Africa. In the 2010 discussions on the next Productive Development Policy (PDP) (2011–14), it was noted that Africa had an important role to play in Brazilian growth. Cultural and historical links, as well as Brazil’s technical and institutional expertise, were recognized. But constraints were also identified, including the inexperience of Brazilian companies abroad, lack of knowledge of the realities of Africa, limited credit, lack of good infrastructure for moving people and goods in Brazil and in Africa, as well as corruption and poor legal frameworks in many African countries. Several officials, both Brazilian and African, pointed out that communication channels and transportation for people and products are key hurdles. In addition, some African countries are 56 The remaining four countries are Angola (5.65 percent), South Africa (5.53 percent), Congo (0.96 percent) and Ivory Coast (0.57 percent). 56 still classified as fragile and others are in a transitional phase, and Brazilian firms would require sizable investment to train thelocal workforce and develop human capital. Brazil and Africa need to work together so as to improve funding for African business missions to Brazil, implement strategic approaches to attract Brazilian investors to Africa, and increase African nations’ knowledge of Brazil. A more targeted approach at the state level in Brazil is also required. The development of a Brazilian strategy for Africa would be an important contribution and complement to Brazilian foreign policy efforts. Such a strategy would not be complete if it did not raise awareness of relevant issues among local stakeholders in the nations involved. In this first chapter, it is noticeable that Africa and Brazil are holding a cultural relationship based on a common history and treatment from the historical colonial powers but also a trade relationship with imports and exports from both areas. Brazil tends to import primary resources (oil, mineral…) and Africa tends to import capital-intensive products, technological products (medium or high technology). Compared to the relations with the Western countries, it seems that this relationship is on an equal level due to the cultural similarities, however, it appears that Africa sometimes appears to be like the “chasse gardée” of Brazil and of some BRICS in general now that the Western hemisphere is losing ground. 57 II. The Brazilian hidden agenda This second chapter will put in perspective the contrast between numerical data and wellconceived speeches and the reality on the field. Nevertheless, one cannot be too impartial about the fact that the data shows disparities of resources between Africa and Brazil. It should be totally agreed on and understandable that no blames is put on Brazil for their hidden agenda: the core of the matter is that any country having an international agenda has to have a hidden agenda to put and preserve their interests forward. The best evidence of this affirmation is the United States of America, which recently had to face massive accusations from Paris, Berlin and Mexico for having spied on their nationals and more astonishingly, on their main officials. The outline in the second part will firstly focus on Brazil’s increase of worldwide influence thanks to the efforts led on the African continent and, secondly, on the ‘trade war’ between Brazil, China, India and South Africa to gain and obtain the most markets and resources in Africa. The objective here will be to put forward how big the Brazilian hidden agenda is and to explicit and analyze the fields in which it is fighting against China, India and South Africa. II.1) Expanding its international influence thanks to Africa… Brazil’s engagement in Africa goes beyondthe economic realm. Its profile in Africa has been significantlyshaped by its commitment to Africa’s developmentchallenges. Building on its own successful development experiences, Brazil has pledged to assist African partner countries in their efforts to fight hunger and poverty, provide healthcare and attain energy security. By transferring its experience and technical know-how in the implementation of 58 social promotion programs, Brazil has presented itself as a partner for the continent’s social and economic development and has tried to gather support for its pursuit of a seat at the United Nations (UN)Security Council. While Brazil’s strategy of South–South cooperation has contributed to its growing economic foothold in Africa and has been used as a trump card in the competition with China, the benefit of Brazil’s Africa policy goes far beyond pure economic profit. By providing technical assistance, Brazil has raised its profile as a leading power of the South and ‘champion of development nations’.57By underpinning its quest for a ‘new multilateralism of the South’ with cooperation projects in Africa, Brazil has gained credibility among developing nations and an international voice as a speaker on their behalf. Forging ties with African countries through the provisionof development assistance has enhanced Brazil’s bargaining power and international status.Brazil has enjoyed its Africa engagement in an indirect way. By engaging in a foreign continent and offering development assistance, the country has achieved an impressive role change. Associated until recently with a broad range of economic and social challenges itself, it has transformed itself into a model for successful development. Through its Africa engagement, Brazil has discarded its status as an aid-receiving developing country and joined the prestigious club of donor countries. Furthermore, by offering technical assistance to African countries, it can demonstrate its willingness and ability to make a contribution to the solution of global problems. By embracing key global issues such as poverty, health and energy and exercising leadership on these development and security challenges of the 21st century, Brazil has become increasingly recognized at the top tables of decision-making in international relations.58 57 Peter Dauvergne and Déborah Farias (2012), ‘The Rise of Brazil as a Global Development Power’, Third World Quarterly, Vol. 33, No. 5, pp. 903–17. 58 Kelley Lee and Eduardo J. Gómez (2012), ‘Brazil’s Ascendance: The Soft Power Role of Global Health Diplomacy’, European Business Review, http://www.europeanbusinessreview.com/?p=3400 (last accessed October 24th, 2012); Council on Foreign Relations Task Force Report (2012), Global Brazil and U.S.–Brazil Relations (New York: CFR). 59 Consistent with the broader South–Southframework and the country’s own approach, Brazil’s position is more of a partner than a donor. Even as it graduates from being an aid recipient to take on a more active funding role in multilateral institutions such as the World Bank and the International Monetary Fund, the country is reluctant to provide direct financial aid to African countries, preferring technical assistance,cooperation projects, training, guarantees, and other instruments to support the countries in question as well as Brazilian private and public partners. Brazil also favors expanding multilateral efforts led by developing countries, such as the ASA Summit and the inclusion of South Africa in the BRICS group. Reflecting Brazil’s own domestic growth model, which mixes a dynamic private sector with targeted support by BNDES and other government agencies and institutions, the country’s recently intensified engagement with Africa demonstrates both geopolitical ambition and economic interest. Brazil’s private sector—engaged in Africa since the 1980s—has relied heavily on government support for its African exposure, particularly in construction, where Brazilian companies have generally built publicly financed infrastructure projects. Trade and investment missions highlight both the newfound importance of Africa and the close relationship between the public and private sectors, with Brazilian debt relief to the continent exceeding US$1 billion. Another unique aspect of Brazil’s role is that it has also fostered triangular (North–South–South) relations, which involve both Africa and developed countries. One example is the Community of Portuguese Language Countries. The statistics on Brazil’s investment and trade in Africa speak for themselves. For example, Brazil’s trade with Sub-Saharan Africa rose from US$2 billion in 2000 to US$12 billion in 2010. Investment and trade have become more diversified by geography and sector. Ten years ago, the main focus was Portuguese-speaking Africa, especially Angola; now trade and investment partners include countries as diverse as Guinea, Namibia, South Africa, and 60 Sudan, though the strongest relationships are still with the Portuguese-speaking nations. While 10 years ago, investment was driven primarily by Brazilian construction companies, it now reaches mining, agribusiness, manufacturing, and aircraft industries. The geopolitical dimension of the Brazil–Africa relationship is also important.Stronger economic and political ties have already led to some important victories for Brazil on the world stage. These include its position as future host of the Olympics and World Cup and the election of a Brazilian (José Graziano da Silva) as director-general of the Food and Agriculture Organization of the United Nations on June 26th, 2011 and the recent election of Roberto Carvalho de Azevêdo as director-general of the World Trade Organizationin May 14th, 201359. In all four cases, it appears that an overwhelming number of African countries voted in Brazil’s favor. Brazil also put some emphasis in its relationships with African nations in forums such as the World Trade Organization and the UN, its goal being to obtain a permanent seat on the UN Security Council. Now that it has been made crystal clear how Brazil’s international influence is growing thanks to Africa, the topic can be switched to Brazil’s fellow competitors in Africa to earn such a global influence. II.2)… whilst competing with three other BRICS on the continent (China, India and South Africa) Brazil is engaged in a complicated and multifaceted relationship with otherBRICS nations, especially China. Though China has become Brazil’s largest trading partner—in buying natural resources and selling manufactured goods—there is a strong sense that Africa is a “battleground,” where Brazilianconstruction and mining companies compete with their 59 World Trade Organization, ‘ WTO Director-General selection process’ (http://www.wto.org/english/thewto_e/dg_e/dg_selection_process_e.htm) 61 Chinese counterparts for markets and resources.60 On one of his last trips to Africa as president, President Lula da Silva made this clear by speaking of China as a rival on the continent and showing pride in Brazil’s comparative advantages as a partner.61 During the last decade, China’s activities in Africa havefurther drawn international attention to the continent’s natural resource potential and have led to competition for what is today considered the world’s last resource frontier. Brazilian companies have joined in this new ‘scramble for Africa’ and have stepped up their activities, using their pre-existing presence in some African countries to extend their engagement and influence. Companies such as Petrobras (oil sector) andVale (mining) are actively competing with Chinese companies for exploration rights in Africa. Brazil may lack thefinancial resources to support its companies in Africa as China does it, but, it sees this as a comparative disadvantage, it can claim a cultural advantage. Although the Brazilian government has made a great effort to provide Brazilian companies with financial and political support in their competition for markets and influence in Africa, it sees ‘cultural affinity’ as the real trump card against more powerful Chinese state-backed companies.62 Brazilian businessmen and government officials aliketherefore stress their common cultural roots with Africa and maintain that, unlike China, they enjoy a commonbusiness culture. The fact that the majority of Brazil’s population is of Afro-Brazilian origin (it has the world’s 60 In July 2011, for example, Vale was competing against Jinchuan, both companies have made offers to buy Metorex, a South African-based copper and cobalt transforming and selling company with various entities present in the Democratic Republic of Congo (www.dci.com.br/Vale-deve-ficar-fora-de-leilao-pela-companhiaafricana-Metorex-1-380539.html). Last access: October 24th, 2013. 61 In Tanzania, President Lula was quoted saying that Brazil’s products are of better quality and that Brazil, unlike China, employs local labor forces. Here is the part of Lula’s speech in Portuguese in which he blames China’s business behavior: “Nada contra os meus amigos chineses. Pelo contrário [a China], é um grande parceiro nosso e queremos manter nossa parceria estratégica. Mas a verdade é que, às vezes, eles ganham uma mina e trazem todos os chineses para trabalhar naquela mina. E fica sem gerar oportunidade para os trabalhadores do país” 62 David Lewis (2011), ‘In Africa, Can Brazil be the Anti-China?’, Reuters Special Report. 23 February 2011. 62 largest black population after Nigeria) serves as a popularillustration of these cultural similarities. Stressing the benefits of their country’s engagement inAfrica, Brazilian officials therefore frequently refer to the employment and training that Brazilian firms provide for the local workforce. In Angola, Odebrecht is, as noted, already the biggest employer and Brazil maintains that its approach towards Africa is generally focused on generating development and benefiting the local population. President Dilma Rousseff therefore has pledged that Brazilian companies willing to invest in Africa will leave a legacy to the local population by transferring technology, providing vocational training and offering social programs.63 Like her predecessor, she is convinced that the Brazilian approach is ensuring benefits on both sides compared to China’s. As the two main BRICS are coming from Asia, a crossed analysis will be made so that each point of comparison will appear between Brazil, China and India. China and India have approached Africa with an open mind and astrong business focus, which has been welcomed on the continent. China and India can both look back upon long political and economic relationships with Africa. New, however, is the notion of building a ‘partnership’, which is mainly motivated by the importance of energy security for the two Asian countries. Although often summarized in terms of ‘Asia’s’ approach towards Africa, both countries in reality have very different strategies. China’s engagement in Africa is dominated by stateowned enterprises and an often aggressive market-entry strategy. India’s engagement is mainly driven by private businesses and has by comparison been more modest so far. Nevertheless, recent years have featured strong and more coordinated activities from Indialeading some experts to suggest that the Indian approach will turn out to bemore 63 Valor Econômico, ‘Dilma revê estratégia para a África’, 8 November 2011. 63 successful in the future than that of its Chinese counterpart. Both China and India face challenges to their investments in Africa, just as the West does, such as low governmental standards, low local labor capacity and security issues. Nevertheless, both Asian players seem certain in their objectives in Africa. It is important that African countries learn to strengthen and negotiate their own positions. Only then will Africa have the chance to integrate itself into the global market in a non-discriminatory way. It is too early to jump to conclusions about how these asymmetric relationships between China, India and Africa will develop in the future. China’s and India’s investment strategies in Africa’s energy sector date backto the late 1990s, but have now come to a critical point. Oil supply from traditional Arabic suppliershas been threatened by political turmoil in the region. At the same time, China and India have respectively become the second and fifth largest oil importers in the world. While this can create new opportunities for Africa, the critical question remains whether and how Africa can benefit from this new interest and competition, which is not only betweenChina and India but also between these new players and the Western countries. There are a number of questions that need to be addressed: Will India and China learn from Western experiences? Will they cooperate or compete in the oil sector? Will the Asian countries’ energy investments be ‘clean’? Will the investment go beyond crude oil? What kind of policy space will be created in Africa as a result of this new investment? What will really be the benefits for the African continent? Even if most African countries officially control their oil industries, progress in technology in the oil sector provides investors with a distinct advantage. Matters of energy security have made oil an issue of global power and put Africa back into the focus of business activities. However, the important question to address is what effect this foreign interest will have on Africancountries. 64 Despite the current focus on the two Asian countries, the West remains themajor player in most African countries. It remains to be seen whether the Chinese state-capitalist model will have positive impacts on Africa. China’s economic success in the last decades is based on its liberalization in the 1990s following a rather ‘Western’ approach. Climate change is an important topic that has been neglected so far in the discussion when talking about the relationships of China, India and Africa. The Climate Summit in Copenhagen in December 2009 was the stage for an alliance between developing countries and China in the G77 group. There is a strong incentive for the three sides (China, India and African nations) to work together as all of them will be among the countries most vulnerable to the consequences of climate change in the future. When China held the first Forum on China-AfricaCooperation in 2006, it became the largest diplomatic summit ever held in China, attended by 35 African heads of state. Former President Hu Jintao presented it as the beginning of a new strategic partnership between China and Africa and set out Chinese investment goals and other forms of cooperation such as scholarships. At the end of the summit, 14 agreements were made featuring Chinese investment projects and concessionary loans to Africa. In contrast, The Africa-India Forum Summit in 2008 was much more modest. The attendees were a mixture of heads of state and business people. The tone was much more one of creating a wider partnership which not only focused on business. China’s interest in Africa is driven by its hunt for resources. The country relies on energy imports to ensure the continuation of its economic growth. Currently, 41% of its oil imports come from Africa. China also understands Africa as a platform for its global ambitions. Chinese companies use the opportunity to go global with the help of tax breaks and support by the Chinese government. The latter follows an approach of ‘aid through trade’ and does 65 not link any conditionality to its investment. This ‘economicdiplomacy’ remains purely business focused and often allows for fast progress in business negotiations. Similarly, India’s key driver is also its energy security. By now, 50% of India’s oil imports come from Africa with Nigeria alone providing a share of around 10%. However, investment is driven more by the private sector as opposed to Chinese state-owned companies. Additionally, India claims to look for a wider partnership promoting democratization, research, and training and skills transfer between itself and the African continent. In contrast to China’s approach to Africa, India says it will build a long-termpartnership with Africa rather than focusing on short-term business objectives. The country’s interest in Africa is not only focused on economic gains from the extractive sector. The potential for an economic partnership is strong and includes sectors such as agriculture and agribusiness. Moreover, India is a supporter of civil society movements in Africa in several countries such as Nigeria or Namibia. As the final emphasis on Brazil’s competition, the highlight will be placed on the comparison between South Africa and India. Government-to-government relations began in 1993, but there are much olderpeople-to-people links. The Indian High Commission in South Africa is holding yearly events to celebrate the anniversary of the South African Indian community – the largest Indian population born outside of India. The diaspora in South Africa see themselves as black South Africans. There are very strong political anti-apartheid connections, and of course Gandhi’s stay in South Africa is well-documented. Ties between the ANC and the Indian National Congress are longstanding, and India was the first country to bring the issue of apartheid before the UN. Since 1994 there has been much goodwill between the countries. In the case of Nigeria, the relationship with India has fallen short of expectations and potential. South Africa is 66 astrategic partner for India in terms of South-South relations, but relations havenot been prosperous. Mainly due to the lackof capacity, especially from the South African perspective, wherethere are a lot of good ideas but it has been difficult to move forward, the lack of clarity from the South African side on where the country sits on particular issues, for example, on the seats of the UN Security Council, and lastly, India and South Africa are competitors within Africa. Their relations are different to those between India and other South African countries, and also between China and other countries. What is the challenge in this context? How can good will be made more substantial whilst the countries remain competitive? There needs to be a balancing out between being big potential competitors, being democracies at the cornerstone of South-South relations, and enabling a fairer global order. Two tiers could develop in the global south, with the more systemically important developing a global system which needs more marginal countries. India is looking for a non-permanent seat on the UN Security Council, and this will probably coincide with the time that South Africa gets elected to the Security Council. Do India and South Africa see the world in similar ways? Do their actions attest to that? The answer is, not always. South Africa sees India as a partner and, as a key component of its SouthSouthstrategy, it has become even more important. Bilateral relations are not just commercial but also concern issues of global governance, as discussed at the 2003 forum of India, Brazil and South Africa. This does not mean that there will be informal alliances at the World Trade Organization, or that they will have the same position there. In some cases South Africa was more assertive on agricultural issues, whilst India was more so on industry. Both countries have an agreement that what was being decided was something that needed to bewithstood. 67 South Africa went with other African countries on decisions to do with the UN Security Council, particularly when they stipulated that any new permanent members would need to have a veto. This meant that South Africa could not align itself with the G4’s position. This was a point of some concern, and the issue is always raised in India. It is the biggest challenge to its worldview. The problem for South Africa is that it has to choose between African consensus and solidarity versus a more robust leadership, and has to be prepared to stand apart from the group. Unlike South Africa, India is not automatically seen to be speaking for the region, and the G20 leaders’ summit was a sign of that. South Africa is, in many respects, coy about leading politically, and this has led to frustration for India. In 1995, a Bilateral Commission between India and South Africa was set up. South Africa had a spate of these after apartheid, and all experienced highs and lows. The one with India had a broad scope, with nearly thirty agreements. In terms of state visits, Thabo Mbeki went to Delhi in 2003 and September 2004, and Manmohan Singh visited South Africa in 2007. Since 2007 the ANC has highlighted its party-to-party links, and before he became President, Jacob Zuma visited the leader of the Indian Congress Party, Sonia Gandhi. Since 1992, exports from India to South Africa have gone from R190 million to 2009’s figures of R18 billion in imports and R15.5 billion in exports. A lot of this trade has been in gold, which accounts for the skewed trade balance. Both countries say that trade barriers are difficult to deal with. Nevertheless, there has been two-way investment: there are forty South African companies in India, including a number of breweries, and Neotel is the second most popular fixed line in South Africa. Areas of disagreement are tiered and multi-dimensional. How does India view South Africa? Its status is locked down because of India and Brazil in BRIC. Nuclear non-proliferation is also a point of contention, and there is a history ofSouth Africa selling weapons to Pakistan in 68 the past. There is a further issue of South African and Indian pharmaceutical companies. Tenders have been given to local companies in South Africa despite Indian companies offering more favorable business deals. There was also the attempted deal between the South Africa-based MTN Group Limited and Bharti Airtel, India’s leading provider of telecommunications, which fell through in September 2009. Indians questioned why South Africans were happy to allow the South African banks to give money to CNPC but were not prepared to see this deal through. The frustration is recognizing South Africa’s sensitivities to its role within Africa. This second chapter enables the readers to be aware that alongside an apparent will to help, there is always a will to gain something in return. Some will classify this attitude under the label of neo-colonialism and other will label this attitude as part of a country’s soft power. This notion was coined by Joseph Nye, former deputy State Secretary, during Clinton’s term was based on the belief that a nation will not rule anymore by force but by its power of attract others in its sphere of influence, mainly by using financial means. As of today, the biggest users of this method are the United States of America and China, which are also present in Africa and in more numerous ways than Brazil. The European Union is still struggling to recover its former influence because of the troublesome past it carries with Africa. It will be far-fetched to utter the situation will stay the same due to the presence of other emerging countries such as India and South Africa. 69 Conclusion The objectives of the dissertation were to: • Inform the readers of the current state of relations between Africa and Brazil • Prove that the relationship is not only based on moral obligation and generosity For the second part, the use of secondary data from books, reports and lectures was crucial. Thanks to it, a crossed comparison between Brazil, China, India and South Africa was made possible in several areas (energy, economic involvement, business behavior). Throughout this dissertation, the point has been put on the fact that on the contrary to some people’s thoughts: the Brazil-Africa relationshipgoes back to several centuries but is on the path of economic synergy and further integration into the globalized world when Lula took office in 2003. The difference is that this ‘new’ relationship is free from the Western interference and domination and that the main catalyzers of the deeper engagement in Africa are corporations and, quite recently, SMEs. The main touch points in Africa from Brazil are Angola- a nation having a border along the Atlantic Ocean and being the most-populated Portuguese speaking country in Africa- and South Africa- a BRICS partner but also a fierce competitor to gain market shares in Africa. This last statement proves that each state has its own agenda even though some of them have similar objectives and are part of common institutions as both Brazil and South Africa. But the core of the survival for each of these countries depends on conquering new markets: this is the case especially for China which needs Africa to export its products and for its large pool of natural resources which provide the energy that China needs. It is also true for India and South Africa but not totally for Brazil as it is also a huge exporter of natural resources (oil). All in all, one can conclude after reading the dissertation that Africa and Brazil have had troubled relations in the past but that they started a new one based on economy and culture, 70 two notions tending to bind people together. Brazil enjoys a common culture with Africa which is definitely an advantage to avoid the critics of neo-colonialism already put on some BRICS because of poor business behavior. The positive aspect of the research was that Africa is definitely not the continent that was described some years ago as doomed to fail or condemned to endure the domination from its old colonizers. The opportunities are becoming countless due to the availability of resources, the population growth and the economic growth. The subject of the dissertation can be extended to the arrival on the continent of several emerging countries Brazil like the BRICS alongside the traditional players as Europe and the United States. In the near future, will the new South-South partnership remain prevail over the North-South traditional relationship? Will Africans be able to play on this competition pool to obtain advantages in world trade or international institutions? And most importantly, will these exchanges of goods and services be beneficial for the economic growth of the continent? 71 Glossary ABC: Agência Brasileira de Cooperaçao or Brazilian Cooperation Agency ABDI: Agência Brasileira de Desenvolvimento Industrialor Brazilian Agency for Industrial Development ADB: African Development Bank APEX: Agency for the Promotion of Exports and Investments ANIP: Agência Nacional para o Investimento Privado or Angolan National Agency for Private Investment ASA: Africa and South America Cooperation Forum BIOCOM: Joint-venture between Odebrecht, Sonangol and Demer BNDES: Banco Nacional de Desenvolvimento Econômico e Social or National Economic and Social Development Bank BRICS: Brazil, Russia, India, China and South Africa C-4: Cotton Four Project CECAT: EMBRAPA Institute for Capacity Development on Tropical Agriculture CENCO: Central de Compras de Angola or Angolan National Purchasing Office CINFOTEC: Integrated Center for Technical Education CNPq: Conselho Nacional de Desenvolvimento Científico e Tecnológico or National Council for Scientific and Technological Development 72 EMBRAPA : Empresa Brasileira de Pesquisa Agropecuaria or Brazilian Agriculture Research Cooperation EU: European Union FAO: Food and Agriculture Organization FDI: Foreign Direct Investment FGV: Fundaçao Getulio Vargas FIOCRUZ: Oswaldo Cruz Foundation G4: Group of 4 G7: Group of 7 G20: Group of 20 G77: Group of 77 GDP: Gross Domestic Product IBSA: India, Brazil and South Africa IPEA: Institute of Applied Economic Research IRBr: Instituto Rio Branco MDA: Ministério do Desenvolvimento Agrário or Ministry for Agrarian Development MERCOSUR: Mercado Comun del Sur or Common Market of the South MFA: Ministry of Foreign Affairs MPLA: Movimento Popular de Liberaçao de Angola 73 OECD : Organization for Economic Cooperation and Development PDP: Productive Development Policy PRESILD: Programa de Reestruturação do Sistema de Logística e de Distribuição de Bens Essenciais à População or Program for Restructuring the System for Logistics and the Distribution of Essential Goods to the Population PROADE: Evaluation of Students’ Performance or Avaliação do Desempenho de Estudantes SACU: South African Customs Union SAEP: Sistema de Avaliação da Educação Profissional e Tecnológica or System for Evaluation of Professional and Technical Education SEBRAE: Serviço Brasileiro de Apoio às Micro e Pequenas Empresas or Brazilian Service to Support Micro and Small Enterprises SEDA: Small Enterprise Development Agency SENAI: Serviço Nacional de Aprendizagem Industrial or Brazilian National Service for Industrial Apprenticeship SESI: Serviço Social da Indústria or Social Industrial Service SNPA: Sistema Nacional de Pesquisa Agrícola or National Agricultural Research System WTO: World Trade Organization UNCTAD: United Nations Conference on Trade and Development UNDESA: United Nations, Department of Economic and Social Affairs, Population Division 74 Annexes ANNEX 1. Perception of Brazil-Africa relationship A short questionnaire to know the Brazilian's & African's respective perceptions on Africa and Brazil. *Mandatory Have you already heard something on Brazil & Africa relationship? * o Yes o No In case you haven't, what do you expect it to be? * o A non-existing relationship o A limited relationship o An equal partnership between Southern zones o A dominant-dominated relationship In case you heard about such a relationship, what can you briefly tell about it? * What would be the advantages of both zones to entertain a relationship without the intervention from the Western world? * Which sectors do you think are most affected by this relationship? * o Technology o Profesional Training o Oil and gas 75 o Building of better infrastructures o Financial Aid o Agriculture In your opinion, which is/are Brazil's main touchpoint(s) in Africa? * o South Africa o Portuguese-speaking countries o Niger Delta countries o Others In your opinion, which are Africa's main touchpoint(s) to reach Brazil? * o Coastal cities and regions o Inner cities and regions ANNEX 2. THE G-20 MEMBERS The G-20 is made up of the finance ministers and central bank governors of 19 countries and the European Union namely Argentina, Australia, Brazil, Canada, China, the European Union, France, Germany, India, Indonesia, Italy, Japan, the Republic of Korea, Mexico, Russia, Saudi Arabia, South Africa, Turkey, the United Kingdom, and the United States of America. To ensure that global economic forums and institutions work together, the Managing Director of the International Monetary Fund (IMF) and the President of the World Bank, plus the chairs of the International Monetary and Financial Committee and Development Committee of the IMF and World Bank, also participate in G-20 meetings on an ex-officio basis. The G20 thus brings together important industrial and emerging-market countries from all regions of the world. Together, member countries represent around 90 per cent of global gross national product, 80 per cent of world trade (including inner-trade in the EU) as well as twothirds of the world’s population. The G-20’s economic weight and broad membership gives it 76 a high degree of legitimacy and influence over the management of the global economy and financial system.64 ANNEX 3. SOUTH–SOUTH FORUMS IBSA—India, Brazil, and South Africa IBSA, a trilateral arrangement between India, Brazil, and South Africa, was officially launched in June 2003, in the aftermath of a G-8 meeting in Evian, France. Unlike the BRICS grouping, the IBSA arrangement was formally conceived to be a framework for coordinated action among the three emerging economies, which would have a major role in the contemporary world order. Trade among the three, for example, increased from US$3.8 billion in 2004 to US$15 billionin 2010 (IBSANews 2011). The reasons for the new IBSA grouping are related to the main common features of the three members—their democratic political regimes, the condition of their developing economies, and their capacity to work on a global scale. The Brasilia Declaration, its constituent document, 65 established that IBSA would be a framework for political coordination and cooperation in key sectors such as agriculture, culture, education, energy, health, science and technology, trade, and transport. Another relevant characteristic is its Fund for Alleviation of Poverty and Hunger, which plays the most significant role in IBSA’s relationship with Africa. Established in 2004, the fund is a pioneer mechanism of South–South cooperation for several reasons. First, it is demand driven—interested beneficiary governments must request assistance from the fund. Second, unlike traditional aid projects, fund projects are planned and implemented without conditions (IBSANews 2011). Third, the goal of the program is to finance innovative, replicable, and scalable projects to alleviate poverty and hunger in low-income countries; some of the IBSA group’s recurrent concerns include capacity building, sustainability, and 64 www.g20.org The Brasilia Declaration is available in English at http://ibsa.nic.in/brasil_declaration.htm. 65 77 knowledge sharing among southern experts and institutions.66Finally, projects must be implemented in collaboration and consultation with the United Nations Development Program (UNDP), national institutions, or local governments. Each of the three IBSA members contributes US$1 million a year to the fund. Three projects have been finalized, one in Guinea-Bissau (agriculture), one in Cape Verde (health), and one in Haiti (waste management). New projects have been approved for Burundi, Cambodia, and the Occupied Palestinian Territories, and are currently under execution. Africa and South America Cooperation Forum Another multilateral forum in which Brazil is involved is the Africa and South America Cooperation Forum. First considered in April 2005 and launched inNovember 2006, it aims to stimulate the capacity for sustainable development among and within its members through strategic South–South partnerships.67 The minimal institutional framework for collective action includes high-level meetings every two years and ministerial meetings on specific themes organized into working groups, each co-chaired by an African and a South American country.68 Despite their similar conditions, the two regions present differences that go beyond economics to include a political, cultural, and ideological dimension. This was evident during the third Africa–South America (ASA) Summit, held in Venezuela in September 2009, where former Brazilian president Lula da Silva suggested that “the integration between the two regions will only happen with respect to the political habits of each country.” In light of the global financial crisis and recent events in North Africa, it remains to be seen how this arrangement will evolve. 66 http://tcdc2.undp.org/IBSA/about/about.htm. www2.mre.gov.br/asa/. 68 www.itamaraty.gov.br/temas/mecanismos-inter-regionais/cupula-america-do-sul-2013-africa-asa. 67 78 Mercosur and the Southern African Customs Union Another important link between Brazil and Africa is the incipient connection between the Common Market of the South (Mercado Común del Sur or Mercosur) and the Southern African Customs Union (SACU). Mercosur was officially launched in March 1991 to integrate South America economically, politically, and socially. It has Argentina, Brazil, Paraguay, and Uruguay as members; Venezuela should become a member in the near future, pending Paraguay’s approval. Bolivia, Chile, Colombia, Ecuador, and Peru are associate members.69 Hence Mercosur covers almost all the territory of South America. Mercosur has experienced ups and downs throughout its 20-year history, including major difficulties as political and economic crises affected its members.The arrangement has not advanced in the last five years on the political front it has been complemented by a new regional institution, the Union of South American Nations (Union de Naciones Suramericanas or UNASUR), created in May 2008.70 In its path to establishing a southern common market, however, Mercosur has succeeded in creating a free trade area, a common external tariff, and a common trade policy (customs union) among its members. Recently, Mercosur developed a few initiatives connecting South America to Africa, more specifically with SACU, whose members are Botswana, Lesotho, Namibia, Swaziland, and South Africa. The long-standing and prominent presence of South Africa in its subregion provoked an agreement between Mercosur and the country, in December 2000, to create a free trade area.71 69 www.mercosul.gov.br/perguntas-mais-frequentes-sobre-integracao-regional-e-mercosul-1/sobre-integracaoregional-e-mercosul/. 70 www.pptunasur.com/inicio.php?menu=30&idiom=1 (in Spanish). The completetrade deal can be read at www2.mre.gov.br/dnc/AQ_RAS_Assinado_Ing.pdf. 71 79 Mercosur and SACU signed a preferential trade agreement a few years later in December 2004.72 An updated and revised version was signed in April 2009 in which SACU gave Mercosur preference in the purchase of over 1,000 SACU-produced products, while reducing duties on the import of over 1,000 goods from Mercosur in sectors spanning agriculture, plastics, chemicals, textiles, and equipment.73 ANNEX 4. BRAZIL-AFRICA OFFICIAL MEETINGS AND VISITS African countries visited by Minister Celso Amorim (2003–10) Year 2003 2004 2005 2006 2007 2008 2009 2010 Visited countries Sao Tomé and Principe, Angola, Mozambique, Namibia, South Africa, Egypt and Libya Sao Tomé and Principe, and Egypt Cape Verde, Guinea Bissau, Senegal, Nigeria, Cameroon, Tunisia, Algeria, Kenya, Ethiopia, Mozambique, South Africa, Gabon, Morocco, Ghana, Angola and Tanzania Algeria, Benin, Botswana, South Africa and Nigeria Burkina Faso, Congo, South Africa and Nigeria Ghana, Guinea Bissau, Sao Tome and Principe, South Africa, Libya, Algeria, Morocco, Tunisia, Cape Verde, Mozambique, Zimbabwe and Zambia Egypt, Cape Verde, Libya, Tunisia, Morocco, Mali, Equatorial Guinea, Togo, and Guinea Bissau Cape Verde, Equatorial Guinea, Kenya, Tanzania, Zambia, South Africa, Angola, Libya, Mozambique and Democratic Republic of Congo Source: Ministry of Foreign Affairs. Prepared by IPEA. ANNEX 5. Brazil’s global market share projections (%) 72 www.sacu.int/traden.php?include=about/traden/bilateral.html. www.africa21digital.com/noticia.kmf?cod=8314506&canal=402. 73 80 2009/10 2014/15 2019/20 Sugar 47 47 50 Green coffee 27 27 27 Soybeans 30 33 36 Soybean meal 22 21 20 Soybean oil 21 16 18 Corn 10 11 13 Beef 25 31 30 Pork 12 14 14 Poultry 41 48 48 a. There are no projections, so market share is maintained constant. Source: The Economist Intelligence Unit 2010, based on data from the U.S. Department of Agriculture 2010; Food and Agriculture Policy Research Institute 2009; and AGE/Ministry of Agriculture, Fisheries, and Food Supply 2010. ANNEX 6. Global land surface temperature and vegetation, May 2011 81 ANNEX 7. Selected small-scale health projects implemented in Africa, with support from the Brazilian government, 2011 Partner countries Diseases combated Partner countries Diseases fought by locals with Brazilian support Angola, Cameroon and the Democratic Malaria Republic of Congo Botswana, Ghana, Kenya, Liberia, Sierra HIV/AIDS Leone, Tanzania, and Zambia Source: Mateos 2011. ANNEX 8. Structuring projects focused on health: Brazil–Africa development cooperation Partner countries Structuring projects Brazilian investment, US$ ‘000 (2010) Angola Pilot project in Program to 240 + 490 fight Anemia + Technical support to implement a 82 center of hygiene and epidemiology Ghana Support to implement a 7,000 national system for treating sickle-cell anemia Mozambique HIV/AIDS pharmaceutical 23,000 plant Sao Tomé and Principe Support to Program to 600 Prevent and Control Malaria Senegal Support to National Program 250 to fight Anemia Source: ABC 2009. 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