Trade, financing top Japan-Africa forum’s agenda


Trade, financing top Japan-Africa forum’s agenda

Trade, financing top Japan-Africa forum’s agenda
Photo credit: Salaton Njau

The close to 4,000 Japanese delegates attending the sixth session of Tokyo International Conference on African Development (TICAD VI) are on a mission to rewrite history.

The team led by Prime Minister Shinzo Abe has also thrust Kenya, the gateway to Africa, on the cusp of history as the first country to host a TICAD session outside Tokyo.

The Japan before TICAD is quite obscure. Just like other African states, Kenyan firms have struggled to gain a foothold of the market which would be an alternative outlet for cut flowers, tea, coffee, nuts, fish fillets, tobacco and sisal fibres.

“There are substantial exports of cut flowers to Japan and the market has been growing over time but we can’t compare to the EU,” Dr Margate Muchui, chief executive at Fresh Produce Exporters and Association Kenya told the Business Daily.

“Exports of fruits and vegetables has however not taken off due to stringent access requirements for the Japanese market, especially the requirement to fumigate produce which makes doing business costly.”

Analysts see other challenges beyond the difficult market access rules. They reckon that a Japanese, unlike a Chinese or Indian counterpart, still conjures up an image of a European-type patronising bureaucrat.

“Africa has traditionally regarded Japan as elitist and West-like, being an OECD (Organisation for Economic Co-operation and Development) member just like rich states of US and UK,” said University of Nairobi political Science scholar George Katete.

“China and India discovered the strategic importance of Kenya (and Africa) early enough. They have won hearts not only by providing cheaper products but also by their ‘no-string-attached’ loans.” 

China and India share ‘developing country’ tag with most African states. India which was colonised by British has particularly been vocal about its common heritage with Kenya.

“Japan has maintained high quality of products that it sells in Africa but high price has locked it out of the mass market enjoyed by Indian and Chinese firms,” said Dr Katete.

Japanese investors are also unaware of Africa’s business potential. Two months ahead of Nairobi TICAD, Kenyans in the diaspora had to organise SMEs seminar in Nagoya, the largest city in the Chubu region of Japan in May.

The goal of the seminar, which attracted 130 participants, according Kenya’s Tokyo Embassy, was market Kenya’s (and Africa’s) business potential to Japanese SMEs.

Being the backbone of any country’s economy, involvement of SMEs would ensure that a critical mass attended the TICAD which enters its climax in Nairobi on Saturday.

In a 2012, paper titled ‘Comparative study on Asian approaches to Africa: an introductory reflection’ presented to the University of Miyazaki, scholar Takuo Iwata echoed these sentiments.

The paper traces Japan’s laidback role to the period before 1990s when unlike Asia and China, Japan maintained no formal policy on Africa.

During that period, Japan had limited political communication with Africa, cut its overseas development assistance (ODA) to bare minimum and its firms were less interested in the continent.

Nairobi TICAD hopes to build on the momentum created by the previous TICAD forums. While trade volumes with Kenya is still low (Sh92.25 billion) compared to China’s Sh329.29 billion and India’s Sh261.47 billion last year, Japan has over the four years of Ticad been creating its way into nearly every sphere of Africa’s economy.

The Sh3.2 trillion TICAD initiative – whose sixth session is being held in Nairobi will see Japan catch up with other Asian states in controlling Africa’s energy, environmental management, infrastructure, education, tourism and agriculture. “TICAD is a latter-day repackaging of Japan’s role in Africa. I see it as a marketing effort,” says Dr Katete.

“Japan appears to be appreciating strategic importance of Africa. Its top leadership appear to be telling us to also think of Japan – not just China and India – in our shift to East policy.” 

Food value chains

A TICAD progress report prepared by Japanese foreign affairs ministry shows that Japan is already training smallholder farmers on commercial farming in Kenya and 19 other countries in Africa.

The campaign dubbed Smallholder Horticulture Empowerment Project (SHEP) has so far benefited 1,324 farmers of East African Community, Egypt, South Africa, Lesotho, Zimbabwe, Madagascar, Ethiopia and Sudan. Others are Malawi, Mozambique, Namibia, Nigeria, Cote d’Ivore, Niger, Burkina Faso, South Sudan and Senegal.

“Japan has assisted for doubling gross rice production, promoting income generation of African smallholder farmers including women and youths, and establishing food value chains which links production, processing and logistics,” the progress report states.

And to a conflict-ridden region, Japan’s fence-sitting days are over. TICAD has transformed the Asian nation into an active peacekeeper. The report shows that Japan has not only been conducting counter-piracy operations at the East African coast (Gulf of Aden) since 2009 but has also contributed immensely to peacekeeping efforts in Africa.

TICAD progress report shows that Japan has contributed Sh100 million to fight piracy off the coast of Somalia, provided technical assistance to the Djibouti Coast Guard and contributed Sh100 billion to support various peace initiatives in Africa between 2013 and March 2016.

From last September, Japan has stationed its engineers in Nairobi to train East African peace-keeping personnel on how to operate heavy equipment under its Sh4 billion African Rapid Deployment of Engineering Capabilities project.

TICAD V Progress Report 2013-2015

As of 2015, the implementation status of the TICAD V Yokohama Action Plan (2013-2017) is good. This report summarizes the progress from January 2013 to the end of December 2015 (the data of 2015 includes provisional figures and some crucial progress until March 2016). The details provided by respective implementing bodies will be uploaded on the MOFA website database.

This progress report was co-written by TICAD co-organizers, and for the first time includes efforts made by Africa as well as Japan and TICAD partners. It showcases cooperative efforts among TICAD partners, including Africa and Japan, to support the continent’s development. Collaboration and synergy should be further pursued among stakeholders, particularly through South-South and triangular cooperation for increased impact and efficiency.

The priority areas of TICAD V still remain valid and steady implementation of initiatives by all parties is vital for continued progress. Where possible, further collaborations and synergies should be sought among stakeholders to increase impact and efficiency, as well as to avoid overlap and duplication.

Overview of Japan’s Development Cooperation for Africa

At TICAD V 2013, Japan announced its assistance package for Africa to provide up to approximately JPY 3.2 trillion (equivalent to US$ 32 billion) by utilizing private and public means, including ODA of approximately JPY 1.4 trillion (equivalent to US$ 14 billion), in the next five years (2013-2017). The progress of the above financial commitments is as below;

Japan TICAD V progress

In February, 2015, the Government of Japan revised Japan’s Official Development Assistance Charter. This new Development Assistance Charter elaborates on Japan’s assistance through joint efforts of the public and the private sector through processes such as TICAD, so that Africa’s remarkable growth in recent years based on expanding trade, investment and consumption will lead to further development for both Japan and Africa. It also states that Japan will take particular note of Africa’s initiatives toward regional development and integration at the sub-regional level.

Bearing in mind that some countries are still prone to conflict or are burdened with an accumulation of serious development challenges, Japan will continue to actively engage in assistance for peacebuilding and assistance to fragile states from the perspective of human security, providing necessary assistance with a view to establishing and consolidating peace and stability, and solving serious development challenges on the continent.