The T20 task force on Cooperation with Africa aims to integrate cooperation efforts with Africa broadly across G20 work-streams, strengthen G20 members’ commitments to Africa’s Agenda 2063, and explore policy options to promote sustainable development across the continent.

T20 Africa, G20 and Africa: Assessing Our Impact and Influence

The T20 comprises think tanks that aim at developing research and evidence-based briefs and positions to guide governments in policy development. The T20 Africa Standing Group was established in 2017 to bring together think thanks from the G20 and African countries to work together on G20 policy matters. But as of now there is little information about T20 Africa’s influence and impact on G20-Africa related policies.

Challenge

As one of the key political and economic forums in the world, the G20 Summit was created to facilitate a stable and peaceful world through promoting several development agendas. Decisions taken by this forum help to support reform at the national and international levels. Since its creation in 2012, the T20 has comprised think tanks that aim at developing research and evidence-based briefs and recommendations to guide governments in policy development. The T20 Africa Standing Group established in 2017 should monitor the extent to which its policy recommendations on Africa-related issues have influenced and impacted policies and plans that emerge out of the G20.

This is particularly important for Africa with South Africa being the only African member in the G20. It is clear that African perspectives and priorities are severely underrepresented in the G20. Though the chairs of the African Union and the Heads of States and Government Coordination Committee of the New Partnership for Africa’s Development were accepted as observers at the G20 meetings, this level of engagement is still insufficient. Given the number of relationships and interdependencies between Africa and the G20 countries and the world and how the interests of G20 members are prioritized first and foremost, policies that emerge out of the G20 directly impact development in Africa and the world. As a result, it is critical to assess the impact of T20 Africa on the policy development process and the effects of these policies on social and economic development in Africa.

The T20 was not created to bring about consensus amongst members on specific topics or to participate in the decision-making process. Instead, its objective is to provide concrete, feasible policy recommendations, ideas and visions to inform the policymaking process.

Proposal

Proposal 1: Collectively, as T20 Africa, Define Success – The Engagement Groups were created for a particular purpose but there are no mechanisms currently in place to assess whether the groups’ objectives are met. In order for T20 Africa to know whether it has achieved its purpose or objectives during each Presidency, metrics of success should be developed.

Indicators are useful for monitoring progress and providing feedback on areas of success and areas in which improvement may be required. They define what success and impact look like and determine whether we are moving toward achieving our desired outcomes – in this case, whether T20 Africa contributed to G20 policies and Africa’s economic and social development. These indicators and metrics should be SMART: Specific, Measurable, Achievable, Realistic and Timely.

For starters, simple output-oriented indicators can be developed to track the number of recommendations that emerged from T20 Africa and how many were considered. This will require a little extra work, but having this information, as the B20 does, would allow T20 Africa to collectively speak about its influence.

Proposal 2: Establish a communication structure within T20 Africa – Establishing a communication structure with regular feedback loops within T20 Africa would a) provide greater strategic focus for the policy briefs based on the objectives of each Presidency and b) allow for internal conversations within the group to reflect on the achievements for the year and how to improve the following year. The T20 Africa governance board is well placed for this. The T20 Africa governance board involves member think thanks from the incoming and outgoing T20 presidency as well as rotation among African think tanks. This allows for feedback loops to facilitate greater learning and knowledge sharing.

Proposal 3: Monitor and Share Status of Every Policy Recommendation – While the G20 is not an implementing agency, the decisions that emerge from G20 countries have significant influence. As it stands, engagement groups do not have an official, standardized and public mechanism or tool to monitor the uptake and implementation of policy recommendations. It would be highly desirable to build capacity in the T20 Africa to effectively monitor policy recommendations that emerge from the group and publicly share their status – whether and when they were considered by the G20 and the implementing agency. This can be done by logging all recommendations and their status into a simple online platform. With this information, researchers can continue to track the aftermath and performance of these recommendations to assess impact to the beneficiaries.

Proposal 4: Collaborate with the other T20 engagement groups – For T20 Africa policies that are considered, collaboration should be sought with B20 and other engagement groups to fully assess the financial and social implications of the policy. This thorough cost-benefit analysis would shed greater light on the feasibility on the execution, on any previously unknown positive and/or negative externalities, and the associated financial gains and losses.

Proposal 5: Conduct Impact Assessment in Every Presidency – An impact assessment should be conducted during every Presidency focused on the priorities and agenda of that Presidency. For instance, the Argentina Presidency focuses on three key issues: the future of work, infrastructure for development and a sustainable food future. From here, we can examine the policy recommendations from T20 Africa that are considered by the G20 and begin to assess how and whether they are aligned within the current Presidency’s framework.

Proposal 6: Develop a post G20 Summit strategy to monitor and coordinate – Africa related policies and initiatives Without sufficient African presence in the G20, it is especially important to understand what impact, if any, G20 declarations and initiatives have on African countries. As a result, a strategy should be developed to assess, monitor, and coordinate actions and initiatives related to African countries and institutions at G20 level. Additionally, this information needs to be publicly available. While the G20 Africa Monitor is one possible platform to monitor Africa related policies and coordination, serious conversation is needed in order to decide whether it is the best platform for this objective.

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Africa-G20 cooperation: reducing complexity, increasing opportunities

Interest among international partners to cooperate with Africa is high. G20 countries generally follow two parallel tracks: they have their own bilateral initiatives and, in some cases, use the G20 to launch policy initiatives. These parallel bilateral and G20 processes create many opportunities for African actors. But the initiatives are not always complementary and not always sustained in the medium- to long-term. The G20 might want to broaden debates on its impact on development by better coordinating bilateral and G20 initiatives (particularly with regard to support for investments) and by including African representatives in all working groups.

Challenge

Africa continues to be relatively weakly represented in international debates, despite its strong membership within the United Nations and a growing number of country-to-continent dialogue formats, such as the Forum on China-Africa Cooperation (FOCAC), the India-Africa Forum Summit (IAFS) and numerous other initiatives organised by the USA, Japan, Turkey or South Korea. Additionally, there are region-to-region dialogues between the African Union (AU) and the European Union (EU) as well as Africa-South America Summits. Yet, in relevant global governance “clubs”, Africa is barely represented. The G20 is a key example: only South Africa is a member. Pan-African organisations are only observers, and do not have their own seat, unlike the EU. At the same time, developments in Africa are substantially influenced by decisions at the G20 level, e.g. in the areas of trade, taxes, macro-economic stability or climate.

Competition among international partners to pursue new cooperation initiatives with Africa is high. In this regard, G20 countries generally follow two parallel tracks: they have their own bilateral initiatives and only in some cases use the G20 to launch new/different policy initiatives. These bilateral and G20 initiatives are not always complementary and they are not always sustained and followed up in the medium- to long-term. For instance, during the 2017 German G20 Presidency, Germany proposed a G20 Compact with Africa while the EU in parallel launched an EU External Investment Plan during the AU-EU summit in November 2017. Both aim at strengthening the investment environment in African countries and creating incentives for (foreign) investments in infrastructure and other areas. Both remain largely disconnected from other international partners’ investments in infrastructure and other areas. In 2016, the Chinese G20 Presidency launched a new but poorly followed-up G20 initiative on industrialization for Least Developed Countries, while the Belt and Road Initiative – with substantial financial resources linked to it – has remained a bilateral endeavor with multiple and varied implications from region to region. Whether and how the Asia-Africa Growth Corridor promoted by India and Japan will feature during the Japanese G20 presidency remains unclear so far. As development success can only be driven from within, a key success factor for international cooperation is how such cooperation is supportive of African initiatives.

These numerous initiatives provide the opportunity for African countries to leverage their design and decide which cooperation initiatives to prioritise. At least in theory, African countries could also exploit this position of strength to encourage cooperation initiatives to be more aligned with African priorities. At the same time, coordination of various international actors also weighs on African (and international actors’) capacities and some initiatives may not complement one another. This brief develops recommendations on how to best use the interest of G20 countries (and indeed other external partners) in collaborating with Africa to enhance sustainable development and structural transformation across the continent in line with Africa’s agendas.

Proposal

Opportunities for African actors

• Strengthen engagement beyond the G20 Development Working Group: PanAfrican organisations and South Africa as the only African G20 member may want to strengthen pro-active engagement with G20 working groups beyond the Development Working Group (DWG). The working groups on climate sustainability, trade and investment, agriculture, energy, employment, tax/finance might be particularly relevant as G20 policies in these areas have major direct and indirect consequences for African countries. One way of encouraging wider engagement would be for the G20 to make it a standard rule for all G20 working groups to include African representatives. This would have the further effect of widening African participation beyond South Africa and the AU/NEPAD via directly inviting particular African stakeholders, without necessarily having to change G20 membership. In line with the way in which the AU usually operates, the modality of such inclusion should be determined by the AU chair and the AUC. Co-opting individual African countries would be more ad hoc than systematically including Pan-African institutions.

• Increase division of labour among African actors when engaging with G20 actors: Pan-African actors could strengthen arrangements for division of labour among them on G20 engagement by identifying which Pan-African actors would lead on specific topics. They could also enhance input to the G20 from African regional organisations. In this regard, the AU and African Regional Economic Communities (RECs) could set up permanent desks dealing with and facilitating engagement with the G20. This cooperative divison of labour should be coordinated by the AU Commission.

• Define concrete and actionable priorities based on Africa’s Agenda 2063 and its 10-year implementation plan: The AU could publish a yearly list of African key priorities that could feed into G20 discussions. These would not be the kind of long-term transformative goals as seen in Agenda 2063, but – derived from the long-term agenda and the 10-year implementation plan – more concrete, shorter-term goals that could be made actionable by one or two G20 Presidencies. This would allow the continent to take a pro-active role in shaping G20 discussions, and should be tailored to also inform discussions in the various G20 workstreams and Engagement Groups such as the Think20, Business20 or Women20.

• Enhance monitoring mechanisms: In order to deal with the complexity of working with the G20 club and its individual members at the same time (as well as other international actors), and to highlight contradictions, African actors could strengthen mechanisms to monitor the launch and implementation of various international initiatives and facilitate discussion of how they fit into wider G20 agendas from year to year. This assessment could be done by the AU or the UN Economic Commission for Africa and the key findings could be presented once a year to the AU General Assembly and shared with the G20. Agenda 2063’s 10-year implementation plan could be an important basis against which to assess G20 countries’ initiatives.

• Primary engagement with G20 anchored with AU Commission rather than AU Chair: The AU has started a fundamental reform process. The AU’s relations with external partners as well as division of labour between AU and RECs are part of this reform debate. Debates are still at an early stage and no decisions have been taken. Until these changes have been finalised, we propose that the primary engagement between the AU and the G20 be anchored with the AU Commission, rather than the AU Chair, as is the current practice. Engagement with the AU Chair is easily disrupted because it changes annually; this disruption is exacerbated by the G20’s own annual change of leadership. More systematic AU-G20 engagement would gain cross-year stability through engagement with the AU Commission under the guidance of and as mandated by the Assembly and Executive Council.

What next?

• The G20 Presidency of Argentina: The G20 Presidency gives Argentina a historic opportunity to engage with African and other G20 actors. As the chair is traditionally the “honest broker” between all club members, Argentina can use the Presidecy to maintain momentum regarding the cooperation with African partners and thereby build its reputation within the G20 and beyond it. A key priority of the Argentinian Presidency should be to ‘keep the ball in the play’. With the Chinese and the German G20 presidencies, the African dimension of the G20 cooperation has gained prominence. Argentina should grasp the opportunity and support the previous presidencies’ initiatives, while, at the same time, prepare the ground for making cooperation with Africa a prominent topic of the Japanese Presidency.

• African Union and other African actors: With a view towards the Japanese Presidency, African actors should plan ahead early on. With regard to infrastructure investments, it would be very useful for African actors if conversations are encouraged between different infrastructure-focused initiatives between G20 members and Africa, notably the Compact with Africa launched under the German G20 presidency (2017), the EU External Investment Plan and the China Belt and Road Initiative.

• South Africa: As the only African G20 member, South Africa has an important role to play. This is a balancing act, as Pretoria cannot claim to speak for the continent. Yet, the country has experiences in engaging in structures of global governance. In 2018, South Africa is the chair of the BRICS and thus can offer a bridge between numerous engagements with the African continent and as a key partner to most external partners to the continent. Argentina has been invited to the BRICS Plus meeting on the last day of the BRICS summit in Johannesburg. Both Pan-Africanism and engagement with global commercial and political partners such as the EU, China, India and Brazil remain in Pretoria’s self-interest, which can provide the necessary energy (and perseverance) to keep African perspectives on the G20 agenda.

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Mobilizing Private Investment and the Compact with Africa: A Preliminary Assessment and Steps Ahead

The Compact with Africa (CwA) is a structured partnership between volunteering African countries and the G20 with the inclusion of key multilateral and bilateral partners and, very importantly, the private sector. It was launched by the German G20 Presidency in March 2017. As of May 2018, 11 African countries are participating in the CwA: Benin, Guinea, Côte d’Ivoire, Ghana, Egypt, Ethiopia, Morocco, Rwanda, Senegal, Togo, and Tunisia.

The CwA is an opportunity for increasing private investment (particularly in infrastructure) in Africa through improved coordination and deeper stakeholder engagement. The process can increase transparency and provide better access to information on investment support mechanisms. It will, therefore, help to continue to redefine roles of development actors, including governments, international organizations, and the private sector. An pdf initial assessment of the CwA (575 KB) , one year after its inception, has indicated the need to enhance monitoring and accelerate the implementation of the initiative. Based on this initial assessment and an unattributed pilot survey among private sector actors (undertaken by the authors), the T20 Africa Standing Group proposes the G20 undertake a regular private sector survey, which shall contribute to a systematic integration of the private sector in the monitoring of the CWA, and improve investment tracking.

Challenge

The challenge is to ensure successful implementation of the CwA, which requires robust monitoring and appropriate remediation – as well as stronger participation of the private sector in Africa more broadly. The Africa Advisory Group (AAG), an informal body comprising a sub-set of G20 members, the African Compact countries, the World Bank (WB), African Development Bank (AfDB), International Monetary Fund (IMF), and other stakeholders such as the OECD, governs the CwA. The AAG has adopted a monitoring framework and a light-touch independent review mechanism. Monitoring takes place biannually at the time of the WB/IMF Annual and Spring Meetings and is coordinated by the World Bank.

Our own analyses of the CwA suggest that the success of the initiative will hinge on whether it manages to provide practical instruments for (potential) investors. These instruments will have to be known and accessible to the potential investors, and they should be adapted to the particular challenges of the various African investment environments in a context of technological transformation. Therefore, we agree with the conclusion of the Monitoring Report that the views of the private sector need to be better represented, ideally through a regularly conducted survey.

To underscore the importance of such a private sector survey, we have undertaken a pilot survey among selected private firms. We stress that the findings of this pilot are only perceptions of the CwA and the challenges investors face in Africa. Yet, the below results highlight the potential benefits of a regular survey for enhancing and accelerating the implementation of the CwA.

In the survey, some German companies emphasized the importance of support mechanisms to target not only investment, but also trade; thus stressing the strong interdependence of trade and investment. They indicated that their investments in Africa are typically preceded by entering a market through exports. Only in a second stage were trading entities set-up; and in some cases then followed by a wider range of activities including service provision (for machines or equipment) and, albeit not too often, production.

The pilot survey largely indicated there is a lack of knowledge and understanding of the CwA among the private sector, including global firms, banks, and industry groups. Those with some exposure to the CwA indicated there has been limited and uneven promotion of the Compact and the benefits to the private sector are not clear. That said, there was overwhelming support, in principle, for the Compact with many respondents noting the entrenched challenges, including risk mitigation and access to local finance that can only be overcome with a collaborative approach among Compact parties, the private sector, and other stakeholders.

Proposal

Integrating the private sector in CwA monitoring and improving investment tracking

We propose that the G20 integrate the private sector into the monitoring framework of the CwA. Specifically, we propose as a first step to regularly survey private sector actors that have engaged in – or are aware of – the CwA to better understand their perception of progress, improvements in policy reforms, and support provided by International Organization or G20 members.

The success of the CwA will hinge on strong private sector participation. Private investment is at the core of the CwA and crucial for its success. It plays a key role in an African Infrastructure Connectivity Alliance. Expanded monitoring can capture “the whole picture of the CwA,” therefore, it is important to include the views on successful practices and challenges for implementation of the private sector. It is furthermore important that views and perceptions of the private investors are taken into account with regard to the actions of all other G20 parties, including the CwA governments, the G20 members, and the IFIs.

A full integration of private firms into the CwA monitoring framework cannot stop at surveying perceptions, but eventually should track their actual investment behavior. We therefore suggest that in a second stage each participating firm reports on its activities, e.g. by stating its planned and realized financial engagement. Such a monitoring has two major justifications: first, as soon as participating firms receive any kind of public support (bilateral or multilateral) they should be obliged to document its use in a transparent manner; and second, given that the CwA’s ultimate aim is to enhance private investment, a regular stocktaking would help assess progress based on up-to-data information. This stocktaking-exercise should go well beyond showcasing successes. It should also systematically track intentions of investment that eventually did not materialize or that experienced delays. The lessons to be learnt from such failures and delays may be as important as the lessons to be learnt from success cases.

The authors of this policy brief are Rob Floyd, African Center for Economic Transformation; Brahima Coulibaly, Brookings Institution Africa Growth Initiative; Jann Lay, Institute of African Affairs, GIGA German Institute of Global and Area Studies; Rainer Thiele, Kiel Institute for the World Economy; and Jing Gu, Centre for Rising Powers and Global Development, CRPD, at the Institute of Development Studies.