Brazil in Africa / by Mark Langevin

Christina Stolte and Chatham House recently published a briefing on Brazil in Africa, Brazil in Africa: Just Another BRICS Country Seeking Resources?   The November 2012 briefing explores Brazil’s rapidly growing engagement with African nation-states, in particular Angola, Mozambique, and South Africa.  The briefing advances the following conclusions:

  • Over the last decade, Brazil has expanded its engagement with Africa, doubling its diplomatic presence from 17 to 37 embassies.
  • New economic partnerships have been forged, raising trade with Africa in the same period from US$4.2 billion to US$27.6 billion.
  • Oil and other natural resources account for 90% of Brazil’s imports from the continent and Brazilian investment is focused mainly on Lusophone Africa.
  • Brazilian policy-makers see Africa’s biggest potential as providing a consumer market for their country’s manufactured goods.
  • Brazil also uses its Africa policy as a means to achieve its foreign policy goal of being recognized as a major power.
  • South–South cooperation is a key driver of Brazil’s Africa policy as it is seeking support for a permanent UN Security Council seat.
  • Brazil advocates South–South cooperation projects that are based on its own development experience. Biomedical and health research and agricultural research have been turned into effective foreign policy instruments.

Chatham House reports that in 2009 some 6.6% of Brazil’s imports came from Africa, mostly oil and other natural resource based commodities while only 3.4% of Brazilian exports were destined for Africa, mostly to Angola, Egypt, Mozambique, and South Africa.  The level of trading is growing, boosted by the increasing investment of Brazilian trans-nationals, including Petrobras (oil and gas), Odebrecht (construction), and Vale (mining).  This engagement, while fundamentally based on African natural resources, is also the result of the international diversification of these Brazilian companies, whose investments in Africa are geared for the long term and facilitated by the Brazilian government and its growing commitment to play a supportive role among many African countries.  Indeed, BNDES, the Brazilian development bank, provides much needed credit lines for infrastructure construction, mostly in Angola, Mozambique, and South Africa.

The report notes,

“Stressing the benefits of their country’s engagement in Africa, 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 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 programmes. Like her predecessor, she is convinced that the Brazilian approach ensuring benefits on both sides compares favourably with China’s.”

Despite the evident increases in investment and trade, the report argues that,

“The intensification of economic ties, particularly trade, over the past decade was driven by government initiatives during the left-wing Lula administration rather than by Brazilian business itself.”

Building stronger ties with Africa and many of its fastest growing and more largest nations provides Brazil with a broader geopolitical foundation for exerting its global leadership as well as a myriad of opportunities for Brazilian headquartered firms who may enjoy competitive advantages, at least with the Lusophone countries of the continent.  Alongside the expanding trade and investment linkages, the Brazilian government has been instrumental in establishing more developmental ties with a broad cross-section of African countries in such areas as agriculture and rural development, rural electrification and biofuel production, the fight against hunger and poverty, health development assistance-including HIV-AIDS prevention and treatment programs among other efforts.

Stolte documents the argument that Brazil’s recent engagement in Africa is constructive, interactive, and mostly serves mutual interests, both public and private.  She notes the rivalry with China’s relatively recent entrance into the continent as well, but falls short of advancing any comparative conclusions.

This briefing is certainly a must read for those interesting in understanding Brazil’s importance in Africa and emerging opportunities for both Brazilian society and its government.