Dakar, Senegal: Hungry for oil and minerals, India and China have become Africa’s new colonialists, exploiting the world’s poorest continent in the same way as its old European masters, said billionaire financier George Soros.
European nations’ scramble for resources, from slaves to diamonds and gold, led them to subjugate Africa’s people under colonialism. After independence swept the continent in the 1950s and the 1960s, they often supported corrupt and dictatorial regimes.
Transparency call: Billionaire financier George Soros.
Over the last decade, amid concern over minerals funding wars from Angola to Democratic Republic of Congo, Western governments and multinationals have largely accepted the need for accountability and transparency in extractive industries. But India and China, which are pumping billions of dollars of loans and investment into Africa, have not, Soros said. “There’s a certain irony of the old colonialists recognizing their past mistakes and trying to correct them, and the new colonialists then repeating those mistakes,” he said in the Senegalese capital.
Soros hoped that Chinese firms would toughen their criteria for investment, although he said Chinese demand for raw materials had brought benefits to the continent, underpinning its strongest growth in four decades. “It’s the basis on which the economic outlook for Africa is somewhat exempt from the current global downturn,” he said, assessing Africa outlook as “quite good”.
“I don’t expect a global recession. I expect a recession in the developed economies but there are some very positive dynamics for the developing world, particularly resource-rich areas,” said Soros.
For those African countries not lucky enough to possess mineral wealth, the outlook was more sombre. Non-oil producing states were losing more in economic terms from record petroleum prices than they ever gained from Western debt relief, he said.
The financier, who set up the Open Society Institute and Soros Foundations, said ongoing post-election violence in Kenya, which has killed more than 1,000 people, was a reminder of the need to bolster African democratic institutions.
Soros, 77, called on Kenyan President Mwai Kibaki and opposition leader Raila Odinga of Kenya to agree a power-sharing administration and move towards new elections, or risk dragging that country’s once thriving economy into a spiral of decline.