Shaping Africa’s future now:
SAFRI presents specific demands for a new Africa policy

The Sub-Saharan Africa Initiative of German Business (SAFRI) is calling for a decisive ‘Africa turnaround’. In view of growing geopolitical tensions, critical raw material dependencies and a young, dynamic population in Africa, Germany must realign its Africa policy – with clear priorities and measurable steps. ‘Africa is not only a market for the future, but also a partner for our economic resilience. If we are serious about diversification, raw material security and new growth areas, we must act now,’ emphasises Thomas Schäfer, Chairman of SAFRI.

Africa as a raw materials partner: from dependency to partnership
Raw materials such as lithium, copper and cobalt are indispensable for the transformation of the European economy. SAFRI is therefore calling for strategic raw materials agreements with African partners that give companies greater planning security. The aim is to diversify supply chains in a targeted manner in order to reduce dependence on individual countries – especially China.

At the same time, the raw materials and circular economy strategies must be more closely integrated. Bureaucratic hurdles to recycling should be removed and research in the field of circular economy strengthened. Schäfer emphasises: ‘Africa has significant reserves. We should be partners for local processing – not just buyers of raw materials.’

Enabling investment: less risk, more opportunities
Financing remains a key obstacle for German companies in Africa. SAFRI is therefore calling for state guarantees and credit cover to be better adapted to the reality of African markets and for deductibles for Hermes cover to be lowered.

In addition, flexible financing instruments such as ImpactConnect for smaller investments and TradeConnect for trade financing are needed. An expansion of double taxation agreements with African countries is also urgently needed in order to create planning security. Schäfer comments: ‘If we want to make German companies competitive in Africa, we must not burden them with unnecessary risks and bureaucracy.’

Free trade as the key to growth
Clear rules are needed to encourage companies to invest boldly. SAFRI calls for the strengthening of the African Continental Free Trade Area (AfCFTA) and the implementation of the EU Economic Partnership Agreements with Africa (EPAs).

In addition, government risk protection for companies must be improved – for example, through more competitive export credit and investment guarantees. Development cooperation should be more closely linked to foreign trade promotion. Schäfer emphasises: ‘We must no longer view Africa solely through the lens of risk and development aid. It is about a partnership approach – with opportunities for both sides.’

Producing instead of just importing: strengthening local value creation
Africa should become not only a supplier but also a partner in industrial development. SAFRI focuses on establishing regional industrial hubs and targeted technology transfers. Know-how partnerships, practical training and joint production networks are key to creating local value added and integrating German companies into regional supply chains. Schäfer explains: ‘Local processing and training are not development aid, but investments in markets of the future – with clear advantages for both sides.’

Digitalisation as a growth driver for both sides
Africa’s future will also be decided digitally. SAFRI calls on the German government to focus clearly on expanding digital infrastructure in order to lay the foundations for the use of technologies such as artificial intelligence and smart farming on the ground.

In addition, the EU’s Global Gateway initiative should be simplified so that funding actually reaches projects, and targeted investments should be made in energy and internet infrastructure.

Background
SAFRI is supported by the German-African Business Association (AV), the Federation of German Industries (BDI), the Federation of German Wholesale, Foreign Trade and Services (BGA) and the German Chamber of Industry and Commerce (DIHK). The aim of the initiative is to intensify economic relations between Germany and sub-Saharan Africa and to support companies in entering the market.

The publication can be downloaded here.

Contact:
Dr. Thando Sililo
Head of the Subsahara-Afrika Initiative der Deutschen Wirtschaft (SAFRI)
DIHK DEinternational GmbH
E-Mail: sililo.thando@dihk.de
Fon.: +49 30 20308 2346