Ideas & Debate

Innovation at the heart of new Swiss plan for Africa


President Uhuru Kenyatta (right) and Swiss counterpart Alain Berset (left) witness the signing of a framework agreement for return of stolen assets stashed in Switzerland to Kenya by the Swiss Ambassador to Kenya Ralf Heckner and Attorney General Paul Kihara June 9, 2018. PHOTO | MARTIN MUKANGU | NMG

One of my early childhood memories is of waiting at the airport with my family for my father to return from Africa. In today’s globalised world, it is difficult to convey just how unusual this experience was for a Swiss child in the 1960s.

Intercontinental travel was still a rare and exceptional experience back then. And Africa, to any Swiss child, was a remote and mysterious place.

My father worked for a Swiss trading company, the Union Trading Company (UTC), and travelled regularly to Africa. UTC traded goods between West Africa and Europe. It also ran some big department stores in Nigeria and Ghana.

Little did my father know that his business activities were emblematic of a new paradigm that would — decades later — come to lie at the heart of the first Swiss strategy for sub-Saharan Africa, which was only recently adopted by the Swiss government.

The document — only the second regional strategy in Swiss Foreign Policy — reflects the fact that Africa is of increasing importance on the world stage and of growing economic relevance.

It focuses not only on challenges, but emphasizes the opportunities and, importantly, it no longer argues in terms of aid, but promotes economic cooperation, beneficial to both parties.

Switzerland, located in the heart of Europe, has a dynamic, strongly export-oriented economy and is proud of its humanitarian traditions.

Throughout its history, the country has maintained close relations with the African continent, in particular through missionaries and traders like UTC.

Switzerland established diplomatic relations with newly independent African countries shortly after their independence and started its development cooperation with many of them. Today, Switzerland maintains embassies and cooperation offices in 23 out of 49 sub-Saharan countries.

The fate of Africa is closely linked to that of Europe — and thus of Switzerland. Africa's economic development, in particular, has a direct impact on Europe, both positive and negative.

On the one hand, the growing middle classes in many African countries render the continent increasingly attractive for investments and exports; on the other hand, the migration flows of young Africans to Europe —on the rise again just in the last few weeks — remain a cause of concern.

A country like Switzerland clearly benefits when Africa prospers. The emphasis of the Swiss government will therefore increasingly shift from development to economic cooperation.

Sub-Saharan Africa comprises some of the fastest-growing economies in the world.

The Covid crisis will slow down this development, but in the long run the potential remains. In reference to the Asian tiger economies, the strategy calls the African champions "lion economies".

The group includes countries such as Kenya, Ethiopia, Ghana and Côte d'Ivoire because of their strong growth and liberal economic policies.

Smaller but rapidly growing economies such as Rwanda and Senegal are also part of the group. In contrast, traditional big players such as South Africa, Nigeria and Angola have seen relatively weak growth rates in recent years.

Kenya, the third most important economy in sub-Saharan Africa, plays a central role: as one of the most promising lion economies, but also harbouring one of Africa's leading digital hubs.

In the future, Switzerland intends to promote trade relations and to support more proactively Swiss companies that are interested in doing business in Kenya.

A first important step consisted in the visit of a high-level Swiss business delegation shortly before the Covid crisis. The visit not only yielded very promising results, but also showed that the current bilateral trade volume of $150 million has room for improvement.

Today, Kenya exports mainly products such as coffee and flowers to Switzerland, while the latter supplies machinery and chemicals. To achieve an increase in trade volumes, it will be important to remove possible obstacles to new investments.

Often cited reasons by investors for shying away from engagements in Kenya are corruption and inefficiencies in the judicial system. Switzerland is prepared to support the Kenyan government in its efforts to fight corruption.

The two governments have already shown their commitment — together with the UK and Jersey — by concluding the Framework Agreement for the Return of Assets form Corruption and Crime in Kenya (FRACCK) in 2018.

Switzerland will continue to work with Kenya through support in the area of governance as well as proactive policies for the recovery of stolen assets. Switzerland has one of the most advanced legislations worldwide in this regard.

Cooperation in the area of digitalisation will be of particular interest. As the World Economic Forum in Geneva recently reported, Nairobi is one of the most dynamic digital hubs in the world. Kenyan leadership in Fintech is almost proverbial by now.

Switzerland is a leading banking centre and also strongly focused on science-based innovation.

It regularly leads international rankings in, for example the Global Innovation Index published annually by the World Property Organisation (WIPO).

Closer cooperation in the area of new technologies will therefore be of mutual benefit.

Digital and AI-based solutions will facilitate the achievement of development goals. For instance, Switzerland is already using digital technology to help secure the water supply of populations in Kenya's northeast and examines how other means such as drones may foster development in the health sector.

Some of these efforts are already under way, but the new strategy provides them with a sound political foundation and a clear conceptual framework. I am certain that those who will benefit from this novel approach are first and foremost the Kenyan and Swiss people.

Dr Zellweger is Swiss Ambassador to Kenya