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Africa watches as Zuma, Buhari meet over SA, Nigeria spat

Tuesday March 08 2016
buhari zuma

President Muhammadu Buhari receives the South African President Jacob Zuma at the State House in Abuja, Nigeria on March 8, 2016. PHOTO | MOHAMMED MOMOH |

South Africa's President Jacob Zuma arrived in Nigeria on Monday night to resolve a series of bilateral spats and disagreements but many will be watching for signs that Africa's richest economy and its biggest are ready to lead political and economic cooperation across the continent.

Nigeria's Foreign Affairs Minister Geoffrey Onyama said President Zuma would hold meetings with President Muhammadu Buhari and address a joint sitting of the Nigerian Senate and House of Representatives.

"The meeting between both presidents is very timely. Nigeria and South Africa are the pillars of this continent and moving forward, both countries have to work together; both presidents have to be close," he said.

"The meeting is also expected to calm the tension that may exist at another level among the citizens of both countries. So, this meeting is going to help to increase the trade between both countries, and they're both facing inimical challenges."

President Buhari and Zuma will not be short of bilateral challenges to discuss. MTN Nigeria, whose parent company is listed on the Johannesburg Stock Exchange, is battling a $3.9 billion fine imposed on it by authorities in Abuja, who have also turned the spotlight on Multichoice, the South African pay-tv company.

READ: MTN vs Nigeria: Light at the end of the tunnel?

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The two countries have also had spats over immigration and in 2012 South Africa turned away more than 100 Nigerian businesspeople it accused of having the wrong yellow fever immunisation certificates, sparking retaliatory moves by Nigeria.

President Zuma's entourage includes the ministers of international relations and cooperation, defence, trade and industry, energy, home affairs, mineral resources, as well as a business delegation.

Beyond the fights, however, the meeting will be watched for major policy directions between the two countries and the rest of Africa.

Nigeria, with a GDP of $568.5 billion overtook South Africa in 2014 to become Africa's biggest economy but it is only South Africa's seventh largest trading partner with crude oil as its only major export.

A slump in oil and commodity prices has exposed the reliance on foreign markets for both countries and a chasm in intra-African trade that the continent's two leading economies could potentially invigorate.

With a population of about 180 million, Nigeria is an important market for over 120 South African firms that have set up shop in the country across many sectors. For instance, 15 years after launching in the country, Nigeria now accounts for more than 60 million subscribers and a third of MTN Group's revenues.

Although the Dangote group invested $200 million in Sephaku, a big cement plant in South Africa, the trade imbalance reflects the lack of diversification in the Nigerian economy, which has put the Naira under pressure as national export revenues slump on historically low global crude oil prices.

Opportunities for cooperation abound, including in energy and transport infrastructure. For instance, while South Africa produces 200,000 megawatts of electricity for its population of 58 million, Nigeria only generates a paltry 4,000 megawatts.

A bilateral national commission set up in 1999 was supposed to plant the seeds of an African economic union. However, the departure of Thabo Mbeki and Olusegun Obasanjo, poor personal relations between Zuma and former Nigerian president Goodluck Jonathan, and a shaky foreign policy under the current South African leader have seen pan-African ideas put on the back burner.

Pan-African projects

The continent will be watching to see if warmer relations between the two leaders could go beyond resolving bilateral disputes and breathe life into pan-African projects like regional infrastructure projects and integration of regional economic blocs.

The timing has never been better. The migrant crisis in Europe has turned the spotlight on internal migration within the continent where many restrictions remain but where a few countries, like Rwanda, have started throwing their borders open for visa-free arrivals by Africans.

READ: Rwanda discusses terms for Israeli asylum seekers

In addition, the removal of trade barriers in the East African Community, Economic Community for West Africa, Common Market for Eastern and Southern Africa as well as the Southern African Development Community regional trade blocs has presented an opportunity for steps towards a continent-wide free trade area.

READ: Businesses lose as Africa trade blocs merger stalls

The two countries are best placed to spark action. They have both broken tradition and fronted candidates to leading institutions, with South Africa's Nkosazana Dlamini-Zuma in charge at the African Union Commission while Nigeria's Akinwumi Adesina and Benedict Oramah run the Africa Development Bank and the African Export-Import Bank respectively.

Many expect President Zuma and President Buhari to resolve the small problems between their two countries. What many will be watching for are signs that Africa's economic are willing to tackle the continent's giant problems.

-AFRICA REVIEW

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