“The connectivity issue is about air access policy and not just about airplanes landing…”

Investing in West Africa was the subject of an interesting discussion last week at The Docks, in Port Louis. In a Q&A with BIZWEEK, the moderator of the panel, Manisha Dhookhony, shared her understanding of the West African policy landscape, and the growing interest from the African diaspora to invest in the continent. The Chairperson of the African Legal Support Facility and of MINDEX also replied to our question on the air connectivity issue within the continent.

You were the moderator of the panel discussion on ‘Invest in West Africa’ organised by the Mauritius Business Network (MBN). What were the main features of this discussion?

Well, I think that there’s a lot of opportunity, and that the Western African region is one of those regions that’s developing with much vibrancy. If you look at Nigeria, it is the engine of growth in this whole region. Nigeria has a new government and they have developed new infrastructure, new thoughts, and new ways of doing things. For example, Nigeria didn’t have a blue economy focus for so many years, and they’re now thinking about that. Prior to this, they had only been extracting gas and oil, rather than really investing in developing the shore and the tourism sector. If you go in a country like Côte d’Ivoire, you see the vibrancy in terms of the new rail infrastructure that is being put in place. Mauritius can definitely gain from the boom in the Western African region.

You’re the one who usually gives lectures and interviews to enlighten the audience, and today (Editor’s note: last week), you were facilitating the dialogue. What did you pick up from the panel discussion?

Well, in terms of what we’ve picked up, it really is the question of diaspora. Whether we’re talking about Nigeria, Ghana or Côte d’Ivoire, there is a very important diaspora. It is one that would definitely want to invest, but as mentioned by some of the panellists, this diaspora may be investing in a different form. It can range from investing in joint ventures to structuring their investments, including wealth structuring. This is something which can be done via Mauritius.

The second thing that is very important to highlight is the International Financial Services Centre. It has been mentioned that our jurisdiction attracted $4 billion of investment, but at the same time, there is also a lot of Mauritian investment that is going in directly to those countries. This shows that Mauritian companies are mature or developing towards maturity to invest outside of the country as well.

Mauritius can definitely gain from the boom in the Western African region

One of the things that the panellists discussed is the connectivity access issue between Mauritius and Africa. Where do we go from these discussions?

Well, I am one of those who suffer from the lack of access connectivity. When I have to go to Ghana or Côte d’Ivoire, very often, I have to transit either through Dubai or through France, because of the ease and the regularity of connectivity between those places. It takes a long time, while a direct route would have taken much less time. So, I think it’s a wider issue of air connectivity across Africa. We could have good hubs across Africa, which helps in the interconnections between different countries. This is something that needs to be thought of in a holistic perspective. It’s all about air access policy. It’s not just about airplanes landing, it’s about what they call the third ride. There are many, many things that need to be decanted in this question.

We had one project, the Corridor to Mozambique, in 2016 or 2017. What’s not working?

I think it’s a question of numbers. How do you build the numbers? If you look at Dubai, for example, it had a small airport like Mauritius some 50 years ago. They’ve been able to build the critical mass for developing this connectivity. Being able to develop the critical mass is very important. And then there is the investment. Dubai, through Emirates, has been able to invest in having a huge fleet of A380s, and those long carriers have made Emirates and the Dubai airport what they are right now. It also depends on whether you have a sovereign wealth fund that backs you and supports the expenses of running an airline and a hub in this region.

Coming back to the ‘Invest in West Africa’ event, Ghana underlined that they have been in gold mining for the past 100 years, and that African countries are very rich in minerals and gold. Yet, the continent is still poor. It so happens that we’ve been talking about Africa as the place to be for investment during the last 25 years. Why should we believe that something is going to happen now?

Many of the countries across the continent are putting in place laws that are called local content law or local value addition law. Without a certain amount of value addition, you’re not able to export. I’ll give you the example of Botswana, where it has been very successful. A law to prohibit the export of raw diamond was enacted. They were able to attract investors to come into the diamond polishing and cutting business for them to be able to bring in that level of value addition.

The second thing is that critical raw materials, today, are in very high demand. Many countries, whether it is the EU, for example, or other countries, are developing memorandums of understanding and collaboration agreements where it’s not just about extracting and taking back. It’s also about bringing in value within the country, whether it is through training, value addition or bringing in the industries.

We talked a lot about the automotive sector today (Editor’s note: last week) during the MBN Panel Discussion. This is a particular sector that depends on critical raw materials. The investors are today boosting the local production. We’re seeing more and more of this happening. I’m quite confident that the new laws will bring the change we’ve been talking about.