Why Economics Minister Habeck is backing Africa

Cape Town Can Africa replace Russia as a supplier of raw materials? And can the continent help Germany to free itself from its dependence on China? These are questions that occupy Robert Habeck’s mind this week during his five-day trip to Africa.

The first stop of the Economics and Climate Protection Minister was Namibia on Monday, and South Africa is on the itinerary from Tuesday. The fourth German-African business summit in Johannesburg will focus primarily on deepening economic relations.

The trip to Africa is another building block in Habeck’s plan to make the German economy less dependent on doing business in China. Habeck wants to reduce dependencies on Beijing, especially when it comes to “critical” raw materials.

“For us, the African continent is the continent of opportunities,” said Dirk Jandura, President of the BGA Foreign Trade Association. “In some parts it is developing faster and more dynamically than all other regions of the world and therefore has great potential.”

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Namibia is one of the hopefuls of the Germans. Above all, cooperation in the production of “green hydrogen” is to be expanded there. “Namibia also has very, very great locational advantages compared to European locations – very sunny, very strong wind areas, especially on the Atlantic,” said Habeck in the run-up to his trip.

Above all, a gigantic hydrogen project in the southwest of the country has become a symbol of optimism. In total, the investments planned near the coast for solar and wind power plants and for a new deep-sea port to transport the green energy should amount to 9.4 billion dollars. This is a mega project for a country with 2.5 million inhabitants, whose total economic output currently totals twelve billion dollars.

The Hyphen consortium, which also includes the German company Enertrag, was awarded the contract for the hydrogen project. The Namibian government is now hoping that the desert country will develop into one of the most important production sites for green hydrogen in the world.

Some observers are downright euphoric and already see Africa as the new “service station of Europe”. In a position paper, the Federation of German Industries (BDI) warns that new raw material partnerships should be supported as a matter of urgency. To this end, guarantee instruments for exports and investments should be expanded, with which companies in Africa in particular often take high financial risks.

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Stefan Liebing, who has headed the Africa Association since 2012 and has been active in the energy sector for a long time, also sees an urgent need for action. He calls for the federal government’s export credit insurance (such as the Hermes guarantees) to be improved. These instruments would also have to be tailored more closely to African circumstances than has been the case up to now.

Large-scale hydrogen project in the fight against the energy crisis: Not just euphoria about working with Africa

But there is not only euphoria in view of the large-scale hydrogen project. Skeptics point out that previous major projects in Africa often failed. The Desertec initiative, founded in 2009 with the aim of supplying green electricity from the Sahara to Europe, was initially celebrated with similar enthusiasm in the past, only to then disappear into insignificance just as quickly.

In Namibia, this could possibly also happen in the end because the production of hydrogen is currently still expensive. For transport reasons, this would probably first have to be processed further on site into “green” ammonia. The shipping of “pure” hydrogen is still a dream of the future because of the necessary cooling to minus 250 degrees.

Power generation from wind and sun

Namibia could become a major supplier of green hydrogen.

(Photo: dpa)

There is also increasing resistance from environmentalists because the project with its wind and solar parks is located in an ecologically sensitive nature park. And finally, after the many bad experiences with large-scale projects, many observers are wondering how much Namibia itself will ultimately benefit from the billions invested. In the past, prosperity enclaves often emerged in the midst of deep poverty, without ultimately offering the country more sustainable development.

Trans-Saharan gas pipeline: Experts urge caution

Political observers emphasize that the comparatively less complex Trans-Sahara gas pipeline also calls for caution. At some point, gas from the Niger Delta in southern Nigeria will flow through the more than 4,000-kilometer-long pipe to Algeria – and from there it will be transported through the Mediterranean Sea to Europe via an existing network of pipelines.

The idea has been implemented for almost 50 years. Ongoing disputes between the countries involved, but also the presence of bandits and terrorist gangs on the southern edge of the Sahara have never really allowed the pipeline project to make any progress. The fact that his resumption was agreed in February changes little for the time being.

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Another problem concerns the production capacities. Even if the Trans-Saharan Pipeline did come about, it would still not guarantee a continuous flow of gas to Europe.

Energy experts point out that Nigeria’s infrastructure has largely fallen into disrepair as a result of vandalism, lack of funding and lack of maintenance. The country’s four ailing oil refineries speak a clear language. Unlike Algeria, Europe’s third largest gas supplier, Nigeria also has no spare capacity and could at best increase it in the medium to long term.

First of all, a reasonably functioning and reliable gas infrastructure would have to be built in Nigeria, which experts say will take five years or more. Provided that the project finds the necessary financing at all, because many Western countries no longer want to support fossil energy projects in Africa in the future.
In view of this mixed situation, it is rather unlikely that Europe will be able to tap into its southern neighboring continent as an energy supplier on a large scale in the short term, despite the raw material partnerships now being called for. Habeck’s flying visit to southern Africa shouldn’t change much about that.

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