An Evaluation of Nigeria – South Africa Bilateral Relations

Journal of International Relations and Foreign Policy 1(1); June 2013 pp. 32-40 Ebegbulem

Joseph C. Ebegbulem Department of Political Science University of Calabar Calabar - Nigeria

Abstract

During the apartheid era, Nigeria amongst The paper will also look at how the presence of other independent African states fought for the many South African companies doing business liberation of their black brothers and sisters in in Nigeria has unproved trade relations between South Africa. Nigeria had no bilateral relations Nigeria and South Africa. with the government of South Africa, as the country was a pariah state in the international Key words: Bilateral, Democracy, community because of her apartheid posture. At Commission, Development, Economic Relations the dawn of democracy in South Africa and Nigeria, there was a dramatic change in Nigeria-South Africa Bilateral Relations attitude. Both countries became two African giants that will champion the repositioning of It is evident that since independence in 1960, Africa on the path of long term development and Africa has remained at the forefront of Nigeria's reduce her marginalization in the international foreign policy. This nucleus of her foreign economic relations. Today, they are regarded as policy saw the country committing herself emerging giants in the African continent. fanatically to decolonization of the African Nigeria enjoys economic dominance in the continent and eradication of racial western part of Africa while South Africa enjoys discrimination and domination. According to economic dominance in the southern part of Onouha (2008) "the first opportunity for Nigeria Africa. While Nigeria’s economy depends to implement her foreign policy on anti- heavily on the oil sector, which contributes 95 colonialism was provided by the Shapeville percent of her export revenue, South African massacre of 21st March 1960. During the economy is a diversified one, which includes incident, the white South African police manufacturing, financial and minerals, among attacked South African blacks protesting against others. This papers aims at focusing on various racial discrimination and domination." This bilateral relations that exist between both incident which led to the death of 72 blacks with nations; their roles in the establishment of many wounded "marked the beginning of NEPAD whose main objective is to eradicate Nigeria's diplomatic confrontations with South poverty in Africa and to place African countries Africa." This incidence and other ugly racial on the path of sustainable growth and incidences in South Africa saw Nigeria development; the establishment of South Africa- spearheading the call for political and economic Nigeria Bilateral Commission which aims at sanctions against the apartheid South Africa in increasing the amount of trade and investments the International Community. between South Africa and Nigeria.

Examples were the suspension of South Africa With democratic government in place in Nigeria from the Commonwealth in 1961 and the in 1999, Nigeria - South Africa relations became imposition of trade embargo under the auspices less confrontational but friendly and cordial. of the Organization of African Unity (O.A.U). Prior to 1999 South Africa had a poor political Nigeria was instrumental to the call for relationship with Nigeria. At the time, Nigeria complete isolation of South Africa by the was ruled by a military junta that was politically International Community. hostile to South Africa. This, however dramatically changed with the end of the As a result of the pressure mounted by Nigeria military government and the return of and other nations of the world, Non-government democracy in 1999. From that point on, the Organizations and influential individuals, the South African State built a strong relationship racist regime of South Africa collapsed in 1991. with the Nigerian government under the "With the obituary of apartheid in 1991, the leadership of Obasanjo and Yar'Adua. This need for change in diplomatic strategies arose." relationship was also helped by the fact that (Onuoha op. cit). The degree of the solidarity, Thabo Mbeki had formed a strong friendship support and sacrifice which the government and with Obasanjo and Yar'Adua when he was in people of Nigeria exhibited in the quest for the exile in Nigeria from 1976 to 1979 (Dubow elimination of apartheid and the enthronement 2000). of democracy and majority rule in South Africa was such that Nigeria, not minding the Nigeria and South Africa are the emerging geographical distance, became identified as a giants of Africa. Politically, both countries are frontline state. the dominant state entities in their respective sub-regions. They also have a history of At the dawn of democracy in South Africa, cooperation with, and involvement in, a range of Nigerians, especially the professionals, were continental projects like the New Partnership for part of those that started to migrate to South Africa’s Development (NEPAD). Africa. Part of the philosophy of those early migrants was to contribute to the much needed The two countries have always added their nation building in post apartheid South Africa. voices in appreciating the new commitment to African development programmes by the With a democratic and majority rule in place in developed world, and ensure that engagement South Africa in 1994, South Africa quickly with the developed world meets Africa's switched over the Pariah Status in the objective of extricating the continent from International Community with Nigeria. The underdevelopment. They have also worked military government in Nigeria with its human closely on conflict prevention and resolution, rights abuses attracted the wrath of the the establishment and operationalisation of the International Community. South Africa now African Union, and put forward a detailed became the "aggressor" as it used its position as blueprint for sustainable development for emerging African Superpower to campaign for Africa. the suspension of Nigeria from the Commonwealth and the United Nations. Bilateral Political Relations

"Nigeria - South Africa confrontations reached Bilateral political relations between South its zenith in 1995 when the then South African Africa and Nigeria are strong with Nigeria President, Nelson Mandela vigorously considered as one of South Africa's important campaigned for the expulsion of Nigeria from partners on the African continent in advancing Commonwealth during the Commonwealth the vision of Africa's political and economic Summit in Auckland." renewal.

The leaders of both countries have traversed the Both countries have continuously stressed the globe spreading the idea of African renaissance imperative of ensuring that peace and stability - focusing largely on democracy, development becomes a reality in Africa. In one of their and security and seeking foreign investments to meetings in Abuja, the Heads of State Summit revive Africa's ailing economies. They have emphasized a need for an effective peer review called for greater international burden-sharing mechanism, which would be designed, owned in peacekeeping missions, campaigns for the and managed by Africans. This mechanism, the annulment of Africa's external debt, Heads of State emphasized, must be credible, championed better access for African goods transparent and all-encompassing, to entering western markets and called for Africa's demonstrate that African leaders are fully aware integration into the global economy in fairer of their responsibilities and obligations to their terms. peoples. It is noteworthy to emphasize that the

It will be recalled that the former Heads of State institution of Peer Review mechanism was championed by Nigeria and South Africa. of Nigeria and South Africa, Chief Olusegun Obasanjo and Thabo Mbeki worked relentlessly Nepad: Nigeria - South Africa Initiative to lobby the rich nations of the world to focus greater attention on African problems. At the G- New Partnership for Africa's Development 8 meeting of the world's richest states in 2000, (NEPAD) is an African led strategy for both leaders argued strongly that the rich economic development and poverty eradication nations should forgive Africa's debt. Both had from the African continent. NEPAD recognizes called for technology and resource transfer from Africa's responsibility to create the conditions the West to Africa, criticizing the gap between for development by ending conflict, improving promise and delivery on the part of most economic and political governance and Western states. NEPAD, championed by Mbeki strengthening regional integration. It is based on and Obasanjo proposed a simple bargain: the the principles of good governance as basic West provides debt relief, opens its markets, requirement for peace, security and sustainable invests in Africa and supports peacekeeping political and socio-economic development. It is missions in exchange for democratic also based on African ownership and full accountability and financial probity by African utilization of African resources for leaders through a self-monitored peer review development. Nigeria and South Africa mechanism. Both leaders have common undoubtedly played an indispensable role in the aspirations for a united and prosperous establishment of NEPAD. democratic Africa. Thabo Mbeki's dream to Without the leadership of Nigeria and South play a leading role in Africa's socio-economic Africa, the creation of NEPAD would have been development merged with Obasanjo's dream of more difficult, if not impossible. The creation of economic diplomacy which led to series of NEPAD was predicated on the believe by South consultations and meetings by the leaders of African and Nigerian leaders that the regional both countries. document will reposition Africa on the path of The meetings of both countries since the past long term development and reduce her decade underscore the need for greater marginalization in international economic coordination of regional mechanisms for relations (Adams, 2006). conflict prevention, management and resolution within the African Union mechanism and the United Nations Security Council.

The thinking among the leaders of those two This is a reminder to Adams (2006) assertion countries and other founding members of this that “the opportunities and benefits of the initiative is that "if the continent is to matter in regional initiative for African nations, the international community in the decades of individually and collectively, have been stressed 2000's and beyond, there is need to rethink the by African leaders and their western allies, development strategy" (Omoweh 2003). While especially members of the G.8 group, who have the long term objectives of NEPAD include (a) pledged their support.” eradicating poverty in Africa and to place African countries on the path of sustainable African leaders with Nigeria and South Africa at the forefront realized that if Africa is to matter growth and development and thus halt the st marginalization of African globalization process in the international community in the 21 and (b) to promote the role of women in all century, there is the need for it to rethink its activities; the short and medium term objectives development strategy (Omoweh, 2003). Hence include among others: the establishment of New Partnership for Africa’s Development (NEPAD) under the (a) Strengthening the mechanisms for leadership of both countries. It is believed by conflict prevention, management and both countries and other African leaders that resolution at the sub-regional and NEPAD will reposition the African continent on continental levels and to ensure that these the path of long term development and mechanisms are used to restore and minimize her marginalization and neglect in maintain peace; international economic relations. NEPAD is (b) Promoting and protecting democracy and therefore a commitment by African leaders to human rights in their respective countries accelerate the integration of the African and regions by developing clear continent into the global economy, as well as a standards of accountability, transparency call to the rest of the world to partner with and participatory governance at the Africa in her own development on the basis of national and sub-national levels; her own agenda and programme of action (c) Building the capacity of the states in (Ebegbulem et al., 2012).

Africa to set and enforce the legal NEPAD is based on the principles of good framework and maintain law and order governance as basic requirement for peace, (Adams, op cit). security and sustainable political and socio- Nigeria and South Africa see NEPAD as economic development. It is based on African opening a new and different chapter in Africa’s ownership and full utilization of African development. Their thinking corroborates Brian resources for development. It rested on African Posthumus’ view which presents NEPAD as ownership and leadership and participation of “the hope for turning back the clock of delay in all sectors of African society. Africa” (Posthumus, 2009). Nigeria and South Bilateral Economic Relations Africa agree jointly that NEPAD represents a tacit recognition of the existence of Since the inception of democratic rule in developmental crisis and believe that there is a Nigeria, South Africa and Nigeria have had need to tackle it through this continental encouraging bilateral economic relations. Since initiative. then, South Africa has emerged among the top

Both countries believe that NEPAD has become investors in many sectors of the Nigerian the defining process in the quest for long term economy. development.

South African companies' presence is visible in As a result of this, South Africa's exports have the Nigerian economy, especially in areas such the potential to grow dramatically. Conversely, as telecommunication, engineering, banking, Nigeria's export products to South Africa retail, hospitality, property development, consists of a single raw material in the form of construction and tourism, to mention a few. In oil. Its oil exports to South Africa are unlikely to terms of technology and infrastructure, South increase dramatically over the next few years Africa has an edge over Nigeria while Nigeria and its export products are also unlikely to has an advantage of large market potentials for diversify. This translates into an unequal trade investments over South Africa. This is why situation between South Africa and Nigeria; in there are a lot of South African companies with which South Africa is in fact the dominant huge investments in Nigeria. partner in terms of trade relations. What really highlights the unequal relationship that exists In 1999, the South African and Nigerian between Nigeria and South Africa, however, is governments signed bilateral agreements on the fact that South African companies have trade and investment. These agreements come to dominate many sectors of the Nigerian amongst other things, aimed to increase the economy. amount of trade and investment between South Africa and Nigeria (Sifingo 2003). The signing South African Companies as Big Players in of these agreements witnessed inter-alia (a) the Nigerian Economy improved trade relations between South Africa Prior to 1999, there were only 4 South African and Nigeria and (b) South African corporations companies operating in Nigeria (Ezeoha and as big players in the Nigerian economy. On Uche 2005). This situation has dramatically improved trade relations between both changed with the assistance of the South countries, we saw that the volume of trade African State, and the signing of bilateral between South Africa and Nigeria increased agreements and the establishment of South from 1999. Prior to 1999, trade between the two Africa - Nigeria Bi-national Commission. countries was minimal. In 1994, South Africa Today, there are over 100 South African exported US$8.1 million worth of products to companies doing business in Nigeria (Sifinan Nigeria; while it imported US$3.1 million worth 2003). Within a mere 8 years, South African of commodities from that country (Omojola companies have become major players in almost 2006). every sector of the Nigerian economy.

With the signing of the South Africa - Nigeria The biggest investment by South African bilateral trade agreement, the situation changed. companies in Nigeria has been in the "By 2005 South Africa was exporting goods to telecommunication sector. In 2001, MTN was the value of R3.4 billion to Nigeria and awarded a license by the Nigerian government importing R4.2 billion worth of commodities to operate a cell phone network in the country. from Nigeria (Tenikin 2007). South Africa's In return, MTN had to pay licensing fees of over exports to Nigeria include machinery, electrical US$285 million. Added to this, MTN has spent equipment, appliances, wood, paper, prepared a further US$lbillion on setting up its operations food stuffs, beverages, plastics, rubber, in Nigeria (Lutchman et al., 2004). Currently, chemicals etc. However, oil makes up 97% of MTN is the largest cellular network company in Nigeria's exports to South Africa (Pahad 2002). Nigeria with over 10million subscribers The situation means that South Africa is (Tenekin, 2007). exporting a wide range of goods to Nigeria, many of which are value added manufactured goods. © American Research Institute for Policy Development 36 www.aripd.org/jirfp Journal of International Relations and Foreign Policy 1(1); June 2013 pp. 32-40 Ebegbulem

South African companies have also become The need for improved bilateral economic dominant players in Nigeria's construction relations between the two countries gave birth to sector. Entech, a South African based South Africa - Nigeria Bi-national Commission. engineering company, headed a consortium of South African companies that were awarded a The South Africa - Nigeria Bi-National tender worth R2.1billion from the Lagos State Commission (Bnc) government to redevelop the Bar Beach and Victoria Island area of Lagos (Pahad, 2002) In October 1999, a South Africa-Nigeria Bi- Many large South African companies have also national Commission (BNC) was established by invaded the tourism and leisure sector in the South African and Nigerian governments. Nigeria. Under NEPAD, the South African The Bi-national Commission was established to parastatal, the Industrial Development consolidate and strengthen bilateral political, Corporation (IDC) has become one of the economic and trade relations between Nigeria largest investors in Nigeria's tourist sector. and South Africa. It has a mandate to review cooperation between the two countries on foreign To date it has invested over US$1.4 billion in affairs, public enterprises and infrastructure, tourism and telecommunications ventures in agriculture, minerals and energy, trade, industry Nigeria (United Nations Report, 2005). Another and finance among others. The Bi-National major player in the tourism sector is the South Commission has been meeting twice a year ever African Company, Bidvest. Through its since and aims to increase the amount of trade subsidiary, Tom-vest, it has purchased one of and investment between South Africa and the biggest tourism companies in Nigeria, Nigeria. The Deputy Presidents of both Touchdown Travels. The biggest development countries head the commission. At the meetings, in the Nigerian tourism sector however, is the trade and investment opportunities in Nigeria massive Tinapa project in the Cross-River state. and South Africa are identified and plans are put This project falls under the auspices of NEPAD in place so that they can be realized. In this way, and has the full backing of the South African many deals that have proved lucrative for South and Nigerian governments. South African African and Nigerian companies and parastatals companies are also heavily involved in Nigeria's have been facilitated through the Bi-national media and entertainment sector. DSTV, as a Commission. The broad objectives of the South major force in the television industry, accounts Africa-Nigeria Bi-National Commission are; for 90% of the viewers that watch satellite TV (i) to provide a framework for collaborative in Nigeria between 2005 and 2009. This has and cooperative efforts in the common seen DSTV growing into the sixth largest endeavour to bring Africa into the company listed on the Lagos Stock Exchange. mainstream of global political, social (Omojola, 2006) and economic developments; According to Jonah Onuoha, “as at mid-April (ii) to provide the basis for the governments 2003, an estimated 55 South African companies and private sectors of both countries to were doing business in Nigeria. The single consult each other on their respective largest investor is MTN”. Its entrance into the economies and investment climates with Nigerian market came by way of the first a view to promoting trade and industry; telecommunications auctions process in Africa, (iii) to improve bilateral relations between in January 2001. At that time MTN’s entrance the two countries in the field of into the Nigerian market was the company’s technology, education, health, culture, single biggest investment outside South Africa youth and sports; (Onuoha, 2008).

(iv) to utilize the generous endowments of As Lutchman and Daniel (2004) noted, in 2003, both countries in human and natural two-way trade flows between South African and resources to maximize socio-economic Nigeria amounted to R5.3billion. Further development, through economies of evidence has shown that out of that amount, scale, global competitiveness and South Africa’s exports were valued at specialization based on comparative R2.3billion, whiles its imports share 98%, of advantage; which oil amount to R2.7billion. According to (v) To establish the mechanisms for putting Onuoha (2008), as at mid-April 2003, an the benefits of economic cooperation to estimated 55 South African companies were the service of peace, stability, social doing business in Nigeria. integration and economic development in other parts of the continent. The South Africa-Nigeria Chamber of Commerce arose out of the Bi-national The cooperation of both countries through the Commission. Some of the largest South African South Africa – Nigeria Binational Commission companies that have investments in Nigeria are seeks to create a climate conducive for the members of the chamber, such as MTN, creation of a better quality of life for all. The Standard Bank, First Rand Massmart, Sun commission is also seen as a platform in which International etc (www.sa.ncc.co.za) The main both countries can jointly as partners impact goal of the South African - Nigerian Chamber of positively, in conjunction with other African Commerce is to identify investment countries, on regional peace and security; socio- opportunities in Nigeria for South African economic development; poverty alleviation; and Corporations. It also provides information on the prevention of crime and corruption. Nigerian government policies and how to do

Nigeria and South Africa have in recent times business in Nigeria. The Chamber of Commerce sought to advance their mutual interests by also conducts market research for South African companies wanting to do business in Nigeria. intensifying their bilateral relationship through cooperation in the areas of trade, investment, The South Africa - Nigeria Binational infrastructure development, science and Commission has been valuable in furthering technology, agriculture, minerals and energy, South Africa's business interest in Nigeria. transport and communication etc. Indeed, the South African state has used its

Both countries have been on regular diplomatic power and the relationship that it has consultations to find ways of establishing with the Nigerian government to assist South common positions on efforts to bring the African corporations and parastatals to become continent into the mainstream of global big players in the Nigerian economy. Along economic development. with this, South Africa, through NEPAD and the signing of the bilateral agreement on trade, has The Commission has facilitated cooperation found in Nigeria a very lucrative market for its between the two countries in areas such as exports. defence and security, science and technology, The Commission looks at tariffs, work with education and culture. The benefit of this Standard Organisation of both countries to commission to both countries can be seen from ensure high standards of export and imports the fact that between 1999 and 2002, there was between the two countries. approximately a 540 percent increase in the volume of South Africa’s export to Nigeria

(Onuoha, 2008).

Jacob Zuma, a former Vice President of South There is an urgent need to institutionalize the Africa under Thambo Mbeki, observed in 1999 bilateral relationship between both countries for when he visited Nigeria that “inasmuch as many continuity. There is no doubt that the creation of will agree that such bilateral arrangements will the South Africa - Nigeria Bi-national be an unequal one because Nigeria is Commission and the growing bilateral predominantly a consuming nation, Nigeria still commercial ties that exist between the two exports not just communities but also human nations will help to overcome this concern. Both resources.” As such, the relationship between countries established the Bi-national the two countries should not be Commission to promote trade and political co- underemphasized. Seeing Nigeria as a operation in 1999 which has since met many consuming nation, South Africa offers a good times. A Nigeria-South Africa Chambers of market to any viable business in Nigeria. Commerce was also established in 2001. Trade between both countries has already exceeded Conclusion 3billion Rand, with Nigeria sending oil and Through the Nigeria - South Africa bilateral brains to South Africa in exchange for relations, it is very clear that Nigeria and South manufactured goods and technology. Nigeria Africa have taken the responsibility to be at the has already become South Africa's fourth largest forefront of confronting Africa's endemic trading partner in Africa. developmental challenges. As a result of the However, it is worthy of note that the idea of realities of today's fast globalizing and Nigeria and South Africa as continental leaders technology-driven world, it became incumbent is far from being universally accepted. The on both nations to work towards greater political strategic alliance between both countries is seen and socio-economic integration within Africa. by some as little more than a new breed of This is evidenced in many bilateral agreements African imperialism. South Africa and Nigeria and the establishment of Nigeria -South Africa must reassure other African states that their Bi-national Commission which is committed to intentions are noble. Both countries must the consolidation and strengthening of political, consult with other countries and ensure that economic and trade relations among AU their actions are not seen as attempts to members, especially among the two countries. dominate the continent in pursuit of their own parochial interests. It is only by taking measures The presence of many South African investors to alleviate such concerns can Nigeria and South in Nigeria has boosted the economies of both African become the continental beacons of counties. This is the result of encouraging democracy and engines of economic growth. bilateral trade relations that existed between the two nations. The South African state has not only opened up Nigeria's economy to South African investments and exports through NEPAD, it has also done so through bilateral agreements and a Bi-national Commission.

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