African pivot: what projects on the continent may be of interest to Russian business

The Russian-African partnership, “frozen” since Soviet times, is once again becoming relevant in the context of the global agenda. Russian President Vladimir Putin also announced Russia's readiness to strengthen trusting ties with African states in May when he greeted the participants in the 11th International Meeting of High Representatives in charge of security issues.

If a few years ago only a small share of Russian companies were interested in the African continent, and the majority focused primarily on the European Union, now the potential of the region is being discussed at the state level.

On the eve of the "Russia—Africa" summit, which will be held in St. Petersburg on July 26–29, we are talking about the most promising projects and technoparks in the African region, selected together with experts, in which Russian entrepreneurs can potentially participate.

"Green" energy and low carbon economy

At the moment, a number of large industrial and infrastructure facilities are being built in Africa, in the implementation of which the countries of Europe, Asia and America are participating. A significant part of these projects belongs to the "green" energy and development of low-carbon production. Irina Gaida, Deputy Director of the Project Center for Energy Transition at Skoltech, told TASS that one of the most promising areas of international cooperation today for Russian integrators of RES (renewable energy sources) — this includes a turn towards African countries and investments in joint projects. “Africa has become one of the main markets for the deployment of renewable energy due to its huge potential in the field of solar and wind energy. Russian companies can actively participate in such joint projects, offering their technologies (including in small hydropower, electrolyzers, post-lithium storage) and successful experience as integrators of projects in the field of solar and wind energy, — Gaida emphasized.

Thus, in the Democratic Republic of the Congo, a cascade of seven Grand Inga hydroelectric power plants is being built, the investment in which is estimated at 14 billion US dollars. Each power plant will generate between 4 and 8 GW, for a total of 40 GW. It is assumed that the "Grand Inga" may become the largest hydroelectric complex in the world.

Another hydropower project is planned to be implemented in Ethiopia — HPP "Mandaya" with a capacity of 2 thousand MW. The project will be implemented in one phase, with construction due to start in 2027 and commercial commissioning scheduled for 2031. The capacity of the HPP will be 12.2 thousand GW/h.

Since 2022, Ergon Solair Africa has been implementing a USD 53.7 million solar photovoltaic project in Kenya. The station will add 40 MW of photovoltaic power to the country's national power grid.

Another environmentally friendly project will be a hydrogen plant for the production of "green" ammonia for 4 billion US dollars in the Egyptian city of Ain Sokhna. Construction is being carried out by Hassan Allam Utilities (Egypt) and Masdar (UAE) and is scheduled to be completed in 2026. The first stage involves the installation of an electrolytic cell with a capacity of 100 MW and a capacity of 20,000 tons of hydrogen per year. By 2030, the capacity can be increased to 4 GW, which will make it possible to produce 2.3 million tons of "green" ammonia annually.

"There are UN sustainable development goals, and the first in these goals — education, elimination of poverty, equal access to energy resources and water. If we are talking about Africa, then the first thing to do is not to try to collect or not to collect bottles, but to ensure that all people who live on this continent have access to energy. It is she who will help solve both problems with food and problems with water, », — noted the Deputy Chairman of the Supervisory Board of the  «Reliable Partner» Dmitry Gusev. According to him, the niches occupied in the Russian and European markets, business can master in a freer African one.

Roads, industrial production and metal mining

Ryan Collier, General Director of Rosatom's regional office in Central and South Africa, told TASS that African countries — one of the company's key partners.  "We see great potential on the continent, not only in the field of nuclear energy, but also in energy storage systems and wind energy. We are actively exploring the potential of wind energy in Ethiopia and South Africa. And of course, we continue to engage in nuclear energy. We have signed intergovernmental agreements with various African countries, and we are trying to help them realize their nuclear ambitions, — Collier noted.

According to him, South Africa has the foundations and a long history of the development of nuclear energy.  "Kuberg Nuclear Power Plant is operated in the country" highly successful and safe for over 35 years. There is also the Safari-1 research reactor for over 55 years. Which means that they have all the legal and regulatory framework in place to move forward along the path of building a new nuclear power plant. Now we see great potential in other African countries that have done a lot in terms of developing the necessary nuclear infrastructure. Such countries are Ghana, Nigeria, Zambia and Rwanda, — Collier emphasized.

At the same time, along with RES and NPP projects, more traditional ones are also being implemented in the region. So, since 2022, Tanzania and Burundi have been building a 282 km long railway together, which will connect the city of Uwinza in Tanzania and the capital of Burundi, Gitega. It is assumed that further this road will go to the eastern part of the DR Congo, and then — Zambia, Rwanda and Uganda. The volume of investments is estimated at 1.04 billion US dollars.

In addition, since 2022, a project has been implemented in Kenya to build six factories producing building materials. They are expected to produce cement, granite, ceramic tiles and timber. At the same time, 30% of MDF and cement will go to the local market, and the remaining 70% — for export.

Finally, the Australian gold mining company Theta Gold Mines plans to restore the old underground gold mines in the province of Mpumalanga (South Africa). The first production is expected in the second quarter of 2024. The life of the deposit is estimated at 12.9 years, while 30 tons of gold will be produced from 35 tons of gold ore.

Development of IT solutions for African regions and beyond

In addition to doing business, African countries offer opportunities for venture capital investment in digital technologies. The continent has a high proportion of the young population, and in some countries there is good access to the Internet and a sufficient number of users with smartphones and computers. Against this background, technopolises — special zones where high-tech projects are created and developed. These centers provide space for young entrepreneurs and start-ups, help attract investment and establish the IT industry on the continent.

Egyptian Smart Village is one of the most competent business parks in the world. It includes international and local telecommunications and information technology companies, financial institutions and banks. Foreign investors may be interested in the Agency for the Development of the Information Technology Industry, which acts as an accelerator for start-ups and provides them with mentoring, inexpensive office space, and start-up capital.

The widest distribution of the Internet on the continent — in South Africa, where there is an increasing need for the development of global digitalization. Here, since 2015, the management company has been striving to turn the country's leading business center TechnoPark Stellenbosch into a sustainable innovation center. Among its residents are Capitec Bank, Compuscan, Garmin Ltd., which specializes in GPS technology, major Internet service provider and web developer Herotel, and radar systems manufacturer Reutech Radar Systems.

But African technology parks strive to support and develop information and communication technologies not only on their territory, but also in other regions. For example, residents of Tunisian El Ghazala are international corporations Microsoft, Alcatel, Ericsson, Huawei Technologies, ST Microelectronics and others.

However, the process of digitalization on the continent is still slow. So, in Central Africa, this is a consequence of the lack of affordable Internet, computers and reliable round-the-clock electricity. And Silicon Mountain, a tech cluster in Cameroon, is looking to bridge that gap — trains young people to develop accessible digital innovations, and is also looking for partners to showcase acquired skills.

Technologies for the "green" projects

Technoparks in Africa are developing not only local and international initiatives to improve life, but also contribute to the development of "green" technology, keeping up with the global agenda.

For example, Moroccan Information Technopark Company has established itself as an incubator and accelerator for small businesses and companies working in the field of information and communication and "green" technologies. The Technopark provides them with funding, access to markets, training and technical support.

Co-Chair — State Secretary of the Russian Environmental Chamber, Chairman of the Public Council under the Federal Service for Hydrometeorology and Environmental Monitoring Vadim Petrov noted that the African market is promising for Russian technology companies under the current sanctions restrictions.  "What is extremely important— it is a pure humanitarian international environmental mission. It seems to me that an important direction in modern conditions would be the development of common Russian-African ESG principles for joint projects, so that investment projects would be aimed at solving environmental problems. Then it will be difficult to disregard national ESG approaches", — explained Petrov.

He also stressed that if today we focus our efforts on the creation of Russian-African ecotechnoparks, then, given the importance of solving environmental problems in Africa for the whole world, these projects will obviously become extremely attractive for ESG investors in the next five to ten years.

In December 2021, a master plan for the development and construction of the Kigali Innovation City (KIC, Kigali Innovation City) was presented in Rwanda. It is a multifunctional world-class smart innovation center for the development of advanced solutions that can stimulate economic growth in the city, the country and the African continent as a whole. Last but not least, the project will be "green": 50% of the area of the city — open spaces, including woodlands. It is expected that the implementation of the KIC project will create an additional 50 thousand jobs, attract foreign direct investment in the amount of more than 300 million US dollars, and the export of information and communication technologies will bring another 150 million US dollars a year.

Also since 2010, iHub — a coworking space and innovation platform that brings together entrepreneurs, software developers and investors interested in developing technologies to solve key problems in Africa. Here, startups can get financial support, advice from mentors, and recommendations from industry experts. iHub's international partners include Facebook, Google, Oracle, Safaricom, Seacom, and the World Bank.

Concentration of universities and fintech

Cape Town hosts the oldest technology business incubator on the African continent — Cape Innovation and Technology Initiative (CiTi). It was created to support innovation and accessibility in the financial services industry, as well as to develop blockchain initiatives. CiTi has gained international recognition as the main catalyst for the fintech boom in the region.

On the other side of the country — in Pretoria — Since 2001, The Innovation Hub business park has been opened, Africa's first internationally accredited science and technology park and a member of the International Association of Science Parks (IASP). It is symbolic that it is located near the Council for Scientific and Industrial Research (the leading research organization in South Africa) and the Ministry of Science and Technology of South Africa. This innovation center houses, among other things, the mLab Southern Africa mobile application laboratory and a business incubator.

And in Kenya there is a real Silicon savanna — Konza Technopolis. It became part of the national development program Kenya Vision 2030. It is home to leading telecommunications companies and scientific institutions, including the Kenya Institute of Science and Technology.

Among several higher education institutions in Nigeria is the Yabacon Valley Technology Park. And the main pride of the Nigerian center CcHub — Andela, a talent accelerator for programmers with campuses in Lagos, Nairobi and New York, preparing developers for work in large IT companies around the world.

The Digital Technology Park (PTN) project in Senegal, due to open in 2025, completes our overview of African technoparks. The total investment in the project — €70 million.F The park is expected to center Senegal's digital economy in the country's new business center — city of Diamnadio. About 20 companies, including international corporations such as ATOS, Free and Solution Informatique Durable (SOLID), have already expressed interest in hosting some of their activities in the future park.

Published with the written permission of the TASS news agency.