Minister of State for Trade and Development Joe Costello recently travelled to Africa to seek new opportunities for Irish businesses. He tells Metro Éireann about his trip and Ireland’s plans to develop strong trade links with Africa
You were recently in Nigeria and Ghana. What did you go there to do?
First of all, I have a dual portfolio: I am responsible for trade and development. One of the things we have done in relation to Africa is build on the development side, which has been very much central part of Ireland’s aid involvement in the world.
Eighty per cent of our overseas development aid goes to sub-Saharan Africa and seven of our nine programme countries are in [the region]. So we have very strong engagement there.
We recently put together a strategy for trade, business and investment that would be complimentary to our development strategy… we now recognise the enormous economic advances that have been made throughout the continent of Africa [especially] in the last five to six years where economic growth in percentage terms has been the fastest growing in the world.
What we are anxious to do is to combine the two strategies but not to have one dependent on the other. So from that point of view we have established a hub in South Africa, which is very much up-and-running… we met a lot of partner companies there and a lot of business was conducted. But as well as that, we engaged with university side, as well… we met people in the University of Cape Town and set up a fellowship, a scholarship for students from townships with Louise Asmal, who is the widow of Kader Asmal, the leader of the anti-apartheid movement here in Ireland.
In west Africa we are establishing a business hub and that would be located very much in Nigeria and Ghana. We have an ambassador in Nigeria but we don’t have in Ghana, we have an honorary consul, so we started putting together the structures there… to build up business relationships, meeting Irish companies that are there, meeting African companies that are there.
We have an interesting initiative between Dublin Port and the ports of Ghana, Tema and Takoradi where management personnel in those ports come to Ireland and see how we operate our ports. It is a two-year programme [supported by the UN and Irish Aid]. Best practice in ensuring good port management [is important] because one of the biggest problems with trade in Africa is congestion at the ports and the difficulty in ensuring that perishable goods are processed quickly. We are doing the same thing with Tanzania – the programme is up and running there.
In Nigeria, we went to see the Guinness brewery that’s there and we were very much impressed by the fact that it is now entirely Nigerian. It was the first Guinness brewery that was established outside Dublin, in 1962. We’re very impressed by the work ethic as well as the overall ethic in the brewery, that they had taken on board the underlining principles of the Guinness family in the manner in which they deal with their workers and the community – they took care of the workers very well, they had pensions, they built houses, etc – so they are not just a business, they also have community responsibility.
The Governor of Lagos [Babatunde Fashola] proposed himself that we set up an Irish-Nigerian Chamber of Commerce. Obviously, we would be continuing with that. And we were impressed about the other areas we saw; we had a look at the Water for Life programme and Nutricema [Glanbia’s Nigerian joint venture] among others.
How many people are employed by Irish companies in Nigeria?
We estimate that about 15,000 Nigerian people are employed by Irish companies in Nigeria, though we’re told that the biggest area of employment of native African people is in South Africa, where a number of Irish companies employ approximately 13,000.
What we are looking at very much is expanding horizons, looking at what is strong in Irish development and then seeing how we can engage the Irish private sector to go into Africa. But we are very anxious to use the same principles. It is what I call an ethical engagement – that is, the basic behaviour used by Irish missionaries, which was towards education and health and helping people as much as possible to develop and deal with poverty, and which then was followed up by Irish Aid, which is very much poverty-oriented. That is why we are almost exclusively in sub-Saharan Africa because that is the area of greatest need throughout the world. And we want the private sector to accept basic human rights principles.
We expect to have our first fully fledged trade mission from Ireland to Nigeria and Ghana [in 2013]. We would meet with private companies that are there like Tullow Oil and look at companies that are interested in doing business in Africa. We want them to do business. We would assist them in every way… and in return we expect they would abide by the best practices in business engagement. In that sense it’s advantageous to both sides.
I met most members of the African Union in Addis Ababa earlier in the year, and in discussing the Africa Strategy [I learned] they are hugely enthusiastic about it, and that is the direction that they wish to see it, they wish to see the situation improve, [they want] less dependence on development [aid]… They want to see foreign direct investment coming in from western countries, and eastern countries as well, that would boost their own economic development. They want trade that doesn’t undermine their own trade.
In terms of Irish companies in Ghana and Nigeria, how many would you estimate operate there?
There are quite a few companies that have come over, particularly in the construction sector since the demise of the Celtic Tiger. We were surprised to see that there are small companies – most big Irish construction companies are all in Nama but smaller companies, local ones, they were looking to see where they could go. We met a number of small companies scattered around the country: a couple from Cork, a couple from Dublin that are involved.
Of course, there is major food ingredients business that we export – about €172m in dairy produce to Nigeria last year. Nigeria is one of the countries where there is a two-to-one ratio. Our exports [to Nigeria] are half, more or less, what exports are from Nigeria [to Ireland].
What is happening now is that smaller Irish companies are beginning to look at Africa to a greater degree and we are very anxious to encourage that. In the past, smaller Irish companies didn’t have to go abroad. But because the European and Irish markets are stagnant, they are looking abroad to a greater degree. There always has been an affinity with Africa, a long tradition of association between Ireland and Africa. [We have identified around] 180 companies that that are not engaged with Africa but are anxious to do. [We want] to meet with these companies.
We will be moving from west Africa to east Africa. We will be setting up a hub in east Africa for Kenya and Tanzania, perhaps Mozambique. The idea is that we would have the four hubs in Africa: Egypt on the north, Nigeria and Ghana in the west, then Kenya and Tanzania in the east and South Africa in the south.
How do you think the new Africa Strategy would affect Ireland’s development aid to the continent?
It is very exciting time for us to be engaged. But it is very important that we still maintain the level of development aid that we have. So we are not in any way going to reduce our aid. You would have seen from the Budget that there is virtually no change. We have the same amount, which is great achievement.
Some Irish companies have expressed concern in going to do business in Africa because of the level of corruption they perceive. What would you say about that?
We have told them clearly that under no circumstances do we see a situation where any Irish company should get involved in any form of corruption or bribery or any of that, and that business can be done in every country [without getting involved in a compromising way].
We are making it very clear that [for] any potential partnership they engage in, there is a standard of ethics they are going to adhere to, and that’s business ethics.
What role do you think Africans in the diaspora can play to help Ireland find opportunities in their homelands?
I think they can play a very good role. This is the first time there’s a new situation in Ireland as well. That is, that we have a significant African diaspora, particularly Nigerians [who number] about 40,000. Nigerians are a very active, entrepreneurial type of people.
And I think there is greater opportunity for [Africans in Ireland] to reengage with their home countries in that respect. So I would very much encourage people from Africa to see what businesses that they might be able to open there.
We are anxious for the African voice in Ireland to be heard back in their own countries, and there are two ways to do it. One of them is by engaging in business back in their home countries. Secondly, I am also anxious to involve the African diaspora in volunteering. The new volunteering programme I am going to be announcing very soon also makes provisions also for not just Irish volunteers to go to Africa but for African volunteers to go back home or to go to other countries.
– In conversation with Chinedu Onyejelem
