Geopolitics Review Extra - 24th October 2024

Years Unfolding In Weeks In The World of Geopolitics

Contents

1. Introduction

2. African Energy Bank

3. Canada Expels Six Indian Diplomats

4. China’s Military Exercises

5. Sudan Escalation Near The Chad Border

6. Google Enters The Nuclear Space

7. Concluding Remarks

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Bitesize Edition

• Today, I’ll deep dive some of the events of the last few weeks that have interested me the most. For those who come to read about energy on Thursdays, I’ll still discuss two stories in the energy space, those being the African Energy Bank and the megacap technology companies entering the nuclear space.

• I’ll also dive into Canada’s expulsion of six Indian diplomats, China’s recent military exercises, and an escalation on the Chad-Sudan border.

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Introduction

What is usually a post on the topic of energy and self-sufficiency, I instead decided that far too much is unfolding in geopolitics to not be discussing these issues further. Hence today will be a buffet of geopolitics, diving into 5 narratives unfolding around the world, such as the potential for an African Energy Bank or Google looking set to enter the nuclear space. Alas, energy will still be discussed in this piece, so if that’s what you come to read, you’ll still find your fix of energy discussion below! Next week, I’ll discuss five more events unfolding in the world today related to geopolitics. For today, let’s dive in.

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African Energy Bank

This story first broke in June and July, but the African Energy Bank was set to be inaugurated in September.

The plan is for each African member country to contribute $83M for a total of $1.5B, and Afreximbank and the African Petroleum Producers Organisation are set to match this.

To meet the $5B initial capitalisation expected for the bank, other investors will be sought. This is reported to be Middle Eastern sovereign wealth funds. At the start of October, it was announced the African Energu Bank raised 45% of the $5B.

Over the next 3-5 years, the aim is to take this project to $120B. As I explored in my energy profile on Somalia, many African regions still lack electricity or clean cooking fuels. When developing underdeveloped societies, the energy methods with the lowest barriers of entry for the lowest cost and largest benefit to as many people as possible will be pursued. The aim of the African Energy Bank is to do just this by providing “the right financial resources for the development of innovation and projects in the oil and gas sectors.”

Photo by Zbynek Burival on Unsplash

Via this project, Africa is taking its future into its own hands, seeking to reduce relations with the West and the need for external finance. The openness of the Middle East’s involvement demonstrates how they are seeking to gain influence in Africa as they reject the West and those who enacted the Age of Colonialism. This has been seen recently with France being expelled in Niger and the other countries in the Sahel. China, Russia, and Turkey are benefitting from this trend.

For countries who are too heavily committed to energy transition, who want to throw fossil fuels in the bin today, what would underdeveloped Africa say to that request? The majority of the world doesn’t think and feel the same way as the developed West, and strategies such as Africa’s Energy Bank are clear proof of this. Discarding fossil fuels anywhere in the world is unrealistic anyway. We used fossil fuels for over 80% of our energy consumption last year and this percentage continues to rise. Replacing this fully with intermittent energy sources like wind and solar is a dream. Nuclear stands a better chance but after committing nuclear to the trash pile in previous decades, rebuilding the industry will take time. If we wanted a clean world with less fossil fuels, we should have started 40 years ago.

This strategy of the African Energy Bank seeks to develop Africa and help improve the quality of life by providing energy to over 1 billion people. The benefits will be seen in Africa, but should be celebrated globally. Africa needs to take their energy future into their own hands, and I hope this strategy works. To better increase the odds of its success, perhaps Africa could look to other countries for investment as it has with the Middle East. For centuries of resource exploitation, some former colonial powers could provide some of the $120B in eventual expected investment.

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Canada Expels Six Indian Diplomats