Africa gains as India and China compete for continent of hope

Since African countries began to attain independence from European colonial powers in the 1960s, trade has come to play an even more critical role worldwide, both between developed powers and in the global South.

Africa, the continent with the highest number of the world's poor, missed the opportunity in the 1980s and 1990s to tap into the massive global trade that would have improved the livelihoods of millions of its population. As a result, poverty hit unprecedented levels, forcing African countries to rely on donor funding and grants.

However, a significant shift continues, as witnessed by the entry of Asian countries into what was once a cosy cocoon for the Western world.

This has seen the sale of African goods and services to Asian markets hit 30 percent, up from 14 percent a decade ago. This is almost the same level of trade as between Africa and its historical partners such as the EU and the US.

The increased outflows show how the second scramble for Africa is taking shape by the day.

Much of the focus now is on two major Asian players, China and India, and the economic revolution they are injecting in Africa.

The battle pitting the world's most populous nations is so deep that some regions in Africa have been named after them. The stable political landscape in South Africa has resulted to it being the nation with the highest Asian population in Africa with over 1.2 million "South Africa Indians."

In Uganda, their numbers are growing, despite the 1971 expulsion of more than 75,000 to the UK by then dictator Idi Amin.

With the overthrow of Amin and the rule of Yoweri Museveni in January 1986, Uganda became more open to foreign investors.

This ushered in two influential families, the Mehtas and Madhvanis, who currently operate multibillion-dollar shopping malls, media, huge hotels and factories in Uganda. Their operations are also dominant in Rwanda, Kenya, Zambia and Tanzania.

Though much attention has been paid to the Indian population, which makes up about 2.6 percent of the African total, there are also a growing number of Chinese in the continent.

Today's scale and pace of China's trade and investment flows with Africa is unprecedented. The emergence of South-South commerce is likely to intensify the scramble further as China seeks to dislodge India from its traditional ground.

With 40 percent of countries in Africa landlocked, China will be banking on the modernization of infrastructure in the continent to boost its penetration further.

Already, Chinese firms are involved nearly all the road projects in Africa, with few exceptions. In the pipeline now is the exploitation of alternative but affordable energy sources such as wind, gas and geothermal.

These are the kind of grand projects China is pursuing in Kenya with the recent launch of Africa's largest geothermal energy project in the remote areas of the Rift Valley.

In Tanzania and Rwanda, China is also playing a covert role in the exploitation of natural gases.

The entry of the two nations to Africa has presented a significant opportunity for growth and integration of the sub-Saharan part of continent into the global economy. Due to the rapidly modernizing industries, booming middle class and burgeoning purchasing power, these two tigers' battle for control of Africa will not end any time soon.

Is the traditional Indian grip likely to loosen as Chinese investors run across Africa for opportunities? Having witnessed the second scramble for Africa from its start in the mid-1990s, I am convinced that it is impossible to forecast the ultimate winner.

India enjoys a long history of trade with Africa, and therefore has a strong base in the continent. Many of the accumulated investments of India in Africa are concentrated in manufacturing, retail, food processing and telecommunications. Destroying it, or even bringing it down a notch, will be a hard nut to crack.

Even just take a quick glimpse at the manufacturing sector in Kenya, for instance. The sector is 90 percent operated by businessmen of Indian origin. Its cutting-edge performance has propelled Kenya's economic figures to new heights.

In Zimbabwe, Nigeria, Zambia and now South Sudan, the sector's wheels are virtually moved by Indians.

Nevertheless, no country beats China in the extraction sector such as mining, building of power plants and road construction.

This shows how asymmetrical the two countries' commercial strategies are. And in the end, the rivalry between the two will help boost Africa's success.