Niels Annen, a member of the German Social Democrats (SPD) and a long-standing foreign and development policy expert, talks to IPQ about managing expectations, development cooperation, and enlightened self-interest.
State Secretary Annen, Germany is seeking new partners in the Global South with a view to reducing those countries’ dependence on China. What are the main reservations you encounter in the Global South about Western countries like Germany?
It’s difficult to give an answer to that question which is universally applicable, because our partner countries in Africa, Latin America, and Asia are all very different. In the Arab world in particular, the mood toward Germany has deteriorated considerably as a result of the Gaza war. However, this shift tends to be articulated more by civil society and not necessarily by governments. It is noticeable that the level of self-confidence is much higher than in the past and that there are clearer expectations of Germany.
What expectations are being voiced there?
Our partners are signaling to us that they would like to work with Germany, with Europe, perhaps even exclusively, but that they definitely have alternatives. Our economic model is still very attractive, but it’s no longer “the only game in town.” Our partners are well informed; if we try to lecture them about democracy or the rule of law, while we are still having to negotiate with and talk to authoritarian governments, they will gleefully point out the contradictions in our argument. And, they know full well that there is a lack of unity on certain issues in Europe.
You said recently that it was likely that in 2030 more than 600 million people, most of them in sub-Saharan Africa, will still not have access to a clean, sustainable, and reliable energy supply. What must Germany do to fulfil its historical responsibility as part of the West, and what is it already doing?
If you look at the historic carbon footprint, there’s no denying that the Western industrialized countries bear particular responsibility for man-made climate change. And Germany is certainly responding to this. We could spend the rest of the time we have for this interview talking about the programs we are setting up with our partners …
One or two examples would suffice.
We have strongly advocated for a loss and damage fund, which was launched at the COP28 UN Climate Conference in Dubai in 2023. Under the heading “Just Transition,” we want to use the experience we have gained in Germany in the transition to carbon neutrality. The aim is to cushion the social upheavals that such a transition process entails for many employees and even entire regions; in our case, coal mining was particularly affected. We are translating this experience into partnerships with other major donors and with important emitters such as Indonesia and South Africa.
On the other hand, certain countries from the Global South are constantly spreading the narrative that we alone are responsible for achieving the climate targets, citing with justification the historical responsibility of industrialized countries. But that doesn’t reflect present day reality.
Why not?
Because countries like China, which still define themselves as emerging and developing countries, are to a large extent equally responsible for today’s emissions. We, the international community, cannot allow them to hide behind an anti- or post-colonial discourse so they can avoid having to adhere to the reduction targets, all for the benefit of their own economic growth. We urgently need to talk about this, along with all the other difficulties we have with China or Russia.
In Germany, the discourse is currently moving in the direction that we should only be talking to our friends. This worries me, because the political price we would have to pay for that would be high, especially when it comes to the climate.
In the debt crisis, too, many observers in the Global South see the West as being responsible, for example due to credit-based development aid. Could the often-demanded debt haircut make a difference?
Not really at the moment, because times and circumstances have changed. When I was young, I demonstrated with others against the International Monetary Fund and the World Bank and called for a debt haircut, which then came. But the traditional lenders such as the Paris Club nations are no longer the key creditors today. It’s primarily the Chinese, but also many large international corporations, that are providing the majority of loans. As much as I sympathize with this discourse in the Global South, also based on my own personal background, it sometimes obscures the fact that something has shifted. In this respect, the demands should actually be directed toward China.
Are you talking to Beijing about this?
Of course. And there have indeed been initial results with the “Common Framework.” But the mechanism is still too cumbersome. We need concrete progress in the negotiations on debt deferral and, if necessary, debt relief. The Chinese have been extremely reluctant so far, even though their lending practices contributed to the debt crisis. This is also an opportunity to shift the focus back to our own instruments. They are sometimes a little more unwieldy, but much more sustainable.
What does that look like in concrete terms?
On the one hand, we are continuing to grant loans that are linked to jointly agreed political and development policy goals. Such loans are attractive for many countries, especially middle-income countries, and they will not lead to a similar debt crisis. That said, we have partners who have difficulties servicing their loans from us. Under German development policy, an innovative and successful instrument for this has been launched, namely debt conversion. Perhaps this instrument could indicate on a small scale what a large-scale solution involving the Chinese might look like.
The West has lost a lot of trust in part due to a lack of solidarity during the COVID-19 pandemic. How can this be repaired?
We sometimes have a tendency toward self-flagellation. I don’t think Germany has played a particularly negative role in this. Every government has an obligation to look after its own people first; that also applies to the German government. The mistakes that were made during this period must be assessed in the light of the situation at the time; they were partly due to the need to take quick decisions and partly to a lack of information. Just think of certain travel restrictions or the reactions to the emergence of the Omicron variant in South Africa. However, we did deal with other issues at a very early stage, especially in Africa.
For example?
Together with our partners, we are investing in healthcare systems and social security systems there. Of course, this doesn’t mean we’re simply replicating the German healthcare or social system in a sub-Saharan African country; the conditions are completely different. But what we are doing there is based on our own experiences during the COVID-19 pandemic. We’re convinced that one of the lessons from the pandemic is to invest money not only in fighting the pandemic itself, but also in the resilience of healthcare systems as a whole.
We have also been heavily involved in the distribution of vaccines and have helped BioNTech to invest in vaccine production in Rwanda, for example. And at the Federal Ministry for Economic Cooperation and Development (German acronym: BMZ), we are working to advance the so-called One Health approach internationally, an approach which also focuses on animal health and therefore on diseases transmitted from animals to humans.
That is important to me because I have the impression that pandemic prevention has already slipped back down the list of priorities of many governments. My great concern is that we won’t be as well prepared in the event of a possible next pandemic. We, at least, have not shut down our work in this field.
How are you experiencing the race for the Global South? Which resources are being fought over the most?
One example is lithium, which is playing a major role. The fact that Germany has resumed development cooperation with Bolivia is linked to development policy reasons, but also to the fact that four years ago, the Bolivian government at the time decided to terminate an agreement with a German company on the industrialization of lithium. We hope to get a foot in the door there again.
What other countries are playing a role?
If you look at the chancellor’s foreign visits, it’s a whole raft of countries. In Chile, for example, we have a different political constellation with a government that is very close to us. The point there is that, in addition to long-term supply commitments, Germany also has the expertise to create value locally. This is something that many systemic rivals are unwilling or unable to bring to the table. We see an opportunity here to serve Germany’s economic interests and at the same time contribute to more sustainable economic development in the countries concerned.
This also applies to the hugely expanding global market for green hydrogen: Where can an investment in green hydrogen simultaneously meet local economic needs? Development policy is under a bit of pressure in that regard right now, and I believe this is a good example of how, under the famous mantle of enlightened self-interest, our work in such cases also serves Germany.
Regarding that “enlightened self-interest”: There is a paradoxical discussion going on in Germany, most recently in the budget debate. On the one hand, people are looking with admiration at how a country like China is creating a global network of economic dependencies with its Silk Road infrastructure measures. On the other hand, the famous “cycle paths in Peru” are being criticized as unnecessary spending. Why do you think that is?
In my opinion, this has a lot to do with the fact that we in Germany are currently in a phase that we’re finding pretty challenging, to put it mildly. First came the COVID-19 pandemic, then we had inflation of almost 10 percent, a decline in real wages of around 4 percent, and many crises, some of which are overlapping. I find it outrageous, but not surprising, that there are political forces in such a situation which try to score easy points by claiming that money is being wasted abroad. My job is not to complain but to explain that what we are doing there is in our own interests.
The cycle paths in Peru, incidentally a legacy of the previous government, are only a very small part of a program with which we are helping emerging countries to achieve their own climate targets. And it is sometimes cheaper to achieve climate targets in a country like Peru than to implement reductions in Germany. In many emerging countries, significant emissions have recently been generated especially in the major cities and this trend is set to continue. That is why we are talking to many emerging countries about cheap loans for urban development and sustainable mobility concepts. I think that’s a pretty good investment in the survival of our planet.
China is a superpower and at the same time presents itself as the Global South’s comrade against Western imperialism and colonialism. However, many people in the South are now disappointed with China: because it behaves in an imperial manner itself, doesn’t keep its promises, shows too little consideration for environmental needs, and doesn’t involve civil society enough. Russia has also lost some of its appeal as a partner due to the war in Ukraine. How could the West fill these gaps?
First of all, there are many countries that have opted for China as a project partner simply because there were no European offers. This is especially true for large infrastructure investments in Africa. I myself have spoken to many government representatives who have told me that they would much rather have done their deals with us, but there were no offers. In that respect, politicians have to ask themselves: Are we providing sufficient resources and are our projects designed in such a way that they can be implemented quickly enough? We can’t yet be satisfied in that regard.
Is progress being made?
It is, and not just at the national level. The Global Gateway Initiative, for example, Europe’s answer to China’s Silk Road, is likely to be continued by the new European Commission; the BMZ is involved in its implementation. In addition, Development Minister Svenja Schulze, together with US Treasury Secretary Janet Yellen, has called for a fundamental reform of the World Bank. We have significantly increased resources through a slightly increased tolerance of risk and by setting new priorities. Most recently, Chancellor Olaf Scholz announced that €305 million in so-called hybrid capital would be made available. The same applies to the regional development banks, for whose Asian and Inter-American Banks I am responsible on the German side. And we are conducting a dialog with German industry about more investment in the Global South.
What could one learn from competitors like China?
The Chinese model isn’t one that would lend itself to being imitated because it has caused high ecological and social costs. I have already mentioned some of the points of criticism such as lending practices. But we must acknowledge that the Chinese have succeeded in really effectively combating poverty in their own country. Of course, China is a competitor and, as we all know, a strategic rival. Nevertheless, I would always advise us to have a certain basic respect for the fact that China has invested in some highly complex, fragile regions, which is something that we have not always done. There have been successes there, and the Chinese government has also learned from its mistakes. If we ignore all that, then we will make the path to limited but important cooperation with China more difficult. Not only on climate policy, but also on the other sustainability goals of the United Nations.
Who should Germany work more closely with in the Global South in future and in which areas?
We have already talked about green hydrogen. We need it if we want to successfully manage the energy transition and remain an industrialized country. That’s why hydrogen partnerships are of the utmost importance. Of course, we must also pay attention to economic viability. North Africa is a good partner here for many reasons. The second point is the climate crisis. The JETPs, the Just Energy Transition Partnerships, are a key instrument in my view. We support these partnerships financially, but they are also about advice, know-how, and a common path.
Development policy can also make an important contribution towards tackling the issue of skills shortages in Germany. Many of our partner countries have a very young population and need to generate hundreds of thousands of jobs and apprenticeships every year. Labor migration is therefore an attractive option for our partners. We have set up economic and development agencies in key countries, but we also recognize that migration is not a one-way street but rather a circular phenomenon.
So, it’s also about people returning to their home countries?
Exactly, because they can use their experience to contribute to their own country’s development. And in certain regions, the issue of skilled labor migration also has a geopolitical aspect, for example in Central Asia. When Chancellor Scholz travels to Uzbekistan or Kazakhstan, he meets representatives of countries that have hundreds of thousands of workers living in Russia who send money home, increasing those countries’ dependence on Russia. If we have a relevant exchange of skilled workers with these countries, it won’t end the dependency, but it will give them a little more breathing space.
Germany entered the competition for resources relatively late. Too late? Your colleague Franziska Brantner from the Federal Ministry for Economic Affairs and Climate Action said: “We are in a race, we have to be careful not to lose it.” What makes you optimistic that Germany will be able to compete for partnerships with the Global South in the long term?
I’m very optimistic in that regard. I work closely with Franziska Brantner and our ministries coordinate their activities. In addition to our development cooperation with Bolivia, we have also resumed our cooperation with Mongolia. This raw materials partnership that former Chancellor Angela Merkel agreed back then was the right thing to do. But it was never really brought to life. We have given it new momentum. The tragedy of the current government is that some very fundamental decisions are being overshadowed by other things, including our own public disputes. But I am also confident because I believe that Olaf Scholz has intuitively recognized how the world situation is changing. We are strengthening our traditional alliances, especially our alliance with the US. But if you look at who the chancellor has spoken to in recent years, who he has invited, where he has traveled, it’s not a random selection. Germany is cultivating partnerships with the relevant players and the BMZ supports this; whether it’s Narendra Modi, Lula da Silva or Cyril Ramaphosa, the Chinese or other difficult partners, but also smaller countries, especially from the Global South.
Which brings us to the old values versus interests debate ...
I think it’s worrying when talks with difficult partners—whether they are conducted by the foreign minister, the chancellor or the development minister—are not seen as clever diplomacy in Germany’s interests. Instead, they’re seen as a “betrayal” of Germany’s values or of any kind of value-oriented policy. I believe this fails to recognize the new realities under which we have to work.
In development policy, we use the technical level of talks to discuss international issues with many difficult partners. And the dependability that we have been able to guarantee over many years helps us.
We’re also working on issues such as our colonial legacy. Germany is generally not perceived as a former colonial power, although we certainly are. Our country has earned a lot of respect in the world, also as a result of its development cooperation. This has been overshadowed in some areas by our position on the Gaza war, which many perceive as one-sided; and we must confront this. However, I believe that we still have such strong substance that we can use this soft power to represent our own interests—and to help ensure that the international system does not fall apart.
That’s why the current cuts are very painful. We’re still just about managing. But I believe that, in the long term, it would not be advisable for Germany to make further cuts in foreign and development policy. Why is that? One example: we have been in the countries of the Sahel region since the 1960s, in good times and in bad. The people there know we’re not going to run away. We’re there. We’re staying. And that means people listen to us.
If we can no longer do that, I can tell you who will be pleased: those who have very precise ideas about how they can continue to expand there, politically and militarily. I don’t think any of us ultimately wants that.
The interview was conducted by the IP/IPQ editorial team.
