Here we go again: cost of Africa’s oil imports > Africa’s aid (updated)

Back in 2010, when I wrote Globalisation and Scarcity (pdf), one of the stats cited in the report that seemed to kindle most interest was the International Energy Agency’s finding in late 2007 that in 13 non-oil producing African states, including South Africa, Ghana, Ethiopia and Senegal, increases in the cost of oil over the previous three years had come to more than the total amount of aid and debt relief that they had received over the same period.

And now? Here’s Fiona Harvey in the Guardian over the weekend:

Developing countries in Africa received less in overseas aid last year than they paid for oil imports, new figures show. Sub-Saharan Africa received about $15.6bn (£9.7bn) in overseas development aid last year, but this was outweighed by the $18bn cost of importing oil, according to the figures compiled by the International Energy Agency and seen by the Guardian.

Not really a surprise, given that oil prices were throughout 2010 significantly higher than they were over the three years to 2007 (see this graph) – but a major headache for net importing developing countries even so.

Here in Ethiopia, where I’m now living, you don’t have to look far to see the impacts of all this: inflation is running at around 36%, and the government’s vulnerable foreign exchange position menas that there are periodic moments when everyone in Addis Ababa is driving around looking for gas stations that still have diesel in stock.

Needless to say, these kinds of challenges come with major political dimensions too. Following the 2008 commodity spike, the government has shifted in to top gear on improving its export earnings, which features as a central objective in the [breathtakingly ambitious] 2010 Growth and Transformation Plan (one page summary here). Two of the key avenues identified for pursuing that goal are massive hydroelectric power projects designed to turn Ethiopia into a key exporter of electricity, and large commercial farm projects that are also geared towards exports.

Most donors and NGOs here seem to agree that these are good ideas in principle, but there are some very live debates, both social and environmental, about how they’re conducted in practice. It’s an interesting case in point of how scarcity issues are in practice all linked together: oil price inflation and import dependence act as the prompt for massive investment in renewables and an ‘African green revolution’, but also for charged political economy questions about access to land, water and other natural resources.

Update: Joe points out below that aid to Sub-Saharan Africa is considerably higher than the $15.6 billion cited by the IEA – and on stopping to think about it, the $15.6bn figure clearly is way too low. confirms that Joe is also right about what the figure should actually be, i.e. more like $45bn (the most recent World Bank figure for total ODA to SSA is $44.6bn, for 2009; Joe’s presumably using 2010 data from the DAC, but I can’t access their website to check).

All of this raise the question of where the IEA got its ODA figure from – and whether the whole premise of the article (and my blog post!) was wrong. I’ve tweeted Fiona Harvey at the Guardian to ask her if her source at IEA can shed any light: will post what she comes back with.