1 Public Institutions

1.1 Federal Government and Bundestag

The principles and priorities of German Africa policy and state cooperation with Africa are shaped and determined by the Federal Government. In March 2019, the Federal Cabinet adopted the updated and further developed Africa policy guidelines of the Federal Government, which build on the Africa policy guidelines of 2014 and previous policy decisions and initiatives, in particular the Marshall Plan with Africa, which formed the basis for the G20 Compact With Africa (CwA). With the revision and further development of its Africa policy guidelines, the Federal Government is pursuing a coordinated holistic Africa approach, which is intended to do justice to Africa’s political and economic importance for Germany and Europe and to further intensify the partnership with the neighbouring continent (BReg, 2019). One of the central objectives of the guidelines is the promotion and safeguarding of economic growth and sustainable employment. To support investments specifically, the Federal Government has launched the Development Investment Fund and announced that it will provide more than 1 billion EUR for this over several years. The fund, which is primarily intended to promote business in the 12 CwA partner countries, consists of three components: AfricaConnect, which provides 400 million EUR for investments by German and European SMEs, AfricaGrow, which aims to strengthen African start-ups with another 400 million EUR, and the Africa Business Network, which is equipped with 200 million EUR to improve the contact structure for German investors.

There is also cooperation with almost all African countries at the parliamentary level. This takes place in the form of inter-factional groups of Bundestag members, so-called parliamentary groups, which maintain regular exchange and dialogue with parliamentarians from partner countries. The aim is not only to exchange information and strengthen bilateral cooperation, but also to flank German foreign policy. There are parliamentary groups for Africa for

  • Egypt,

  • the Maghreb states (Algeria, Libya, Morocco, Mauritania, Tunisia),

  • Eastern Africa (Ethiopia, Burundi, Djibouti, Eritrea, Kenya, Rwanda, Somalia, Seychelles, Sudan, South Sudan, Tanzania, Uganda),

  • Southern Africa (Angola, Botswana, Lesotho, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Zambia, Zimbabwe, South Africa, Kingdom of Eswatini),

  • Central Africa (Equatorial Guinea, Democratic Republic of Congo, Gabon, Cameroon, Republic of Congo, São Tomé and Príncipe, Central African Republic) and

  • West Africa (Benin, Burkina Faso, Ivory Coast, Gambia, Ghana, Guinea, Guinea-Bissau, Cape Verde, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone, Togo, Chad) (BT, n.d.a).

Each parliamentary group is given the opportunity once per legislative period to undertake a delegation trip to the partner countries and to invite members of the partner parliament to Germany (BT, n.d.b). In addition, the parliamentary groups work closely with the African embassies in Germany. For German companies, it can be useful to place their business interests in an appropriate manner with the members of parliament responsible for the respective target country and thus secure political support.

1.2 Foreign Office and German Foreign Representations

One of the most important and central points of contact for German companies when it comes to obtaining political support on site is the Foreign Office (AA) with its headquarters in Berlin and its foreign representations, especially the German embassies, in currently 43 African countries (AA, 2020).

The AA represents the foreign affairs of Germany for the federal government, which, in addition to maintaining relations with foreign states and intergovernmental and supranational organisations, also includes foreign trade promotion. The vast majority of German foreign representations are embassies. These have at least one contact person for economic issues at each location, and often even their own economic departments at larger locations, which perform these tasks. They are often also supported by seconded staff from other federal ministries who contribute their expertise. The tasks of the economic representatives include, among others, the

  • Advice to German companies on economic policy issues in the host country,

  • Improvement of market access conditions for the German economy in the respective country,

  • Support of specific business interests vis-à-vis government agencies of the host country,

  • Establishing contact with decision-makers from the politics and economy of the country,

  • Initiation and mediation of economically relevant discussions with official bodies,

  • Representation of German economic interests in the host country,

  • Organisation of economic discussions with the local economy in the host country for German companies,

  • Organisation of events for German trade fair exhibitors abroad and their business partners, and

  • Preparation of regular reports on the economic and political framework conditions in the respective country (AA, 2017).

The foreign representations of the federal government work closely on site with the German Chambers of Commerce Abroad (AHK), the Germany Trade and Invest—Society for Foreign Trade and Location Marketing mbH (GTAI) and the implementing organisations of German development policy, KfW Development Bank and Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), which are also presented in this chapter.

Organisationally, Department 3 of the AA with its four divisions 320 (Southern Africa, Great Lakes, Congo, Basic Issues Sub-Saharan Africa), 321 (West Africa, Central Africa), 322 (East Africa, Horn of Africa, Madagascar) and AS-Sahel (Sahel-G5: Mauritania, Mali, Niger, Burkina Faso and Chad) is responsible for the individual regions of Africa.

In addition, the AA has its own economic department, which also includes Division 403 (Foreign Trade Promotion in Countries and Regions) with its Foreign Trade Advisory Working Group. This working group offers workshops, but also individual advice on topics such as political flanking, best practice, key actors and common mistakes. It is recommended for German companies to maintain regular exchange with the responsible divisions and departments in order to receive up-to-date information on the country of interest and on bilateral activities such as official visits or delegation trips with economic representatives at an early stage and to be able to feed in their own concerns.

A traditionally good opportunity to talk to representatives of the AA and especially the heads of the German foreign representations, but also numerous foreign embassy representatives, is offered by the annual Economic Day of the Ambassadors’ Conference. On this day, the AA opens its doors at its headquarters in Berlin to high-ranking representatives from business, politics and culture by invitation. In recent years, more than 1,000 guests have regularly participated. The contact person of the AA for persons interested in participating is Division 403.

1.3 Federal Ministry for Economic Affairs and Climate Action Energy

The Federal Ministry for Economic Affairs and Climate Action (BMWK) is primarily responsible for the federal government’s foreign trade promotion.

The Africa Business Network of the BMWi, established by the BMWi at the beginning of 2019 with its office in Berlin, aims to more closely link the efforts of the various public and private actors in foreign trade promotion, including the institutions described below, and to provide companies with bundled support for market entry and investments on site.

In addition, the BMWi offers German companies the Market Development Programme “Measures for the Development of Foreign Markets for Small and Medium-Sized Enterprises in the Manufacturing Industry and for Service Providers”, with which it promotes project-related measures for the exploration and development of new sales markets. The programme is aimed at small and medium-sized enterprises from various sectors, including mechanical and plant engineering, vehicle and supplier industry, chemical and electrical industry as well as services and crafts (BMWi, 2020). Excluded are those areas for which the BMWi has its own funding offers. This also includes the area of renewable energies and energy efficiency technologies. The programme content can include a market exploration trip, which the BMWi offers together with project partners, such as the AHKs, the German-African Business Association (AV) or the Mechanical Engineering Industry Association (VDMA), and which aims to discuss company-specific concrete market opportunities on site, understand political and legal framework conditions and establish first networks to potential business partners, multipliers and responsible persons.

Finally, the BMWi plays an important role in the approval of state export credit guarantees for goods and service exports from Germany to secure against political and economic risks of payment default (Hermes cover). The decision on the assumption of Hermes cover is made by an Interministerial Committee (IMA), which is staffed with representatives of the BMWi, which has the IMA lead, the Federal Ministry of Finance, the AA, the BMZ, the mandataries Euler Hermes AG and PricewaterhouseCoopers AG as well as experts from banks, industry and associations.

1.4 Federal Ministry for Economic Cooperation and Development

The Federal Ministry for Economic Cooperation and Development (BMZ) with its headquarters in Bonn and its second office in Berlin designs and steers the development policy of the federal government, which includes not only actual development cooperation (EZ) with partner countries but also cooperation with civil societies, with the economy and with multilateral organisations. The basis for the partnership-based EZ are bilateral government consultations and international treaties, in which objectives, measures and the scope of Financial Cooperation (FZ) and Technical Cooperation (TZ) are regulated. The BMZ commissions implementing organisations with the practical implementation of the measures, which cooperate with project sponsors nominated by the partner government. The most important implementing organisations of development cooperation are the KfW and the German Investment and Development Company (DEG), both responsible for Financial Cooperation, and the GIZ for Technical Cooperation.

In 2017, the Federal Government initiated a paradigm shift in development cooperation with Africa with the Marshall Plan with Africa: away from donor and recipient countries towards incentive-based reform partnerships with those countries that are particularly committed to reforms to strengthen democracy, the rule of law and the economy (BMZ, 2017). In 2017 and 2018, the BMZ pledged financial support of up to 800 million EUR to the reform partner countries Ivory Coast and Ghana (both in the field of renewable energies and energy efficiency) and Tunisia (in the banking and financial sector), together with the other partner countries, more than 1.4 billion EUR were provided during this period. Further reform partnerships were agreed at the end of 2019 with Ethiopia, Morocco and Senegal (BMZ, 2020).

An important point of contact in the BMZ is Department 2 (Marshall Plan with Africa; Flight and Migration) with its Sub-Department 20 (Africa) and the Divisions 201 (North Africa, Mediterranean Policy), 202 (Sahel; West Africa I), 203 (West Africa II) as well as Sub-Department 21 (Personal Africa Representative of the Federal Chancellor; Africa Representative of the BMZ) and the Divisions 211 (Central Africa), 212 (East Africa) and 213 (Southern Africa; South Africa). In addition, the BMZ offers so-called EZ Scouts, who work as experts in business associations, in the regional association, in chambers of industry and commerce and chambers of crafts and provide free advice to German companies on topics at the interface of foreign trade promotion and EZ, on cooperation opportunities and on individual EZ funding instruments. In Africa, the BMZ is represented abroad by staff who it sends for a certain period of time to partner countries, to international organisations or to German embassies. In addition, the BMZ provides a representative on the Board of Directors of the African Development Bank (African Development Bank, AfDB).

1.5 German Chambers of Commerce Abroad

After the German foreign representations, the German Chambers of Commerce Abroad (AHK) form another point of contact for German companies on site. There are AHKs in various forms and degrees of organisation as bilateral AHKs, as delegations of the German economy or as representations of the German economy.

On the African continent, there are currently AHKs as bilateral AHKs in Egypt, Algeria, Morocco, Tunisia and in Southern Africa as well as delegations of the German economy in Angola, Ghana, Kenya and Nigeria. In addition, the AHK Southern Africa (based in South Africa) is represented through regional offices in Mozambique, Zimbabwe and Zambia (AHK, 2020).

The bilateral AHKs are representations of the German economy on site, which are supported by a voluntary association of German member companies based in the partner country. The delegations and representations of the German economy usually form the preliminary stage to this and are found in countries where the establishment of a bilateral AHK is being prepared, but where the market economy and autonomy may not yet have progressed accordingly or where legal framework conditions are opposed.

The AHKs are supervised by the Association of German Chambers of Industry and Commerce (DIHK) and are financed by membership fees, income from their partly chargeable DEinternational service offer and grants from the BMWi for their public task of foreign trade promotion for members and non-members. They cooperate with the other German institutions that are committed to the German economy on site, as well as local institutions, actors and companies.

The partly chargeable service offer of the AHKs includes market and industry information, experience exchanges, the mediation of business contacts, help with legal and tax issues, trade fair activities and project support. While the AHKs usually have good and broad contacts especially with the economy of the respective partner country, the way to official bodies, for example ministries, is recommended via the German foreign representation (embassy) on site.

1.6 Germany Trade and Invest

The Germany Trade and Invest—Gesellschaft für Außenwirtschaft und Standortmarketing mbH (GTAI) was created in 2009 by merging the Federal Agency for Foreign Trade (BfAI), the Invest in Germany GmbH and the Society for Foreign Trade Information (GfAI). Its corporate purpose is the marketing of the economic, investment and technology location Germany. As a state institution, the GTAI is financed by the BMWi, which also provides the chairman of the GTAI supervisory board with a state secretary.

The GTAI’s service offer for German companies includes, among other things, market analyses, country reports, project information, contact addresses and international tenders. For the latter, the GTAI offers its own online portal, in which the tenders of the KfW Development Bank and tenders within the framework of development projects of international donors such as the EU Commission, the World Bank or regional development banks are published. As one pillar of the federal government’s foreign trade promotion, the GTAI works closely with the other public and private institutions presented here. In Africa, it currently has locations in Egypt, Ghana, Kenya, South Africa, and Tunisia (GTAI, n.d.a).

1.7 KfW Development Bank and Deutsche Investitions und Entwicklungsgesellschaft (DEG)

The KfW Development Bank, which belongs to the KfW banking group, plays an important role in the development policy and cooperation of the German federal government with partner governments. It acts as the federal development bank and implements its Financial Cooperation by financing and accompanying reform processes, investments, projects and programs in partner countries with their state institutions on behalf of the BMZ. This is also the main difference to DEG, which, as a 100% subsidiary of KfW, is also responsible for the Federal Financial Cooperation, but focuses on building private sector structures.

The overarching goal of the KfW Development Bank is to “support partner countries in combating poverty, securing peace, protecting the environment and climate, and shaping globalization fairly” (KfW, n.d.a). In addition to these classic development policy issues, KfW also promotes more economically related topics such as energy, water, health and urban development. Tenders for projects involving the KfW Development Bank follow fixed procedural rules and are monitored throughout their progress. Depending on the economic performance of the partner country, the KfW Development Bank uses either exclusively BMZ budget funds (grants or loans at very favorable conditions), a mix of federal funds and market funds (development loans), or loans at market-related conditions (promotional loans) (GTAI, n.d.b).

The KfW Development Bank currently has offices in 23 African countries, 20 of which are in Sub-Saharan Africa, including Ethiopia, DR Congo, Cameroon, Kenya, Nigeria, Mozambique, Rwanda, Zambia, South Africa, Tanzania and Uganda, and 3 in North Africa with Egypt, Morocco, Tunisia (KfW, n.d.b). The country directors are usually well connected with the state institutions of the country as well as the heads of the German foreign representations and can support with further contacts.

Contacting and exchanging with the KfW Development Bank is particularly recommended for German companies when the KfW Development Bank is involved in the project of interest. The central contact point of the KfW Development Bank at its headquarters in Frankfurt am Main is the Africa/Middle East country area, whose head is responsible for the West Africa (LAa), East Africa and African Union (LAb), Central Africa (LAc), Southern Africa (LAd) and North Africa (LNb) departments. In addition to the specific project and local partners, they usually also know the general political and economic framework conditions in the country very well and can provide helpful hints.

Just like the KfW Development Bank, the DEG’s Africa focus is on Sub-Saharan Africa with representations in Kenya for East Africa, in South Africa for Southern Africa, in Nigeria for West Africa, in Ghana and a representative in Ivory Coast. The DEG offers German companies tailor-made financing options for their foreign investments, whether they are guarantees, loans, mixed financing, participations or even venture capital. It also finances feasibility studies. In terms of content, the DEG’s offer basically includes all areas of the private sector, as long as the projects are profitable, sustainable and developmentally relevant.

In addition, the DEG is the contact point for the aforementioned AfricaConnect funding program, which supports small and medium-sized enterprises in financing investments with up to 4 million EUR loans under special conditions.

For companies planning to make their Africa investment more sustainable, for example by creating training places or using renewable energies, the DEG’s develoPPP.de program is interesting. The DEG promotes corresponding sustainability measures with up to 2 million EUR per company.

1.8 Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ)

The Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) with its headquarters in Bonn and Eschborn was created in 2011 by merging the Deutsche Gesellschaft für Technische Zusammenarbeit (GTZ), InWent (Internationale Weiterbildung und Entwicklung) and Deutscher Entwicklungsdienst (DED). As a privately organized federal and non-profit company, it supports the federal government in promoting international cooperation for sustainable development and international educational work. In contrast to the KfW Development Bank, which handles the Financial Cooperation of the federal development policy, the GIZ is responsible for its Technical Cooperation.

The main client of the GIZ is the BMZ. In addition, the GIZ also works for other federal ministries, including the AA, as well as international institutions such as the World Bank or the United Nations, but also private clients. On their behalf and in coordination with the state authorities of the partner country, the GIZ implements development projects on site with various thematic focuses itself or, as a public client, assigns individual tasks to suitable private sector companies. This includes in particular the preparation of expert opinions, the procurement of technical equipment and goods, and the actual project implementation.

The respective procurement law regulations apply to the award of contracts, which define certain threshold values below which the GIZ, for example, only has to issue restricted tenders or may negotiate directly with several companies (GIZ, 2020).

For companies that are active in the area of GIZ’s work priorities and interested in corresponding contracts, it is therefore advisable to establish contact with the GIZ at an early stage and to accept suitable event formats and presentation offers for their own company. The same applies to maintaining contact with the currently almost 40 GIZ country offices in Africa, which also offer good networking with local institutions, especially at the working level. The GIZ’s main areas of focus are Good Governance, Rural Development, Sustainable Infrastructure (Water, Energy, Transport), Security and Reconstruction, Social Development, Environment and Climate, and Economy and Employment (GIZ, n.d.).

1.9 Limits of Support by Public Institutions

Just as important as knowing where and how public institutions can support is knowing in which cases they will not be active from the outset. The support always finds its limit where the political flanking of the interests of a German company would negatively affect the interests of another German company. For example, if two German companies apply as competitors for the same tender, the principle of state neutrality prohibits public institutions from supporting the interests of one company. The general effort to ensure that a German company is generally successful in the tender remains unaffected. Furthermore, public institutions will not interfere if the company has a sufficient legal recourse to solve the matter or if the business partner is part of the private sector.

2 Private Institutions

2.1 Regional Associations

To support German economic interests, privately organized foreign trade associations have been founded, which offer their members a sometimes extensive range of services. The following regional associations exist: Business Association for Latin America (LAV), German Eastern Business Association (OMV), German Near and Middle East Association (NuMOV), German Asia-Pacific Business Association (OAV) and German-African Business Association (AV).

The AV has been serving the promotion of German-African economic relations since 1934. Its members are predominantly German, but also some African companies, institutions and private individuals. It is active across all sectors and regions and has offices in Berlin and Hamburg. The AV offers its members a comprehensive range of services, including:

  • Delegation trips to African countries with official and economic program,

  • large trade fair events with different industry focuses,

  • economic forums with African state guests such as presidents, ministers, ambassadors,

  • bilateral economic days,

  • information about specific markets, opportunities, laws, possible business partners, etc. and

  • information about economic and political events in Africa, new business opportunities, newsletters and publications.

The AV has the four country departments North Africa and Sahel, East Africa, Francophone West and Central Africa, Anglophone West Africa and Lusophone Africa and industry experts with many years of experience and contacts in the individual countries. In terms of content, the association works closely with the individual federal ministries, especially the AA, the African embassies in Berlin, African governments, associations and NGOs. In addition, the AV maintains helpful cooperations with organizations in numerous African countries, including national chambers of commerce and partner associations.

Due to its close cooperation with the African embassies in Berlin and its prominent position as the German association that bundles the companies with economic interests in Africa, the embassies of the African countries usually approach the AV when it comes to organizing the—in addition to the obligatory political part—economic part of the visit of representatives of their country to Germany. Corresponding formats in turn offer the AV member companies the opportunity to get into conversation with high-ranking representatives of the target country such as government members, to place company interests and any difficulties in the project process and to advertise for support. Prior to delegation trips, which are oriented towards the interests of the member companies, there is the opportunity to incorporate concerns and goals of the company in the respective country into the program planning and to receive information from decision-makers. Overall, the diverse offer of the AV can contribute an important part to being successful in Africa when used intensively and strategically.

2.2 Political Foundations

Finally, as part of their information strategy, German companies should also consider German political foundations such as the Konrad Adenauer Foundation (KAS), which is close to the Christian Democratic Union of Germany (CDU), or the Friedrich Ebert Foundation (FES), which is affiliated with the Social Democratic Party of Germany (SPD).

The political foundations, which are mainly financed from federal budget funds but are independent in terms of content, have maintained foreign offices in numerous African countries for many decades and have thus gained a certain foreign policy importance over time. General focuses of their work are the promotion of democratic processes and reform initiatives, the support of civil societies and the promotion of political exchange between the host country and Germany and Europe. In addition, depending on the country/region, the foundations pursue special thematic focuses. Through their work on site, the foundations have individual networks in politics, economy and society, to institutions, parties, civil society organizations, media and selected elites of the country. Especially because of these networks, it is worthwhile for companies to make contact with the foreign offices of political foundations, to plan a visit station there if necessary and to ask for support, for example by establishing further contacts. In addition, the foundations offer events around their thematic focuses as well as extensive country reports, which can also help as background knowledge to better understand the political and economic agenda of the country and to learn about changes in the political and party power structure or changing responsibilities of decision-makers at an early stage.

3 Importance and Value

German companies are not alone in their endeavor to be successful in Africa. German politics offers numerous institutions that can help. Because of the political component mentioned at the beginning in economic decisions, the political sphere should also be taken into account. The higher the state (also indirect) influence on a project, the more important this is. The political sphere varies from country to country, depends on the respective project participants and changes over time due to changes in the system.

It is advisable to maintain a close and regular dialogue with the institutions of German politics described above, to gather different perspectives and to feed the entrepreneurial project into them in a suitable way. From the diverse individual information, a large picture (understanding) of the political sphere of the respective state is formed, comparable to a mosaic, which should be continuously fine-tuned in an iterative process. Based on this, a strategy can be developed on how to best serve the political sphere with regard to project success.

Companies that do not want to do this resource-intensive and time-consuming work themselves can also turn to experienced consulting companies specialized in Africa for support, which already have the necessary networks and many years of experience in successful political and strategic project flanking.