Reframing Africa’s Development: From dependency to sovereignty
Amb Prof Bitange Ndemo December 27, 2025
For more than six decades, Africa’s development trajectory has primarily been shaped by external actors.
Former colonial powers and multilateral institutions like the Bretton Woods system often made decisions affecting the continent’s economic priorities outside Africa.
This era entrenched a model of dependence on foreign aid, external capital, and externally defined development agendas.
Today, however, that model is showing visible signs of strain, and a new phase of African self-determination is emerging.
Several structural shifts are driving this transition.
Digital infrastructure has expanded rapidly across the continent, regional integration has gained momentum, donor funding has declined, and the private sector has assumed a more prominent role in financing development.
Together, these changes are creating space for African governments, institutions, and businesses to make strategic decisions about the continent’s future, that is, decisions rooted in African priorities rather than external prescriptions.
At the heart of this emerging development paradigm is infrastructure, particularly infrastructure that supports energy security, industrialisation, and intra-African trade.
One of the most ambitious proposals illustrating this shift is the Gas-by-Rail Economic Corridor Initiative (GBR-ECI), a private sector–led project anchored by a preliminary agreement between Ethiopia and Nigeria.
The initiative proposes a continent-wide freight railway system for transporting liquefied natural gas (LNG), spanning approximately 73,500 kilometers across 40 Sub-Saharan African countries.
With an estimated cost of US$500 billion to US$1 trillion, the project seeks to connect East and West Africa through a unified energy and transport network.
Unlike externally driven infrastructure programs, GBR-ECI explicitly prioritises African energy independence and trade integration.
Supporters say this method is very different from programs like the EU’s Global Gateway, which, although they focus on improving connections, are often seen as promoting the interests of donor countries along with development goals.
Although projects like the Lobito Corridor pursue similar objectives of improving African logistics, GBR-ECI stands out for its emphasis on African ownership and control.
Increasingly, African policymakers recognise that sovereignty over energy, food, and digital systems is indispensable if the continent is to compete meaningfully in global markets. As the saying goes, charity begins at home.
Ethiopia offers a compelling illustration of how infrastructure-led development can reshape national and regional economies.
As Africa’s largest landlocked country, Ethiopia faces structural trade constraints that make rail and logistics infrastructure essential.
Recent investments suggest a deliberate effort to overcome these limitations through industrial and energy integration.
The Dangote Group, in partnership with Ethiopian Investment Holdings (EIH), is investing US$2.5 billion in a massive urea fertiliser plant in Gode.
Structured as a 60–40 joint venture, the project will produce up to three million metric tons of fertiliser annually, positioning Ethiopia as a major exporter while significantly reducing Africa’s dependence on fertiliser imports.
By leveraging domestic natural gas resources, the project directly links energy infrastructure to food security. Thus, the project combines the two pillars of economic sovereignty.
Similarly, Russian aluminium producer RUSAL has signed an agreement with EIH for a US$1 billion first-phase investment to build a large aluminium smelter in Ethiopia.
With a planned annual capacity of 500,000 tons and access to low-cost hydropower, the project aims to support regional industrialisation, reduce reliance on imports, and position Ethiopia as a strategic supplier within Africa.
Together, these investments underscore how infrastructure, energy, and industrial policy can reinforce one another when aligned with national development strategies.
Beyond physical infrastructure, Africa is also reshaping its financial architecture. After decades of attempting to reform global financial systems with limited success, the continent has increasingly turned inward to build institutions that support trade, investment, and self-reliance. The African Export-Import Bank (Afreximbank) has emerged as a central actor in this transformation.
The success of M-Pesa demonstrated that digital finance could reach millions of unbanked Africans using simple technologies.
This breakthrough catalysed a broader fintech ecosystem that has fundamentally altered how Africans save, borrow, and transact.
Building on this momentum, Afreximbank has introduced innovative financial instruments designed to expand intra-African trade while avoiding unsustainable sovereign debt.
Key among these initiatives is the Pan-African Payment and Settlement System (PAPSS), which enables cross-border payments in local currencies, reducing reliance on the US dollar.
The bank also deploys offtake-backed loans, credit guarantees, and political risk insurance to mobilise private capital for industrial projects.
Through trade finance, SME support, intra-African trade fairs, and a US$10 billion AfCFTA Adjustment Fund, Afreximbank is laying the groundwork for a trade-driven development model.
Complementary regional systems further strengthen this ecosystem.
COMESA’s Yellow Card insurance scheme simplifies cross-border transport, while the East African Payment System (EAPS) enables real-time settlement in local currencies.
These platforms address long-standing inefficiencies in African trade, where transactions were historically constrained by dollar shortages, high costs, and settlement delays.
Africa’s historical dependence on the US dollar has imposed significant constraints on intra-continental trade.
Foreign exchange risks, payment bottlenecks, and high transaction costs have discouraged regional commerce, reinforcing colonial-era trade patterns that favoured exports to Europe over neighbouring markets.
Reducing dollar dependence will not be easy. Competition from global card networks and geopolitical pressure, particularly from Washington, may present real challenges.
However, India’s Unified Payments Interface (UPI), which established a national digital “rail” through which most transactions flow, offers valuable lessons.
We could accelerate financial inclusion, strengthen regional integration, and enhance monetary sovereignty with a similar unified African payments infrastructure.
These developments vindicate long-standing critiques of aid-dependent development models.
Economist Dambisa Moyo famously argued that foreign aid fostered dependency, weakened institutions, and undermined self-sufficiency.
Her call for trade-led growth, robust financial systems, and domestic capital mobilisation is increasingly reflected in Africa’s evolving development architecture.
Yet progress remains fragile. Persistent conflict across the continent threatens economic gains and deters investment.
While arbitrary colonial borders are often blamed, deeper drivers of conflict lie in political exclusion, unequal access to resources, and economic marginalisation.
Addressing these root causes requires inclusive governance, equitable development, and meaningful participation by all communities.
Without reforms that promote fairness and opportunity, Africa’s emerging infrastructure and financial systems risk being undermined by instability.
Therefore, not only does sustainable development rely on rails, pipelines, and payment systems, but also on political agreements that guarantee equitable growth.
Only then can Africa fully transition from an era of dependence to one of genuine sovereignty.
See also: