Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is Wall Street Week.
Speaker 1: I'm David Weston. When it comes to geopolitics, we tend
Speaker 1: to focus on Ukraine or Gaza or Taiwan. And when
Speaker 1: it comes to powers rival in the United States, we
Speaker 1: focus most often these days on China, but sometimes overlooked
Speaker 1: our developments in West Africa, where increasingly the rival is
Speaker 1: not China but Russia, with potential economic as well as
Speaker 1: security implications for the United States. To give us a
Speaker 1: status report, we welcome now Ian Bremer. He's founder and
Speaker 1: president of the Eurasia Group and author, most recently of
Speaker 1: The Power of Crisis. So Ian, welcome back. Great to
Speaker 1: have you here. As I said, we tend not to
Speaker 1: focus on places like Nizier and Chad and Burkina, Faso
Speaker 1: and things, but there's a lot of developments going on
Speaker 1: right now there that are not particularly good for the
Speaker 1: US or even US investors.
Speaker 2: Yeah. Well, I mean there are almost no journalists on
Speaker 2: the ground, but that doesn't mean it doesn't matter, and
Speaker 2: this part of the world does matter. It matters in
Speaker 2: particular because there are a lot a lot of that
Speaker 2: are very important for industrial processes, especially as we turn
Speaker 2: to transition energy away from coal and towards you know, batteries,
Speaker 2: and they require a lot of what we get out
Speaker 2: of the ground from these countries. But governance in this
Speaker 2: part of the world is very poor, indeed, explosion of insurgencies,
Speaker 2: Islamic radicalism, and very poor local governance with a lot
Speaker 2: of military coups that have happened in these countries, and
Speaker 2: some of the most authoritarian, most brutal leaders in the
Speaker 2: world want to turn to a country that will provide
Speaker 2: them support for security and not ask any questions at
Speaker 2: all about their human rights abuses and governance on the ground.
Speaker 2: And you know the best country for that at scale,
Speaker 2: that's Russia.
Speaker 1: Well, and to speak of that, I mean it's I
Speaker 1: guess a reconstitution of the Wagner Group now called Africa Corps.
Speaker 1: There's moved in. They actually reportedly have some troops on
Speaker 1: the ground that displaced some US and French forces.
Speaker 2: That's right. In many of these countries they have told
Speaker 2: the Americans the French to get out after the military
Speaker 2: has taken over the leadership of the country and they
Speaker 2: want to have the need paramilitaries, they need advanced military
Speaker 2: equipment and they're willing to pay for it, and if
Speaker 2: they don't have hard currency, they can give you a
Speaker 2: percentage or control or an interest in state controlled companies
Speaker 2: on the ground that have access to these minerals, and
Speaker 2: the Russians are more than happy to do that.
Speaker 1: Now.
Speaker 2: That used to be through the Wagner Group. Of course,
Speaker 2: the Wagner Group quite historically imploded when mister Progosion, who
Speaker 2: ran it and had been a very close and formal
Speaker 2: advisor to Putin, turned against Putin. It has since been
Speaker 2: reconstituted with many of the same people and all the
Speaker 2: same weapons on the ground. This group that is now
Speaker 2: directly reporting to Putin and the Russian military called the
Speaker 2: Africa Court.
Speaker 1: So Ian, what is US policy toward West Africa?
Speaker 2: Now?
Speaker 1: What should it be? Is there a way for us
Speaker 1: to compete with the Russians? And by the way, do
Speaker 1: we want to compete with given the nature of some
Speaker 1: of those hunters that are running some of those countries
Speaker 1: these days?
Speaker 2: Well, I mean it's like saying, what's American policy in
Speaker 2: you know, Iran or bashar Asad, Syria or Kim Jong
Speaker 2: Uns North Korea. These are not countries the Americans can
Speaker 2: have functional diplomatic relations with because they're considered rogue states,
Speaker 2: they're considered illegitimate, they don't have the support of their
Speaker 2: people to be in charge. So again, if these countries
Speaker 2: push the Americans out, I mean, the US historically has
Speaker 2: had a fair amount of interest in what's called the
Speaker 2: Gorilla Belt. And here I mean like gorilla the animals,
Speaker 2: as opposed to gorilla the illicit fighters through Central Africa,
Speaker 2: and the US has a lot of troops on the ground,
Speaker 2: has provided humanitarian aid and is trying to help provide security.
Speaker 2: But when you have countries like Chad, like Nize, like
Speaker 2: Burkina Fasso that are run by military juntas that overthrow
Speaker 2: their legitimate government, the US policy is containment. It's to
Speaker 2: try to ensure that the instability of that country doesn't
Speaker 2: spill over into other countries that the US can work with.
Speaker 2: That's both true in terms of forced migration, it's true
Speaker 2: in terms of radicalism and extremism, and it's also true
Speaker 2: in terms of direct border incursions and invasions. So I mean,
Speaker 2: it's not as if the United States is competing with
Speaker 2: Russia for influence over these governments. No, Rather, these are
Speaker 2: governments that the Americans would rather see out of power.
Speaker 1: Let's come back to where you started with the possible
Speaker 1: relocations economically, particularly when it comes to energy transition because
Speaker 1: of some of those raw materials that really exist uranium, certainly, lithium,
Speaker 1: baux sized others. What are the possible rapplications for investors
Speaker 1: if in fact Russia's influence continues to grow in West Africa.
Speaker 2: Well, it's going to be a greater cost because again,
Speaker 2: these are countries that are going to have resources that
Speaker 2: will be exploited in illicit ways, in legal ways using
Speaker 2: child labor for example. They're not going to be welcomed
Speaker 2: in supply chain by many advanced industrial democracies in the world.
Speaker 2: And even when they are, the Russians are going to
Speaker 2: have a preference to ensure that the supplies are first
Speaker 2: and foremost given to friends of Russia with preferential long
Speaker 2: term contracts, China of course being the country in that
Speaker 2: category that has the greatest need for them. And there
Speaker 2: are a lot of resources here. I mean the Russian
Speaker 2: government has secured direct access to I mean major gold
Speaker 2: reserves in the Central African Republic as well as in Sudan,
Speaker 2: platinum in Zimbabwe, diamonds in Zimbabwe as well as the
Speaker 2: ar uranium as you mentioned in Namibia. Right now, the
Speaker 2: United States still gets uranium from Russia, and Congress is
Speaker 2: trying to stop that. They're trying to actually ensure there's
Speaker 2: money to increase production in the United States and with friends,
Speaker 2: so that if the US is going to start building
Speaker 2: reactors again. You've seen the Bill Gates announcements on your
Speaker 2: own Bloomberg that they don't have to get it from Russia.
Speaker 2: But the more that Russia is on the ground essentially
Speaker 2: the lead supporter of many of these illicit governments, these
Speaker 2: military regimes in Central and Western Africa, you know, the
Speaker 2: Russians are going to end up also having control over
Speaker 2: some critical nodes of the minerals that are necessary for
Speaker 2: a transition energy revolution.
Speaker 1: And West Africa has traditionally historically been a zone influence
Speaker 1: for France because they colonized it. At the same time,
Speaker 1: mister Macrone right now is distracted with a few other
Speaker 1: things closer to home, with this snap election he's called
Speaker 1: less than three weeks way. Now give us a sense
Speaker 1: of what apossible ramifications of this are.
Speaker 2: You know, Macron's own party Center Party lost historically seventeen
Speaker 2: points under the national rally far right of Marine la
Speaker 2: penn and so on the back of that really embarrassing,
Speaker 2: much larger than expected loss and by the way, historic
Speaker 2: over fifty percent of French registered vote has turned out
Speaker 2: to vote in this European parliamentary election. That doesn't sound high,
Speaker 2: but for a European parliamentary election with not much at stake,
Speaker 2: it's by far the highest that France has ever had.
Speaker 2: So huge embarrassment, it felt like he was going to
Speaker 2: get censored by the government over the course by the
Speaker 2: parliament over the course of the fall. It meant that
Speaker 2: his budget wasn't going to get through, he wasn't going
Speaker 2: to be able to continue to be fiscally responsible. So
Speaker 2: he decided to call a snap election, which in France
Speaker 2: means three weeks of campaigning and then they go and vote.
Speaker 2: And the idea for mccron being if he wins, because
Speaker 2: you'll have seventy percent turnout for a parliamentary election as
Speaker 2: opposed to fifty for the European parliamentary elections, that suddenly
Speaker 2: his party will do better. He'll be able to scare
Speaker 2: people away from voting for the far left of the
Speaker 2: far right, but the left wing parties have all come
Speaker 2: together and they are working to not run candidates against
Speaker 2: each other in parliament. So that's a big problem for
Speaker 2: the Center. And the average French citizen doesn't oppose, doesn't
Speaker 2: believe that Le Penn and her party is a threat
Speaker 2: to democracy. Only forty percent say that she is that
Speaker 2: they are compared to eighty percent David twenty years ago.
Speaker 2: So look, anything can happen. But right now these were
Speaker 2: only a week and a half away. These elections look
Speaker 2: very bad for Macron, very dangerous. And if the Penn
Speaker 2: and the National Rally are able to capture government and
Speaker 2: her party takes the premiership, well then you know, anything
Speaker 2: in the European Union that requires agreement of all the
Speaker 2: parliaments she will be opposed to. So France will no
Speaker 2: longer be one of the strongest supporters for example, more
Speaker 2: aid for Ukraine, or greater defense spending for Europe, or
Speaker 2: more fiscal accountability or more coordination on industrial policy. No, Instead,
Speaker 2: one of the largest and founding members of the EU
Speaker 2: will be strongly opposed to EU consolidation and sovereignty super
Speaker 2: national governance. It's a huge risk, especially against the backdrop
Speaker 2: of US elections, which if Trump wins, you'll have a
Speaker 2: president that supports a for exit from the EU and
Speaker 2: a much weaker EU, very different from Biden.
Speaker 1: Just my question and is it too far to go
Speaker 1: expect about the possibility of, as you said, a Frexit,
Speaker 1: not Brexit, but frexit, because as you said, Marie Leapenn
Speaker 1: has been fairly hostile to the European Union.
Speaker 2: She is very hostile, but you know, Brexit went very
Speaker 2: badly for the UK and one of the reasons why
Speaker 2: Marine La Penn is polling so well and her party
Speaker 2: is is because she's backed away from a Frexit instead
Speaker 2: just picked up all of the policies that show euroskepticism.
Speaker 2: So I certainly think that were she to become premier,
Speaker 2: I don't think they would agitate for an exit, but
Speaker 2: I think she would be very aligned with Victor Orbon's
Speaker 2: Hungary and she'd be very aligned with a Trump policy
Speaker 2: on Europe, which essentially means that Europe would get weaker,
Speaker 2: not stronger, at a time that a lot more countries,
Speaker 2: including Ukraine, are counting on a stronger Europe for their
Speaker 2: own well being.
Speaker 1: And it's always so helpful to talk with you. Thank
Speaker 1: you so much. That's Ian Brenner of the Eurasia Group,