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Benin gives green light for Niger’s oil exports to China

Benin’s concession was a decisive step towards resolving a trade conflict between the West African neighbors that threatened to cause significant economic damage to both countries.

The rapprochement came through the mediation of the Chinese government and the Chinese companies operating the newly inaugurated pipeline between Agadem, in eastern Niger, and Seme Kpodji, in southern Benin.

In recent months, the closure of the Niger-Benin border has primarily affected Benin’s state revenues and increased food costs, which led to protests over the high cost of living.

Military coup in Niger: trigger of the crisis

Tensions between West African neighbors Niger and Benin began with the July 2023 military coup in Niger and the arrest of the country’s democratically elected President Mohamed Bazoum.

West African bloc ECOWAS condemned the coup and imposed sanctions on the Nigerien military regime led by General Abdourahamane Tiani.

In Benin, the protests against the coup leaders were particularly explicit. Beninese President Patrice Talon loudly demanded Bazoum’s reinstatement and even advocated for a military intervention by ECOWAS troops against the coup leaders in Niger.

Niger closes Benin border

Niger’s military leaders responded promptly by closing the borders with Benin.

Ulf Laessing, head of the Sahel Regional Program at the Bonn-based Konrad Adenauer Foundation think tank, who recently visited Niger, told DW that there is a certain degree of paranoia in Niger.

“There are Nigerien army troops stationed at the border with Benin. The Nigerien government is still afraid that ECOWAS or France could try to reinstall the ousted president through military intervention.”

Trade war begins

Trade between Niger and Benin has practically come to a standstill, resulting in significant financial losses, especially on the Beninese side.

Before the coup, almost all of Niger’s imports — food, cars, consumer goods, etc. — traveled through Benin’s port of Cotonou .

Alternative routes, such as through Togo’s port of Lome and then through Burkina Faso, were considered complicated, not to mention unsafe due to an Islamist insurgency in Burkina Faso.

Despite the risks, Niger increasingly shifted its imports through Burkina Faso, and expanded its cooperation with the country that a military junta has ruled since a violent coup in January 2022.

The fact that Burkina Faso and Niger were politically and economically approaching each other while trade relations between Niger and Benin were collapsing raised eyebrows in Benin.

After the lifting of ECOWAS sanctions against Niger, Benin demanded that Niger immediately reopen their shared borders.

“To emphasize the demand, Benin resorted to a highly effective means of pressure,” said Laessing. “Benin said that Niger’s oil exports to China through a newly built Chinese pipeline to the port of Cotonou can only begin when the borders between the two countries are reopened.”

Relations deteriorate

Benin’s position not to allow ships carrying Nigerien crude oil to enter the ports in Benin threatened the survival of Niger’s military junta.

More than 90,000 barrels of crude per day were earmarked for shipping to China through a pipeline that travels through Benin.

The Chinese state-owned company China National Petroleum Corporation (CNPC) had even signed a memorandum of understanding to this effect — and completed an almost 2,000-kilometer (1,200-mile) pipeline between Agadem in eastern Niger and Seme-Kpodji, near Benin’s port of Cotonou.

But until May 15, 2024, Benin was thwarting Niger’s plans and prohibiting the loading of Nigerien crude oil onto Chinese ships. That decision was made on May 6 at the highest government level and communicated to the Chinese ambassador in Benin as well as the pipeline management company.

Was the blockade legal?

According to Beninese political analyst David Morgan, Benin’s decision to temporarily block the export of Nigerien crude oil to China through Beninese ports was “at least understandable.”

Benin could justify the decision invoking the principle of state sovereignty and the principle of reciprocity, meaning that the Nigerien side had also closed the borders with its neighbor, and thus must expect a similar countermeasure, said Morgan.

“This measure by Benin aimed to force Niger to reopen its borders so that the populations on both sides of the border can resume conditions for common trade,” Morgan added.

At the same time, Morgan suggests that Benin’s decision to block Niger’s crude oil exports might potentially contravene international law.

Under the United Nations Convention on the Law of the Sea (UNCLOS), an international agreement providing a legal framework for all marine and maritime activities, landlocked states like Niger are legally guaranteed access to the sea.

Great economic damage

The standoff, which now appears to have been resolved, inflicted great economic damage to both countries, according to Ulf Laessing.

“But Niger, it seems, needs Benin more than vice versa because oil exports can only go through Benin,” Laessing said. “The pipeline was built that way. The oil pipeline, which was supposed to go into operation these days, runs through Beninese territory.”

Indeed, Niger urgently needs revenue from oil exports to China. Since the 2023 coup, Niger has been facing major financial difficulties.

Laessing pointed out that Western countries have suspended development aid, except for humanitarian assistance. Therefore, oil exports are crucial for the Nigerien military regime.

Solution brokered by China

Laessing welcomed the fact that China has now apparently been able to mediate successfully in the conflict. China maintains good relations with both countries and has a vital interest in protecting investments in the region. “China built the oil pipeline. And it is also Chinese companies that buy the oil from Niger,” said Laessing.

All three countries involved — Niger, Benin and China — attach great importance to the crude oil business. In April, representatives of all three countries celebrated the completion of the pipeline as a “forward-looking project”. The pipeline stands for a future of prosperity and more independence from traditional partners, such as France and Western Europe, it was said.

Ultimately, Niger and Benin needed each other. The port of Cotonou wants to continue to handle imported goods for Niger. And Niger urgently needs to pump its crude oil through Benin territory towards Cotonou to prevent a national bankruptcy. “In this respect, it is very welcome that both countries, apart from the hostile rhetoric, are apparently coming together again with the mediation of the Chinese,” said Ulf Laessing.
Source: Deutsche Welle

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