South Africa wanted to use some of the $8.5 billion that the United States, Germany and France were going to provide in climate finance, on its electric vehicle industry. However, the West opposed this move by the South African government as they wanted him to use the funds to replace coal-fired power plants with renewable energy.
The United States and its allies decided not to release the funds. Their decision was motivated by the irrational desire of the United States to create its monopoly in the electric vehicle industry. Despite the huge size of the US market, which is expected to grow from $28.24 billion last year to $137.43 billion in 2028, its attempt to prevent a developing country like South Africa from South, which has been through a series of political and economic turmoil, is brazen and represents the neo-colonial mentality of the West.
Biden understands that if South Africa develops its electric vehicle industry, it will dismantle his country’s dominance in the sector. The United States maintained this hegemony by increasing its import duties and tariffs. The South African plan is seen as a hindrance to its monopoly, which is why it has not released the funds.
The United States also sees the power of oil-producing countries as a threat to its authority. The largest oil-producing states in the world are major geopolitical players that influence the decisions and policies of other countries due to the importance of oil as an essential commodity.
According to data published by the US Department of Energy in 2015, only fifteen nations account for 75% of world oil production and have 93% of reserves. In fact, according to the BP Statistical Review of World Energy 2020, approximately ninety-five million barrels of oil were produced in 2019, a 17% increase from a decade ago.
Saudi Arabia is on the list of major oil-producing countries, has an output of 11.8 bpd, or 12.4% of the world total. It is also the leader of the OPEC group. Similarly, Russia accounts for 12% of oil supply which is 11.5 million bpd. Given this, the United States wants to limit the influence and power of oil-producing countries by lowering the value of oil. But how will he do this?
By developing its electric vehicle industry and reducing the use of petroleum-based cars, which is the largest petroleum-consuming market. Then people will start buying more electric automobiles and their dependence on oil and gas will gradually decrease, which will reduce the power of OPEC in the political and economic areas of world politics. But again, power will shift if oil production shifts to EV production to other countries. This is why America wants to keep the electric vehicle hegemony to itself.
Ford’s involvement in the problem
Now a leader of Ford Motor Co. pointed out that South Africa needs a policy to transition its automotive industry to manufacturing electric vehicles within six months.
Currently, South African automobiles, which account for 5% of GDP, are mainly exported to European countries, but Britain plans to phase out new petrol and diesel vehicles from 2030, followed by the EU in 2035.
In such a situation, Ford, a large company, can step up and start investing in the South African automotive industry and push it to continue manufacturing electric vehicles. The African country has the manpower and the resources since last year Cyril Ramaphosa announced, during the launch of the Toyota Corolla Cross Hybrid, that South Africa would export it to around forty countries, which would bring nearly a billion dollars to its economy. In fact, according to Canalys, which is a research company, South Africa must continue the production of electric vehicles because its sales are expected to increase by 160%.
Thousands of people in the country are employed in this sector which holds immense capacity to produce cars, so if Ford sets up a factory and starts production. If all goes according to plan, South Africa will become the first country in Africa to take the lead in the production and export of electric vehicles. South Africa has already angered Biden and his allies with his decisions on the foreign policy front and with this development will deliver another blow to the West.