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The US is planning a trade and investment offensive to drum up business opportunities for American companies in Africa after years of rapid expansion throughout the continent by China and other emerging countries.Investment by the US in Africa has fallen in relation to China and other emerging countries during a decade of conflict in the Middle East involving American forces and a focus on tightening diplomatic links with Asia.
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The White House has dispatched three senior trade and economic officials to the region this month to discuss ways to strengthen the presence of US companies in African markets.“There is clearly a sense of opportunity in Africa and the US government is embracing that,” says a senior US government official speaking on condition of anonymity. “We see it [Africa] as a real source of opportunities.”The US government has also announced it will hold in August the first US-Africa business forum “to strengthen trade and financial ties” with the region. The forum, which US officials said would gather dozens of chief executives from African and American companies, would take place on the eve of President Barack Obama’s summit at the White House with leaders of roughly 50 African countries.According to the African Development Bank, China has built close relationships with African partners by coupling trade with high levels of investments. Beijing has also provided African countries with billions of US dollars in credit lines.Emerging nations including India, Turkey, Malaysia and Brazil have also invested heavily during the past decade as investment by western countries have lagged behind.
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US-Africa trade has doubled in the past decade from about $50bn in the early 2000s to $110bn last year, while China-Africa trade has surged from just $10bn in 2000 to more than $200bn last year, making China the largest trading partner of Africa.Japan is also deepening its commercial and investment ties with Africa and moving away from a traditional focus on aid. Shinzo Abe this year led the first visit by a Japanese prime minister to sub-Saharan Africa in eight years in what Tokyo said at the time was a trip to support “Japanese companies’ investments to secure important natural resources” in the region.European countries, particularly the UK, France and Germany, have joined the scramble to secure infrastructure contracts as well, officials and businessmen said.In 2014, sub-Saharan Africa is forecast to grow 5.4 per cent, according to the IMF, making it the second-fastest growing region in the world only behind developing Asia, including China and India.
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Africa-based businessmen and officials have welcomed the American push, hailing a change of attitude, although some businessmen cautioned that the US had a long way to catch up with China in the region. Tony Elumelu, a Nigerian billionaire and chairman of Lagos-based conglomerate Heirs Holding, said that there were signs that Washington had “willingness to engage with Africa . . . in a different way”.The US is in the process of renewing a 13-year-old preferential trade agreement with the region that expires in 2015, but is pushing for better access for its products and investments in the region. The African Growth and Opportunity Act, originally crafted under President Bill Clinton in 2000 and renewed by George W Bush, is the cornerstone of US-Africa economic relations providing African countries with duty-free access to America for products from oil to seafood.
