WINDHOEK – With new commitments in investments and trade support to Africa worth more than US$33 billion (N$354 billion), America has just renewed its vows to Africa, a significant display of affection to a continent in a serious relationship with China, and in a love-hate affair with the European Union.
Yet, besides the criticism that the summit was a talking shop and an attempt by the US to catch up with countries with direct access to African leaders – and the denouncing of Obama’s reluctance to have direct one-on-one meetings with African presidents – the summit did manage to endear Africa as the true bosom trade ally to the US, albeit all within three days tête-à-tête summit in Washington.
The African Union Commission chairperson, Nkosazana Dlamini-Zuma, said of her impression of the summit: “I got the impression that African leaders actually enjoyed the summit, particularly interacting with businesspeople. At most of these summits you are not offered that opportunity. Leaders were saying that is what was unique about this summit.”
Nigeria’s billionaire businessman, Aliko Dangote, used the platform to announce a joint investment of US$5billion (about N$54 billion) over the next five years in energy infrastructure projects across Sub-Saharan Africa with a particular emphasis on power, transmission and pipeline projects.
However, the N$354 billion commitment to Africa is not necessary direct cash investments into Africa. It is rather a part of the US’ Doing Business in Africa campaign, which seeks to support existing and new American investments in Africa, finance American businesses to expand their exports to Africa and facilitation of elimination of barriers that might hamper trade between the US and Africa.
Hence, the funds, or commitments of funds, are through institutions such as the U.S. Export-Import Bank which has under taken to finance the N$6 billion sale of General Electric locomotives to South Africa’s Transnet, and another N$10,7 billion financing of US exports to Angola’s infrastructure, with the financing done through the Angolan ministry of finance.
There are, however, very few country specific investments and trade facilitations, with the exception of specific deals signed for Angola, Nigeria, Tanzania, Ethiopia, Mozambique, Ghana, and South Africa.
US Trade and Development Agency for instance has agreed to partner with South Africa’s Air Traffic and Navigation Services Company of to evaluate satellite-based automatic dependent surveillance broadcast across the African continent, the implementation of which will improve air traffic safety and create over N$1 billion in U.S. export opportunities.
The entire package of N$354 billion commitments would be channelled, as private-sector deals and investments, guarantees and support financing, through the US Department of Agriculture’ Commodity Credit Cooperation, Department of State, U.S. Agency for International Development (USAID), U.S. Export-Import Bank, the Overseas Private Investment Corporation, and the Millennium Challenge Corporation.
The US’s sudden push for stronger relations with African nations is partially a response to the increasing economic ties between Africa and China. Beijing is investing billions of dollars in the continent, and has been its biggest trade partner since 2009.
However, the GDP growth of sub-Saharan Africa, which has grown at a much faster rate than the rest of the world over the past decade, coupled with the continent’ young population and an expanding middle class has attracted the US. Last year, US goods exports to the region stood at US$24 billion (N$258 billion), a 250 percent increase from 2003, while imports stood at $39.3 billion (N$422 billion), which was up by 53 percent from a decade ago.
By Desie Heita
New Era Reporter
2014-08-12 08:59:45 4 years ago