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Global

Inbox OUT OF AFRICA Anver Versi Has the USA missed the boat on Africa? Perhaps it is a sign of the perceived swing of global economic infl uence from the West to the East that the fi rst USA-Africa Leaders Business Summit was only held in August this year, aeons behind similar conferences involving African and Asian economic giants, particularly China, India, Singapore, Korea and Japan. Nevertheless, as he promised to do so during his short tour of three African countries last year, Barack Obama, to the relief of some of the USA’s largest corporations, made it happen and did so in some style. Fifty-odd African heads of state, complete with full-size delegations, met and mingled with representatives of more than 100 US companies in Washington. To underscore the importance of the summit to the USA, Obama was fl anked by Vice- President Joe Biden and Secretary of State John Kerry. Former President Clinton, the original ‘Africa Bill’ because of his special interest in the continent, was in his element, saying that the USA has “barely scratched the surface” of Africa’s economic potential. The USA’s earlier slowness in coming forward in Africa, when the rest of the globe was climbing over each other to get a toehold on the fastest-growing region in the world, will remain a mystery. Even when China, running neck and neck with the USA in the global economic superpower race, was manically adding market after lucrative African market into its already overfl owing bag, the USA did not twitch – apart from issuing the usual homilies on the evils of terrorism and dictatorship. Meanwhile, billions of dollars of infrastructure related contracts – from telecommunication to giant dams, from new road and railway networks to ports and airports, from massive power projects to the designing of brand new cities – were being contested for and won by Asian fi rms. The penny fi nally seems to have dropped. “We are letting Europe and China go faster than the USA,” said a surprised-sounding Michael Bloomberg, the former New York mayor and billionaire businessman. “We also realise we have some catching up to do,” he added. For US companies such as Only one per cent of US exports are sold to Sub-Saharan Africa General Electric and Coca-Cola, which have been valiantly fending off the encroaching Asian forces from their ramparts and calling for reinforcements, the USA cannot move fast enough when it comes to initiating trade with Africa. Obama admitted that US trade with the entire African continent was about the same as its trade with Brazil and that only about one per cent of US exports go to Sub-Saharan Africa. “We’ve got to do better, much better,” he said during closing remarks at the summit. “I want Africans buying more American products and I want Americans buying more African products.” He also announced US$33 billion in commitments, which is roughly the same size as that announced by Japan’s premier, Shinzō Abe, at last year’s TICAD meeting with African heads of state. China’s trade with Africa, by way of contrast, is around $200 billion. He could not resist taking a swipe at China. “The United States is determined to be a partner in Africa’s success,” said Obama. “We don’t look to Africa simply for its natural resources. We recognise Africa for its greatest resource, which is its people, their talents and their potential.” Africans have heard all this before. What they want is business and investments. There was some encouraging news for them on this front: US companies announced $14 billion in investments. Coca-Cola said it would invest $5 billion to fund manufacturing lines and production equipment; GE will invest $2 billion by 2018; Marriot has planned an investment portfolio of $200 million across Africa; and IBM will commit $66 million to provide technology services to Ghana’s Fidelity Bank. Obama’s $7 billion Power Africa initiative, aimed at providing electricity access to at least 20 million households in Africa, was boosted by another $12 billion from the private sector, the World Bank and the government of Sweden. The aim has been expanded to provide electricity access to 60 million African households. The African leaders were pleased to note that the negative perceptions of Africa that seemed to have dominated the American mind were slowly being replaced by a more realistic image of the continent. While this will encourage more US companies to venture into Africa, one has to wonder if the eye-opening has come a little too late. Anver Versi is the editor of London-based African Business and African Banker magazines www.global global four th quar ter 2014 -br ief ing.org l 13


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