U.S. Senator Chris Coons (D-Del.) will chair a hearing of the Senate Foreign Relations Committee on Wednesday to consider the vast economic opportunities for U.S. businesses and investors in Africa, as well as steps the U.S. government could take to increase bilateral trade and investment.
The hearing, which is entitled "Economic Statecraft: Increasing American Jobs Through Greater U.S.-Africa Trade and Investment," will take a comprehensive look at U.S. policy for promoting enhanced trade and investment in Africa in a manner that leads to mutually beneficial economic growth. It will also examine legislation, S.2215 -- the Increasing American Jobs through Greater Exports to Africa Bill of 2012 -- which aims to increase U.S. exports to Africa by 200 percent in the next decade.
Africa is home to six of the ten fastest growing economies in the world, a number that is projected to increase to seven by 2015. Ernst & Young recently released its 2012 Africa Attractiveness Survey showing that foreign direct investment in Africa grew by 27 percent in 2011 and is expected to double from its current level by 2015. U.S. exports to Africa tripled between 2001 and 2011, creating jobs for Americans and fostering economic growth in African countries. At the same time, there is more that could be done to fully capitalize on Africa's vast economic potential and compete more aggressively with countries such as China, whichsurpassed the United States as Africa's largest trading partner in 2009.
Opening Statement of Senator Chris Coons (as prepared for delivery)
I am pleased to convene today's hearing of the Foreign Relations Committee entitled "Economic Statecraft: Increasing American Jobs through Greater U.S.-Africa Trade and Investment." I would like to welcome our distinguished witnesses, as well as my partners on the Africa Subcommittee, Senator Isakson, Senator Durbin, and others who have joined us today.
Before we begin, I would like to reflect on yesterday's passing of President John Atta Mills of Ghana. Senator Isakson and I had the pleasure of meeting President Mills last year, and there is no question that the people of Ghana have lost a great leader and dedicated public servant. President Mills worked to promote economic growth and strengthen democratic institutions, and his leadership and commitment to his people will be deeply missed.
Today's hearing is the second in a series exploring Africa's vast economic potential and considering U.S. policy to increase regional investment and trade. At this hearing, we will consider legislation I have joined Senator Durbin in introducing -- the "Increasing American Jobs through Greater Exports to Africa Act" -- which aims to increase U.S. exports to Africa by over 200 percent in the next decade (chart).
Sub-Saharan Africa is a region of endless opportunity and economic potential. In the past ten years, it has been home to six of the ten fastest growing economies in the world (chart), and that number is projected to reach seven by 2015 (chart).
As I mentioned at the last hearing, trade between Africa and the rest of the world has tripled since 2001. During this time, U.S. exports to Africa have increased by more than 200 percent and imports have increase by more than 250 percent (chart).
Despite this positive trajectory in bilateral trade, the U.S. is losing out to competitors in the African market to countries such as China, which surpassed the United States as Africa's largest trading partner in 2009 (chart). Just last week, China announced it would provide $20 billion in loans to African governments over the next three years to encourage investment in infrastructure and agriculture, which more than doubles the financial commitment China made to Africa in 2009.
The U.S. must fully capitalize on the exponentially growing number of consumers and market potential in Africa, not only to be a more aggressive competitor with China, but also because it leads to the creation of American jobs and is good for U.S. business. In order to do this effectively, we must improve coordination between the ten key U.S. government agencies involved in formulating a trade strategy (chart).
We must also eliminate inconsistencies in the U.S. approach to increasing trade and investment with Africa, such as the recent decision by Commerce to eliminate Foreign Commercial Service Officers in rapidly growing African markets, such as Ghana. After visiting the officer posted in Accra last year, I was deeply disappointed to learn that this post was not renewed by Commerce despite the decision by other agencies to deepen the U.S. investment in this critical country.
To explain the tools the administration has at its disposal to increase trade and investment in Africa, we have assembled a strong panel representing three key agencies. Fred Hochberg, Chairman of the Export-Import Bank, will describe the rapidly increasing scope of Ex-Im loans supporting trade with sub-Saharan Africa (chart), which reached $1.4 billion in the last fiscal year.
Next, Under Secretary of Commerce for International Trade Francisco Sanchez will discuss the role of Commerce in overseeing the Foreign Commercial Service and other programs to support U.S. trade with Africa. I am particularly interested in resource allocation and the possibility of increasing the number of Foreign Commercial Service Officers on the continent from eight to at least 14 (chart), as proposed by S.2215.
Finally, Elizabeth Littlefield, President and CEO of the Overseas Private Investment Corporation (OPIC), will detail OPIC's work in Africa promoting economic growth and investment in developing and emerging economies. Last year, OPIC had a 300% increase in value of deals in sub-Saharan Africa, rounding out a ten-fold increase in OPIC's investment in the region since 2001 (chart). I look forward to hearing about how OPIC is fulfilling its development mandate and supporting small and medium sized enterprises (SMEs) in Africa.
On our second panel, we will hear from Dr. Mwangi Kimenyi, Senior Fellow and Director of the Africa Growth Initiative in the Global Economy and Development Program at the Brookings Institution; Scott Eisner, Vice President of African Affairs and International Operations for the U.S. Chamber of Commerce; and Stephen Hayes, President and CEO of the Corporate Council on Africa. I am grateful for their testimony and look forward to learning from their insight and expertise.
First, I would like to turn to Senator Isakson and Senator Durbin for opening remarks.