4 May 2014

Africa: Is Africa's Future in Trade or Aid?

Photo: Swazi Media Commentary
Teachers and other workers protested in Swaziland , appealing for an international asset freeze against King Mswati III (file photo).

opinion

Early in the month of August last year, the 12th edition of the US-Sub-Saharan African Trade and Economic Cooperation Forum otherwise known as AGOA Forum was held in Addis Ababa, the capital of Ethiopia. The theme of the forum was: "Sustainable Transformation through Trade and Technology". The event was hosted by the Federal Republic of Ethiopia in association with the United States Government. Delegates to the forum were drawn from the AGOA Eligible African Countries among other stakeholders.

Mr. Michael Forman, the United States Trade Representative who co-chaired the forum with Ethiopia's Foreign Minister, Dr. Tedros Adhanom said: "US officials and Ministers from AGOA Eligible Sub-Saharan African countries have launched a review on what kind of changes to be made to AGOA going forward". However, participants at the forum including private sectors and civil society organizations highlighted the challenges hindering the development of Africa's trade with the US and the world in General. Some of the challenges include; infrastructure gap, marine transport and logistics, absence of evaluation mechanisms to gauge the performance of AGOA exports, cost of branding exports, absence of direct air transport connection between major African countries and the United States among others were challenges listed at the forum.

Nonetheless, it will be recalled that, the African Growth and Opportunity Act (AGOA) which was introduced to provide tangible economic incentives for African countries by opening up America's market to eligible African countries was signed in to law on May 18, year 2000. It was on this basis that some civil societies and activists called on the United States Government to increase its investments in Africa so as to unleash the continent's potential for growth. They argued that, the US investment in Africa currently stands at a mere 1 percent of the total US investment across the globe. But, in what looked like an open admission about America's investment status in Africa, the former United States President, Bill Clinton who spoke to the BBC admitted that, his country America is lagging behind China in terms of development in Africa, saying, the only area America is far more above other countries is in the health sector, where it is still the leading light in Africa.

But, at the AGOA forum, some suggestions on how Africa could maximally benefit from AGOA were postulated! For example, Dr. Tedros Adhanom, Ethiopia's Foreign Minister who co-chaired the forum with Mr. Forman noted that, since one of the major reasons for the poor performance of Africa is mainly related to supply side constraints, he asserted that, "Africa is not asking for a mere extension of AGOA beyond 2015, but rather, it would work on the supply side problem so that, it could benefit from the untapped potential of the AGOA initiative". While responding, Mr. Forman said: "The answers to the impediments and problems mentioned is something to be worked out between the US and Africa".

Meanwhile, some American analysts and commentators have decried the participation of African negotiators in the EU--Africa Economic Partnership Agreement. For example, one of the commentators who appeared on the Voice of America said, Africans cannot be demanding for the extension of AGOA, while it allows its own market to be flooded by goods from Europe under the EPA. It will be recalled that, when the idea of EPA with Africa was mooted as a replacement to preferential trade between Africa and Europe some years ago, it was greeted by a massive protest in some countries like Senegal. They argued that, EPA will pauperize their country, as it will expose local production to big international corporations. They also listed some objectionable elements in the EPA to include but not limited to lifting of quotas on imports, lifting of taxes on imports, no subsidy in the agricultural sector among others! But in allaying the fears expressed by those protesters, the promoters of the EU-Africa Economic Partnership Agreement promised to compensate Africa for the losses it may incur.

In the same vein, I must also look at the attitude or the mentality of Africans themselves. Even without EPA with the EU, have our local productions been able to match their foreign competitors? Can an average African willingly buy a "made in Nigeria or made in South Africa product on his or her own accord? Even when a product is declared contraband, why do we still have people who smuggle them in to the continent if there are no buyers readily available to buy them? It like a question one of the BBC Journalists asked former President of Mexico, Mr. Philippe Kaudorun on why the incidence of drug related offences are on the increase in his country despite his clampdown on their activities? His answer was "If they are no drug buyers in America, would those barons continue with their illicit business?

Looking at it from the other perspective, what if those companies should come to Africa where there is huge market, land and manpower to establish manufacturing plants to produce and sell their goods to Africans as some of them have done in China, would that assuage those analysts and commentators who are against the extension of AGOA beyond 2015?

In conclusion, whether Africa's future is in trade or aid, the continent's leaders should negotiate a deal that will reduce unemployment, poverty, maternal and child mortality, youths restiveness, national crises cum regional conflicts and engender a new frontier for Africa where a child in South Sudan enjoys the same rights, privileges and access as the child in Germany. Where no woman in the continent would die just because she wants' to give birth to a baby; and where the dreams and hopes of a better life for an African child would no longer be a pipe dream, but a reality he or she lives with!

- Uhara, an activist and commentator on public affairs, wrote in from Yenagoa.

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