Washington, DC — President Bush has announced the creation of a US$200m "support facility" that will give U.S. firms access to loans, guarantees, and political risk insurance for investment projects in sub-Saharan Africa. The new program will be handled by the Overseas Private Investment Corporation (Opic).
He was speaking at a day-long Forum of African trade ministers and U.S. officials at the Department of State in Washington, DC, held to review the progress of the African Growth and Opportunity Act (AGOA) that became law last May. The act is designed to boost investment and trade between the U.S. and African countries and in President Bush's view, it is working well: "Across the continent, African governments are reforming their economies and their governments in order to take advantage of AGOA," he said.
AGOA aims to promote trade and investment in Africa. Under its provisions, nations "certified" as meeting several "conditionalities" - by phasing out government subsidies and price controls, protecting human and intellectual property rights and making efforts to combat corruption - will get preferential treatment for their exports. Just ten nations have been certified for AGOA's preferential apparel benefits so far, although 35 nations are eligible. Representatives from all 35 were present at Monday's Forum.
"These nations are working hard to fight corruption, improve labor standards and reform their customs regimes," Bush said. "The United States will work in partnership with African nations to help - to help them build the institutions and expertise they need to benefit from trade."
President Bush also said that he has asked the Trade and Development Agency to establish a regional office in Johannesburg, South Africa, to help governments that are trying to improve the investment environment and loosen their trade laws.
Finally, President Bush announced the appropriation of US$15m to launch the Trade for African Development and Enterprise Program to help African businesses use AGOA to sell more of their products on the global market.
African participants, largely from trade and finance ministries, came into the Forum uncertain about the stance of the U.S. on trade and development in the aftermath of September 11. "Any nation at war has to place its own national security first," said one, "we understand that; but we're very concerned that African trade issues might get lost in the shuffle." Opening the forum, however, U.S. Trade Representative Robert B. Zoellick declared: "The U.S. commitment to prosperity and freedom in sub-Saharan Africa is strong."
President Bush's short speech underlined that message. There was also an enthusiastic reception for Secretary of State Colin Powell, who told participants: "As America's sixty-fifth Secretary of State and as her only African American Secretary of State so far, I need no convincing that America's and Africa's pasts, our present and our future, are closely intertwined."
"Two things came across clearly," said Nigeria's Ambassador to the United States, Jibril Muhammad Aminu: "September 11 has not changed the U.S. so that its attention has wandered from Africa. And the Bush Administration remains firm in their commitment to AGOA. They have said enough for us to take them at their word." Nigeria's President Olusegun Obasanjo will hold talks with President Bush Friday.
But despite their applause, members of the Forum raised challenging questions about the prospects of the golden future being sketched out by their American hosts..
In his speech, General Powell compared Africa's possibilities to China's two decades ago, suggesting that similar progress was possible: But a member of Nigeria's delegation later asked Secretary Powell to explain how that might be achieved, given that China had not been burdened with the kind of debt that burdens Africa: "We are being dragged down by heavy debts, by misdeeds of the past and while we appreciate President Bush, we are being hurt by our heavy burden. America is not doing much about that."
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Powell's response was cautious: "You're right," he told the delegate, "[but] the point I'm making is that if you're willing to separate from the past and look at future possibilities, great achievement is possible."
Later, South Africa's Deputy Minister of Trade and Commerce, Lindiwe Ngwane, commented: "We are asking developed nations to retreat from their past in the way that they treated us and in the way that they saw us." She added that a new view of Africa and assistance with trade and industry on the continent was a practical necessity: "The rest of the world cannot reach its potential if Africa does not reach its potential."
