Economic ties focus of U.S.-Africa summit
Posted: August 6, 2014 at 5:35 a.m.
WASHINGTON -- President Barack Obama announced $33 billion in commitments Tuesday aimed at shifting U.S. ties with Africa beyond humanitarian aid and toward more equal economic partnerships.
The bulk of the commitments were from private-sector companies, including Coca-Cola and General Electric, underscoring Africa's growing appeal to businesses. The continent is home to six of the world's fastest-growing economies and a rapidly expanding middle class with increased spending power.
Yet Obama noted that U.S. trade with the entire African continent is about the same as its trade ties with Brazil and that just about 1 percent of U.S. exports go to sub-Saharan Africa.
"We've got to do better, much better," he said during closing remarks at a day-long session that brought together U.S. and African politicians and business leaders. "I want Africans buying more American products, and I want Americans buying more African products."
Wal-Mart Stores Inc., which operates in South Africa and 11 other sub-Saharan countries as Massmart Holdings Ltd., is expected to announce a $3 million investment today in farmer training programs to help bolster its supply chain in Rwanda, Zambia and Kenya.
Wal-Mart President and Chief Executive Officer Doug McMillon appeared with other executives Tuesday on a panel titled Expanding Opportunities: The New Era For Business In Africa, at the U.S.-Africa Business Forum in Washington. The business forum is part of a three-day summit underway in Washington, with nearly 50 African heads of state in attendance.
Former President Bill Clinton moderated the panel discussion that included McMillon, who was president and CEO of Wal-Mart International before taking the helm at Wal-Mart Stores Inc. in February.
"We're investing in sub-Saharan Africa for the long term, empowering African producers through hands-on training and using our global supply chain to connect them with our businesses around the world," McMillon said.
The U.S. is hardly alone in seeing economic potential in Africa, with China, Europe and India moving aggressively to tap into Africa's growing markets. China in particular is hungry for oil, coal and other resources and is eager to develop the roads, bridges and ports needed to pull them out of Africa.
Obama has sought to cast the U.S. as a better partner for African nations than China, arguing that his administration has a long-term interest in the continent's success and is not simply seeking to extract resources for its own purposes.
"The United States is determined to be a partner in Africa's success," he said. "We don't look to Africa simply for its natural resources. We recognize Africa for its greatest resource, which is its people, their talents and their potential."
About 100 U.S. companies were represented at Tuesday's conference. Vice President Joe Biden and Secretary of State John Kerry also addressed the attendees, as did Clinton, who declared that the U.S. has "only barely scratched the surface" of Africa's economic potential.
In conjunction with the meeting, U.S. companies announced $14 billion in investments for Africa. Among them: a $5 billion investment from Coca-Cola to fund manufacturing lines and production equipment; $2 billion investment from GE by 2018; $200 million in investments across Africa by Marriott, and a $66 million commitment by IBM to provide technology services to Ghana's Fidelity Bank.
The White House also touted another $12 billion in new commitments for Obama's Power Africa initiative from the private sector, World Bank and the government of Sweden. Obama announced the Power Africa initiative last summer, setting a goal of expanding electricity access to at least 20 million new households and commercial entities.
The president said that with the new financial commitments, he was boosting that goal to 60 million homes and businesses.
Obama also announced $7 billion in new government financing to promote U.S. exports to and investments in Africa. That includes $3 billion in financing from the U.S. Export-Import Bank aimed at supporting American exports to Africa over the next two years.
The bank is at the center of a political controversy in Washington, with some Republicans threatening to block its reauthorization when Congress returns from recess this fall. The GOP lawmakers seeking to shut down the bank argue that its spending is politically motivated and unnecessary.
GE Chief Executive Officer Jeffrey Immelt, who was among the business leaders participating in Tuesday's summit, appealed to Congress to renew the bank's charter, saying its existence signals to other countries that the U.S. government believes in investing overseas.
"The fact that we have to sit here and argue for it is just wrong," Immelt said.
Information for this article was contributed by Julie Pace, Paul Wiseman and Stacy A. Anderson of The Associated Press and by Cyd King of the Arkansas Democrat-Gazette.
A Section on 08/06/2014