Agoa.info - African Growth and Opportunity Act
TRALAC - Trade Law Centre
You are here: Home/News/Article/Trump administration unveils its new Africa strategy — with wins and snags

Trump administration unveils its new Africa strategy — with wins and snags

Trump administration unveils its new Africa strategy — with wins and snags
Karen Dunn Kelley, Deputy US secretary of commerce
Published date:
Wednesday, 19 June 2019
Author:
Danielle Paquette

The Trump administration’s message to Africa has been blunt: Choose the United States over China and Russia. 

Officials announced the details of that policy challenge Wednesday in the southern African nation of Mozambique, urging hundreds of African business leaders at an economic conference to ramp up partnerships and trade with American companies.

U.S. firms deliver “unrivaled value,” Deputy Secretary of Commerce Karen Dunn Kelley told the crowd. “Yet we have lost ground to the increasingly sophisticated — but too often opaque — business practices of foreign competitors.”

The White House’s solution is Prosper Africa, a new effort that shifts American focus on the continent from aid to industry. 

The $50 million program will offer technical help to companies looking to enter or grow in Africa, which is urbanizing more rapidly than anywhere else on Earth. The region is projected to have 1.52 billion consumers by 2025 — nearly five times the size of the U.S. population. 

But Americans are missing out on that market, Kelley said: U.S. exports to Africa have dropped by nearly a third since their 2014 high.

The administration seeks to reverse that trend by searching for business opportunities, trying to reduce trade barriers, connecting firms to financing and guiding them through bureaucracy, among other commerce-boosting tactics, she said.

Kelley highlighted one example of success: Texas energy company Anadarko Petroleum Corp. gave the green light Tuesday to start building a $20 billion gas liquefaction and export terminal in Mozambique — the biggest such project ever approved in Africa. 

Meanwhile, the U.S. International Development Finance Corp. , a government agency that will begin operating in October following a bipartisan congressional push, will double the amount of money available for American investment in low-income countries, including some in Africa. 

“We know that the U.S. government can and must do more to capitalize on the competitive advantage of U.S. companies,” Kelley said, “and the entrepreneurial spirit of the African people.”

The specifics of President Trump’s Africa policy emerge six months after national security adviser John Bolton announced that the administration was switching gears on the continent — with an emphasis on countering the rising influence of China and Russia. 

The “predatory practices” of those rivals threaten the financial independence of African nations by strapping them with debt, he said in December — and squash opportunities for the United States to expand its economic footprint.

“They are deliberately and aggressively targeting their investments in the region to gain a competitive advantage over the United States,” Bolton said in a speech at the Heritage Foundation in Washington, where he mentioned China 14 times.

The condemnation received mixed reviews in Africa, where China is generally popular as the continent’s biggest trading partner and Russia is making aggressive inroads.

Russian President Vladimir Putin plans to meet with 50 African leaders on his home turf in Sochi at the first Russian-African Summit. The meeting is meant to bolster “Russia’s active presence in the region,” Foreign Minister Sergei Lavrov said last year

And Chinese President Xi Jinping pledged $60 billion in September in financial aid to Africa. China will forgive debt in poorer nations, he added as Beijing hosted dozens of African dignitaries. The sky was uncharacteristically blue that week because air-polluting factories had shut down for the summit.

Xi has also visited the continent multiple times. He arrived in the West African nation of Senegal last year, for example, to hand President Macky Sall the keys to a new $52 million wrestling stadium, courtesy of China. (Wrestling is huge in Senegal.)

“Say what you want about what the Chinese are doing in Africa, but their leaders do make the effort to go there and build personal relationships,” said Eric Olander, managing editor of the  China Africa Project, a news site in Shanghai.

U.S. diplomacy is less flashy. American efforts tend to unfold behind the scenes: training military forces, helping cities rebuild after devastating floods, distributing fertilizer to farmers, helping regions get rid of disease-spreading flies.

Trump has not visited the continent. (Ivanka Trump, his elder daughter and adviser, made a positive splash in April when she danced with cocoa farmworkers in the Ivory Coast.) 

Commerce Secretary Wilbur Ross was supposed to promote Prosper Africa at Wednesday’s U.S.-Africa Summit in Mozambique — an event attended by 11 African presidents — but canceled because of a scheduling conflict.

Gyude Moore, a Liberian former minister of public works, said that the United States’ new strategy in Africa is considered a positive step but that the absence of political star power at its announcement was insulting.

“There’s a saying: What you’re doing is so loud, I can’t hear what you’re saying,” Moore said. “The U.S. does not have the decency, the courtesy, to send a Cabinet-level official to this event.”

In the optics battle with China and other competitors, “we’re losing,” said Todd Moss, who was a diplomat in West Africa during the George W. Bush administration. 

Another roadblock is misconceptions among American decision-makers about African markets, said Melissa Cook, founder of African Sunrise Partners, an investment strategy group.

“When you talk to U.S. companies, people say, ‘Oh, well, it’s only 2 percent of world GDP’ or ‘Oh, it’s scary and dangerous — we don’t need to be there,’ ” she said.

In Senegal’s capital city of Dakar, African shopkeepers work alongside Chinese vendors, hawking sandals, fabrics, purses and fake eyelashes.

That’s where Abdoulaye Niang, 42, sells pots and pans. Chinese characters and French words dominate signs. People communicate with body language and in Wolof, Senegal’s mother tongue.

“A lot of the Chinese people here speak it,” he said. “I don’t know any Americans who do.”

News about Trump — the incendiary tweets, the trade disputes, reports that he referred to some African nations by a derogatory term “shithole” countries — has popped up periodically on his Samsung smartphone. 

“I don’t think Africa truly interests him,” Niang said. “All he cares about is money.”

Read related news articles

Prosper Africa coordinates 17 US agencies to help boost Africa’s low participation in AGOA

The US has mobilised 17 relevant government departments and agencies under the umbrella of Prosper Africa coordinator British Robinson to try to clinch deals between US and African businesses that will increase utilisation of the African Growth and Opportunity Act (Agoa). The 20th annual Agoa Forum ended in Johannesburg at the weekend with an all-round commitment by Africa and the US to renew the preferential trade programme when it expires...

09 November 2023

We want more Ghanaian exports in US market – trade minister

Mr. Kobina Tahir Hammond, Minister of Trade and Industry, says Ghana desires to increase its exports to the United States (US) market, arguably the most lucrative consumer market globally. He indicated that the Government had stepped up support for the private sector, both domestic and foreign, to enhance production and export capacity, particularly in the manufacturing sector, with notable opportunities for export into the U.S. market. The...

11 August 2023

Could supply chain security take US firms to Africa?

Beginning in August, China will levy export controls on two critical minerals: gallium and geranium. These metals are essential to semiconductor technology and restricting access to them marks Beijing’s latest volley in its strategic power competition with Washington and will significantly disrupt U.S. and Taiwanese chip manufacturers. The global mineral supply chain is already narrow and China has an overwhelming lead with...

28 July 2023

US AGOA and private sector collaboration as backbone for strengthening relations with Africa

With over 1300 delegates at the US-African  Business Summit held mid-July in Gaborone, Botswana, the main focus was on mapping out strategies to strengthen trade and economic relations between the United States and Africa. Majority of the speakers emphasized reviewing and widening collaboration between governments, while others underlined the importance of the private sector as the key driver in achieving  robust economic growth in...

17 July 2023

Fact sheet: US- Africa partnership in promoting two-way trade and investment in Africa

Africa’s integration into global markets, demographic boom, and continent-wide spirit of entrepreneurship and innovation present an extraordinary opportunity for the United States to invest in Africa’s future.   The United States will support and facilitate mobilizing private capital to fuel economic growth, job creation, and greater U.S. participation in Africa’s future.   Together, business and government leaders will...

14 December 2022

The 'three issues that will make or break the Prosper Africa initiative'

The U.S. government’s Prosper Africa program, launched in 2019, aims to double two-way trade and investment between the United States and African countries and, in doing so, to put a new face on American foreign policy in Africa. Despite the initiative’s embrace by two separate administrations, it has so far been slow to live up to expectations. The Prosper Africa Act, a draft piece of bipartisan legislation put forward in the U.S. House...

18 May 2022

US legislators seek to codify the Prosper Africa Act

 In January 2022, representatives McCaul (R-TX) and Murphy (D-FL) put forward the Prosper Africa Act (H.R.6455) to codify the existing Prosper Africa initiative into law. This program strives to increase investment and trade cooperation among the United States and African nations. Since 2019, the initiative enabled almost 800 deals worth $50 billion. The codification of Prosper Africa will benefit the program by...

14 March 2022

US seeks more investment opportunities in Africa

The US government is exploring ways to expand trade and investment opportunities in Africa, in a bid to scramble for the control of the continent’s raw materials with other world’s powerful nations such as China and Russia. The US Deputy Assistant Secretary of State Akunna Cook said the country has yet to deepen its presence in Africa, which has a population of about 1.3 billion people.  “We have been behind the curve for...

25 February 2022

US Congress: Representatives McCaul, Murphy introduce Prosper Africa Act

House Foreign Affairs Committee Lead Republican Michael McCaul (R-TX) and Congresswoman Stephanie Murphy (D-FL) introduced the Prosper Africa Act to codify interagency efforts and promote, facilitate and increase two-way trade and investment between the United States and Africa.  “Advancing two-way trade and investment between the U.S. and African partners must be a key foreign policy priority,” said Rep....

21 January 2022

Biden eyes up Africa as new trade market, reboots Trump-era initiative

The Joe Biden administration has announced plans to revamp the Trump-era Prosper Africa initiative, as it works to “substantially increase” two-way trade and investment between the US and Africa. With a focus on infrastructure, clean energy and healthcare, the White House said in recent weeks that it would kickstart a new Prosper Africa Build Together Campaign, having also requested US$80m from Congress in additional funding...

01 September 2021

Biden Administration launches initiative to build US-Africa trade

The Biden administration on Tuesday announced a new push to expand business ties between U.S. companies and Africa, with a focus on clean energy, health, agribusiness and transportation infrastructure on the continent. U.S. industry executives welcomed the interest, but said dollar flows will lag until the administration wraps up its lengthy review of Trump administration trade measures and sets a clear policy on investments in liquefied...

28 July 2021

You are here: Home/News/Article/Trump administration unveils its new Africa strategy — with wins and snags