President Barack Obama has said Africa’s fast-growing economies represent a great opportunity for United States (U.S.) companies to expand their investments if governments curb corruption and human rights abuses.
According to Bloomberg, Obama said Africa represents a great opportunity for American companies to expand their investments, as the U.S. competes with China to tap some of the world’s fastest growing economies.
“Africa’s rise means opportunity for all of us,” Obama told heads of state gathered for a morning session yesteray at the State Department in the final day of U.S.-Africa Leaders Summit.
He promised them “a partnership of equals that focuses on African capacity to solve problems, and on Africa’s capacity to grow.”
The president is seeking to shift the U.S. focus in Africa toward fostering investment and trade, instead of the traditional emphasis on providing aid. The new approach is being taken as China has surpassed the U.S. as Africa’s biggest trading partner with a relationship that exceeded $200 billion last year, more than double that of the U.S.
At yesterday’s U.S.-Africa Business Forum in Washington, the U.S. president drew an indirect contrast y to China’s approach, saying that the U.S. wants to work with African nations to promote their expansion. “We don’t simply want to extract minerals from the ground for our growth.”
That prompted a response yesterday from the Chinese government.
“China’s African policy has always featured sincerity, friendship, equal treatment, mutual benefit and common development,” Foreign Ministry spokeswoman Hua Chunying said, according to a report by the official Xinhua News Agency.
“This is the fundamental reason why China-Africa cooperation is welcomed by African countries and people.” China, the spokeswoman said, hopes the U.S. “can play a greater role” than it does now in supporting African development.
China’s state-owned enterprises have rolled out projects in every country on the continent, including hydroelectric dams, highways and rail lines linked to the extraction of natural resources.
The U.S. is seeking to expand its commercial footprint in Africa. At yesterday’s forum, which included more than 90 U.S. companies, Obama highlighted $33 billion in commitments to Africa: $14 billion in investments by companies including General Electric Co. (GE) and Coca-Cola Co. (KO), $7 billion in financing to promote U.S. exports and $12 billion for an initiative to double availability of electricity in sub-Saharan Africa.
Obama said he wanted to focus leaders’ attention today on factors that encourage investment and economic stability: governance and rule of law, expanding trade and steps to deepen security cooperation.
To draw more U.S. investment, the administration is pressing African leaders at the summit to protect human rights, especially for women, curb corruption and foster more transparent financial systems. It has been a recurring theme from the president and top administration officials over the three days of the summit.
Obama said: “Capital is one thing. Rule of law, regulatory reform, good governance? Those things matter even more because investors want to be able to do business without “paying a bribe or hiring somebody’s cousin.”
Africa’s biggest need, he said, is “laws and regulations and structure that empower the individual” and don’t simply preserve “power for those at the very top.”
Obama will return to that message during the final session of the summit today titled “Governing for the Next Generation.” The White House, in a statement, said that discussion at the State Department will include emphasizing that accountable and transparent government promotes development.
