The U.S. will add 10 trade missions in African countries and expand its presence in other parts of the continent as it tries to compete with China, the continent’s biggest trade partner.
“Now is the time for the U.S. to do business in Africa,” Commerce Secretary Penny Pritzker said at the U.S.-Africa Business Forum in Washington today, where she announced the expansion.
The forum, part of a three-day summit attended by more than 40 African leaders, comes as President Barack Obama seeks to shift the approach of the U.S. from providing aid to fostering investment and trade in the continent.
Obama plans to announce today $14 billion in commitments from U.S. companies for investments in Africa, according to an administration official. The world’s biggest economy is stepping up efforts to forge closer ties in Africa after China’s trade with the continent exceeded $200 billion last year, more than double that of the U.S. China overtook the U.S. as the Africa’s biggest trading partner five years ago.
The U.S.-Africa economic relationship is essential for mutual prosperity, Pritzker said. Former U.S. President Bill Clinton made similar comments at the forum. Africa offers a massive opportunity to American companies that have been slow to invest there, he said during a panel discussion.
“It strikes me that we’ve only barely scratched the surface of what we could and should be doing there, and that we’re missing the boat,” Clinton said.
General Electric Co. yesterday announced plans to invest $2 billion in the region by 2018 and double its workforce on the continent. Ford Motor Co. is looking to expand its manufacturing plants in Africa, Jim Benintende, Ford’s head of operations in the Middle East and Africa, said in an interview yesterday.
Aliko Dangote, president of Dangote Group and Africa’s richest man, announced a $5 billion investment by 2019 with New York-based Blackstone Group LP (BX:US) in power projects in sub-Saharan Africa. He also formed a joint venture with the Washington-based Carlyle Group LP to invest an unspecified amount in Nigerian oil and gas ventures and other sub-Saharan projects.
The U.S. should extend the African Growth and Opportunity Act for another 15 years to seek stronger trade and support growth in Africa, Clinton said.
The act, which offers qualifying African countries preferential trade arrangements by eliminating import levies on more than 7,000 products, expires next year. South African President Jacob Zuma said talks on the accord will be a major focus of this week’s summit.
The U.S.-Africa Business Forum is hosted by Bloomberg Philanthropies and the U.S. Commerce Department. Bloomberg Philanthropies is led by Michael Bloomberg, the founder and majority owner of Bloomberg LP, the parent of Bloomberg News
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