Author: Adva Saldinger
Affiliated organization: Devex
Type of publication: Article
Date of publication: June 04th, 2020
The United States may have provided billions of dollars over the years to the continent — particularly through programs such as the President’s Emergency Plan for AIDS Relief, which has saved billions of lives — and may be the “single most important development partner,” but it seems clear that Africa just doesn’t rank that high in U.S. priorities when compared to other regions.
President Donald Trump has met with just two African presidents in the Oval Office in his first term — fewer than any of his predecessors — has made racist statements, and has strained relations by rolling out limitations on immigration for African countries.
It is also not lost on African leaders that Trump has repeatedly proposed deep cuts to foreign aid programs, which are critical on the continent, a move that they see as a demonstration of U.S. priorities.
“There is an enormous problem with how this administration framed Africa policy vis-a-vis China. They framed Africa as a pawn in a great game, as if it’s something to be lost or won, that Africans don’t have agency, and there is no intrinsic value otherwise to strong relations with African states or engaging Africa as an important region of increasing political and economic weight globally.”
It’s increasingly clear as well that this framing isn’t well received on the African continent, with Kenyan President Uhuru Kenyatta speaking out at an event in Washington, D.C., earlier this year, saying that Western countries and their counterparts in Asia and the Middle East are acting like Africa is for the taking.
U.S. engagement in Africa is focused in five key areas, according to Nagy: harnessing the potential of African youth; creating a level playing field for U.S. companies and encouraging U.S. business to go to the continent; helping improve governance; countering China’s narrative; and increasing engagement with diaspora communities.
The U.S. Agency for International Development’s priorities are similar: focusing on building trade and commercial ties; protecting the U.S. from security and health threats; and helping African states progress toward stability and self-reliance.
U.S. policies seem focused inwardly and on global power competition, some experts said. While there are some positive steps, and a focus on boosting trade and investment could help emerging African economies grow sustainably, it must be done strategically and in concert with other policies, the experts said. There needs to be more action and more clarity around policies and proposals, they said.
Framing Africa policy in the context of its competition with China is problematic, because African leaders reject it and because it can be counterproductive to U.S. priorities in the region.
African leaders don’t want to be stuck in the middle of international competition with countries acting like Africa is for the taking. They want to be able to work with a number of partners, rather than be forced to choose one over the other.
The U.S. has been “late in realizing what is going on” and China has been there, What the U.S. needs to do is get more American companies engaged on the continent and offer alternatives to the Chinese approach.
U.S. engagement in Africa is focused in five key areas, according to Nagy: harnessing the potential of African youth; creating a level playing field for U.S. companies and encouraging U.S. business to go to the continent; helping improve governance; countering China’s narrative; and increasing engagement with diaspora communities
The choice is for Africans on the ground to make but the U.S. needs to talk about the advantages American companies bring, and talk about the funding that the U.S. contributes to global health for example, in the same way that China might tout a new stadium.
The U.S. insistence that African leaders “beware of the Chinese” and efforts to define themselves as the “partner of choice” doesn’t sit well. African leaders seek as many partners as possible and China certainly has unique competencies that the U.S., regardless of intentions, won’t provide.
With this framing, it is difficult for U.S. concerns to be taken seriously, particularly on issues of debt, where U.S. advice to countries “doesn’t carry the weight it would have if it was not seen as biased”.
While there are valid criticisms of some Chinese investments and a lack of transparency in particular, those can be levied without making a “blanket condemnation of Chinese engagement on the continent.
Trade and investment
A key part of the administration’s stated focus on the continent has been building trade and investment, with Prosper Africa launched as the flagship initiative in that effort. The initiative, while broadly supported in theory, has struggled in its early years and has not yet delivered much on its promises.
The U.S. should look to build initiatives in areas where it can differentiate itself, like in the creative sector, in sports, in venture capital, in higher education. The U.S. won’t compete with China on building bridges, roads or rail
Information about the initiative has been sparse and released in bits and pieces since its 2018 launch and has “lost a lot of its momentum because of this very slow roll out,” said Judd Devermont, the director of the Africa program at the Center for Strategic and International Studies.
There is still little known about the initiative. USAID houses its secretariat and it aims to mobilize U.S. capacity to facilitate transactions and foster better policy environments for trade and investment in Africa, Maloney said.
The U.S. government is building a one-stop shop for its more than 60 trade investment support services as part of Prosper Africa. USAID is working with Prosper Africa teams to help identify potential deals with its networks and provide technical assistance in some cases.
Some significant activity is beginning through the U.S. International Development Finance Corporation and the Export-Import Bank, and if that is happening under the Prosper Africa coordination mechanism.
The initiative must do a better job communicating what tools are available to encourage and incentivize American investment in Africa, and Africans need to work to lower barriers to engagement and address both the real and perceived risks in investing in their countries.
The U.S. should look to build initiatives in areas where it can differentiate itself, like in the creative sector, in sports, in venture capital, in higher education. The U.S. won’t compete with China on building bridges, roads or rail.
The African Growth and Opportunity Act, part of the U.S. trade toolkit on the continent, just marked its 20th anniversary. But it hasn’t performed to the level that its crafters had hoped and there are both policy and structural issues that prevent many African countries from fully using the trade preferences.
But it’s not necessarily easy to figure out what comes next —- the U.S. doesn’t have the capacity to negotiate many bilateral free-trade agreements at a time, and any new agreements would have to work with the African continental free-trade agreement and AGOA.
A bright spot
While there may be questions about the administration’s policies in several areas, experts agreed that the creation of DFC has the potential to be a very positive development for Africa.
The United States International Development Finance Corporation (DFC) invests globally but has the potential to do a lot in Africa, particularly since the legislation creating the new agency mandated that it focus on low- and lower-middle income countries. DFC has set a goal of having 60% of its investments in those and fragile countries.
The agency has a spending cap of $60 billion, more than double its predecessor, but it also has important new authorities that may have a particular impact on the continent. DFC’s equity authority, and the lack of a requirement of a U.S. nexus in projects it invests in, along with the doubling of resources could be “transformational in the way we do development financing.
Its predecessor had ramped up investment on the continent, but with DFC only six months old it remains to be seen how much of its portfolio will be invested in Africa.
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