US Secretary of State Hillary Clinton on Friday wrapped up her visits to six African nations over an 11-day tour in the continent, during which she pressed for deepening economic ties between the US and Africa and called for democratic building there.
Clinton’s Africa trip, her fourth as the top US diplomat, came after US President Barack Obama in June unveiled his new African strategy, declaring that the “forgotten continent” torn by poverty could be the world’s next economic success story.
Analysts believe that the US, having seen China and other powers already investing heavily in Africa and benefiting from such relations, hopes to catch up with them in a region seen as the next frontier for economic growth.
US seeks bigger economic presence
During her visit to South Africa, Clinton announced that the US is committed to extending the African Growth and Opportunity Act beyond its 2015 expiry date. The US Congress earlier this month already voted to renew the bill that allows some 40 African nations to export their textile and apparel goods to the US duty free.
Meanwhile, acting US Commerce Secretary Rebecca Blank is also scheduled to pay a visit to Africa this month on the heels of Clinton’s trip.”I think there is a signal being sent by the Obama administration that the US is ready to massively expand its trade and investment in Africa,” Shen Dingli, director of the Center for American Studies at Fudan University, told the Global Times.
Clinton was accompanied during her tour by a large delegation of business leaders from some of the biggest US companies, including Boeing, GE and Walmart. In contrast, trips to Africa by senior US officials in the past would mainly focus on humanitarian aid and development assistance.
The US has a long history of trade and investment links to Africa. However, for many years, a number of US companies have avoided African markets or reduced their involvement out of concerns over stability and the business climate, said Peter Lewis, associate professor and director of the African Studies Program with Johns Hopkins School of Advanced International Studies.
“The growing involvement of China and other emerging markets has signaled to US investors that new opportunities are coming to light,” he told the Global Times.
Africa has become home to six of the world’s 10 fastest growing economies over the past decade, and according to a World Bank report in 2011, Africa is likely to embark on an economic takeoff much like China did 30 years ago.
“It just makes financial sense for any countries and their respective businesses to invest in Africa now. China’s current financial return on foreign investment is higher in the African continent than in any other developing regions,” Scott Firsing, a research fellow at the South African Institute of International Affairs, said to the Global Times.
Ample room for China and the US
The shift of the US focus on Africa came against the backdrop of China’s increasingly important role in the region. China surpassed the US as Africa’s largest trade partner in 2009. In 2011, the US was only the third largest exporter to Africa after China and France.
During her first stopover in the West African state of Senegal, Clinton took a veiled swipe at China by announcing that the US was committed to “a model of sustainable partnership that adds value, rather than extracts it” from Africa.
“The US is a little bit jealous of China’s successful strategy in Africa and the growth of its influence over the years in the region. The US hopes to counter China’s influence and seek benefits by using China’s strategy. At the same time it is unwilling to acknowledge this fact and attacks China’s African policy to create conditions for a bigger US presence in Africa,” Ding said.
But Firsing believes that the US is not overly concerned about China, as US companies and investors simply do not want to miss out on lucrative deals in the African continent.
There certainly is still going to be competition in key areas between China and the US and there will be battles for certain contracts and tenders, Firsing said. “But both the US and China form part of the reason why Africa pessimism has now turned to Africa optimism,” he added.
“There is ample room for both China and the US to benefit, along with African countries,” Lewis said, stressing that US and Chinese companies, as well as official assistance, offer different benefits and approaches.
Compared to China, the US does have some advantages due to close ties in fields such as health, peace and security.
“For example, in 2011, Washington provided over $600 million in assistance to Uganda to hunt down the Lord’s Resistance Army,” noted Firsing. “This will surely help the US access Uganda’s Albertine Basin, which has about 2.5 billion barrels of recoverable oil with Uganda set to become one of sub-Saharan Africa’s top oil producers within a decade.”China has more work to do
The advantage for China might be that it is more experienced in dealing with locals due to China’s long history of cooperation with African countries and investment there.
China’s rapid economic growth also offers the possibility of sustained trade and investment cooperation. China last month pledged $20 billion in loans to African countries over the next three years at the Forum on China-Africa Cooperation in Beijing.
In contrast, economic woes at home make it difficult for the US to commit large amounts of investment in Africa.
That said, however, China does have problems that need to be resolved to make its African policy more effective. “Some criticism against China may not be right, but it would be good for us to heed advice from others,” Shen said.
While consolidating relations with governments in Africa, China also needs to learn how to better deal with opposition parties and non-government organizations there, he added.
China’s expanding investment and economic ties with Africa are accompanied by a number of challenges as well as benefits. A Chinese employee was killed and another four injured during their confrontation with local workers that occurred at a Chinese-owned coal mining enterprise in southern Zambia this month.
Firsing suggests that Chinese companies use local labor wherever possible and invest in the community and adhere to the labor standards that Western companies abide by.
“Chinese companies are experiencing the tensions that Western companies confronted in the 1950s or 1960s, which were managed over time through dialogue, bargaining, with African governments,” Lewis said.
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