I think we can all agree that the poverty rate in many African countries remains way too high. While effective foreign aid can help to alleviate the problem, it’s very unlikely that it will solve it. We see this in places all across the world, even in America. Government spending often can’t attack the very basis of the problem.
Centralized planning hasn’t worked – look at the failed socialist experiments of years past in Zimbabwe, in Tanzania, and in Ethiopia. Even now, even as we stand here today, South Africa is debating an amendment to permit the expropriation of private property without compensation. That would be disastrous for that economy, and most importantly for the South African people. Socialist schemes haven’t economically liberated this continent’s poorest people.
We all know the right way forward. Basic strong rule of law, respect for property rights, regulation that encourages investment. You need to get the basic laws right so that investors can come and invest their capital. We also need women’s full participation in this economic liberation. And we need governments that respect their own people. These are the fundamental ingredients for true and inclusive, sustainable economic liberation.
We all know the history of the Asian Tigers. The Asian Tigers lifted themselves up in a span of just a few decades, because they liberalized and they opened for trade. That can happen right here too – and indeed, I would argue that it must.
More than 60 percent of the population in Africa is under the age of 25. Only nations hospitable to the private sector will stimulate enough growth, enough opportunity, enough resources, enough capital that will deliver jobs and prosperity on the scale that this continent needs and over the timeframe that it requires.
Future generations are depending on stable, corruption-free environments that attract foreign investment. As the Ethiopian proverb says, “A partner in business will not put an obstacle to it.” Indeed, some countries have already taken steps to enhance freedom for entrepreneurs: Rwanda has exempted small and medium-sized businesses from certain taxes, it slashed construction spending several times, and it’s upgraded its power grid. Togo has knocked down similar bureaucratic hurdles on fees, wait times, permitting, and other impediments for business owners.
I just came from Angola, where President Lorenco and his team are courageously turning the page on corruption and are privatizing hundreds of state-owned businesses. In Ethiopia, citizens pushed for change. Prime Minister Abiy’s bold reforms stimulate private sector growth that can help set the tone for the entire continent.
None of this is easy. If it was easy, it would have happened long ago. But it’s moral, and it’s right. And it’s necessary. There is nothing more noble than allowing our people to have the dignity of work.
With the right policies and leadership, we believe that true economic liberation will happen here in Africa. If you will all focus on the basics – if you’ll get it right, if you’ll get transparency right, good governance right – American businesses will come. We’ve been in Africa for an awfully long time. More capital will flow.
Just these last few days in Senegal, we signed an agreement where Bechtel, America’s – one of America’s finest engineering companies, will build a road from Dakar to St. Louis, transforming infrastructure and creating opportunities. I was proud to be part of the signing ceremony in Dakar, along with the signing of four other major agreements with American businesses that are going to invest in Senegal and in the Senegalese people. In Angola, Chevron and others are exploring offshore natural gas fields, bringing jobs and economic growth right along with them. When American capital comes, it hires local. In Ethiopia, Coca-Cola is expanding a new $300 million investment, and companies like FedEx and Citibank are exploring new opportunities as well.
As for the American Government, the Trump administration wants these trade ties to continue and to expand. We’re committed to it. If there’s one thing you should know about our President, my boss, you should know that he loves deals. He wants more to happen. He wants more to happen between the United States and nations all across Africa. That’s why the United States launched our new Development Finance Corporation. It’s now just one month old, but it’s well-resourced, well-funded, and well-structured.
The goal is very simple. The goal is to catalyze private sector investment in developing countries, focusing heavily on priority areas like agriculture, like energy, and infrastructure. Sixty billion dollars of capacity, $60 billion of finance capacity, it will help here in Africa.
The U.S. under President Trump launched Prosper Africa – the Prosper Africa initiative, which is opening opportunities for businesses on both sides of the ocean. We are pushing forward, too, the W-GDP program, with the goal of economically empowering at least 50 million women by 2025. We expect more than half of those women to be in Africa.
USAID, one of our traditional assistance mechanisms, is integrating the private sector into its core development work in ways that it’s never done before. We support the African Continental Free Trade Area, and we remain committed to our partnership with the African Union.
Look, not every nation doing business in Africa from outside the continent adopts the American model of partnership. Countries should be wary of authoritarian regimes with empty promises. They breed corruption, dependency, they don’t hire the local people, they don’t train, they don’t lead them. They run the risk that the prosperity and sovereignty and progress that Africa so needs and desperately wants won’t happen.
Real simple. The United States stands for local jobs, environmental responsibility, honest business practices, high-quality work, and mutual prosperity. Don’t take my word for it – look at the facts, look at the history. We stand for true partnership, true economic liberation.
Entrepreneurs, political leaders, media voices, you are the forces that will ensure that those with power who promise liberation understand what that truly means. Hold onto that.
By Mike Pompeo
US Secretary of State.