Hillary Clinton in Dakar, Senegal P. Courtesy
Early August, US Secretary of State Hillary Clinton visited Africa for the second time since her appointment by President Barak Obama into this key position. Dr Scott wrote in his article for SAIIA that her visit is emblematic of her commitment to the US-South Africa Strategic Dialogue which was launched in April 2010. The goal of the Strategic Dialogue is to reinforce cooperation between the two countries in a variety of key areas and takes place in the form of an annual bilateral forum where US and South African officials review the work of various bilateral issue-based working groups and discuss the future of the bilateral relationship.
Q:How would you sum up Hillary Clinton’s African tour and discuss Washington’s investment and trade agenda for Africa?
Scott: I believe Clinton's tour was a large success and for the most part well received by worldwide media. However, some media agencies jumped on US vs China bandwagon and this wasn't helped by Clinton's Dakar speech and the almost immediate reply by Beijing. America is starting to put some of its political muscle behind US investment in Africa, which is welcomed. Clinton's tour really began to show how Washington is going to "Encourage U.S. Companies to Trade with and Invest in Africa," as stated on page four of the White House's new strategy for sub-Saharan Africa.
Some people have spoken about new overtures in the U.S. policy for Africa. But what I can say is that I know of mainly the proposals Hillary Clinton presented during her time in SA. Nothing was really new, but the biggest impact initiative I believe would be the offer through USAID (see below) due to the high unemployment rate in SA. It will supposedly create over 20,000 jobs. Other details can be found here (http://southafrica.usembassy.gov/press_120807a.html). For more details on older but recent American initiatives in Africa, see http://www.state.gov/p/af/.
Q: In your opinion and from your research over the past few years, what has attracted foreign players especially the United States to review policy and intensify its activities in Africa?
Scott: On the peace and security side and focusing on the US, Al-Qaeda groups in Africa such as the Western Sahara separatist movement, the Polisario Front, Boko Haram, Al Qaeda in the Maghreb (AQIM), and al-Shabaab in Somalia have strong connections and are growing in strength. This poses a threat to US embassies and businesses in Africa and possibly the homeland itself.
On the economic front, all you have to do is examine the numbers. Six of the world's 10 fastest-growing countries were African during the last 10 years. Africa is growing extremely fast with the IMF expecting around 6% growth this year, nearly the same as Asia. All foreign players want to increase their trade and investment and Africa is the current continent to accomplish this.
Q: Do foreign players, especially China and India, pose competition to U.S. policy in Africa? What about Russia that said it was returning to Africa?
Scott: Increased competition is probably more appropriate and is good thing from the African perspective. I believe the US is just doing what is in its best interest and will continue to do so as dictated in its new African policy. They want to improve democracy, economic growth, and security and trade in the region.
In the most literal connotation, if China floods the continent with SALW that ultimately end up in the hands of rebel and extremist groups that threaten America's interests, that poses a threat to US policy in Africa. If India starts to invest in universities around the continent like it intends, that does not pose a challenge to US policy in Africa. Russia has a long way to go compared to others, but its Africa trade is growing. It needs to expand outside of its usual partners such as Angola, Nigeria and South Africa and into different fields beside resources and defence.
Q: How practical is your suggestion (in an article) that the United States have to cooperate with China in certain areas in Africa, and can you explain why it is important for U.S. to team up with China and which specific areas?
Scott: It is a practical solution and many organizations have had success in such ventures. For example, a high-level panel hosted jointly by the Brenthurst Foundation, Chinese Academy for Social Sciences, Council on Foreign Relations and Sullivan Foundation met three times in 2006/7, which was known as The Africa-China-U.S. Trilateral Dialogue. It was initiated to challenge the notion that the United States and China are locked in an inevitable competition for influence and resources in Africa. Delegates felt that agriculture is a prime candidate for cooperative endeavors, as well as health.
There is always going to be competition in certain areas, especially on the larger type contracts when dealing with commodities like oil. However, today both Chinese and US companies find-doing business in Africa difficult and share similar experiences, which they can deal with together. It can be as simple as forming a consortium of Chinese and American investors in a mining project such as the Catoca Mine in Angola that is operated by numerous companies, including Angola's state-run mining company, Endiama, which owns 32.8%. Brazilian consortium Odebrecht owns 16.4% of the mine, China’s Sonangol owns 18% and 32.8% is owned by Russia's Alrosa.
In May 2009, American and Chinese officials pledged cooperation by signing 32 deals worth $10.6 billion between companies from their respective countries. According to media reports, China Mobile also closed deals with HP, Alcatel-Lucent, Oracle, Emerson, Sun Microsystems and Cisco, while China Construction Bank signed with Microsoft, IBM, HP, and Cisco. There were also deals between Ford and Amway with their Chinese counterparts. The same can be done with Africa and its companies as additional partners.
I would personally like to see an annual FOCAC-like conference that also includes American government and business delegations in order to increase cooperation between the US, China and Africa. Both the US and China are extremely knowledgeable in areas that Africa needs most including infrastructure development (ie engineering, energy etc), health and education (ie science and technology). Why not pool resources and implement Sino-US joint projects that will ultimately help uplift the African continent? It is important for the US to team up because it is $16 trillion dollars in debt of which 1.16 trillion is owned by China.
Q: Clinton remarked during her tour that “a model of sustainable partnership adds value, rather than extracts it.” As U.S. policy expert, how would you explain this statement to the reading public?
Scott: This Obama Administration, "including through the Presidential Policy Directive on Global Development, has charted a new approach that focuses on sustainable development outcomes and a new operational model for U.S. development assistance and builds on our work to date," - June policy. Ultimately, Africans need to be able to control their destiny and this can be done through aspects like technology transfers and investment in education and training, which I feel Washington believes in. Moreover, sustainable partnership improves African people's livelihood, grows their middle class that will drive their demand for more high-tech and modern product from America.
Q: How does the U.S. government support private business firms that wanted to engage Africa and what forms of support? For instance, Obama administration is now supporting U.S. companies with state budget to do business in Nigeria. Is it only a case for Nigeria or it will apply to other African countries?
Scott: The US government supports business in numerous ways. For example, the US Export-Import Bank creates and sustains American jobs by financing sales of US exports to international buyers. The Ex-Im Bank and the Industrial Development Corporation of South Africa signed a DOI on $2 billion in credit in support of South Africa's energy sector and clean energy in general. Some of the US companies that might benefit include Siemens, GE and other clean energy firms. The government also supports private business firms by organizing events such as the first US-South Africa Business Summit that took place in Johannesburg. The event brought together 200 executives and government officials from both countries. This was a key event and one I personally thought was way overdue.
Q: What were the key results of the third session of the US-SA strategic partnership meeting?
Scott: In my opinion, the key outcomes of the Strategic Dialogue revolved around HIV/AIDS and the transfer of PEPFAR ownership from the US to SA, the EX-IM deal mentioned earlier, and a topic that really didn't make the media, which is a USAID credit guarantee facility up to $150 million to fund more than 300 small and medium enterprises (SMEs). It has the potential to create over 20,000 jobs in South Africa, and that says a lot to a country with an unemployment rate close to 40% and whose main emphasis is on job creation.
(First published in BuzinessAfrica.com)