Interview with Congressman Bobby Rush, Co-Chair of the Africa Partnership for Economic Growth Caucus (APEGc)

Posted by Motaroki on Thursday, July 23, 2009 at 5:11pm.

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AfricaBusinessSource.com:  The general perception of Africa here in the United States, arguably created by the Media, is of a continent in crisis. This one sided depiction of the continent likely plays a role in the lack of interest from smaller businesses and tourists while considering Africa as an investment opportunity or vacation destination. Is there anything the APEGc could do to help “rebrand Africa” here in the United States?

Congressman Rush:  This is a very interesting point. While the media is trying to inform the public on important issues affecting the continent, they indirectly discourage investment in Africa. The public associates Africa with poverty, war, corruption and disease.  This is hardly the case.  The public needs to understand African diversity and the fact that the continent has countries with distinct socio-economic conditions.  Some African countries have made major improvements.  It is your responsibility as the media to communicate that as well.

One of our goals as a caucus is to promote African achievements.  It is important that we lift up the most successful African democracies and sustain their economy.  Ghana, for example, has significantly improved its political system, but it will not be able to sustain its democracy without investment.  African governments must put forth more effort to attract investment in their countries as well. It is important that we create a synergy among the government, private sector and the media on both sides of the Atlantic. On this note, I thank you for the partnership that your website has extended to the caucus. Partnership is key.

AfricaBusinessSource.com: CMC Baird, along with the US Chamber of Commerce recently released a survey of 30 senior executives from fortune 500 companies.  The survey gave us a window into how major US corporations view Africa as an investment opportunity.  While it shows an increasing interest in Africa based opportunities, there were some concerns. These concerns included respect for the rule of law, poor access to larger regional markets, poor infrastructure and lack of skilled workforces. Will APEGc engage African Governments directly with these types of concerns voiced by US businesses? If so, how?

Congressman Rush:  The challenges to trade in Africa are important.  The concerns raised by those executives are legitimate.  These are issues that can only be resolved by African governments.  The core foundation of the caucus is partnership.  We will engage African countries on issues affecting not only our bilateral relations, but issues affecting our respective economies.  I will be leading a congressional delegation to four African nations in August.  I will seize that opportunity to discuss with all US Africa trade stakeholders about those issues which are important for both regions.  We are committed to partnering with and providing assistance to countries that abide by democratic principles.  We will support programs and legislation that will increase investment in infrastructure, electricity, telecommunications, energy, and transportation. We will work with African government to (a) identify the best U.S. export prospects to Africa; (b) identify tariff and non-tariff barriers that impede U.S. exports to Africa; and (c) undertake discussions with African states to increase market access for these goods and services. AGOA have proven to be successful in one aspect. We need to sustain our gains — especially in the textile industry — and move toward trade in value-added products and manufactured goods. The old model of selling products in a country, taking the profit and leaving should end. It is critical that investors have local partners and provide training to local workforces. If we want to be economically successful, we must ensure that the economies of Africa are equally successful.

I must also note that I am looking forward to reading a survey on the views of African’s governments on doing business with Fortune 500 American companies.

AfricaBusinessSource.com: It’s estimated that the Chinese have invested more than 100 billion dollars in African economies this decade alone. As expected they’re investing heavily in oil rich economies, but they are also buying into non-oil producing sectors across the continent. Is there a second scramble for Africa’s resources and how should the U.S. respond to this, in your opinion?

Congressman Rush:  China’s policy towards Africa is more aggressive than the U.S. policy. For instance, in 2007, China’s Ex-Im Bank guaranteed loans of $13 Billion to Chinese companies investing in Africa, compared to approximately $440 Million by the US Ex-Im Bank. U.S companies can not compete under such circumstances. Congress needs to revisit our trade and financial policies and how the U.S. private banking sector can help American companies wishing to invest in Africa.  The current recession makes it difficult, but African Banks could play an important role as well.  At present, the largest bank in Africa, Standard Bank (20 percent Chinese owned) is moving into the American market to help finance American companies wishing to do business in Africa.  United Bank of Africa, out of Nigeria, is also doing the same thing.  It is time for the American business sector to innovate and go the extra mile.  We need to strengthen the Overseas Private Investment Corporation’s (OPIC) efforts to provide jobs for Americans engaged in public-private partnership projects.  If the U.S. is to remain a major player and partner in the region, there must be a major policy shift in how financing is made available to U.S. companies seeking to do business in Africa. The European Union is also intensifying its trade relations with African nations though Economic Partnership Agreements that were recently signed with some Southern African countries. The U.S needs to move beyond AGOA, which I consider as an investment tool for Americans and a development tool for Africans. I will discuss these issues and others during my upcoming trip to the region, to Liberia, Ghana, Angola, and South Africa.

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