THE TTALK QUOTES 

On Global Trade & Investment

 

Published Three Times a Week By

The Global Business Dialogue, Inc.

Washington, DC   Tel: 202-463-5074

Email: Comments@gbdinc.org

 

No. 61 of 2014 

WEDNESDAY, SEPTEMBER 17, 2014     

 

   

Filed from Portland, Oregon  

     

Click  here for the September 8 AGOA quote from Rep. Vern Buchanan.

THE U.S. & AFRICA: AN EVOLVING RELATIONSHIP

"... [I]t would be foolish, I think, of the United States to not be thinking about where we want to go with these very dynamic countries."

Florizelle Liser
September 10, 2014


CONTEXT
Africa and American Trade Policy: An Update.  That was the topic for the Global Business Dialogue's first fall colloquium.  It was held at the National Press Club on September 10, and Florizelle (Florie) Liser was the first on-the-record speaker.  She had been asked to talk about the results of this summer's U.S.-Africa Leaders Summit, and of course she did. 

AGOA - the African Growth and Opportunity Act - is the centerpiece of U.S. trade policy toward Africa, and renewing it - the act expires in September 2015 - was very much on the minds of the African leaders who met with President Obama in early August.  The "Statement by the Chair," the conference's concluding document, summed up the issue this way:

 "Leaders agreed on the importance of the prompt, long-term renewal of an enhanced African Growth and Opportunity Act (AGOA), and pledged to work together to increase its utilization by African countries."

Understandably, Florie Liser talked a lot about AGOA.  

It was only very briefly that she touched on the fact that America's relationship with the countries of sub-Saharan Africa exists in a larger context and the idea that America needs to consider the implications of that broader context in charting its own relationships in Africa.  Those comments of hers came at the end of her opening remarks.  Here is a little more of what she said:

 "As I said earlier, much has changed in Africa and the global trading system since 2000 when AGOA was first passed.  And as much as we are very focused on U.S.-Africa trade and helping the countries of Africa take much greater advantage of AGOA, we also have to look at what is happening in the global trading system of today and where do we want to go?

"And, as they [African countries] are sitting and negotiating economic partner agreements, for example, with the EU, as well as partnerships with other countries around the world, it would be foolish, I think, of the United States to not be thinking about where we want to go with these very dynamic countries."

Every sub-Saharan country, of course, has an array of relationships around the globe, but there are three that seemed to be on everyone's mind last Wednesday.  These are the continent's relationships with the United States - the topic of the morning - those it has with the European Union, and those it has with China. 

Ms. Liser spoke directly and forcefully to the issues raised by Africa's trade with the European Union.  In response to a question about South Africa's restrictions on certain meat products from the United States, Ms. Liser began with a question of her own:

"... Why should the U.S. be looking at extending one-way unilateral preferences for all of these countries if these countries at the same time, are, in one way or another, preventing the U.S. and U.S. businesses from being able to export products and not just agricultural products?"

The question she was addressing was more about standards than preferences, but it was more than understandable that she should have begun her answer as she did.  The European Union is in the process of concluding a number of Economic Partnership Agreements with African countries and recently signed one with 7 of the 15 members of the Southern African Development Community (SADC), namely, Angola, Botswana, Lesotho, Mozambique, Namibia, Swaziland, and South Africa.  These are reciprocal agreements and have the effect of putting U.S. exporters at a relative disadvantage vis-à-vis their EU competitors.  Understandably, they are receiving a lot of critical attention from U.S. business and throughout the U.S. Government.  Ms. Liser was reflected that criticism.

Where China is concerned, however, the Administration's policy is not so critical.  Asked about China's engagement with China, Ms. Liser said simply, "We welcome Africa having as many partners and investors as they possibly can."

***

AGOA and a Memorandum.   While Ms. Liser was clear and unwavering in her insistence on the need for a prompt and long-term renewal of AGOA, she was also realistic about its limitations.  "No matter what the duties are," she said, "[duty-free access under AGOA] alone is really not going to promote greater U.S.-Africa trade."  Rather, she said, AGOA needs to be at the center of a broader, U.S. Government-wide effort on Africa.  

The blue-print for such an effort is the Presidential Memorandum that President Obama signed on August 4, the first day of the Leaders Summit.  In that memorandum, President Obama described the situation this way:

"Since AGOA went into effect 14 years ago, exports from Sub-Saharan African to the United States have more than doubled and non-oil and non-mineral exports in particular have increased nearly fourfold.  The growth of new export industries has supported the creation of hundreds of thousands of jobs in Sub-Saharan Africa.

 
"However, my Administration's recent review of AGOA has revealed that, while the tariff preferences provided under AGOA are important, they alone are not sufficient to promote transformational growth in trade and investment.   For beneficiary countries to be able to utilize AGOA to its fullest, this program must be linked to a comprehensive, coordinated trade and investment capacity building approach with clearly stated goals and benchmarks."

Among other things, the memo establishes a steering group, specifically, the Steering Group on Africa Trade and Investment Capacity Building.  It is a group with 17 departments and agencies of the U.S. Government, including State, Treasury, Agriculture, USTR, and 13 others.

COMMENT
In the nature of write-ups like this, we have left out a lot.  We have left out the new financial commitments Ms. Liser referenced.  Some of those are mentioned in the documents listed below, and we will come back to others in future entries.  We will end this one with an observation, a hope, and a question.

First, the observation.  AGOA and the goal of promoting trade and investment with Africa are objectives with broad bipartisan and bicameral support.  That's remarkable.  It's remarkable not just because the U.S. Government is otherwise so deeply divided.  It is remarkable because in Africa the desire to have America's trading partners succeed is palpable where it is often undetectable in other regions.

The hope is simply that Congress will be able to renew AGOA either late in 2014 or very early in 2015.  It is a hope.  It is not a sure thing.  Much as Congress may want to aid Sub-Saharan Africa and to keep faith with U.S. investors there, the reality of the EU's partnership agreements is galling, and there doesn't seem to be an easy and obvious way of addressing it.

The question has to do with some things we haven't mentioned yet, namely the resolutions in support of the Leaders Summit that were passed in the House and Senate and, separately, with the Electrify Africa Act, which the House passed on May 8.  The House mentioned that legislation in their resolution.  Indeed, it got its own "Whereas" clause, as follows:

"Whereas on May 8, 2014, the House of Representatives passed the Electrify Africa Act, to make it a national policy of the United States to support the electrification of sub-Saharan Africa, and to direct United States agencies to devote resources to facilitate and support the implementation of this initiative ... "

Interestingly, it was the Democrats in the House who voted overwhelming in favor of this legislation - 191 to 1.  The Republican caucus was split - 106 to 116.  With just that information, you would think the bill would sail through the Democratically controlled Senate.  And yet, so far; nothing.   Is there a story there?  We don't know. 
SOURCES & LINKS
NOTE: The featured quote.  We did not publish a tape recording of the September 10 GBD colloquium.  It is your editor's notes, therefore, that served as the source for today's featured quote and the others from last week's event.

Statement by the Chair takes you to the "Statement by the Chair of the US.-Africa Leaders Summit," which is available on the White House website.

Presidential Memorandum is memorandum on Establishing a Comprehensive Approach to Expanding Sub-Saharan Africa's Capacity for Trade and Investment, which President Obama signed on August 4, 2014.

A Partnership Agreement is a page on the EU Trade website devoted to the EU's Partnership Agreement with South Africa and certain other members of the Southern Africa Development Community (SADC).

Hold Your Nose and Ratify is a story about the SADC-EU partnership agreement from the September 17 issue of allAfrica.

H. Res. 699 is the House resolution in support of the U.S.-Africa Leaders Summit, which was passed on August 1, 2014.

S. Res. 522 is the Senate resolution in support of the U.S.-Africa Leaders Summit, which was passed on July 31, 2014.

SUBSCRIBE
If you want to receive these TTALK Quotes, we're happy to send them to you.  That's the deal.  If you want to help and ensure that they keep coming, please


SUBSCRIBE NOW
It's just $50 a year.  Click here and you' re done.

Buy Now
Thank you.

Note: GBD Members are already subscribers and we thank them for their membership and support.

 

 

 

 

TO GET THE TTALK DAILY QUOTE IN YOUR INBOX

 

Or Other GBD Notices, Click below. 

Join Our Mailing List

 

© 2014 The Global Business Dialogue, Inc.

1140 Connecticut Ave., NW, Suite 950

Washington, DC   20036

Tel: (202) 463-5074

R. K. Morris, Editor

www.gbdinc.org