US political, business leaders woo Africa at investment talks

US President Barack Obama is scheduled to address a US-Business Forum at the Mandarin Oriental Hotel in Washington DC, setting the tone for the meeting with African political and business leaders from 26 countries.

A source at the White House told the Nation that President Obama — who was slated to speak at 10.45 Kenyan time on Tuesday evening — would announce a collective plan by US companies to invest close to Sh1.2 trillion ($14 billion) in the continent.

“He will announce that prospective investors have committed to invest the money in sectors like banking, construction and information technology,” said the source who requested anonymity because he is not authorised to speak on behalf of the US President.

On Monday, the US Secretary of State, Mr John Kerry, was straightforward about Washington’s aims.

“I say unabashedly: We want and we will work hard to get more American companies to invest in Africa. We also want more African companies to invest here in the United States, and there’s no reason that they shouldn’t,” Mr Kerry said.

On Friday, President Obama had told a news conference: “We want to do business with these folks.”

Not surprising, Tuesday’s programme largely focused on business opportunities, trade, development, infrastructure and investment. Speakers included former US President Bill Clinton, Wal-Mart president and chief executive Doug McMillon, MasterCard president and chief executive Ajay Banga and World Bank president Jim Yong Kim. Over 300 people were expected to attend.

This is the first time that an American president has brought together all but a few of African leaders in a summit focused on strengthening financial and trade ties between African countries and the United States.

Mr Clinton said that the US had “only barely scratched the surface” of Africa’s economic potential.

He told a panel discussion with CEOs that Africa must be given a chance to economically compete with the rest of the world.

He took a swipe at political opponents who have criticised the Obama administration for supporting businesses that invest in Africa.

FASTEST-GROWING ECONOMIES

“Economics is not theology,” Mr Clinton said. “If you’re running a country, you’ve got to try to create an opportunity for all of your businesses to be competitive.”

According to the African Development Bank, the continent is home to six of the world’s fastest-growing economies. A decade of steady growth has created a middle class with increased spending power.

Other nations, most notably China, have been moving aggressively to tap into growing African markets. China surpassed the US as Africa’s largest trading partner in 2009.

“We also realise we have some catching up to do,” said Mr Michael Bloomberg, the former New York City mayor and a billionaire businessman.

“We are letting Europe and China go faster than the US.”

Among the American companies represented at Tuesday’s meeting were Chevron, Coca-Cola, IBM and Mastercard. Also participating in the forum was Jeff Immelt, the CEO of General Electric. All those companies have branches in Kenya.

During the panel moderated by Mr Clinton, Mr Immelt appealed to the US Congress to renew the charter for the Export-Import Bank, which helps finance American exports.

Some Republicans want to shut the bank when Congress returns from recess next month, arguing that its spending is politically motivated and unnecessary.

But Mr Immelt said the bank signals to other countries that the US government was interested in investing overseas. “The fact that we have to sit here and argue for it is just wrong.”

The White House did not provide a specific breakdown of the $14 billion in new commitments from US companies, but said the money focused on, among others, construction, clean energy, banking and information technology.

Mr Stephen Hayes of the Corporate Council on Africa, a US business group, said private sector meetings could get US companies more interested in the continent.

“From the standpoint of the US, we need CEOs to be more engaged,” he said. “For America to be able to compete for the long term, with China and others, they are going to require partnerships.”

Beyond boosting business ties, the summit also focuses on security partnerships and supporting a new generation of African leaders.