By 2013, the U.S. had a trade deficit with Africa, importing more from Africa ($51 billion worth) than it was exporting to Africa ($35 billion worth), according to a report in East Africa BusinessWeek by John Sambo.
Trade between the U.S. and Africa has grown 7 percent per year over the last decade, with U.S. companies investing $10 billion in African countries, second only to $11 billion from the U.K.
More than 400 companies generate more than $1 billion in revenue in Africa, and many are American companies such as IBM, Hewlett-Packard, General Electric, General Motors, Proctor and Gamble and Ford, BusinessWeek reports. Walmart plans to open 63 new stores in five African countries by December 2016.
Ten economies account for 80 percent of economic growth. These include six in Sub-Saharan Africa: Angola, Kenya, Ethiopia, Ghana, Nigeria and South Africa; and four in North Africa: Egypt, Algeria, Morocco and Libya.
But the U.S. share in Africa’s trade has declined from 13 percent in 2001 to 7 percent in 2013, bypassed by China, which grew its share from 3 percent in 2001 to more than 14 percent over the same period.
U.S. President Barack Obama’s President’s Advisory Council on Doing Business in Africa came out with its first report on how the U.S. can strengthen commercial ties with Africa following the U.S.-Africa Leaders Summit of August, 2014.
The council made eight recommendations that it says could hold the key to improving U.S. trade with Africa. These include:
Highlight trade opportunities by publicizing best practices and success stories, developing unique marketing platforms and partnerships, and creating an online Doing Business in Africa toolkit.
Address U.S. manufacturing and services companies in Africa and industrialization in African countries by initiating government-to-government dialogues including with regional economic communities such as the East African Community.
Support capacity building for African banks, financial regulators, exchanges, and financial market participants through knowledge sharing, partnerships and training programs. This could be enhanced through funding of existing U.S. Securities and Exchange Commission technical assistant program.
Mobilize more capital from institutional investors by launching an investor roadshow and creating an investor toolkit.
Emphasize harmonization, automation and global best practices through inter-agency coordination and partnership with the private sector. Provide assistance to African countries during implementation of the World Trade Organization Trade Facilitation Agreement.
Optimize the perishable supply chain through analysis and training programs that enable technological improvements to cold chain, storage, and packaging facilities, thereby reducing post-harvest food loss.
Enhance the ability of U.S. companies to compete for major infrastructure projects with a dedicated U.S.-Africa Infrastructure Center.
Use the center to compile a database of forthcoming infrastructure projects in Africa and provide a focal point for U.S. inter-agency coordination to enhance U.S. competitiveness in African infrastructure projects.
Help small- and medium-sized U.S. businesses pursue opportunities in the health sector. Expand the use of healthcare public-private partnerships. Allow more flexibility in existing U.S. government healthcare assistance for Africa for broader healthcare infrastructure needs in Africa.
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