8:30 A.M. EDT
MODERATOR: Welcome to the Foreign Press Center in Washington. Good morning to those of you here, and good afternoon to those of you in Johannesburg. Today’s briefing is AGOA at 10: New Strategies for a Changing World. And I would like to invite to the podium in just a second Deputy Assistant Secretary William Fitzgerald of the Bureau of African Affairs, U.S. Department of State. He will introduce our other speakers and noted guests.
But before I invite DAS Fitzgerald to the podium, I would – let me first explain our format. Our principals are going to make a few opening statements and then we’re going to go directly to Johannesburg to take questions from the journalists in Johannesburg. Once we finish with the questions in Johannesburg, we’re going to come back to the journalists here in Washington and take your questions. So we’re going to try to evenly split the time between Johannesburg and Washington, D.C.
And without further ado, I’m going to invite DAS Fitzgerald to the podium now.
MR. FITZGERALD: Paul, thank you very much. It’s a great pleasure to be here and to be talking about AGOA. We’re really excited about the AGOA event this year, in part, because we’re going to be having a hybrid format. We’re going to do the first two days in plenary session here in Washington with opening by U.S. Trade Representative Ron Kirk – Ambassador Ron Kirk – and then we’re going to split – after those two days, we’re going to go to Kansas City and we’re going to host a session in America’s heartland, focusing on agribusiness, and it’s very exciting. On the one hand, in Washington, we’ll be talking about trade policy, how to improve AGOA after 10 years, and also once we get to Kansas City, how we can actually take advantage of the context that the Africans and the Americans will make out there. So we’re really looking forward to this.
It’s a great pleasure to be up here first because I get the honor to introduce by colleagues, both here and in the audience, and I think I’d like to do that right now. First, I’d like to introduce Florie Liser, who’s the Assistant U.S. Trade Representative for African Affairs in the Office of the U.S. Trade Representative. Kevin Boyd is the Director of Africa, Market Access and Compliance at the U.S. Department of Commerce. I’d also like to recognize a couple of our colleagues in the audience: Anthony Ieronimo is Deputy Director of the Office of African Nations at the Department of Treasury; Patricia Sheikh is Deputy Administrator in the Office of Capacity Building and Development in the Foreign Agricultural Service in the Department of Agriculture; and Joan Wadelton, the senior advisor in the Office of Trade Policy and Programs in the State Department’s Bureau of Economic Energy and Business Affairs. I’d like to single out Joan because she’s also coordinating another innovation in this year’s AGOA Forum, the participation of – well, women from 35 African countries, women entrepreneurs. And I understand they are an active, very important part of our forum this year.
And with that, I think I’ll turn the podium over to Florie to continue.
MS. LISER: Thank you. Greetings. Well, the forum, as we know, is an important forum and opportunity for high-level dialogue between the United States and the countries of Sub-Saharan Africa. And it’s the forum that allows us the opportunity to talk each year about U.S.-Africa trade and investment flows.
We want to talk this year about how we can truly advance the U.S.-Africa trade and investment relationship and the opportunities that we’re afforded under the African Growth and Opportunity Act and how we can improve AGOA implementation. As many of you know, this year we celebrated the 10th anniversary of AGOA. And this is an important program because it has literally changed the dynamic of the U.S.-Africa trade relationship. Overall, trade is up dramatically in both directions since AGOA was enacted. African nations are sending us more value-added and diverse products from cars to clothing to processed food, and U.S. firms are increasingly looking to the new opportunities in African markets not just in energy and minerals and extractive products, but also in services and agribusiness.
So the opportunity for dialogue that’s supported by the AGOA Forum this year is an important one and more important than ever, in fact. With AGOA now entering its second decade, this is a good time for stocktaking. We need to examine how the changing global trading environment, including increased competition for the Africans and their products, new trade agreements that are being negotiated, and regional integration amongst the Africans, how all of those factors are effecting African countries’ efforts to make the most of trade opportunities, not just with the U.S. but globally. And there are no easy answers, but we do look forward to speaking with the African ministers of trade, foreign affairs, finance, and agriculture about how we can, as a partner with Africa, chart the way forward.
U.S. Trade Representative Ron Kirk, my boss, is also looking forward to the opportunity to meet with his trade counterparts as well as other ministers to discuss these and other important issues. Ambassador Kirk will co-chair with the minister of trade from Rwanda a plenary session entitled, “New Strategies for Expanding U.S.-Sub-Saharan African Trade.” And he’ll also hold a number of bilateral meetings as well as a large group meeting with all of the trade ministers.
Deputy U.S. Trade Representative Marantis will also hold a number of bilateral meetings, including one with the heads of the regional economic communities of Africa. That’s a very important meeting from our perspective, given the importance of regional integration in Africa.
Let me close by saying again how much we at USTR are looking forward to hosting our partners from Sub-Saharan in Washington, D.C. and Kansas City. And I’m looking forward to answering the questions that you have.
MR. BOYD: Good morning to everybody here in Washington and, of course, a good afternoon to our friends in South Africa. I’d like to take just a second to also congratulate our South African friends for doing a magnificent job on the World Cup. Some close friends of mine did travel down for the cup and they came back just absolutely raving. So a great job down there.
Two quick points and then – I know that we would all like to turn to some questions. First, Florie’s totally correct; you’ve had a significant growth in trade, you’ve got a lot of different goods coming to the U.S. I would like to stress that there is still significant room to improve in terms of the diversification of products coming to the U.S. We’ve still got a lot of room to grow and a lot of opportunities to try to do business.
Second, for the Commerce Department, we’re also working very hard to try to encourage more U.S. companies to do business throughout Sub-Saharan Africa and we are, throughout the program of the forum, trying to create some business-to-business contacts. We’re working with our friends at the trade development agency to bring businesses from Africa to Kansas City to meet with U.S. businesses and to try to do some deals. Trade flows both ways, and the more you have U.S. companies doing business in Sub-Saharan Africa, I think that creates significant opportunities in terms of goods and services to flow back from Sub-Saharan Africa here to the U.S.
I will close with that so that we can take your questions. Thank you.
MODERATOR: Okay. Thank you, Mr. Boyd. DAS Fitzgerald, can I invite you back to the podium. And we’re going to go now to Johannesburg with questions from Johannesburg.
QUESTION: Okay. This is Brooks Spector, the associate editor of the online publication The Daily Maverick. And I look at the information that was provided to me and I’ve listened to the comments from the three of you and the word “new” came up, oh, seven, eight, nine times. But new is not necessarily different – sometimes it’s just new. What exactly is new about this second decade of AGOA and what tangibly are you going to make different from everything that has gone before over the previous decade?
MR. FITZGERALD: Well, I’ll take a stab at that one, and then I’d probably ask my colleagues to come up and help to give you the best answer possible. It’s new in the sense – on the very physical sense – of we are having a hybrid AGOA conference. For this year, at any rate, we have two days of plenary sessions here in Washington and then we split and then we travel to Kansas City where the focus will be less – there won’t be any plenary sessions in Kansas City, but rather we have more than 100 U.S. business people primarily focused in the agribusiness sector, but not necessarily and not completely, and they will work – and we’ve also invited African business people. So it’s less government, frankly, in Kansas City and I think that’s absolutely essential.
To be sure, there are a number of things that we need to do to improve – I agree with Kevin. We’ve seen progress, tremendous progress in AGOA, but we can do better, absolutely. We can do better and this is the way to do it. I would also say, as more and more American agencies begin to focus, for instance, in the Millennium Challenge Corporation, primarily is focusing on agriculture and infrastructure. Now that’s a new thing over the past three or four years. And infrastructure, I think we can all agree, will play a tremendous part in improving the ability to get goods to ports and goods to market. So I think that there are a number of parts within the U.S. Government that are finally beginning to come together and to help us boost exports from Africa, and in that, ultimately at the end of the day, economic development.
Florie, would you like to add some thoughts?
MS. LISER: Yes, thank you. I think – when I think about what’s new, as we end the first decade of AGOA and go into the second decade, is that at the beginning of AGOA back in 2000, I think there was more of an assumption that we would open the market here in the United States – this is a $14 trillion market now – and that by virtue of opening our market to an additional, about 2,000 products just from the Africans, that we would see a rapid uptake in products coming from the continent, from the AGOA-eligible countries. What we learned in the early years of AGOA was that many of the African countries did not have the kind of productive capacity and also were addressing – were dealing with a number of supply side constraints on their side.
And so it was only after, probably the first two or three years of AGOA, that we sort of said, okay, where are the products from the African countries that we had expected. I think as we enter this second decade, what we have seen is in the last, probably three to five years, more African countries that are AGOA eligible have actually diversified their production base. They’ve moved from making only raw commodities or exporting largely natural resources and raw commodities to adding value to those products, processing them more, and by virtue of that, sending more of the value-added products to the U.S. that we had initially hoped we would see coming from Africa.
I know that I personally have visited now footwear factories, factories that are producing jams and jellies and hot sauces, sunglass factories, just a whole array – apparel factories, obviously. And so I think as we enter the second decade, this is now an excellent time to reassess.
I think the other thing that is new is that there is a recognition in the U.S., as well as the global community that Africa has been advancing certain reforms – far more are needed. But I think that people look at Africa now and they know that it is a continent of great opportunity, growth rates are up, inflation is down, countries are basically reducing the kinds of barriers to internal or intra-African trade, they’re also lowering barriers to foreign direct investment. There’s more of that coming into Africa. So this is a really good time. To us that’s new. This is a good time for us to focus on that, and how in light of this better environment for business and for investment, this is a good time for us to now look at how we can enhance the U.S.-Africa trade and investment relationship.
MR. FITZGERALD: Thanks, Flori. Ultimately, at the end of the day, I think the most important thing is that AGOA is not a static document and it’s not a static program, but in fact, a dynamic program. And we’ve got to adjust as we get more evidence on how it’s working and how it’s not working.
(Inaudible) Channel Africa at the SABC. I see here that the forum will provide African countries with the ability to take advantage of trade opportunities and AGOA. How exactly will other forum go about doing this?PARTICIPANT:
Kevin, do you want to take a stab at this one? MR. BOYD:
Oh, okay. Now, if I understood your question, yes. In the plenary session, of course, in Washington, there will be discussions of how African countries can adjust their regulatory systems, their structural impediments to freeing up the business space for sure, improving the environment for, for instance, the 20 – the 35 women entrepreneurs who have succeeded, who have absolutely succeeded in African countries, in 35 different African countries. But they themselves tell us that government can do more to get out of the way.
And I think that’s what we’re looking at in Kansas City. I’ll be perfectly honest with you. If I can have – if I can take a South African – you’re from SABC – and introduce him to, I don’t know, a wheat farmer in Kansas – Kansas and Missouri straddle Kansas City – and then they begin to develop, I can take two steps back, because it’s really investor to investor.
It’s funny, I was – I had the opportunity to accompany the USAID Administrator Raj Shah when he met with President Wade recently around a food conference in Dakar. And I remember distinctly President Wade was almost sheepishly saying we really haven’t taken advantage of AGOA as much as we should have, as much as we should. But my problem, President Wade said, is that we need to get the investors with the investors. And that’s precisely what we’re trying to do in Kansas City is to get African investors together with American investors, and that way, we can boost trade.
And ultimately, when you’re boosting trade, you’re providing jobs and you’re improving the economic development of the African countries, and that’s the whole point at the end of the day. Thank you. QUESTION:
Brooks Spector again. I’ll follow up on this. Every once in a while, there is a rumor about – and sometimes, it’s fueled by the way Americans talk about AGOA, that AGOA is a unilateral act by the United States to create this opportunity, but it is, after all, legislation rather than a bilateral or multilateral treaty. And so every once in a while, there is the sense that it might be better if this plan, this program, were in fact a formal treaty between the United States and the member countries in Africa. So your comment on that as we face the new decade?
And second, related to it to some degree, is there a plan that would graduate some countries out of AGOA preferences once their economies move to a certain level or a certain level of confidence or whatever word you might like to use in that regard? So, two parts to the same texture.MR. FITZGERALD:
I’ll take the first part of your question, and I think it’s a very good one. The idea of having a more formal, perhaps permanent treaty – well, as you know, AGOA is due to expire in 2015 unless Congress extends it again. To be perfectly honest, I think that we need to make a lot of progress on AGOA on the program over the next five years. I think after the 10 years, we’ve seen really some good success, but we need to do better.
Now, I’m not sure on the legal framework whether a treaty would be necessary or whether we could continue or whether a treaty would actually change the way we deal with things. I take from your question that you want to see a more permanent sort of AGOA framework.QUESTION:
I’m not sure what’s best. MODERATOR:
Could you please repeat?QUESTION:
I said – I’m just asking. I’m not actually sure I know what is best.MR. FITZGERALD:
Oh. I’m not sure I know what is best, but I’m doing the best thing that I can, which is to support the program that we have in front of us. I think we need to show even greater success. I think, as Kevin was saying, we need to see the diversification within the African market.
Now as far as your other question, I think I’ll turn to Florie about whether states actually graduate.MS. LISER:
Let me also add some to what’s already been said regarding your first question. I think that if you look at the current state of trade and investment relationships globally, what you see are a range of tools that are used to enhance trade and investment. So many countries have preferential market access programs, programs that – like AGOA which allow for one-way, duty-free access for the products of either least developed countries, or in the case of AGOA, we allow both least-developed African countries and non-LDCs to send their products to the U.S. duty-free under AGOA.
But you also see, in addition to these one-way preference programs, which are not treaties but generally are like the generalized system of preferences like AGOA, like everything but arms in Europe, these programs have been in place for quite some time and usually are legislated by those countries and they’ve been there for a while. What you’re also, though, seeing today is a whole new set of two-way trade relationships that are being negotiated. Some of them are free trade agreements and arrangements. Some of them are amongst the Africans. In fact, we’re very pleased to see that there are customs unions and free trade areas and common external tariffs that are being developed amongst the Africans that will free up trade within Africa – intra-African trade. But we’re also seeing some new trade arrangements that are being negotiated, say, between South Africa and China, or South Africa and India, or with Brazil, Africa, and India.
And so I think that what we need to look at as we go forward – you talked about treaties. I think, actually, what we need to look at in terms of the U.S.-Africa trade and investment relationship is are we using all the tools that we have possible to enhance the U.S. trade and investment relationship. We have a number of bilateral investment treaties with countries in Sub-Saharan Africa and are in the middle of negotiating some additional ones right now. But I think we need to look at the full sort of toolbox and see what we need to do perhaps beyond just a one-way preference program like AGOA.
On your question of graduation, that’s an interesting question because the Congress right now is very much looking at preference program reform in the U.S. They’re looking at GSP, they’re looking at the Caribbean Basin Initiative, they’re looking at a whole range of programs. AGOA would be as well. They’re looking at how to implement duty-free, quota-free for least developed countries. And I think that the concept of graduation comes actually more from the idea that we would like to see a wider range of countries, especially the poorer countries, be able to utilize these programs more effectively. Right now, for example, South Africa is the largest non-oil exporter to the U.S. under AGOA, 2.3 billion last year. The next country after that was 277 million in terms of non-oil AGOA exports.
So I think that what we want to do is to see how we can spread the benefits better, and I think that Congress is taking a close look at this now. We in the U.S. Administration are going to be sitting down with them and working with them to try to determine what is the best way forward to make sure that our trade preference programs work as effectively as possible.QUESTION:
I’m Wangui Muchiri. I work with the African Media Hub. You mentioned that this AGOA Forum will be new in the fact that you’re trying to get government to get out of the way and get businesses closer together. And my question is: How is government in the way? What is it you want government not to be in? What is hindering businesses from collaborating better because of government? What are you going to do?MR. FITZGERALD:
I’ll take a stab at that. I think that what we’ve seen in the past and we’ve seen great improvement, frankly, in places like Uganda and Rwanda for improving the access, the ability to form a corporation, the ability to get all the licenses that you need, the ability that – in ways that you have to get government approval to be able to begin to operate as a business. Frankly, I wish we had some of the women entrepreneurs because the entrepreneurs are going to be the ones who can tell you exactly what the structural impediments are to conducting business, to carrying out business.
Government always has a place, obviously, in the marketplace. But what I’m saying is that in the past, in AGOA, we have had trade ministers talking to trade ministers, which is fine, which is perfectly okay. They’re keys to solving a lot of the bureaucratic and legal framework – legal roadblocks that we run into. But if we really want to see a jump in trade, if we really want to see AGOA perform as it can and as it should, beyond what we’ve seen already, is we’ve got to put investors – private investors with private investors. Kevin, I think, mentioned the Trade and Development Agency is conducting – is going to be participating in Kansas City with a reverse trade delegation, bringing African investors over to meet with U.S. businesses to try to come up with deals.
I mean, we need to have the investors dealing with the investors to boost the trade that’s coming from Africa to the United States. Kevin, you want to take a swing at that?MR. BOYD:
Sure. Probably the best way to take a swing at that one is just to talk about a brief conversation late yesterday afternoon with a businesswoman from the continent. She was talking about trying to find ways to take advantage of AGOA. She said that her government – and we’re not going to name names here – had been spending several years to come up with a plan to try to take advantage of AGOA. The complication was, was that her government had not consulted with the private sector.
So I think that gives probably the most clear-cut answer to your question. You don’t necessarily need to get government out of the way completely. You do need to get them to listen to the private sector, though. Thank you. MODERATOR:
Yes, please, Florie.MS. LISER:
Just a couple other points. One of the things that African governments need to realize is that they are competing for investment, foreign direct investment, from the entire – from – with countries all around the world.
And even though, as we all recognized, many of the African countries have been improving to some extent, they’re doing business processes, allowing companies to get their licenses and establish themselves more rapidly, setting up one-stop shops, there remain a number of what we would call structural constraints on the African side for businesses looking to invest so that when they look at should I invest in the Philippines or in Honduras or in South Africa, what do I have to deal with. And you’ve got infrastructure challenges. The transport costs are higher there. Energy costs are higher. And then we have the issue of access to capital for the businesses that are there so that if a U.S. business wants to partner with an African business, how easily can that business get access to capital.
These are the kinds of things that African ministers of trade, finance need to be looking at. African leaders need to look at this. And I would just say that there are many opportunities. I think a lot of people recognize that the 800 million people in Africa constitute as global consumers a huge, quote-un-quote, “new market” and people are – including American investors – are more interested now in Africa. We are seeing a better and improving perception of Africa. But there is this whole thing of Africa competing with others for investment there and how governments need to take proactive steps to make it easier for foreign businesses and investors to come in, set up business, form joint partnerships, get access to capital, have reliable transportation, lower cost energy. These are the things that are critical that governments can work on.
And I would just say as one last point that the U.S., through a number of our own programs, whether it’s our Treasury Department or the Millennium Challenge Corporation or the Department of Agriculture, many of us are working with the Africans to try to help them improve their doing business environment, to help them move the barriers and constraints out of the of way, to help them build better transport infrastructure, lower energy cost, et cetera. So we are partners with the African governments in this, but of course, the first level of responsibility for looking at these issues and trying to address them is on the Africans.MODERATOR:
Okay. We have time for one more question from Johannesburg if – is there another question from Johannesburg?PARTICIPANT:
There’s one last question from Johannesburg.QUESTION:
Let me turn back to my notes. Yeah, when I – the last time I looked at the AGOA trade statistics, it was still clear to me, unless I’m mistaken on this, that by value, the largest volume of trade, Africa to the U.S. under AGOA, is still oil, petroleum. And that then says that it comes primarily from a fairly small group of states, mostly on the west coast of Africa and most of whom are not what we would refer to as effective representative democracies. How would you position the strengths of AGOA to leverage that trade relationship into what I understand to be other objectives of the U.S. Government?MR. FITZGERALD:
That’s a very good question. Every year, we review every country in Africa for issues of governance, issues of human rights, issues of market access, issues of democracy. So every year, we scrub the list. I have to tell you, this year, Niger was not on the list because of the coup there. Madagascar, which was a very large producer, was also not given AGOA access eligibility.
You have good questions about the oil sector. Again, it makes up, by far, the majority of trade under AGOA. So – but I can tell you again, actually, we’re coming into the season where we are going to be reviewing each of these countries for their governance issues and corruption and all the wide swath of indicators that we use. Thank you.MODERATOR:
Okay. Thank you, South Africa.MS. LISER:
I just --MR. FITZGERALD:
We’re going to add one more thing.MS. LISER:
I just – thank you. That was really an excellent question, and let me just take a moment to add to what’s already been said.
The issue of oil being the predominant product exported to the U.S. – I believe Nigeria, Angola, the Republic of Congo are some of the largest oil exporters to the U.S. under AGOA. And so they are amongst a number of countries in the continent – on the continent that are exporting oil. But what this actually reflects, this large predominance of oil, is the overall pattern that Africa has in terms of trading with the world. It’s not unique to the United States.
So, for example, oil is predominant in Africa’s exports to China, to Europe, to most places in the world. It reflects the fact that many African nations are shipping natural products, raw commodities, and that what is missing from the picture globally are the value-added processed products that we are trying to focus on through AGOA. We are trying to get the countries to look at how to expand their productive capacity of the non-oil products, of the non-extractive products.
And we believe that what will also help in terms of allowing the Africans to do that is to also have a good outcome to the Doha round. Because right now, if you look at the way that tariffs are structured, many countries will let Africa’s raw commodities come into their countries duty-free. And they take those products and process them and manufacture them and create the jobs, and then ship some of those same products back to Africa.
However, under Doha, if we are successful, I think what we will see is that the tariffs on the value-added products from Africa – so not just the cocoa beans, but the chocolate – we want to see that come in duty-free also. We want to see more of the kinds of value-added products, not just the raw vegetables, but we also want to see the processed canned vegetables and specialty foods come into those countries duty-free. And the way that many countries structure their tariffs – not us, because we have AGOA and we focus on that – but many countries structure their tariffs so that the raw products can come in duty free, but the value-added products cannot. They come in with higher tariffs.
So I would just say that we want to look at that whole situation. And I think all of us should be working with the Africans. And we’re going to use the AGOA Forum as an opportunity to do that as to how Africa can increase its production of value-added products using their own natural resources.MODERATOR:
Okay. Thank you, Johannesburg. And with that, we’re going to go here to Washington and we’re going to first do Adam, then Ben, and then Williams. Okay, so Adam?QUESTION:
Hello. Good morning. MR. FITZGERALD:
My name is Adam Ouologeum. I’m from Mali, the Washington Bureau Chief of the Africa Sun Times. I did not hear you say – giving us concrete examples of what you have accomplished in Africa. And the brother said there is no democracy in West Africa and that’s not true. We are democratic country in Mali, Benin, Ghana, all of those are involved in AGOA. What have you done so far?
If you looked out to 10 years past, I was here when AGOA started. I’m still here 10 years later. What have you done in a concrete manner? In Africa, people don’t see your presence. They can see that China is aggressive, India is aggressive, but there is no way to find to see what you have done and what you have accomplished in Africa. Can you give us some example?MR. FITZGERALD:
Well, yes, I can, and I’ll turn to my colleagues as well, who will probably have even more than I do. But from my perspective, what we see now is you can go outside here and go to any BMW dealership in the Washington area or, frankly, across the United States, and you’ll sit in a BMW and you’ll discover that, in fact, this BMW, this Mercedes Benz was assembled in South Africa and shipped to the United States. You’ll see that Kenya, for instance, has dramatically expanded its shipment of cut flowers, which is a tremendous industry – not going to Europe, but going to the United States. Ethiopia is selling leather that – actually, they use the leather to make golf gloves and shoes for pro golfers, I mean, on the professional circuit. These are anecdotes, though. Perhaps you have other examples or you’d like to add something to the response.QUESTION:
(Inaudible) something about West Africa now.MS. LISER:
Okay. Well, I think, first of all, that the United States probably isn’t the best at public relations, because we have really been on the continent and doing a lot in a variety of areas. Your country, Mali, has a Millennium Challenge compact that I believe is maybe about 300 or –MR. FITZGERALD:
350 million.MS. LISER:
-- about $350 million. We have compacts throughout – Millennium Challenge compacts, just talking about that one program – probably in about 11 countries in Sub-Saharan Africa, countries that have been doing the right thing, for example, like Mali, like Benin, all throughout Ghana, we have a number of these compacts, Senegal. Tanzania has a $700 million compact. And frankly, sometimes I wish that the U.S. would be more about tooting its own horn and talking about the kinds of things we’re doing, because Millennium Challenge compact is only one area that we are working with Africa in.
Every agency that’s going to be at the AGOA Forum – and I could go on and on – but let me just tell you some. U.S. Department of Agriculture has people on the ground in Africa. They have programs that have been established just for Africa – the Cochran Fellowship. The Department of Treasury – I started to say finance – has financial advisors sitting in finance ministries throughout Africa helping them to develop the skills to do what is needed on their end and to transfer the kinds of technical skills that are needed in that particular area, financing and accountability. The Overseas Private Investment Corporation has billions of dollars of loans and underwriting for loans throughout the continent. The U.S. Export-Import Bank is working with U.S. exporters who are sending products to Africa. I know of particular ones where they’ve sent the equipment that’s needed for the African factories to be able to produce the products that they’re then shipping back to the United States.
I mean, we could go on and on. The U.S. Agency for International Development and the State Department have a whole array of programs. Since AGOA started, we have put $3.3 billion into trade capacity building in the AGOA countries – 3.3 billion. So, I mean, even though we are not very good at – in fact, our 3.3 billion – we are, the U.S., the largest single country donor of trade capacity building support to Africa; bigger than China, bigger than the EU. But we don’t do a good job of advertising ourselves. But our people are on the ground. The Peace Corps is there. I mean, I travel to Africa so much and when I go – I just want to say this much – I take off my business jacket, I put on my tennis shoes, I go out to the field, I visit with women in cooperatives, I visit factories, I sit down with farmers. I’m just telling you we’re there. The U.S. is there. And I wish that somehow, all of what the United States does with Africa – not for Africa, but with Africa – were more visible. I really do.MODERATOR:
Okay. Ben?MR. FITZGERALD:
Yes, please, Kevin. Hold on just a minute.MR. BOYD:
Can I just add just one more thing to that? Florie’s totally correct. We’ve got a lot of U.S. programs on the ground, and we’re talking about U.S. Government programs. So let me also note you’ve got a lot of U.S. companies out there as well. And U.S. companies will do – people call it corporate social responsibility programs. So you see U.S. companies that are doing things to provide clean drinking water. Private companies will help build schools, help train teachers, will help provide healthcare. So yes, you’ve got the government doing stuff, but you’ve also got the U.S. private sector out there doing stuff as well. And they don’t do a real good job of going out and publicizing it, but the people on the ground realize it.MODERATOR:
Thanks, Kevin. That’s absolutely true. And Florie, you’re probably right that we don’t publicize it, but I think that’s part of who we are in the United States, that it’s – that we want to reach out, and it’s in a partnership with the Africans that we do this.
But please, go ahead. Any other questions? My friend from Guinea, how are you?QUESTION:
I’m doing great, thank you very much.MR. FITZGERALD:
How are the elections going?QUESTION:
Well, it’s still hanging on a balance.MR. FITZGERALD:
Okay. Well, the United States was with Guinea all throughout this.QUESTION:
We noticed that.MR. FITZGERALD:
You just mentioned that every year you take time to review country – MR. FITZGERALD:
-- (inaudible) on the democratic front. You mentioned Niger, you mentioned Madagascar –MR. FITZGERALD:
-- which have been in turmoil. And Guinea as well has been in the news.MR. FITZGERALD:
Guinea as well, unfortunately.QUESTION:
What are the prospects there in a month or years to come in terms of building up a strong relationship between U.S. and Guinea based on its –MR. FITZGERALD:
Yes, yes. QUESTION:
-- extraordinary relationships? Could you comment on the latest news there? Is there any hope for (inaudible) and trade?MR. FITZGERALD:
Oh, absolutely. We review on an annual basis all of the countries. And it’s a contentious process within the State Department, to say the least. I think I can say that, but that’s good. I mean, some conflict is important for representing every side in the equation, including those folks from human rights from those folks who want to boost business.
As far as Guinea goes, absolutely. Guinea has enormous riches. We are very pleased and praise the Guinean people, in particular, for really taking this opportunity to have the first free, really free elections in more than 50 years, which is astonishing. They couldn’t have done it without the support of the West African nations, ECOWAS, as well as the AU. The international community played a part, but ultimately, it came down to, I think, the Guineans, as the Malians did some years ago when they turned the corner and went for democracy. I think that’s absolutely critical.
Free markets, free society, they go – should go hand in hand. And it’s much easier to have a free market if you have a democratically elected government. I think both candidates – the United States doesn’t take sides in the race – I think both candidates will understand precisely what Florie was saying before: the importance of competition. The competition is no longer just amongst the Africans within AGOA, but you have competition from Southeast Asia; you have competition from South Central Asia; you have competition everywhere. The world is getting that much more competitive every day.
It’s absolutely true that Guinea is blessed with enormous riches, from bauxite to iron ore. There’s an American firm, in fact, that has some leases offshore for oil. Again, we look at what’s the value added. And I’m hopeful that there are entrepreneurs in Guinea who are just waiting for the opportunity to step forward and take some of those raw materials and do something with them. Maybe you can – I know that some aluminum firms are considering establishing a refinery in Guinea. What an American investor, what any investor is looking for is stability, security, and the ability to make a large capital investment and see a legitimate return from that, all the while, providing tremendous employment within the society.
I don’t know if you have questions on Guinea, answers on Guinea?MODERATOR:
All right. Let’s take a question from Williams.QUESTION:
Yeah, thank you very much. Williams Ekanem is my name. I write for Business World News for Nigeria.MR. FITZGERALD
: I know it. How are you?QUESTION:
Good, good, good. Florie talked about 10 years being a good time for stocktaking, which is very good. And as positive and good as the AGOA initiative is, I must also point out that there are countries, like my country Nigeria, where the initiative has not really been taken to advantage. Would you say that we’ll have 2015 as the cut of it, how do we – what are we looking forward to? Now that countries, some countries like Nigeria, have not really taken good advantage, is it that they’ll miss out all together? Or are there things you are doing so that countries of that nature can really take good advantage of the AGOA opportunity?MR. FITZGERALD
: Williams, thanks very much for a very important question. And I think the burden rests on both sides. I think the United States has to reach out and explain AGOA perhaps better. That’s what – precisely what this forum is for: Where we can work directly with – the first two days with your trade minister, with your minister of commerce, and those folks to not only explain it, but to push them to explain it better to the people on the ground. But also Nigeria, the Nigerian Government, as I’m saying, has a responsibility to also participate, to explain it to their people.
Fortunately, I’m pleased to say that the United States has a binational commission – as of last year, an initiative of the Secretary Hillary Clinton. And we just recently, in June, held an energy and investment conference and AGOA was discussed. And so as far as Nigeria goes, we’re talking to energy providers mostly. But I think they understood what AGOA represented. What we need to do – and I think in particular the infrastructure challenges in Nigeria are very difficult. And that was a large part of it. I’ll be honest with you Williams, a lot of firms have departed Nigeria because of the lack of reliable energy, and I think you know that as well.
Other companies have stayed but are providing their own.
I think for Nigeria, and certainly what the work we’re doing in the Binational Commission, is to push Nigeria to standardize the regulatory framework that surrounds the power generation, electrical distribution sector. And I know president Jonathan is very interested in this; he appointed his own energy czar to oversee it. A very good man with a good reputation. And I think that’s the first step is you attract investors into the power sector and begin to provide the electricity and the power that frankly, the citizens of Nigeria have been demanding for many, many years. And I think you will start to see small-scale manufacturing return to Nigeria.
But again, so many of the African issues are based on infrastructure. And I can see Florie is leaning forward, so I’m going to give the mic to her. (Laughter.)MS. LISER:
Thank you, Bill. I just wanted to touch on a couple of things. First of all, Nigeria, with $17.2 billion in exports to the U.S. under AGOA is actually the largest beneficiary of AGOA. So 17.2 billion, okay? But now, if you take out oil, of course, that drops Nigeria way down. And I think that takes us back to the issue of how countries are making the environment better for businesses in the non-oil, non-extracted sectors, and how the U.S. can and is partnering with those countries to do that.
Now, I happen to know that there are increasing non-oil exports from Nigeria to the U.S. And I don’t have the exact products in front of me, but actually, maybe Pat Sheikh can talk about it. I know some of them are in the agribusiness sector. I, myself, visited a shea butter cooperative in Nigeria about, maybe about 18 months ago. And processed, high-quality shea butter is now coming to the U.S. from Nigeria entering under AGOA. So I do know that there is some diversification that’s happening in Nigeria’s exports to the U.S. And I want everyone to be aware of that. Because even though the 17.2 billion is largely oil, you do have to start from somewhere. And there are products that are not oil that are now beginning to expand and come to the U.S.
I want to say one more thing before I turn it over to Pat. We have this U.S.-Nigeria Trade and Investment Framework Agreement, we call it a TIFA. We have maybe about nine of them throughout Africa, like with Ghana, South Africa. We have one with COMESA. We have one with the UEMOA countries. But we have specifically a national one with Nigeria. And in that process, we talk about a whole range of trade and investment issues and try to address them. One of them we have tried to address are the import bans that Nigeria has, which prevents certain products from coming into your market which are inputs to other products. So I want to end by telling you the one example that I know of personally.
After I visited the shea butter cooperative and looked at the shea butter that was being sent to the U.S., it’s being shipped in large bags, but it’s high-quality. It then comes to the U.S. and then they put it into very pretty jars with the right kind of labels and all of that. I asked the question, why isn’t this being done in Nigeria? Why not? Here was why: Those little plastic containers that need to come in for the shea butter producers to use are either banned from coming in or the duties on them are so high that it’s non-competitive to try to then package and process the shea butter there. But imagine how many jobs would be created in Nigeria if they would remove the barrier to the jars coming in and allow the people who make this high-quality shea butter to actually process it right there in Nigeria. That would be a factory, two factories, five factories, hundreds of people with jobs. But they have an impediment to that. So we are talking to them about that. That’s a practical example of the problem that we have there.
Thank you, Florie. I just want to say one thing about Nigeria that your probably don’t know. But outside of oil, the largest non-oil revenue sector are the wheat milling industry. And that industry grew up out of cooperation between our U.S. wheat industry and the Nigerian mills. Nigeria is probably one of – not probably, but Nigeria is one of our largest wheat importers. So here we’re talking about two-way trade and we’re talking about investment. And so you have gone from less than 20 mills to a whole slew of wheat mills in your country to further process wheat, mill wheat, and feed your people.
Another area that we, at the Department of Agriculture, have been working with Nigeria on is, that because of your climatic conditions with regard to a very important staple food crop like cassava, you have problems with the aflatoxin levels of fungus that can be – that can be either in the fields or in the processing or storage of that commodity. And that’s very important because you want to be able to hold and release commodities depending on the marker conditions. You don’t want to flood your market at one time with commodities in terms of supply and demand and cost factors. And so we have been working with the Nigerians to – through biological means to reduce those levels. So, you’ve got to have something to start with. You got to have a product that you can maintain. And so we feel our role is to help countries like Nigeria and others to be able to take the scientific measures.
And lastly, I wanted to mention if you – I don’t know if you’re familiar with Dr. Borlaug, the father of the Green Revolution. We have brought a significant number of Nigerian scientists to the United States to train them on scientific areas regarding agriculture of interest to them. Not what we want to them to do, but what they want to do. And we have placed them in several of our land grant colleges and universities to study whatever it is that they need to study, take that knowledge home, and we keep up those relationships. And every year, in about October of every year, we have in Des Moines, Iowa, where Dr. Borlaug lived, what we call the academy award in terms of food production. And we always bring our Borlaug fellows, and Nigeria is well represented when we do that. It’s a phenomenal event, and it’s one where we honor scientists who are going to help lead the way in Nigeria and other countries in Africa in terms of the productive capacity.MODERATOR
: Okay. Thank you, Pat. We’ve now been going for an hour and we’re going to conclude at this point. If you have extra questions, would it be okay if they approached and asked? MR. FITZGERALD:
: Okay. So with that, we’re going to end today’s DVC with South Africa. Thank you.
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