Meeting of the President’s Advisory Council on Doing Business in Africa: Recommendations report
On 29 June, Deputy Secretary of Commerce Bruce Andrews, on behalf of U.S. Secretary of Commerce Penny Pritzker, attended the President’s Advisory Council on Doing Business in Africa (PAC-DBIA) in Washington.
The PAC-DBIA brought together business leaders and government officials to discuss strategies designed to strengthen commercial engagement between the United States and Africa. In the final meeting of its inaugural term, PAC-DBIA adopted five new recommendations to drive sustainable growth and investment in Africa.
Members of the Council shared their findings from a trip to Nigeria and Rwanda in January 2016. In fulfilling its ongoing mission, the PAC-DBIA identified high-potential African countries where there is significant room to advance U.S. interests in solidifying existing business relations and cultivating new initiatives for U.S. companies.
Members of the PAC-DBIA chose to travel to Nigeria and Rwanda and organized a fact-finding trip to engage in extensive dialogue with key public and private sector actors in both countries. The goal was to identify barriers and find paths to improve opportunities for doing business in Africa.
In his remarks, Deputy Secretary Andrews noted the PAC-DBIA’s impact on the Obama administration’s work, and announced the Council’s next steps to even the playing field for U.S. companies and encourage foreign direct investment into Africa. Deputy Secretary Andrews stressed the importance of events such as the upcoming 2016 U.S.-Africa Business Forum to highlight commercial opportunities in Africa.
Findings from the Trip to Nigeria and Rwanda and Related Recommendations
Message from the Chair and Vice Chair
The President’s Advisory Council on Doing Business in Africa is pleased to present a report on our January 2016 trip to Africa and our third set of recommendations on how to strengthen commercial engagement between the United States and Africa. These recommendations extend and refine our previous recommendations, based on our continued analysis of opportunities and challenges for U.S. businesses in Africa.
In particular, the recommendations reflect the invaluable input we received from our travels and conversations in Nigeria and Rwanda. While every member of the Council has experience doing business in Africa, the opportunity to travel together – meeting key leaders in government, business, finance, and civil society – was immensely valuable in understanding the U.S. Government’s resources on the ground, testing the assumptions underlying our previous work, and unearthing new opportunities for the U.S. Government to play a transformational role in supporting new business and partnerships.
Over four days in Nigeria and Rwanda, we focused on key issues for African development and areas of interest from the American business community. In Nigeria, we spent time with top members of the new government and discussed the agenda for accelerating growth, security, and development in Nigeria. In particular, we focused on the ease-of-doing-business and held a lengthy roundtable discussion on infrastructure (which has been a priority of the Council), drawing on our collective experience executing and financing African infrastructure projects.
In Rwanda, we focused on issues of regional integration and governance, drawing lessons from the Rwandan experience for other countries. Throughout the trip, we also focused on access to capital, skills training, and the importance of women’s participation in the labor force and entrepreneurship.
On the basis of these conversations, and our continued consideration of African economic trends, this report contains recommendations in five areas:
Accelerate Power Africa and Energy Infrastructure: Pursue a detailed action plan to achieve 10,000 MW in Nigeria over the next five years, including financing solutions, achievable targets for public access to electricity, and a framework for prioritizing gas supply.
Strengthen Vocational and Skills Training: Deepen skills training components of important U.S. Government programs like the Young African Leaders Initiative; work with U.S. experts in the Departments of Education and Labor to inform technical and vocational curricula design for African institutions to align market needs and teaching; elevate and expand workforce training programs offered by the U.S. Trade and Development Agency.
Deepen U.S. Commercial Dialogue and Engagement: Start a commercial dialogue with Nigeria to elevate discussions and convene key government and private sector stakeholders; establish annual sector forums to accelerate investment in priority sectors like agriculture and infrastructure; use fora like the U.S.-Africa Business Forum and Presidential trips to highlight commercial opportunities in Africa.
Improve Travel Routes and Transportation Infrastructure within Sub-Saharan Africa: Address the lack of connectivity across the Continent by improving rail and air travel. This should include: financing for rail locomotive upgrades and rail infrastructure and rehabilitation; developing robust air route networks; improving aviation safety; training an upskilled workforce; and encouraging adoption and implementation of the Cape Town Convention on International Interests in Mobile Equipment.
Negotiate Harmonized Tax Treaties: Encourage the Department of the Treasury to pursue tax treaties with key African markets (including Nigeria and Ethiopia) to even the playing field for U.S. companies and encourage foreign direct investment.
Since we last reported to you, Africa continues to be on a dynamic journey of development and growth. At the time of our October report, turmoil in global markets threatened to lead to crises in emerging markets including massive capital flight. While these risks are still present (and Africa has indeed experienced some capital flight and slower growth), some of the worst volatility has momentarily abated and Africa continues to be one of the world’s fastest growing regions.
The slump in commodity prices has slowed, and hopefully, African economies will emerge from recent stresses with stronger, more diversified economies that are less dependent on extractive industries. In addition, your Administration has made progress in key areas. In particular, Congressional passage (and your signature) of the Electrify Africa Act in February marks an important step in elevating and institutionalizing your commitment to Power Africa and energy infrastructure development. As we have highlighted in previous reports, we believe this is a critical foundation for economic growth in Africa.
Finally, we believe you and your Administration have an important opportunity at the upcoming U.S.-Africa Business Forum (USABF) in September 2016. This global forum should be used to push forward critical initiatives, from capital and skills to energy and infrastructure, and to ensure there are sustainable mechanisms to support progress beyond your tenure. In fact, this Council originated at the inaugural USABF in 2014, so it is fitting that the Forum be used to accelerate and extend our recommendations.
In addition, we urge you to make this year’s USABF more inclusive by broadening it to small and medium-sized businesses and other stakeholders and more focused on key sectors and concrete business opportunities. As a likely capstone for your Administration’s involvement in Africa, we believe this could be a unique moment to announce or expand a legacy initiative that will symbolize the United States’ enduring commitment to Africa.
Remarks by Deputy Secretary of Commerce Bruce Andrews
As you know, President Obama issued an executive order to create this council following the 2014 U.S.-Africa Business Forum here in Washington – when American companies announced over $14 billion in investments in Africa.
The President charged Secretary Pritzker with assembling a council that could offer advice on how to create jobs in the United States and Africa through trade and investment, connect American businesses with potential African partners, and keep the private sector engaged in policymaking and our investment strategy in Africa.
Everyone on this Council brings extensive experience in Africa and unique private sector perspectives to the table. You represent companies of every size and sector – from finance to agriculture to health care. Your recommendations have helped us develop new strategies for increasing commercial engagement, creating jobs, and expanding economic opportunity throughout the United States and Africa.
For example, your input helped us launch an Institutional Investor Roadshow, and we’ve already held two successful events. Our first event brought delegations from six African nations to New York City to meet with 20 top U.S. investors. And earlier this spring, we held another event here in Washington following the U.S.-Nigeria Binational Commission meeting.
Your recommendations were also instrumental to our ongoing development of a U.S.-Africa Infrastructure Center pilot project and our first-ever cold-chain symposium on the East Africa region, which included the release of an assessment report on the Kenyan market. Additionally, your recommendations were instrumental in the Department of Commerce’s continued efforts to find digital solutions that address expansive and complex transportation challenges.
Your recommendations also influenced our decision to organize a fact-finding trip to Nigeria and Rwanda led by Secretary Pritzker earlier this year. I look forward to hearing some of your insights from that trip later today.
I know that the she considers that visit to be one of the most significant trips she has taken while at the Department of Commerce – and this is from a Secretary who has traveled to more than 40 countries.
Still, our work is far from complete. We must continue seeking solutions to build modern infrastructure, build more jobs and opportunity for young people, and expand access to education and the internet.
President Obama believes – as do we – that increasing collaboration between U.S. business leaders and the African business community is essential to overcoming these challenges. At the 2014 U.S.-Africa Business Forum, the President made clear that he does not want to simply sustain our current trade and investment relationship – he wants to build on it.
In other words: we all have a mandate to strengthen our engagement with Africa.
Our sustained focus on Africa is not just strategically important. It is also good business. According to the United Nations, Africa has a fast-growing middle class and the fastest-growing population of any continent. By 2050, 25 percent of the world’s population will be African, and this will increase to nearly 40 percent by 2100.
Despite this tremendous growth, only a small percentage of U.S. companies do business in Africa. Together, we must do more to ensure our businesses, investors, and entrepreneurs capitalize on the extraordinary opportunities that await them on the continent.
We are pleased that the Department of Commerce and Bloomberg Philanthropies will co-host a second U.S.-Africa Business Forum in New York City on September 21. We are excited that President Obama and several African Heads of State will attend. We plan for this year’s forum to be even more successful than the last. We look forward to facilitating meetings and discussions at this year’s forum that will spark new interest among investors and spur new business-to-business partnerships.
In 2014, we answered the question, “Why Africa?” This year, we will answer the question, “How?” How do you effectively do business in Africa? How can we grow partnerships between U.S. and African companies? How do we spur trade, investment, and job creation between our two continents?
All current PAC-DBIA members are invited. You have spent over a year and half working on these issues. We know that you have solutions to share. That’s why we need you there.
In 2012, before the creation of this Council, President Obama announced his groundbreaking U.S. Strategy toward Sub-Saharan Africa. Four years later, our Administration is as committed as ever to Africa’s future. That’s why President Obama has directed the Department of Commerce to renew the PAC-DBIA for another term.
The Department of Commerce is committed to this council and to the continuation of its mission: to increase trade and investment and to build prosperity throughout the United States and Africa.
Thank you for the time and effort you have devoted to the PAC-DBIA. I look forward to hearing your observations and recommendations today – and to your continued engagement in the years to come. Thank you.