American investors will meet with African businessmen and government officials later this month (September 27-29th) for the first annual US-Africa Infrastructure Conference. Delegates will explore the potential and challenges of investing in sectors that development specialists say will lead to economic growth on the continent, including water, energy, transportation and communications technology.
Development specialists say Africa’s economic potential can not be tapped until the continent has a well-developed infrastructure. The conference is designed to mobilize American investors in the effort. It’s being organized by the Washington-based Corporate Council on Africa, the CCA, and will be held in a Washington suburb. Among the many sponsors are General Electric, and the US Department of Transportation.
Stephen Hayes is the president of the CCA. He says there are a number of opportunities for US investors – a point that will be emphasized at the conference.
"Road systems are very much available for American companies; most countries with major ports are building and expanding [them]; airports have got to be built and expanded…. Infrastructure (also) includes telecommunications, optics and fiber optics, and computer networks. So a lot of things are available. It’s a matter of trying to find out who the right contacts are and how to develop those relationships.
"That’s the purpose of the conference – to bring people together and find partners or develop the leads, and gather as much information as possible - there will certainly be a lot of information available - and then be able to do business and make things happen," he says.
Hayes says he’s concerned that American investments in Africa – with the exception of the energy sector – are lagging behind China, India and Europe. He says the United States has the expertise to help develop African agribusinesses, telecommunications, and roads, railways and ports.
But he says many investors are not familiar with Africa’s financial environment. For that reason, the CCA has invited US government officials and representatives of international lending institutions who can lend support to US-African partnerships. Among those scheduled to attend are representatives of the US Department of Commerce, the Overseas Private Investment Corporation (OPIC), the United Bank for Africa, and NEPAD, the New Partnership for Africa’s Development.
One of the scheduled speakers is Susan McDermott, a top official with the US Department of Transportation. McDermott is the agency’s deputy assistant secretary for aviation and international affairs. She says she will emphasize US support for strengthening Africa’s infrastructure.
She explains how improvements in the continent’s transport system affect Africa’s trade with the US:
"Today, Africa has some of the highest transportation costs in the world. Some commentators have indicated that many of the tariff benefits of AGOA and other traditional advantages have been diminished if not lost because of the high cost of transporting goods to and from Africa. So improved transportation is going to play a critical role in strengthening, improving and sustaining U-S / Africa trade flows," she says.
Also participating in the first annual US-Africa Infrastructure Conference is the law firm Hunton and Williams. It will help with workshops on the legal aspects of investment, including public-private partnerships, project finance, and contemporary business practices that encourage transparency.
Plenary sessions will focus on the support of multi-lateral and domestic African lending institutions. They will also look at the importance of regionalism in African infrastructure projects.
Rob Edwards – a partner with Hunton and Williams – explains:
"While Africa as a continent is very large, it is broken into 54 countries, and in order to develop infrastructure on an economic scale, many (projects) will be need to be done on a regional basis. For example, if you build a power plant in one particular country, it has to be anticipated that power would be (also be) exported to neighboring countries.
"If you are talking about roads, bridges and transportation, you need to connect up the economies of neighboring countries. So if Cote d’Ivoire has lots of cocoa, there has to be efficient way to get it to the coast and to foreign markets for sale.
"Similarly, there have been somewhat famous oil pipelines that have been built to move oil from the place where it is to the place where it is needed. Much of what will have to happen for Africa to be successful in the medium term is appropriate regional economic integration so economies can reach economies of scale and so products can be moved to markets." he says.
US Department of Transportation official Susan McDermott notes that the robust globalization of commerce means that increased trade – and the potential wealth that comes with it – is no longer the province of developed nations. Interconnected markets now allow small and medium-sized businesses to become part of the world of buyers and sellers.
The conference on African infrastructure is part of the effort to ensure that Africa has a safe, competitive and efficient way to compete in the new world of goods and services.
For more information on the conference, go to the Corporate Council on Africa web page at: www.africacncl.org