Despite the global economic crisis, US investors are being told to strongly consider putting their money in Africa. That'll be the message later this month when Washington hosts the 7th Biennial US/Africa Business Summit.
Corporate Council on Africa CEO Stephan Hayes describes Africa as a "booming business opportunity." He says the upcoming summit will allow US companies to see the continent as an "essential asset across many business sectors."
Think it's this country's best chance to get US business focused on Africa. There's not another program like it. It's where government and private sector come together every two years. And because it's in Washington, D.C., you've got some key government leaders also providing leadership," he says.
President Obama and Secretary of State Hillary Clinton have been invited to speak, as well as the US trade representative and commerce secretary.
"We're also going to see a lot of government ministers from Africa. We also have about 10 heads of state that are coming so far," he says.
In all, about 2,000 people are expected to attend the summit, most from the American private sector.
Technically, the United States private sector is the largest investor in Africa, but so much of that is in oil. If you take away oil out of the equation, then a lot of other countries are greater investors…. China will also likely pass us up this year in investment in Africa," he says.
US firms invest about $40 billion a year in Africa. Most of that is in energy. Agribusiness is also a major investment target. But Hayes says it's time to diversify.
Building up Africa
"It's the major need in Africa right now. In order to get things to the market, in order to have ports that work, there's got to be enormous infrastructure development. China is certainly filling that void to certain extent, but there's still such a great need there are opportunities for American business as well," he says.
Cell phones are another area of investment.
"Africa has basically just skipped over landlines and gone to mobile cell phones, doing business by that. And yet, less than 10 percent of the population of Africa is using those cell phones. So there's a tremendous market," he says.
The head of the Corporate Council on Africa says other promising areas include tourism, health care and power.
"They can only grow as fast as the power is that allows it to grow. You can't have the IT (Internet) technology). You can't have roads unless there's also a power sector that keeps up with that growth. And right now that growth is just about hitting the maximum power capabilities," he says.
While Hayes touts Africa as being ripe for investment, what assurances does he give regarding risks?
"I can…give you the same assurances that you can give in the United States. There's always risk with your investment. So you've got to do proper due diligence. But there are many countries in Africa that are good places to invest and solid places to invest.
The US/Africa Business Summit in Washington runs from September 29th through October 1st.
The Corporate Council on Africa is a non-partisan organization representing nearly 200 US companies, which represent nearly 85 percent of US private investments in Africa.