Promoting Regional Integration

A proposal making the rounds in Washington would have the Obama and Zuma administrations make common cause in favor of international trading rules designed to promote Africa’s economic integration. The proposal is timely and could, if it gets traction, help to restore trade relations bruised by the failure of negotiations on a US-SACU free trade agreement under the Bush and Mbeki administrations.

The need to increase the capacity of African countries to trade with each other has been brought into sharp focus by the global economic slump. Currently less than 10% of African trade is intraregional. Africans would be richer, healthier and far less dependent on foreign aid if they were selling the goods and services to each other rather than simply exporting raw commodities to the rest of the world.

As Lord Malloch Brown, the British minister for Africa, argued in Maputo recently, “if Africa is to weave the social safety nets that lift its people out of poverty… build the businesses that give its people jobs (and) deepen democracy to put sovereignty firmly in the hands of its people, then it’s through the regional push that it will get there.”  The theme is developed more fully in the 2009 Africa development report put out last week by the UN Center for Trade and Development (UNCTAD). Continue reading “Promoting Regional Integration”

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Unhelpful Research

Build it and we might come, especially if you ask nicely and kiss our ring. That is the basic, if unfortunate, message conveyed in “The Conversation Behind Closed Doors”, a study commissioned by the US Chamber of Commerce and undertaken by Baird’s CMS, a PR consultancy, on what corporate America “really” thinks about direct, as opposed to portfolio, investment in Africa.

Baird’s surveyed decision makers from 30 US, mostly Fortune 100, multinationals between January and October last year. If the results were generally depressing –“overall, US businesses do not view Africa as an attractive place to invest” — that may have had something to do with the way the research was framed. According to the executive summary – the full study was not made public — the survey “examined the reasons why US companies hesitate to invest” in the continent.

This was most definitely not a “push” poll designed to shape respondents’ opinions in a positive direction. The general thrust of the results, at least as presented, is that African countries have a lot of work to do to win over American business. “News about Africa is mostly about chaos and unrest. Africa is not active or aggressive enough about attracting investment; the voices of the few countries that are making an effort get lost in the surrounding negative noise.” Continue reading “Unhelpful Research”