“Does Trump’s ‘America First’ Mean ‘Africa Last’?” Richard Lee, How We Made It In Africa, 14 July 2017

“Secretary of State Rex Tillerson --who invited African Union Commission Chairman Moussa Faki to Washington only to turn him down at the last minute-- squandered the diplomatic goodwill accumulated by Obama, and gives the impression that Africa is no longer on America’s agenda. And President Trump walked out of the Africa session during the last G20 summit in Hamburg”.

African leaders are wondering whether the Trump Administration has an ‘Africa last’ policy. When Obama was elected, Africa had great expectations. He put Africa on the radar of the American business community. He made five official trips to Africa, visiting seven countries. In 2013, he launched the Power Africa initiative, to produce electricity for 60 million households and businesses by 2030. In 2014, he initiated the US-Africa Business Forum. In 2015, he extended the African Growth and Opportunity Act (AGOA) by 10 years, reaffirming the commitment to Africa. But in 2016, US total trade with Africa reached $48.8bn --the US importing $26.5bn and exporting $22.3bn to Africa--. US-Africa trade dropped by 65.6% from its peak of $141.9bn in 2008. At its highest, Africa exported $113.5bn worth of goods to the US in 2008 and imported $38.1bn from the US in 2014. Since then, African exports and imports dropped by 76.6% and 41.5% respectively. Overall, it represents 1.3% of the US global trade, down from 4.2% in 2008. General Motors recently completely exited the continent. After 90 years, GM is leaving Africa, divesting all its operations, including its Kenyan assembly, to Isuzu. Oil majors: Chevron sold 75% of its South African assets to China’s Sinopec for $900m; Exxon Mobil sold 60% of Mobil Oil Nigeria. American companies see African countries as unattractive trade and investment destinations. Two reasons for this decline: 1) The US-Africa trade is mainly based on commodities: oil and gas. 2) Prices of commodities have dropped in the world markets. Oil and gas production in the US has increased dramatically thanks to fracking.  Hence, since the US-Africa trade is mainly related to oil and gas, the oversupply pushes the decline in trade. As for foreign assistance, the US spent $8bn in 2016 in health, education, peace and security. For 2017, it will drop to $7.1bn and for 2018, to $5.2bn (31% from 2016).

 

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“Does Trump’s ‘America First’ Mean ‘Africa Last’?” Richard Lee, How We Made It In Africa, 14 July 2017

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