WASHINGTON (Reuters) - A senator on Thursday called for early renewal of trade benefits for Africa as part of a broader strategy to counter growing Chinese investment and influence on the continent of nearly one billion people.
“America is losing ground and ceding economic opportunities in Africa to competitors,” Senator Chris Coons, chairman of the Senate Foreign Relations Subcommittee on African Affairs, said in a report from his office.
“China, which has made dramatic inroads across the continent in recent years, may undermine or even counter value-driven U.S. goals in the region, and should serve as a wake-up call for enhanced American trade and investment,” the Delaware Democrat said.
Coons urged early renewal of the African Growth and Opportunity Act, which is set to expire in September 2015. That legislation, first passed by Congress in 2010, waives duties on African goods to help create jobs in 40 Sub-Saharan African countries.
He also recommended revamping the program to encourage countries to take greater advantage of the duty-free treatment.
Currently, oil from African producers such as Nigeria and Angola accounts for 88 percent of the value of U.S. imports under the AGOA program.
Many African countries lack the industrial base needed to capitalize on the opportunities provided by the program and some are “simply unaware” the opportunities exist, Coons said.
The report calls for the United States to develop a “coherent, integrated strategy” to improve the business climate on the continent through removing barriers to trade, reducing corruption and enhancing regional economic cooperation.
Coons said the time is right to act because in the past decade Africa has been home to six of the world’s 10 fastest growing economies, and trade between Africa and the rest of the world has tripled in the last year.
The International Monetary Fund has forecast the region to grow 5 percent this year, while the World Bank has said Africa could be “on the brink of an economic takeoff, much like China was 30 years ago and India 20 years ago,” the report said.
Other recommendations included increasing the number of Foreign Commercial Service officers in Sub-Saharan Africa to help companies navigate the business climate.
It also called for agencies like the Export-Import Bank and the Overseas Private Investment Corp to step up activity in the region in support of U.S. exports.
The U.S. government should also engage Africans living in the United States in efforts to strengthen ties with the continent, the report said.
Reporting by Doug Palmer; editing by Jackie Frank