The U.S. and Africa Share "Natural Ties," Zoellick Says

USTR gives major speech in Nairobi

Nairobi, Kenya -- "A new breeze is blowing between the United States and Africa," two regions that share "natural ties" and draw strength from their diversity, United States Trade Representative (USTR) Robert B. Zoellick told a distinguished African audience February 14.

In a major address in Nairobi sponsored by the Kenyan Association of Manufacturers, the American Business Association, and the Organization of Women in International Trade, Zoellick told business executives, African diplomats, and trade ministers, "While our relations were once marked by fears, suspicion, and inattention, today they are animated with a potential dynamism, cooperation, and mutual respect."

"Born in struggles for independence from colonialism, we both need to draw strength from our diversity. We both are proud of our traditions, but recognize that our future depends on reinventing ourselves within larger global changes," he said.

Zoellick told his audience that President Bush is "committed to strengthening America's economic and political bonds with Africa, and is leading by example."

Last year, the trade official noted, Bush met with nine sub-Saharan African heads of state, and is expected to meet with three more later this month at the White House.

Zoellick, who is the first U.S. trade representative to officially travel to Africa while in office, reminded his audience that Secretary of State Colin Powell toured Africa in May and said that Treasury Secretary Paul O'Neill and Commerce Secretary Don Evans are looking forward to visiting Africa in the coming months.

The United States recognizes the valuable role African nations and African peoples can play in promoting a more peaceful and prosperous world, Zoellick said.

Quoting President Bush, who addressed the inaugural U.S.-Sub-Saharan Africa Trade and Economic Cooperation Forum last May, Zoellick said, "'We Americans want to be more than spectators of Africa's progress. We want to encourage a brighter future through policies that nurture and support freedom and democratic reform.'"

Focusing on U.S.-Africa trade trends, Zoellick said that one out of every six dollars' worth of Africa's exports are bound for the United States, making America Africa's largest single export market.

Zoellick credited the historic African Growth and Opportunity Act (AGOA) for greatly enhancing trade between the United States and sub-Saharan Africa.

"Imports of products covered by AGOA totaled $8,400 million in the first 11 months of last year," he said, which equals a 1,000 percent increase over the same period in 2000. Evidence now indicates, he added, that AGOA incentives have generated nearly $1,000 million in new investment.

Citing Kenya as an example, he said that country's exports to the United States increased by more than 20 percent during the first nine months of last year, compared to the same period in 2000. "Thanks to AGOA, Kenya has attracted $13 million in new investments," he said.

Zoellick said other success stories can also be found:

-- Uganda, which credits AGOA with helping it to secure a $20 million spinning mill.

-- Lesotho, with $120 million in new investment in the past year.

-- Madagascar, with a dramatic jump in textile exports to the United States -- from $22 million in 1998 to $155 million in the first 10 months of 2001, a 700 percent increase in four years.

"The flower of economic development is beginning to bloom in Africa," Zoellick said. And as part of that progress, 12 nations have instituted the customs and visa reforms to qualify under AGOA provisions for lifting all duties on eligible apparel products, he told his audience. He added that Mozambique and Tanzania have also been added to that list.

Efforts are now under way in the United States Congress, Zoellick said, to further enhance and strengthen AGOA, in the form of expanded legislation known as AGOA II.

He reminded his audience, however, that "we cannot have a truly global trading system unless we include the 10 percent of the world's people living in Africa within its network of prosperity."

He also noted that Africa's tariff rates are still too high, hampering regional economic growth, averaging 19 percent, as opposed to the global average of 12 percent and 5 percent among industrialized countries.

Turning to the World Trade Organization (WTO), Zoellick said that in 1990, the International Monetary Fund classified 75 percent of African countries as operating "restrictive" trade regimes. Today, he said, that now stands at 14 percent of African countries that are still deemed "restrictive," with 43 percent "open."

"The growing movement for openness has helped to deliver higher standards in pockets of Africa," he explained. "Over the past few years, a number of countries achieved economic growth rates exceeding 5 percent, while keeping inflation in single digits: Benin, Botswana, Burkina Faso, Cameroon, Mauritius, Mozambique, Senegal, Tanzania, and Uganda."

As more African countries integrate their development strategies with the opening of global trade, he added, they may wish to channel more of their development efforts through the WTO -- which he called "one of the key pillars of international economic openness and commercial fair play."

Focusing on the recent WTO meeting in Doha, Zoellick said it was there that the African ministers said they would not be spoken for by other representatives of the developing world.

Zoellick told his audience that he is visiting Kenya, South Africa, and Botswana February 12-21 to listen to Africans, to hear how they think they can effectively connect free trade to Africa's economic rebirth, its regional integration, and its political reforms.

"I want to hear the dreams of upcoming generations of Africans and what they think about their future in the global economy," he said.

He announced five key goals of his trip:

-- to strengthen AGOA and America's trading relationship with Africa;

-- to encourage Africa to embrace global trade;

-- to advance the common objectives of Africa and the United States in the new global WTO negotiations launched at Doha;

-- to hear the African perspective on possibly signing new free trade agreements with South Africa and members of the South African Customs Union; and

-- to hear more about ways to overcome poverty across Africa.

Zoellick also announced that the United States will be contributing almost $10 million more -- $8.7 million to an AGOA trade capacity-building fund for the Southern African Development Community (SADC); $500,000 for AGOA technical assistance to the Common Market of Eastern and Southern African States (COMESA); and $300,000 to support the COMESA Court of Justice, which will help them settle any pending trade disputes.

Concluding, Zoellick told his audience that African countries have begun to write a new chapter in their histories. The democratic ranks are expanding throughout the continent and the majority of African governments are now headed by popularly elected leaders who are in turn pushing for greater regional integration and enhanced commercial cooperation.

Zoellick, the 13th United States trade representative, is a member of President Bush's Cabinet who holds the rank of ambassador.