FOR IMMEDIATE RELEASE September 23, 2019
Office of Communications (202) 565-3204
Washington, D.C. – Today, the 2019 Sub-Saharan Africa Advisory Committee of the Export-Import Bank of the United States (EXIM) submitted to the U.S. Congress its statement on EXIM’s Report to the U.S. Congress on Global Export Credit Competition (Competitiveness Report), which was issued in June 2019 and covers global official export credit activities during the calendar year 2018.
At the time of publication, EXIM’s Competitiveness Report did not include comments from an advisory committee because the agency had been unable to appoint one due to the lack of a quorum on EXIM’s board of directors until May 2019. In July 2019, the EXIM board appointed members of the 2019 Advisory Committee, as well as the 2019 Sub-Saharan Africa Advisory Committee. Both committees held their first meetings at EXIM headquarters on September 11.
The EXIM 2019 Advisory Committee also issued a statement today. The Sub-Saharan Africa Advisory Committee issued their statement at the request of Advisory Committee Chairman Stevan Pearce. Both statements are available on EXIM’s website.
The EXIM 2019 Sub-Saharan Africa Advisory Committee Statement on the 2018 Competitiveness Report is as follows (full text):
“Congress, in EXIM’s Charter, directed that an advisory committee be created to advise and make recommendations on ways to facilitate U.S. exports to sub-Saharan Africa. EXIM Chairman Reed and the Board of Directors recently reconstituted the Sub-Saharan Africa Advisory Committee as a first order of business after a period during which the agency lacked a board quorum and could not appoint members to its advisory committees. We are pleased to have an opportunity to comment on the recently published EXIM Competitiveness Report to the Congress and on the need for a fully authorized EXIM to enable U.S. exporters to compete with companies from many countries around the world, including China, Germany, the United Kingdom, and Japan, for the growing export opportunities in Africa. EXIM’s work in Africa is neither aspirational nor marginal; it is central.
Africa is richer, freer, and offers more opportunities to the United States than the continent did a few decades ago. If the American business community does not engage there, Africa will take its business to China and other countries. By any number of metrics, Africa is going to be one of the world’s greatest business opportunities of the next 50 years. EXIM has a critical role in helping American business take advantage of these opportunities, and, in so doing, create and sustain jobs in the United States.
Africa does not receive the attention that it deserves in terms of its countless entrepreneurs, spectacular growth, and the amazing progress that has taken place in recent years. Today Africa’s middle class encompasses approximately 350 million persons.i Forty percent of Africans now live in cities, and 50 percent will live in cities in ten years. Widespread advancements in technology have greatly expanded communications across the continent. For example, there are now more than 650 million mobile-phone users in sub-Saharan Africa.ii
According to many estimates, sub-Saharan Africa will have a larger working-age population than China and India combined in 30 years. This “demographic dividend” can be expected to lead to accelerated economic growth. The United States would do well to find ways now to share in that growth potential, especially considering that Africans in business throughout the continent continue to tell us that they want to buy from Americans.
The United States historically has been a major partner in Africa’s development, and it should be a partner in Africa’s growth and investment. American exporters will need a fully authorized EXIM to help make that happen, or others will seize the opportunities, and U.S. businesses and workers will lose out.
Africans today have other trade options and partners. For example, for a number of years, Africans have been turning to China as a viable alternative source of goods and services. However, there is also a widespread and strong impression across the continent that many of China’s projects are not as high quality, especially when it comes to standards of transparency such as those set forth in the Foreign Corrupt Practices Act (FCPA). Other trading partners, including European and Asian countries, also are mirroring the Chinese approach of implementing a muscular national industrial policy aggressively facilitated through export credit agencies, often with financing structures that do not meet the consensus arrangement on officially supported export credit of the Organisation for Economic Cooperation and Development (OECD), to which EXIM adheres.
Today, China is the number one exporter of goods to 19 of 48 sub-Saharan African countries and has become Africa’s largest trading partner. Forty countries on the continent have signed bilateral trade agreements with Beijing.
If Africans view the United States only as a provider of foreign aid, at some point they are going to question the U.S. commitment to the continent. It is important that the United States offers a viable and more favorable alternative. EXIM Bank is a critical instrument of engagement to reframe the relationship between the United States and Africa as a mutually beneficial economic partnership. If the United States does not have a strong EXIM, that will make it much harder for American businesses to engage in Africa and to realize the opportunities on the continent.
In summary, Africa offers tremendous business opportunities for the United States. An enormous amount of infrastructure will be built in the near future, and Africa has significant energy needs. The urbanization of Africa will demand smart technology, and the telecommunications boom also will provide great opportunities for American businesses. Becoming fully engaged and invested in Africa’s growth would be a win-win for the United States and for Africa. A fully authorized EXIM could help Africa achieve its aspirations of economic growth and self-sufficiency while helping U.S. companies create American jobs through building trade and investment partnerships with Africa. If we do not seize these opportunities, others will.”
iDaniel F. Runde and Romina Bandura. “U.S. Economic Engagement in Africa: Making Prosper Africa a Reality” (Washington, D.C.: Center for Strategic & International Studies: A Report of the CSIS Project on Prosperity and Development, April 2019) https://csis-prod.s3.amazonaws.com/s3fs-public/publication/190429_RundeBandura_ProsperAfrica_WEB_v2.pdf
iiDaniel F. Runde, Romina Bandura, and Sundar R. Ramanujam. “The Role of Development Finance Institutions in Enabling the Technology Revolution” (Washington, D.C.: Center for Strategic & International Studies, CSIS Briefs, June 2019) https://csis-prod.s3.amazonaws.com/s3fs-public/publication/190617_RundeRominaRamanujam_DFI_v3.pdf
2019 Sub-Saharan Africa Advisory Committee members:
Senior Vice President, William A. Schreyer Chair in Global Analysis, and Director, Project on Prosperity and Development
Center for Strategic and International Studies (CSIS)
World Perspectives, Inc.
Commissioner of Agriculture
North Dakota Department of Agriculture
Federal Global Department Manager
Co-Founder and President
Combustion Associates, Inc.
President and CEO
Corporate Council on Africa
Baker & McKenzie, LLP
The Okpa Co.
Consulting Partner; Insurance Broker
Securitas Global Risk Solutions, LLC
Senior Vice President – International
Acrow Corporation of America
Director, Power & Renewable Energy, International Development Services
ABOUT EXIM BANK:
EXIM is an independent federal agency that promotes and supports American jobs by providing competitive and necessary export credit to overseas purchasers of U.S. goods and services. A robust EXIM can level the global playing field for U.S. exporters when they compete against foreign companies that receive support from their governments. EXIM also contributes to U.S. economic growth by helping to create and sustain hundreds of thousands of jobs in exporting businesses and their supply chains across the United States. In recent years, 90 percent of the total number of the agency’s authorizations has directly supported small businesses.