This blog is one in a series by experts across the Center for Global Development ahead of the 2022 US-Africa Leaders Summit. These posts aim to re-examine US-Africa policy and put forward recommendations to deliver on a more resilient, deeper, and mutually beneficial partnership between the United States and the nations of Africa.
In 2022, the populations of India, China, and the African continent (in its entirety) were each about 1.4 billion. But last year the US imported $505 billion in goods and services from China, $73 billion from India, and just $38 billion from Africa. That imbalance illustrates an opportunity both for countries in Africa and for the United States, and is a sign of how important it is that the upcoming US-Africa Leaders Summit focuses on much more than aid and security. The Biden administration should say a lot about US financial flows to the region and how they will be improved, but summit commitments must go far beyond that.
On US government financial support, President Biden might highlight the Millennium Challenge Corporation’s investment in West Africa—the agency’s first-ever regional compact. But the president should also use his welcoming speech to commit MCC to supporting larger, repeat compacts—and additional regional compacts—in low- and lower-middle-income countries as a priority over working in richer countries. Such a pledge could help ensure a greater share of MCC’s valuable grant funding flows toward Africa. It would also be great if President Biden would recommit the US International Development Finance Corporation to work in the world’s lower-income countries rather than getting distracted (sometimes under pressure from lawmakers) by deals that yield more limited development impact, like telecom cables connecting Singapore.
And when it comes to climate finance, President Biden should acknowledge that Africa is the region that will suffer the worst from a global problem it has done the least to create. The administration should accept the responsibility this implies: rich countries including the United States must deliver on their commitments to climate finance with support to Africa that emphasizes adaptation and recipient ownership, and doesn’t pretend a sprinkling of public money will unleash a torrent of private sector investments in the infrastructure Africa needs to adapt. That means a multibillion, multiyear commitment, additional to traditional development finance to ensure the world’s poorest people, concentrated in Africa, don’t pay twice on climate change. The most plausible way the US administration can help deliver the required scale of support is through the IMF and multilateral development banks—not least, an IBRD climate-dedicated capital increase alongside more aggressive recycling of IMF Special Drawing Rights into climate and development finance.
Again, with climate and development finance both, it would be great to see the White House emphasize real partnership over paternalism in the way the US provides assistance in the region. Not least, I hope President Biden uses the summit to promote USAID Administrator Samantha Power’s localization agenda at USAID in a big way—and commits to a considerable scale-up of US assistance directly to recipient country governments in the region. He could further demonstrate support for Africa-based institutions by acknowledging the role of the African Development Bank—which just concluded the latest replenishment of its concessional window, the African Development Fund.
But partnership is about a lot more than official finance, and the other elements of the US Africa economic relationship are, if anything, in need of even more work. Start with the fact it is hard to partner if you can’t meet. And yet the wait simply to get an interview for a visa to take a business trip to the US is nearly two years in Lagos, 238 days in Addis Ababa, and more than 100 days in Cape Town and Cairo. Sure, the last administration ran down visa capacity and the pandemic made things worse, but we’re coming up on two years into the Biden administration—if it were a priority to fix this problem, it would be done by now. So let’s see the president commit to get wait times below 20 days within three months of the end of the summit.
And while we are on the subject of people moving, it is time the administration recognized the immense opportunities presented by Africa’s growing and increasingly educated labor force. The last three years have seen the US face a wave of early retirements alongside a dearth of new arrivals. The millions missing from the labor force as a result are a major factor behind worker shortages and inflation. Meanwhile, Africa’s young population continues to expand and tertiary education enrollments have climbed as high as 39 percent in Egypt and 19 percent in Ghana. The skills that America desperately needs in sectors from construction and clean infrastructure through care and hospitality can be supplied by African migrants. The mutual benefit from that exchange would be particularly high if it involved skills partnerships, where migration agreements include skills training provided in source countries for emigrants and remainers alike. A green skills partnership that emphasizes training in areas like heat pump and turbine repair could help fill global skills gaps needed for the low carbon transition with the most immediate benefit to signatory countries. President Biden could use the summit to announce a green skills partnership potentially covering two or three African countries and thousands of workers as a test model.
The movement of people–permanent and temporary—is vital to trade and private investment flows, but the administration should do more to support that commerce directly. On trade, the new Africa Continental Free Trade agreement (AfCFTA) presents a real opportunity. US imports from the continent are still dominated by commodities and will only significantly grow if they also diversify. The Prosper Africa initiative, which this administration inherited from the previous one, was designed in part to accomplish that, but there is clearly a need to go further. The Africa Growth and Opportunity Act, which provides duty-free access to the US market for over 1,800 products from eligible countries in the region, is up for renewal in 2025. The president could propose that negotiations for the revised Act will also include bilateral trade concessions with AfCFTA as a group, including an agreement with AfCFTA on regional trade preferences perhaps alongside preferences for individual AGOA partners with greater flexibilities around value-chain inputs from other AfCFTA members. All of that could be supported by fiscal incentives and tax credits on investments by US corporations in Africa.
It would be fantastic to see the US-Africa Leaders Summit reflect the reality that the region is at the forefront of global change–climate, development, demographics, pandemics—and US interests require a strong, stable growing region that is supported through partnership rather than charity. President Biden will surely express those sentiments, but it would be a welcome surprise if the actions proposed match the rhetoric employed.
Stay tuned for more analysis on the summit in the coming days, and sign up for our US development policy newsletter to get updates in your inbox.
CGD blog posts reflect the views of the authors, drawing on prior research and experience in their areas of expertise. CGD is a nonpartisan, independent organization and does not take institutional positions.