Business
The U.S. and Africa Must Be Equal Partners
SH: Africa is important to the U.S. for several reasons. First, it is one of the continents still sympathetic to the United States. There is also a large market that remains untapped, and culturally, there are ties that would make Americans natural partners to Africans everywhere.
THN: So, let’s pivot to South Africa: What is going on in the minds of those working to get that country graduated from AGOA?
SH: I think there are two things – one negative and the other positive. On the positive side, some see AGOA not so much as a trade tool but as one for development. And there’s some truth to that. Therefore, those calling for its graduation see it as a developing country that is benefiting more than other African countries and this is an issue. On the negative side is the punitive issue; punitive because the political relationship between the U.S.
and South Africa has, sometimes had its share of tension. For instance, South Africa was the primary reason that the Southern Africa Customs Union free trade agreement did not go through. But this sort of punitive measure may be a little unwise and even a little unfair. It is unfair to punish
those who have succeeded under AGOA if we are also criticizing those countries that are not fully utilizing its development facets. An argument that
could, ostensibly, hold water is that South Africa needs to open up more of its market to U.S. companies. Of course, the fact that this market is closed to us could be the result of us asking for something equitable from the South Africans. Conversely, we are the ones who put AGOA in place. So, at this stage, we do not have a great bargaining tool to give the other side everything they want and then turn around and so that we need them to give us something as well. We have no major leverage.
THN: With South Africa’s ‘problems’ probably emanating from their Trade, Development and Cooperation Agreement (TDCA) with the EU, what’s your take on Economic Partnership Agreements (EPAs)?
SH: My understanding is that EPAs are unfair to the U.S. I think these give special preference to countries bilaterally, and in having a privileged agreement between the EU and an African country, it means that we are not part of that arrangement, and so, at a disadvantage. Importantly, EPAs are neither in our interest, nor are they in Africa’s interest. When you rule out factors of competition – where you can have more competitors coming in to give you better leverage (and more variety of products) – the EPAs do not help you very much.
THN: Onto regional integration, where do you see the trigger – for dominoes to fall to a potential African Economic Community?
SH: Obviously, the U.S. is betting on the East African Community, and I think the Obama Administration is wise in taking a smaller group, making it work, and then expanding it to the diversity of COMESA – a regional economic community (REC) that has countries spanning from (Egypt in) North Africa to (Lesotho in) Southern Africa – and then from the east (with Uganda and Kenya plus Djibouti), to the west (with the Democratic Republic of Congo). But if you are talking about creating a customs union, COMESA’s diversity is what you need as you do not want to have too many regimes all over the continent, negatively affecting regional integration. So, practically, while SADC and EAC present immediate opportunities, COMESA has the understanding and leadership to get things to the next level.
THN: If you had to advise African leaders on how to get the best out of their summit with President Obama, what would you say to them?
