Business
U.S. – Africa Trade: Much Progress has been made; but we haven’t tried everything yet.
Editor’s Note:
One of the best things about Katrin is how much heart she has. Not only does she care deeply about the things she does; she is not afraid to let everybody know where she stands on the issues. But of course, she is very careful about the way she lays things down. She believes in discourse, discussion and progressing issues from start to finish. If she were in sales, she would be known as The Closer.
THN: Let’s go through the process we had to undertake with everyone else in this publication. Let’s talk about improving this nascent relationship
between the U.S. and Africa. What say you?
KK: This is a significant moment in the trade and investment relationship between the United States and Africa. There are many opportunities comingup with the next stage of AGOA, the trade and investment partnership with the EAC, and the Power Africa and Trade Africa initiatives.
Taking advantage of these will require a real focus on what is possible and what the market could look like in the future. It will also require commitment from all sides and new ways of approaching both market possibilities and challenges, with an emphasis on how improvements to the business climate are implemented in practice.
We have the chance to build upon the foundation AGOA established and develop a true, mutually beneficial partnership with the market as its driver,
and this should be the focus of our collective efforts in the upcoming months.
Africa has changed a great deal since AGOA was enacted, and many of its markets have become much more commercial. Companies are responding to African
markets in a way that is fundamentally different than they may have five or ten years ago.
The voice of these companies (and their African counterparts) will need to be part of the dialogue at all stages. Of course the highest levels of government must also be engaged, but much will need to happen on the ground. In particular, government involvement will need to extend down to the regulators who are making day-to-day decisions in the market. The conversation has to become more specific in order for it to be practical and cannot remain something at the 10,000-foot level.
Both U.S. and African governments will need to take measures to improve markets, yet much of the work can only be done on the African side. These new partnerships can be built through AGOA, the Trade and Investment Framework Agreements (TIFAs), the Trade and Investment Partnership with the East African Community, and other mechanisms as well.
THN: What do you, then, have to say about current process of regional economic integration?
KK: Having worked on African trade issues for some time, it is really exciting to see regional integration gather momentum from the African side. In particular, regional economic communities like the Economic Community of West African States (ECOWAS), the East African Community (EAC), the Common Market for Eastern and Southern Africa (COMESA), and the Southern African Development Community (SADC) have made considerable progress.
Regional trade efforts can create much greater benefit for many more people, contributing to larger, more efficient markets, economies of scale, and harmonization of rules and regulations. This is very important, particularly when looking at a continent of many countries that have their own separate rules, laws and standards. A greater degree of harmonization will have a tremendous impact on many stakeholders, from African producers to U.S. businesses trying to invest in the region.
The United States should, under the circumstances, do everything we can to support this momentum. While this bears further discussion, AGOA could
be used to support regional integration more. This was a frequent topic of discussion at the AGOA 2013 Ministerial in Addis Ababa this past August. For example, AGOA could be reinforced to act as a catalyst for implementing some of the harmonization efforts that are underway and are going to be so
important for making the markets work.
In particular, greater focus on the non-tariff measures is called for. These include rules around transport and distribution, inconsistently applied sanitary and phytosanitary (SPS) rules and other standards.
THN: Perhaps we should delve into what sorts of roles and responsibilities all parties ought to have in the U.S. – Africa partnership.
KK: As a lawyer, I think about how to make sure that what is agreed to in words or on paper becomes a reality. This is one of the aspects of regional integration that will be most critical. While high-level regional trade agreements are promising, it is very important to see how they translate into real changes on the ground. There is an obligation for all involved to work together to implement these agreements, and we need better mechanisms for doing so.
First, this can only work through partnership, both between nations and between the public and private sectors on an ongoing, day-to-day basis.
Second, the conversation needs to be driven by business and by the market, rather than just political or even emotional considerations.
Third, an emphasis must be placed on reaching the level of people’s individual lives. This accountability – making sure agreements work for the farmer who is trying to move something from one market to the next – is what trade is all about in many ways.
THN: What do you have to say about the current conundrum that South Africa finds itself vis-a-vis AGOA, and also its relationship with Europe?
KK: South Africa is an important part of this conversation, and it has been an economic driver and a linchpin of regional integration. I do not think we should do anything to undermine this role, which graduating South Africa from AGOA would threaten.
I do think that South Africa’s FTA with Europe has raised questions of how to make sure that U.S. enterprises are treated fairly, and it is in our long-term interest to make sure that we are part of the South African market going forward.