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Trade Key To Africa's Future

Trade Key To Africa's Future
Trade Key To Africa's Future

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"For too long," said U.S. Secretary of State Hillary Clinton, "Africa has been viewed as a charity case instead of a dynamic continent capable of becoming a global economic engine of the 21st century." It is time to change that view and recognize that better trade and development policies will enable African business to tap more effectively into existing markets and create new ones.

The first step is for African countries to develop trade relationships among themselves. It is clear, said Secretary Clinton, "that if African countries began trading with one another, they would quickly have more increase in gross domestic product than they could ever imagine by just bilateral agreements with Europe and the United States."

Development assistance will continue to play an important role in promoting economic progress in Africa. In 2005, the U.S. pledged to double its 2004 levels of official development assistance to sub-Saharan Africa by 2010.

Some of this assistance will focus on food security by improving agricultural productivity and facilitating market access for smallholder farmers. Official development assistance will also continue to support regional integration efforts, private sector development and other projects that promote inclusive economic growth. Such assistance can be effective, but only when it complements a country's own development priorities.

Another area of potential economic growth in Africa is in the extractive sector. We are working with countries to promote the issues of transparency and governance in this sector. Programs like the Extractive Industries Transparency Initiative can help countries more effectively manage large inflows of money for the benefit of the population.

Investment can do much to unlock Africa's potential. The United States plans to negotiate a bilateral investment treaty with Mauritius, and our exploratory talks with Ghana, Nigeria and Gabon demonstrate our broader interest in engaging other potential partners in Africa. Mauritius can
be justly proud of its success in implementing the economic reforms that such treaties require and serves as an important example to other African countries.

But investment in Africa is unlikely to occur unless certain underlying conditions exist. They include good governance, transparency and accountability. Moreover, African nations must be committed to ending corruption and upholding the rule of law.

"Companies," said Secretary Clinton, "are not going to be attracted to states with failed or weak leadership, crime or civil unrest, or corruption that taints and distorts every transaction and decision, or to countries that violate the rights of their people."