Africa in the spotlight for US investment

Compared to the rest of the continent, South Africa is a strong trade partner of the United States and a key driver of investment and trade, particularly sub-Saharan Africa. “The United States government has recognised that it cannot ignore trade and investment with Africa and doing business on the continent is not about if. It’s about how and when,” said Jeff Nemeth, chairman of the American Chamber of Commerce (AmCham) as well as president and CEO of Ford Motor Company Southern Africa. He believes the major constraints to growing trade to Africa are infrastructure and lack of cohesion. “Africa is the world’s most fragmented continent in terms of trade,” said Nemeth. He added that much was being done by government and private stakeholders to address these challenges and noted that the US needed to facilitate free trade market access. “The African Growth and Opportunity Act (Agoa) is a key engagement area and AmCham is backing South Africa’s bid to extend its duty- free access to the US.” Nemeth said that Amcham members included General Electric, Ford, General Motors, Coca-Cola, IBM and Massmart. Amcham and trade and industry minister Rob Davies visited the US recently for Agoa’s extension and South Africa’s continued inclusion under the provisions, despite its status as a middle-income country, he added. Speaking during a panel discussion at a breakfast briefing held by Amcham in September, Grant Pattison, chief executive of Massmart, said the company used to “fly under the radar” but was currently investigating ways to expand into Africa. “However, to attract US investment, African governments need to work smarter, employing strategic diplomatic relations,” said Pattison. “Massmart will for example wait for target asset prices to come down and will invest when the prices for big business investment versus small business investment are more equal,” he commented. Therese Gearhart, business unit president for Coca- Cola Southern Africa noted that South Africa was the first African country in which Coca Cola had invested and announced that from 2010 to 2020 the company had earmarked R12 billion to further invest in Africa. “Coca Cola’s view on investment has always been long-term. When we invest in a country, we know we are there to stay,” she said. She added that seven of the top 10 fastest growing economies in the world were currently in Africa, with Nigeria, Egypt and Morocco having been identified as the most attractive markets for expansion and development over the next three to five years. As part of its expansion drive into Africa Microsoft will not follow traditional trends and will establish partnerships with those who drive local innovation, said Mteto Nyati: managing director of Microsoft South Africa. INSERT & CAPTION Doing business in Africa is not about if. It’s about how and when. – Jeff Nemeth