No threat in China rivalry for Africa business: Obama

PRETORIA Sat Jun 29, 2013 1:37pm EDT

U.S. President Barack Obama participates in a town hall-style meeting with young African leaders at the University of Johannesburg Soweto, June 29, 2013. REUTERS/Jason Reed

U.S. President Barack Obama participates in a town hall-style meeting with young African leaders at the University of Johannesburg Soweto, June 29, 2013.

Credit: Reuters/Jason Reed

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PRETORIA (Reuters) - The United States does not feel threatened by the growth of trade and investment in Africa by China and other emerging powers, U.S. President Barack Obama said on Saturday.

Suggestions that he has allowed China to steal a march over the United States in doing business with Africa have dogged Obama's three-nation swing through the continent, but he said the increased Chinese engagement was beneficial for all.

"I don't feel threatened by it. I feel it's a good thing," Obama told a news conference during a visit to South Africa.

The more countries invest in Africa, the more the world's least developed continent can be integrated into the global economy, the first African-American U.S. president said.

"I want everybody playing in Africa. The more the merrier."

China has greatly expanded its reach in Africa since the start of the new century. It overtook the United States as Africa's largest trading partner in 2009, a February report by the U.S. Government Accountability Office (GAO) showed.

China's advantage in trade stems mostly from how much it sells to Africa. Chinese exports to the continent in 2011 were almost triple the level of U.S. exports.

When it comes to investment flows, however, the picture is different. Data for 2007-2011 suggest U.S. foreign investment flows to the region were larger than China's, the GAO said.

"China's role as an investor, aid donor and financier is not outsized," Johns Hopkins University China scholar Deborah Brautigam wrote recently.

"Although Western countries fret about China's growing role in Africa, the United States alone disbursed more official finance to African countries than China did in 2010."

Still, China's influence looms large over the continent, partly because it has been so aggressive in its courtship.


Obama's visit to Senegal, South Africa and Tanzania will bring to four the number of countries in sub-Saharan Africa that the U.S. president has visited in the last four years. He stopped briefly in Ghana in his first term.

In contrast, China's president and vice president have visited 30 African countries over the same period, said Mwangi Kimenyi, a senior fellow at the Brookings Institution in Washington.

There is also a sense that the United States may be resting on its laurels.

"There hasn't really been a presence of U.S. companies since 1994, taking advantage of the new opportunities," Haroon Bhorat, a professor at the University of Cape Town said recently, speaking of South Africa.

"So, you've seen new emerging markets entering into other emerging markets like South Africa and taking advantage of economic opportunities in a way where the U.S., already with a foothold, arguably hasn't done enough."

Obama's aides have argued that he has had two wars and a deep economic crisis to deal with since he took office in 2009.

Obama has also said that U.S. interactions with Africa have included goals of social and political development, unlike those of China, which he said were more narrowly focused on commercial benefits.

"A lot of people are pleased that China is involved in Africa," he told reporters travelling with him on Friday.

"On the other hand, they recognize that China's primary interest is being able to obtain access for natural resources in Africa to feed the manufacturers in export-driven policies of the Chinese economy."

That relationship makes Africa an exporter of raw materials but does not create jobs in Africa and is not a sustainable model over the long-term, he added.

In Pretoria on Saturday, Obama urged African nations to be tougher negotiators in accepting investments from abroad.

"You produce the raw materials, sold cheap and then all the way up the chain somebody else is making the money and creating the jobs and the value," he said.

"Make sure that whoever you're dealing with ... you're getting a good deal that's benefiting the people here and that can help to spur on broad-based development."

(Writing by Pascal Fletcher and Mark Felsenthal; Editing by Gareth Jones)

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Comments (6)
MikeBarnett wrote:
China’s investments in Africa open opportunities for all countries, including the US. China adds infrastructure projects to build roads, railroads, ports, airports, power plants, factories, shops, shopping centers, schools, hospitals, and sports facilities. The last three create a healthy, educated workforce, a basic requirement for a modern industrial state. The middle four create energy and places to make and sell products to provide workers with jobs and paychecks that let them become customers and taxpayers to continue expansion and growth indefinitely. The first four allow transportation of raw materials, finished products, workers, customers, businessmen, and tourists for a thriving, vibrant economy. This has given China double digit trade increases per year and triple digit trade increases every five years.

The West has tried local, African contractors, but corruption has left many western projects incomplete. China learned from this lesson and uses Chinese construction companies. African leaders know that they will receive the infrastructure that China promises and that it will be completed on time. In addition, China respects African sovereignty and does not impose demands for imposing Chinese political or social systems on African countries as a precondition to receiving aid. The former owners of African slaves in America and the former colonial masters in Europe demand that former African slaves and former colonial subjects prove that they are almost human by adopting social and political institutions of the former masters in the US and EU. (Note: This sentence may arouse some discussion, but it expresses one of the great unfortunate truths of US/EU relations with Africa, and it explains some of China’s successes in Africa.)

In 2011, the US and NATO gained a “no fly zone” resolution at the UN for Libya. The US and NATO illegally expanded it to become a bombing mission against the Libyan military and civilian leadership. The African Union and China condemned the illegal US and NATO actions, but their protests were ignored. Fortunately, US trade with Africa fell in 2012 while China’s trade grew by double digits. The US needs to learn to respect other countries whether they adopt US political and social institutions or not.

Jun 29, 2013 12:09pm EDT  --  Report as abuse
randburg100 wrote:

Well said; one teensy problem…..the US has delusions that it is Imperator Mundi….and therefore it will never learn to respect other countries. THAT is the root cause of the problems in the Middle East- the US imposes its morals etc on other countries and expects all & sundry to bow down in unending gratitude. The problem is – the US is too arrogant to learn..and then wonders why it is loathed so many countries!

Jun 29, 2013 1:19pm EDT  --  Report as abuse
tatman wrote:
“The more, the merrier.”

tell that to the tens of thousands of elephants slaughtered in an aggressive and unprecedented bloodbath fueled by China’s desire for their ivory. the species is being hunted RIGHT NOW to the edge of extinction, with entire families of elephants, infants and pregnant females being gunned down indiscriminately and their faces hacked off with machetes to get at their tusks. The poaching isn’t stopping with the elephants, however — rhino are being slaughtered at an alarming and critical pace for their horns — a folk cure for cancer and impotency in China.

China’s investment is bringing devastation to the African environment — make no mistake that China is there for their OWN interests exclusively, to engage in a monopoly market on the raw materials necessary for the high-tech industry. the bribes being paid to the local African governments for unfettered access is granting China a permanent presence there. and the more Chinese, the more blood is spilled by the wildlife body parts trade to feed their appetite.

And where is the money being paid by the purchasers of ivory and rhino horn going? to fuel the rebels in Afica’s republics — KONY and the Congolese rebels who are committing human rights abuses on the African populace. these rebels are also responsible for the systematic rape of women, children and babies as young as 6 months old, and the forced enlistment of children as warriors and sex slaves.

“The more the merrier.”

No, an abomination.

Jun 29, 2013 1:44pm EDT  --  Report as abuse
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