The United States has urged African governments to improve their business environments to better attract major American investment. The U.S. Assistant Secretary of State for African Affairs, Tibor Nagy, made the comments during a four-nation tour of Africa.
The U.S. diplomat says many American businesses want to invest in Africa. But, Tibor Nagy says they first need to first see a more positive investment environment.
“Which means, minimum levels of corruption, fair treatment, honoring contract and quite frankly a good governance environment because that’s what American businesses want,” Nagy said.
Nagy made the comments after meeting Friday with Ugandan President Yoweri Museveni on the first leg of his four-nation African tour.
In December, the U.S. announced its long-awaited Africa policy. The economic focus is on countering China’s fast-growing influence on the continent through investment.
Critics have accused China of saddling African nations with huge debts that Beijing can use as leverage, so-called “debt diplomacy.” While China rejects the charge, many African nations point out they have few options for funding large-scale infrastructure projects. And, unlike U.S. investments, China’s don’t come with human rights and good governance requirements.
The U.S. says its investment priority for Africa is not just to improve opportunities for U.S. business but to also safeguard African states’ independence.
But Ugandan political analyst Bernard Sabiti says, in responding to China, the U.S. policy on Africa is becoming more flexible.
“The prerogative that the United States has always had to say if you do not have these governance and human rights benchmarks, then you will not qualify for World Bank loans or our money,” Sabiti said. “I don’t think that threat is as effective as it used to be. The countries have learnt that you can actually still be pretty brutal, and the United States does not necessarily back away completely.”
But Sabiti says African nations still need to do better in addressing good governance, human rights, and corruption to attract more and bigger U.S. investments.
Assistant Secretary Nagy said conflict in Africa is also hindering investment.
On Monday, Nagy finished a visit to Rwanda, where a diplomatic spat has soured relations with neighboring Uganda.
Nagy said President Museveni and Rwanda’s President Paul Kagame needed to work to resolve the matter.
“Both of these countries are very positive forces for the regional environment,” Nagy said. “Regional security is important for both countries. Both countries obviously have also experienced turbulence with the Eastern Democratic Republic of the Congo region. So, we encourage our friends to discuss any disputes that they have between themselves.”
Nagy is scheduled on Wednesday to be in the Democratic Republic of Congo to meet with civil society and the controversially-elected new government. He plans to discuss strengthening regional stability, good governance, and commercial ties as well as responding to the Ebola outbreak in the country’s east.
Nagy’s last stop is next week in Cameroon, where, among others, he will meet with members of the Young African Leadership Initiative. YALI is the U.S. government’s signature effort to invest in the next generation of African leaders.